Betsy McCaughey
The federal Centers for Medicare and Medicaid Services reported last week that health spending in the United States inched up 3.9 percent in 2011 — the latest available statistics, and the third year in a row it rose at that tiny rate. It’s the slowest pace in 52 years, after decades of staggering double-digit increases.
It’s an embarassing fact for President Obama. To frighten the nation into passing the Affordable Care Act (a k a ObamaCare), he repeatedly warned throughout 2009 and 2010 of “skyrocketing” health-care costs threatening family budgets and the nation’s economy. He even labeled these “skyrocketing” costs “the domestic crisis of our time.”
Now the data show just the opposite, that health-care spending was growing more slowly than at any other time in the last half-century.
The federal report highlights one reason for the trend: a decline in inpatient hospital care (down 1.1 percent), as more folks get outpatient treatment instead. New technologies such as anesthesia-reversing drugs help make that possible.
But in a separate report, the same agency’s actuaries project that the Affordable Care Act will soon reverse our progress in taming spending growth. In 2014, when most of the law’s provisions take effect, spending will jump 7.4 percent — 2.1 percent faster than if ObamaCare hadn’t passed.
In other words, the government’s own actuaries warn that ObamaCare will cause the very “skyrocketing” costs we were told it would cure. They also say spending will continue to grow 6.2 percent a year through 2021, pushing health care to 19.6 percent of GDP by 2021.
Blame government programs for the increase. In 2011, federal, state and local government funding for health care grew 6.4 percent, while health spending by business, households and other private sources rose only 1.9 percent. Government will pay for over 49 percent of health care by 2021.
Sadly, spending will grow fastest on something that doesn’t provide care to the sick or even preventive care for the healthy: namely, on government health-care administration — bureaucrats and regulators telling doctors what to do.
This cost will soar from $29.6 billion in 2009 to $68 billion in 2021. That increase alone is enough to buy health plans for 2 million American families a year.
The projections from the Centers for Medicare and Medicaid Services identify other problems ahead: One is an 8.5 percent rise in demand for physicians’ services in 2014, when coverage expands. Who’ll meet this demand? A 2010 report from the American Association of Medical Colleges warns of a 10 percent shortfall in doctor supply by 2020 (91,500 too few physicians).
The situation may be worse. A survey last October from the Physicians Foundation shows that many doctors are shortening hours and seeing fewer patients in response to mounting regulations, low pay and the impact of the new health law.
The report also warns that “some large employers with low-wage employees are expected to discontinue health-insurance benefits for their employees,” and pay a penalty instead. It’s no wonder: The ObamaCare law requires employers with 50 full-time employees to provide a package of “essential benefits” more costly than what many employers now offer. It will add $1.79 an hour to the cost of a full-time employee, calculates James Sherk of the Heritage Foundation.
That’s affordable when hiring lawyers and stockbrokers, but not waiters.
On Jan. 6, a Nebraska network of Wendy’s restaurants announced what many other employers are expected to say, that they are cutting back employees’ hours to part-time to avoid the mandate. Federal data suggest that fewer employees will get coverage on the job after the “employer mandate” goes into effect in 2014 than if it had not been enacted.
In short, Obama invented a crisis to get the Affordable Care Act passed — but now that law will indeed put many Americans in crisis.
Betsy McCaughey’s new book is “Beating ObamaCare: Your Handbook for Surviving the New Health Care Law.”
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