The Health of a Nation

NY Times ^ | April 3, 2006 | ALLAN B. HUBBARD

[neverdem]

IN the past five years, private health insurance premiums have risen 73 percent. Some businesses have responded by dropping healthcare coverage, leaving employees uninsured. Other employers pass the costs on to workers, both by raising co-payments and premiums and by denying workers the wage increases they need to afford these higher prices.

What is driving this unsustainable run-up in health insurance costs, and how can we make things better?

Health care is expensive because the vast majority of Americans consume it as if it were free. Health insurance policies with low deductibles insulate people from the cost of the medical care they use — so much so that they often do not even ask for prices. And people don't recognize the high premium costs of this low-deductible insurance because premiums are paid by employers. Finally, the tax code subsidizes these expensive, employer-purchased insurance policies.

To control health care costs, we must give consumers an incentive to spend money wisely. We can do this by encouraging the purchase of high-deductible policies and providing the same tax benefits for out-of-pocket health spending that employer-provided insurance enjoys. The overall cost to the consumer will be no greater than it is now and, in most cases, significantly lower. And no consumer is better than the American consumer at driving prices down and quality up.

The president has proposed a package of reforms that will spur such changes by building on the success of consumer-directed Health Savings Accounts and the insurance policies that go with them. Health Savings Accounts allow people to save money tax-free to pay their out-of-pocket health costs, as long as they have high-deductible health policies to cover catastrophic expenses. Enrollment in these accounts has grown rapidly since their introduction in 2003, with more than three million people now contributing to them.

[babygene]

No... On a small group plan <50, it's $13200 per year. That's with a $250 deductible and maternity benefits... To go to a $5000 deductible you save about $125 a month.

We investigated health savings accounts. Guess what? You can't get them unless you have insurance.

For a 200 day year, 8 hours per day, that's $8.25 per hour.

Is it any wonder that so many people are uninsured? A lot of people don't make that much.

[therut]

Way to low for the employer. I know I am one. I think employers should put on the employees pay stub what benefits they paid for their employee that pay period. Maybe them employees would at least know what it really costs to employee them. We have one employee whose yearly premium just for her is 9,000.00. My own is 8,100 a year. We are a small business we pay 100% of employees insurance. We have 32 employees.

[therut]

That is all good and fine. But the nurse practioner or physician assistant is working under a physician. Maybe the law could be changed where that was not so. But then that person would have to charge more as they would have to pay for malpractice insurance to practice medicine solo and their premiums would be even higher than a physicians. We have a nurse Practicioner in my practice. Since we as physicians are legally responsible for her the insurance to cover her is less than 500.00 a year. Her charges are the same as the physicians.

[babygene]

One more thing...

If your a small group (<50), the small company is the primary payee if you hire someone on Medicare. If you are in a large group, Medicare is the primary payee. This makes it very difficult to hire old folks who already have Medicare, Or somebody who's spouse is on Medicare.

[Choose Ye This Day]

Amen--employees have NO idea how much employers pay, in FICA taxes, in health premiums, in 401(k) or profit sharing contributions, etc. It should be right there on the paystub.

[ran15]

Massively limiting the liability that health practioners face should be the first step. It should even be much different then liabilities other professionals face. Because other professionals are not dealing with something anywhere near as complex as the human body.

[DoughtyOne]

I have worked for larger employers. My question is how it would impact your costs if you employed 500 to 1000 employees vs just 32 or so. You probably pay almost as much as if the employee were to have their policy on their own.

I have no way of knowing what groups rates are vs single insured (including family of course).

I don't quite understand why rates would be lower if a business employed 1000 vs 10 people. It would seem that claims would be the same for people insured each way. Why would one be deemed worthy of a better rate?

Well, sorry to hear how heavily this impacts you. You do bear the brunt of increased costs, no doubt.

I agree that it would be a good idea for employees to know what your costs are. I think it would serve you well to tell them.

[glorgau]

What is driving this unsustainable run-up in health insurance costs, and how can we make things better?

One factor might be the cost of free emergency room care for illegal aliens.

[Attention Surplus Disorder]

I'd tend to go with DB's response to your post. Bank the savings (from having a larger deductible) and you'd be fine coming up with a $500/$1K "hit" in the event of an accident.

[glorgau]

I have a $500 deductible and have never made a claim on insurance I've purchased in 20 years. I have been paid for people that have hit me though...

[CheyennePress]

Depends. Sometimes I'll see people who look like routine patinents who the doc looks over, spots another abnormality, tests it, and it turns out something far more severe was lurking behind what looked like routine symptoms.

[gleeaikin]

I saw an article (I wish I could remember where) a year or two ago that said drug company profits are from 2 to 7 times that of other major businesses. I think the average was something like 20% profit.

Drug companies run around giving free samples of their products to doctors to get them to perscribe new drugs, when there are perfectly good existing drugs, many now generic, which are a whole lot cheaper.

One way to save money is to ask your doctor if there is a generic medication which would do the job as well. Another thing is to learn how to eat and live in a really healthy way instead of looking to doctors for "magic pills." Take responsibility for your own health.

[Hardastarboard]

I see nothing wrong if you want to diagnose yourself and decide what medicine you want as long as you do not complain and try to sue yourself when you screw up.

I tend to agree with that. Why should I see have to see a doctor for diuretics? It's my body after all.

[cyborg]

Health insurance policies with low deductibles insulate people from the cost of the medical care they use

** Perhaps if everyone paid cash then the costs would go down.

[napscoordinator]

We have one employee whose yearly premium just for her is 9,000.00. My own is 8,100 a year. We are a small business we pay 100% of employees insurance. We have 32 employees.

Wow!!!! That is a lot of money for one person. Interestingly enough, I wish that health insurance was like car insurance whereas if you don't have it and get into a crash you pay out of pocket. That is how medical should be, get insurance and pay deductible or if you don't have medical insurance, pay the bill PERIOD. If it takes you years and years to pay off so be it. Once you die, the money can be taken out of your inheritance. If there is not enough then it can be a loss, but I think in the long run it would be better than giving it for free out right.

[napscoordinator]

One factor might be the cost of free emergency room care for illegal aliens.


That should not be free. Maybe they should take some of that money they send back to Mexico and give it as payments. Even if they can't pay the entire bill anything is better than zero. I will be so mad if people who have worked their entire lives are not going to be able to afford medical in their later years because we have been giving free medical to all these folks who are here illegally, but I think that even our own poor folks should at least pay something. Free should not be in the equation at ALL. I mean even a twenty dollar visit should be affordable to everyone and five or ten dollar perscriptions for everyone. It beats having everyone who can't afford it paying ZERO.

[napscoordinator]

Another thing while I am on my soapbox today. If hospitals are accepting people for free services than I think the costs should be taken out of the paychecks of people who perform the procedures. If a doctor is looking at someone who can't afford medical payments, and that doctor still checks the person, the cost should be taken from the doctor, nurse, aide whoever helps with the appointment.

Another thing that Korea has is you are not seen until you pay. They do not have problems with high medical costs because most pay out of pocket for everything and they don't touch you until you find a way to pay. I sorta like this idea too.

[spikeytx86]

Maybe if employee's paid fully for there FICA and SS taxes (in which in essence they are any way in reduced pay) employers could afford to expand or provide coverage or absorb increases. Just a thought.

[spikeytx86]

doesn't korea have universal insurance?

[spikeytx86]

I kind of like Singapore's health system. Everyone in Singapore pays a flat percentage of his or hers income matched by there employer in a "medisave" plan and only after it is exhausted dose the government kick in. There med costs of GDP is under 5% and its not horrible health care either. If we were to adopt a system like that here and make every American responsible for his primary care the costs would plummet.