It's not even necessarily the fault of the insurance companies. As someone who works in the industry, I can tell you that insurance companies are paying out more and more money for the same drugs and health care as the prices continue to skyrocket and newer more expensive drugs and procedures enter the market which, of course, the people expect their insurance companies to pay for. After all, everyone wants the best possible health care, don't they? Isn't that what they're paying those premiums for? They (the insurance companies) can't pay the claims unless they have enough money in reserves to cover them. They won't have enough money in reserves to cover the claims unless they raise the premiums. It's a vicious circle. As the population ages, and the average age of the population is going up as baby boomers continue to get older and live longer, health care and pharmaceutical usage goes up (remember all those doctors prescribing prescription medication for every little ailment when a natural product would do?).
Doctors order a lot more tests than they used to simply to cover their butts in this litigious society (it's referred to as CYA medicine). If something happens to the patient or heaven forbid they should die, some lawyer out there is usually quick to find some test that wasn't ordered or a drug that wasn't prescribed or a procedure that wasn't performed and convince the family to sue the doctor for medical negligence. Medical malpractice insurance comes into play then as claims are paid out and premiums go up. The doctors have to cover the costs of higher premiums, so to stay in practice, they pass that cost along to the patients.
See how this is all tied together and we as individuals played a part in this too? How many people do you know who feel that they haven't been "treated" by the doctor unless they leave the office with a precription in hand? How many people do you know that will pressure their doctor to let them try the latest and greatest drug out there after seeing a commercial for it on TV (Rogaine and Retin-A and a host of allergy and cholesterol-lowering medications come to mind here)? Consumers drive the market. I'll fault the pharmaceutical industry for their commercials and ads trying to convince everyone that they need whatever new drug they are coming out with, but people also need to stop and ask themselves if they really need that new drug or if they are simply falling prey to slick advertising.