Analysis: No health care reform costlier than overhaul

WASHINGTON - What could be worse than health care overhaul? No overhaul.

It's anybody's guess whether President Barack Obama's health remake will survive in Congress. But there's no doubting the consequences if lawmakers fail to address the problems of costs, coverage and quality: surging insurance premiums, more working families without coverage, bigger out-of-pocket bills, a Medicare prescription gap that grows wider and deeper, and government programs that pay when people get sick but do little to keep them healthy.

"They complained, 'If you pass this bill, prices will go up,' " said Sen. Maria Cantwell, (D-Wash.) who helped shape the Senate Democrats' bill. "Well, you don't pass it, and prices will still go up."

For economist Douglas Holtz-Eakin, a top adviser to 2008 GOP presidential nominee John McCain, "no one has the luxury of saying we're not going to worry about this."

While he's no fan of the Democrats' approach, he said Republicans "are going to have to deliver something at some point. The question is whether they do it with this president leading or wait for a Republican president."

Health care spending hit $2.5 trillion last year, growing faster as a share of the economy than at any time in a half-century, yet with results that compare poorly with other advanced countries spending less. Government programs - mainly Medicare and Medicaid - will soon cover more than half the nation's health care tab.

For those with private insurance, the recently announced double-digit premium increases for people purchasing their own coverage. Medical costs are rising in a weak economy, causing healthy people to drop coverage and raising costs for those left behind, with no limit in sight.

With Congress looking to cut the federal deficit, Medicare will be on the chopping block again.

If present trends continue, the divide between those who have health insurance and those who don't will get deeper. Many more will find themselves with inadequate coverage that leaves them with hefty bills if they get seriously ill.

Insurers would be able to continue denying coverage to people with medical problems, or charge them higher premiums. People who get sick could face cancellation of their coverage.

People in their 50s and 60s, when many medical conditions emerge, would face premiums up to six times or seven times higher than what those in their 20s pay.

If nothing gets done, large employers will be the front line in efforts to rein in health care spending. They will keep passing on costs to employees through higher premiums and copayments.

Small companies are likely to keep dropping coverage, as are employers with lots of low-wage workers.