Recently the Congressional Budget Office announced that ObamaCare would cost $1.76 trillion through 2022, roughly twice the original CBO projection of $938 billion when Congress passed the bill. This may be a surprise to some, I suppose. But take a quick look at our history, and you’ll see that this is nothing new. When Medicare was passed in 1965, it was predicted to cost $12 billion by 1990. In fact, costs were almost 10 times higher.
I was at a dinner the other night where someone expressed surprise when I told her health insurance rates were going to go up a lot in 2014, assuming the law is deemed constitutional and all goes forward. “I thought this was supposed to lower everyone’s costs”, she said. “Really?”, I thought to myself.
Despite the marketing hype behind it, ObamaCare was never about making health care or health insurance more affordable. There is nothing in the legislation that does anything to lower real costs. Health insurance rates for individuals will be going up 30 – 50% on average in 2014, and over 100% in many cases.
Politicians who don’t understand economics think that, given enough power, they can control costs. Richard Nixon tried this in 1971, putting wage and price freezes in place until 1974, thinking he could thus control inflation. By the time this nonsense ended, the U.S. inflation rate had reached double digits. It didn’t work.
It never does.
ObamaCare is, and was always about, giving government control over the health care system. This control dramatically increases the power of the politicians, the regulators, and the lobbyists working in the system. And in the case of health care, we’re talking about one sixth of the economy.