Surge in Healthcare Costs Have Many Doubting The Obama Administration

September 28, 2011  |  

by Cynthia Wright

A recent study of employers by Kaiser Family Foundation shows that the cost of health insurance has surged again in the US this year. The surge has caused those with shaky faith in the Obama administration to doubt that healthcare legislation will curb insurance costs for the country.

When it came to insurance premiums for families in 2011, health benefits jumped to $15,073, a 9% increase from a year ago. Kaiser’s chief executive Dave Altman commented that the year’s increase further devastates the workers and employers already struggling through the current economy.

While the survey does show some early impact of the law, there is no evidence to support the rise in cost. At the same time, maybe it shouldn’t be taken as that much of a surprise, since healthcare costs have doubled within the past decade.

Kaiser representative also commented that it has also started to see the changes in preventative care benefits, with many companies enrolling young adults into their corporate health plans. However, some believe that the increase of insurance-covered adults may be due to the fact that adults up to the age of 26 can still be covered under their parent’s plan.

Of course, the critics commenting believe that this is the evidence needed to prove that the Obama administration’s healthcare law would be an inevitable failure.

At the same time, critics of the industry argue that the issue is not about the Obama administration’s healthcare plan but more about insurers raising premiums, especially since they benefited for years on low medical utilization rates. Meaning that, during the course of the economic downturn, insurers deterred millions of people from seeking treatment or procedures that they [the insurers] deemed less “important.”

The Obama administration also weighed in on the study by stating that healthcare insurers set premiums higher last year, due to the anticipation of higher medical costs across the board. Nancy-Ann DeParle, President Barack Obama’s deputy chief of staff revealed that premium prices would start to decline once more provisions in the law were released. She also noted that healthcare costs were declining in some instances before lambasting the healthcare insurers for their greed when it came to turning a profit.

This comes as the Obama administration made public that it will seek U.S. Supreme Court consideration of the health-care overhaul in a move that may lead to a ruling in the middle of the 2012 presidential race.

Cynthia Wright is an avid lover of all things geeky. When she isn’t freelancing, she can be found on her blog BGA Life and on Twitter at @cynisright.

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