It’s been known since at least the time of Emporer Diocletian: price controls don’t control prices, create shortages, and ultimately lead to more inflation.
So… prepare for longer lines and delays in treatment. For an administration that likes to think of its decisions as rooted in science, they forget/skip/don’t understand/choose to ignore economic science. Things like supply, demand, and price are not the inventions of Karl Rove or the Koch brothers. Incentives matter.
From Sebelius’s Price Controls in today’s WSJ:
ObamaCare mandates greater insurance benefits and other regulations that distort market pricing, while also accelerating the explosive costs of medical services. Premiums will naturally climb to cover those costs.
“I find myself in an unprecedented place and time, as do my counterparts throughout the country,” Mr. Sullivan wrote to Mr. Blumenthal, “in overseeing the implementation of one of the most far-reaching policy initiatives enacted by the federal government in recent history.” State regulators, he continued, are “in an unenviable position as we are required by Congress to approve richer benefit packages, while simultaneously being called upon by you to reduce rates.”
…A similar premium drive-by continues to play out in Massachusetts—and is coming soon to a state near you. Politicized rate-setting is the new reality of the U.S. health insurance market, not that consumers will in any way benefit.