NYT: Health Care Costs to Rise

Robert Pear of the New York Times reports:

WASHINGTON — A government analysis of the new health care law says it will not slow the overall growth of health spending because the expansion of insurance and services to 34 million people will offset cost reductions in Medicare and other programs.

The study, by the chief Medicare actuary, Richard S. Foster, provides a detailed, rigorous analysis of the law.

In signing the measure last month, President Obama said it would “bring down health care costs for families and businesses and governments.”

This brings to mind President Obama's confession during his healthcare summit with Republican lawmakers that he doesn't understand how insurance really works.

"You know, when I was - when I was young, just got out of college, I had to buy auto insurance. I had a beat-up old car. And I won't name the insurance company, but there was a company, let's call it Acme Insurance in -- in Illinois. And I was paying my premiums every month. After about six months I got rear-ended, and I called up Acme and said, 'You know, I'd like to see if I can get my car repaired.' And they laughed at me over the phone. Because really, this was not set up to actually provide insurance, what was set up was to meet the legal requirements. But it really wasn't serious insurance.

That a Harvard graduate would not know the difference between collision and liability insurance is quite remarkable.

BREAKING NEWS: White House Press Secretary Robert Gibbs reports that President Obama phoned Medicare officials yesterday to make sure the healthcare bill he signed last month will actually lower costs - and they laughed at him over the phone.