Health Insurance Premiums Rocket

By Jed Bickman 11/22/11

We should all be worried about the cost of health care, says a new report—but an Obama law may help.

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Health insurance premiums across the country rose 50% for families between 2003 and 2008, finds a new study. For employer-paid health plans, they rose 63%, and deductibles also rose dramatically. If premiums continue to soar at this rate, the average premium for family coverage will reach $24,000 by 2020. In the context of a stagnant economy, this projection is particularly worrying, for addicts and everyone else. The authors of the study—by the Commonwealth Fund, a private think tank devoted to health policy—say that “rising health care costs and restricted incomes have pushed more people into poverty.” They note that if health care costs were deducted from income measurements in census data, ten million extra people in America would be categorized as poor. But the report speaks optimistically about the Affordable Care Act passed by President Obama earlier in his presidency, believing it likely to temper the rise of healthcare premiums over the next ten years by restricting admin costs and expanding the government Medicaid and Medicare programs. One of the factors blamed for the rapidly rising premiums is the growing "monopoly power" of the largest health plans. It's hoped that Obama’s law will also break up this market domination and lead to more consumer choice.

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Jed Bickman is a journalist and copywriter living in the greater New York City area. He is the associate editor at The New Press. You can find him on Linkedin or follow him on Twitter.