September 17, 2009

Health care costs $13,375 per year and rising, but hey, no problem

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The average cost of employer-sponsored health insurance in this country? $13,375. That’s a 5 percent increase over last year. And that’s as inflation fell. And that’s while many voices are trying to tell us the system is just fine, and doesn’t need fixing.

I’m reminded of the shocked faces of my Canadian friends as I described how much a typical family plan in the U.S. costs. That family, a family of three children and two parents, paid $108 per month for their coverage. And they were quite satisfied, relieved, and happy even. No treks down to the border to obtain U.S. health care to supplement the the so-called rationed care their system couldn’t deliver.

Workers here paid a quarter of that $13,375, or $3,515, according to the annual poll of U.S. business by the Henry J. Kaiser Family Foundation. Total premiums have risen 131 percent over 10 years, compared with 38 percent for wages and 28 percent for all inflation, according to Kaiser and reported in the LA Times. But we don’t have a problem with our health care system. No inefficiency in there somewhere. Nobody or no piece of the system is scraping off too much money. No problem if the delivery system is tied to employment, and no problem when the unemployment rate rises to 10 percent nationwide during a recession.  Never mind that of the firms reporting in Kaiser’s survey, 21 percent said they reduced the health benefits or increased cost-sharing, and 15 percent said they increased the worker’s share of the premium. No problem that despite these incredible costs, our death rates are high among western nations, and perhaps because of them, our medical bankruptcy rates are skyrocketing.

Meanwhile, as Sen. Max Baucus’ compromise legislation goes forward, it seems to be falling short of the Montana Democrat’s goal of bringing Republicans and Democrats together. The three Republicans in the so-called Gang of Six working on the compromise aren’t even supporting their man, and some liberal Democrats appear to be holding out for the “public option” that would allow the government to operate an insurance program in competition with private insurers. The Senate may be looking at scraping up 60 votes for a majority to pass its own, more liberal version, the New York Times reports this morning.

The Baucus legislation – like the two other Democratic health bills – is designed to largely preserve the current system of employment-based health coverage. Is there a problem with that concept that the current recession and that the figures from the Kaiser study surely demonstrate? What happens to a very expensive system built on a foundation of jobs and full employment during an economic downturn or marginal employment for large sectors of your community?  The proposed system would layer a system of highly regulated, state-based insurance marketplaces on top of the employment-based health coverage plans. People who don’t receive coverage from their employer could buy coverage here. But with President Obama now saying illegal immigrants, for example, would not be permitted to buy into the state-based exchanges, even with their own, unsubsidized money, the system is being set up to fail, and largely for political reasons.

This is a new position for the president, who had first simply said illegals would receive no federal subsidies, the Denver Post reported.

“But immigrant advocates pointed out that barring illegal immigrants from obtaining health insurance through the marketplace is illogical considering they will be forced to go to emergency rooms when injured or ill, which is much more expensive.

 So for some groups in our community, even if they can afford to buy coverage, this system would insist on maintaining the emergency room as primary care doctor. Which delivers bad care at a high price. We know that. And Obama, who spent a certain amount of time listening to docs as this debate moved forward over the summer, should know that as well. But this is all about politics and stilling the shrill voices.

— Rita Hibbard

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