It should not come as a surprise to many that over the past year, spending on healthcare was the second largest consumer of private funds, voraciously vacuuming up some $1.9 trillion in real dollars. More importantly, noted Zero Hedge, for U.S. economic growth, such as it was, healthcare spending was the biggest source of incremental costs by almost a factor of two.
As further noted by the Washington Free Beacon, health insurance premiums rose faster than wages and inflation in recent years, climbing an average of 28 percent from 2009 – President Obama’s first year in office – to 2014, despite the enactment of a law that was supposed to trim healthcare spending and cut average consumer premiums and other medical costs by $2,500 a year (see that lie repeated often here). This is according to a newly released report from Freedom Partners.
‘More disposable income is being consumed’
In its first year in office, the administration expressed concern about skyrocketing healthcare premiums in “The Burden of Health Insurance Premium Increases on American Families,” a report that no doubt was mostly intended as propaganda, to help convince the American people to push their representatives to pass Obamacare. The concern then was that premiums had risen 5.5 percent from 2008 to 2009.
But, as the WFB noted, from 2010 to 2011, after the law was passed and health insurers began to comply with the law’s higher mandatory coverage packages, premiums rose by 9.4 percent.
“In 2009, when the [Executive Office of the President] issued its report, states had seen premiums increase on average by 30 percent between 2004 and 2009,” states the Freedom Partners report. “But since 2009, health insurance premiums have continued to grow faster than wages in nearly every state, averaging a 28 percent increase from 2009 to 2014, resulting in a greater amount of disposable income being consumed by rising premiums.”
So much for this president really being concerned about “rising income inequality.”
As further noted by Zero Hedge:
“Incidentally, with spending on healthcare (courtesy of the Supreme Court’s Obamacare tax) soaring, while outlays on the traditionally most consumption-intensive category, housing and utilities, going nowhere for the past several years, it is only a matter of 2-3 quarters before Healthcare surpasses Housing as the biggest use of American cash.”
“We show this just in case there is still any confusion why US households are unable to channel more spending into ‘discretionary,’ non-mandatory purchases unlike Obama’s ‘health insurance’ tax, pardon, noble venture,” the site noted further.
‘By their own standards, the Affordable Care Act has failed’
According to the Freedom Partners report, though premiums increased 28 percent from 2009 to 2014, wages increased by only 7.8 percent. From 2004 to 2009, though premiums increased by 30 percent, wages increased by 12.2 percent.
In addition, the data reveals that health costs are rising faster than inflation.
“The average annual cost of a family’s employer-sponsored health insurance policy was $17,545 in 2015, which marks a 4.2 percent increase from the 2014 average of $16,834, while the inflation rate remained low at 0.1 percent,” says the report. “With health care costs still rising faster than inflation six years after passage of the Affordable Care Act, it is clear that the law is not helping lower the burden of health care expenses for American families.”
What’s more, beleaguered Americans suffering through fewer opportunities for high-paying jobs and stagnant wages are going to see their premiums increase again next year, the group says.
“The Administration claimed the ACA would bend the cost curve, but our report shows it bent in the wrong direction—premiums didn’t slow down under the Affordable Care Act, they sped up,” said Nathan Nascimento, senior policy adviser at Freedom Partners. “No wonder the White House is trying to change the national conversation away from health care costs. By their own standards, the Affordable Care Act has failed.”