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Education & Labor Committee Republicans

Contact: Press Office (202) 226-9440
Despite President’s Promises, Health Care Costs on the Rise

It wasn’t long ago the American people were promised that health care reform would lower costs. In fact, President Obama repeatedly pledged his health care plan would lower premiums by up to $2,500. Unfortunately, as a recent study by the Henry J. Kaiser Family Foundation helps make clear, Democrats got their government takeover of health care and the American people are stuck with higher costs. According to a report by Bloomberg:

The cost for businesses to buy health coverage for workers rose the most this year since 2005 and may reach $32,175 for a family in 2021, according to a survey of private and public employers.

The average cost of a family policy climbed 9 percent in 2011 to $15,073, according to a poll of 2,088 private companies and state and local government agencies by the Henry J. Kaiser Family Foundation in Menlo Park, California, and the Chicago- based American Hospital Association’s Health Research and Educational Trust.

The consequences of rising health care costs often go beyond high premiums and more expensive care. Today, an estimated 160 million individuals receive health insurance through an employer, which means rising health care costs can lead to lower wages for struggling workers.

The groups’ findings, based on data collected through May, show that health insurance is consuming a bigger share of employer costs, preempting pay raises and making companies pass on more medical costs to their workers, benefit consultants said. The premiums reported are in effect for the full year.

“Rising health-care costs have crowded out other elements of the compensation package,” said Randall Abbott, a senior health-care consultant at Towers Watson & Co. (TW) “That’s the price we are paying, beyond the fact that health-care cost in and of itself continues to be more expensive.”

While supporters of ObamaCare attempt to ignore reality, House Republicans have been listening to countless employers describe ObamaCare’s negative consequences for the workforce:

  • “Complying with the requirements of the new law will force entrepreneurs to invest less into growing their business. I am here today to inform the Committee on Education and the Workforce that the new health care reform law will slow or stall the growth of small and midsized businesses as we struggle to absorb its new costs."

- Gail Johnson, President/CEO, Rainbow Station, Inc., 02/09/11

  • "The new health law imposed a 2.3% excise tax on most types of medical devices. The excise tax is based on revenue, not profit, and begins in 2013… Such a severe increase in tax liability will undoubtedly force us to cut critical R&D funding and inhibit job creation and retention."

- Denis Johnson, Vice President Operations, Boston Scientific, 06/07/11

  • "The requirement for employers with over 50 employees to insure part time and seasonal workers provides strong disincentives toward job creation. When insurance is required for part time employees, I will be unable hire another part time worker. It will be almost impossible for an entrepreneur to start a new business and hire."

- The Honorable Mark Messmer, Messmer Mechanical, Inc. 06/07/11

  • “We are very unhappy about the effects this will have on our employees – for example, an employee who currently works full-time in our kitchen will be shifted to part-time status with Bowlmor and he/she will likely have to find another part-time position at another restaurant or similar business. While Bowlmor would definitely rather not disrupt our full-time employees like this, we must do so to protect existing jobs.”

- Brett Parker, Vice Chairman and Chief Financial Officer,
Bowlmor Lanes, 03/10/11

The American people demand real solutions that will reduce health care costs and improve access without harming our economy and job growth. It’s time for President Obama to face facts and heed calls for repeal of this harmful law. Unfortunately, it looks like that is a promise the president isn’t prepared to make any time soon.

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