ObamaCare sends costs skyrocketing

There may never have been a law more misnamed than the Affordable Care Act.

President Obama’s health-care-overhaul law already is driving up health-insurance costs for businesses and consumers and will inflict even higher costs on American taxpayers in the years ahead.

Obama repeatedly promised the American people he would cut a typical family’s premium $2,500 a year before the end of his first term. But costs are rising now even faster than before the law was enacted in March 2010.

A Kaiser Family Foundation survey found that premiums for a family policy topped $15,000 a year in 2011, increasing an average of $1,300 in the last year — three times faster than the year before.

The many more mandates to come from Washington will raise premiums even further. Health insurance is consuming a bigger share of employer budgets, pre-empting pay raises and pushing higher costs onto employees, the Kaiser survey found.

The premium increases reflect the law’s early provisions, such as “free” preventive care and adding “children” up to age 26 to their parents’ policies. Consumers may like these features, but they come at a cost, and because they now are in federal law, people can’t opt out.

Analysts at the Congressional Budget Office estimate that the average policy for those who get health insurance through the workplace will cost $20,000 a year for a family of four by the year 2016. Millions of Americans who buy insurance on their own will pay at least $2,100 a year more for their policies than if the law had not passed, CBO says.

Former CBO Director Douglas Holtz-Eakin estimates that as many as 35 million more people will flood to subsidized exchanges for health insurance than Congress expected, adding $1 trillion to the $2.6 trillion cost to taxpayers.

One of the tools companies have found valuable in helping them offer affordable coverage — health savings accounts — are at risk of being strangled by obscure and complex regulations issued by the Department of Health and Human Services.

Supporters of the law point to figures released in December showing that per capita spending in Medicare increased only 2 percent in 2011, half the normal rise. The actuaries, however, attribute the slowing primarily to lower utilization of medical services by seniors — not to provisions in the new law.

With 10,000 baby boomers aging into Medicare daily, spending will soon bankrupt Medicare and the federal government unless the program is modernized.

One of the reasons the business community supported passage of the law was because of promises it would finally get health costs under control. The experience in Massachusetts, which passed legislation in 2006 similar to the national law, shows that costs are continuing to soar, with Massachusetts still facing the highest health costs in the nation.

We needed health reform, but the Affordable Care Act tried to do too much too fast and it is backfiring in its goals. It’s time to head back to the negotiating table and get this right to save consumers, businesses and taxpayers from the law’s calamitous costs.

Published in the Pittsburgh Tribune-Review, January 3, 2012.

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