- Health Care costs are out of control
Many thought that the cost of health care would go down with the passage of the President’s Health Care Reform Act. The opposite seems to be happening. The Kaiser Family foundation has released a study. Family coverage now costs an annual premium of $15,073 for a family of four through an employer. This is 9% higher than last year, and there has been no inflation recorded. Over a ten year period since 2001, the cost of a policy has doubled in real terms, but there has only been a 34% increase in wages.
I can’t explain what is happening and no studies have come out with any definitive conclusions. We do not know if this is a result of the advent of Obama Care or are some insurance companies tacking on extra charges before new rules and regulations go into effect in 2012. One rule requires insurance companies to justify any increase over 10%. It’s in effect next year.
The United States economy amounts to about $15 trillion dollars. Of that amount about 17.4% represents health care. This is a staggering $2.6 trillion, unheard of as a percentage in any other country. No other country goes beyond 12% of their economy. As an example of the coming rate increases, Aetna is asking for increases ranging from 9% to 53%, while United Health Group / Oxford is talking in the range of 13% to 34% increases.
Very simply, this cannot continue. Costs are out of control, and the government cannot tax enough to continue to afford these kinds of expenditures. With America moving towards an older workforce, and people living longer, it seems the problems are going to get exacerbated. We are not at a crisis stage yet, but it will probably occur after the next election and before 2016. We are fast reaching an inflection point.
admin 
Posted in 
Tags: 
