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Affordable Care Act Maintaining Steady Health Costs


Posted on December 31, 2012 by admin
Popular opinion among cynics of the Affordable Care Act is that the healthcare legislation is driving up medical insurance premiums. Now and again you will read about an individual’s experience with Obamacare and how he or she went from paying $500 a month to $1,000 per month in the last year. However, a recent report by the Kaiser Family Foundation indicates that this is generally not the case for most Americans.

The study focuses on the average annual cost of premiums paid by employers of two different sets of companies: those with one to 199 employees, and those with 200 workers or more. The study spans from 1999 to 2014.

The problem most people have with the Affordable Care Act is that costs of health insurance continue to rise year after year. From 2009 to 2014, the cost of health insurance provided by a business employer went up 26 percent. However, these numbers need to be shown against statistics of previous years to get the full picture.

Before the implementation of Obamacare, spikes in health insurance cost were substantially more severe. In a similar period (between 2004 and 2009), the cost of health insurance rose 34 percent, and in years before, the spike was even more significant. Between 1999 and 2004, health care costs rose by an average of 72 percent.

In the current insurance market, 26 percent is considered stable.

It is understandable that all Americans want more affordable health insurance coverage, but the enemy of higher costs for these particular individuals is not the Affordable Care Act. It is the employers. The lead author of the Kaiser report, Gary Claxton notes that business owners used to pay very little for young, healthy employees. However, under Obamacare, premiums are no longer generated based on age and health. The way employers have responded is by pushing these unforeseen costs onto their workers. These are the unusual cases of workers’ premiums doubling in the past year, because the statistics show that the American public is not experiencing such a hike in coverage prices.