CBO Report – Obamacare Kicks In & Insurance Costs Increase 9% in 2011

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Click here for the CBO report on healthcare spending with projections into 2035.

According to the January CBO report, healthcare costs rose 9% in 2011 as compared with 3% (only 1 percentage point higher than the cost of inflation) in 2010 because insurance companies are preparing for the impending crisis that will be caused by Obamacare. The 9% increase is three times the rate of inflation and it is the highest since 2005.

Two million more young people were added to health insurance for “free.” It’s absurd to pretend this add on was free or that it is saving money somehow. It will only get worse as the healthcare of more and more people become the taxpayer’s responsibility. We will not simply be paying for emergency care, we will be paying for every nosebleed and every hangnail.

Take a look at chart 8 –

Healthcare premiums were 3% in 2010, close to the increase in inflation, and they were 9% in 2011, three times the increase in inflation. The trend of the rise in healthcare costs has been downward and closer to employee earnings, with 2010 demonstrating the biggest improvement.

Healthcare costs are rising faster than other expenses, but they were trending downwards, closer to employee earnings, until 2011 when Obamacare started to kick in. You will see in this chart that the 9% increase in healthcare premiums today represents a far greater magnitude than the 11% increase in family health insurance premiums compared to other expenses in 2000. In other words, assume that you paid $1000 for health insurance premiums in 1999. That 11% increase in 2000 represents an increase of $110 for a total of $1110. Following along, the 13% in 2002 represents an increase of $158.60 for a total of $1379. I won’t go through the math for each year of the decade listed, but the final year listed, 2011, shows an increase of 9% representing $210 for a total of $2548, which is near-double what you paid out in 2000.

Obamacare started closing in during 2011, which accounts for the increase to 9% from 3%. The fallacy that Obamacare was going to reduce costs is completely debunked here.

Chart 3 has the federal debt held by the public increasing to somewhere between 175% and 200% by 2035, clearly unsustainable.

If you look at the last chart, chart 9, you will see that the percentage of total healthcare spending will rise above 26% of the GDP by 2035, again, clearly unsustainable.

Obamacare, as the bill stands, notwithstanding all the new upcoming rules, reaches into every tiny corner of the healthcare system, much like a metastasized cancer. Imagine the effect this will have on rationing, doctor’s salaries and consequent doctor shortages, profits on businesses, and so on.

Whoever thinks the less worthy – to be determined by the government – won’t be rationed out of care is simply in denial.

It is not possible for companies to pay for the Obamacare mandates. The employer mandate will devastate U.S. businesses –

 

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