So tell me again, Senator Cruz, why the President is the cause of health care cost increases!

 

     After listening to various persons, close and strangers alike, complaining about health care cost figures I decided to do something silly. I actually researched historical health care costs in an attempt to determine what impact the ACA was really having on the average person. I did this because listening to the Cruzes, Limbaughs, and Rubios has yielded little substantive data, but scads of innuendo, predictions, wild ass guesses etc.

     The paragraph below comes from an article written in 2008. (Pre-Obama, for those of you who wondered why I chose that date). What the paragraph doesn't do is mention the historical average of 5% to 8% increase and give a figure for the single employee in 2008. I will extrapolate to 2008 and 2012, since I have that kind of time. When I have done so, it should become apparent that what is being thrust upon this President as the blame for health care costs is largely unfounded and simply another "blame the Black guy" ploy of the Tea Partiers.

      Here, following, is the paragraph. Note: this addresses employee contributions, and assumes some employer input. This implies real individual cost plans could be even higher for the non-employer plan 

"The amount that a worker or employee contributes to the cost of health care continues to increase each year as premiums rise. In 2004, the average employee contributed a little more than $300 a month of the annual cost for single coverage and $800 a month for family coverage. By 2008, the costs of coverage for a family of four cost more than $1,000 a month or almost $13,000 a year."

Now for the math. Assuming a conservative estimate, splitting the difference between 5% and 8%, -  a  6.5% annual price increase,  costs break down as follows (monthly single employee):   2004 - $300,  2006 - $340, 2008 - $385, 2010 - $437, 2012 - $496. Using the high end estimate of 8% annual increase, the figure for 2012 is a lofty $555 monthly! This particular figure is interesting, because a person known to me was complaining about being single, not covered by an employer provided plan, and being quoted a price of in the high $400 per month range.  Using my figures, which I assure you are accurate, that is in the ballpark of what health care would cost this person if there were no ACA or President Obama! The point is, this is irrespective of any government influence.

Obviously, I rounded the figures, but just as obviously, (since these costs are based on 2008 before the ACA) the increase in health care costs being attributed to the Affordable Care Act would have, in fact, reached the same level simply due to the annual percentage increase of the past several decades!  

      Why don't CEOs and business leaders get as excited about the ACA as workers? It’s simple, really. In 1978, average worker to CEO compensation ratio was about 30:1 As a  simple example - a worker earning $20,000 annually might work for a corporation whose CEO was compensated  $600,000. Seems like a big gap? You ain't seen nuthin' yet! Consider 2012, where the ratio was in the area of 272:1.  Let’s assume a family of four has two parents working, each earning what the Government considers the poverty level wage for a family of four ($23,021) . In other words they make double the poverty wage, or $46,042 annually . If the CEO of either of their companies is average, he is making  $6.2 million or so in the same year!  Do we think he or she has health care insurance concerns?  

     If your personal income grows at the rate of 8% per annum, good for you; for many (like teachers) it doesn't. For the working poor, it is waaay lower. As someone who negotiated benefits for a large (>19,000 member)  group for about a decade, I was, and am, well aware of the historical increase in health care costs. We were lucky, in that management used the same plan, so we were “in it together”, yet almost every year there were top to bottom arguments over increased deductibles, copays, etc. This was in a situation where basic health care plan costs for the employee were covered as part of compensation. 

     I feel for the single individual who has health issues and needs coverage , even if just for catastrophic events. But, based on my experience, this is little different now than it was ten years ago, except someone has finally tried to rein in the excesses of the insurance industry, who NEVER take a loss. Whereas we used to get angry and blame insurers, the Cruzes and others now would have us get angry and blame the President.