Sunday, November 9, 2008

Health Care Reform (2) or Just the Facts Maam


Facts are stubborn things.

Yesterday I posted my own analysis of the broken health care system in our country. Later I was dismayed to read that some pundits believe reform must be put on the back burner until other problems are solved. Then I read that many economists believed that the economic downturn will never be fixed until the health care issue is resolved. If they are correct (and I believe they are) their assertion moves reform back to the front burner for immediate attention.

I would like to see reform happen before I die. My medical needs are taken care of, but my daughter has no coverage and she has some health issues that will be costly. For her, and the thousands like her, I sincerely hope that Obama will make this a priority in conjunction with the economy. I am enclosing an article of facts that, when studied, should make even the most die-hard opponent of universal health coverage think twice. Although this is a repetition of what I wrote yesterday it is written much better and is worth repeating. The article is from The National Coalition on Health Care.

Facts on the Cost of Health Insurance and Health Care

By several measures, health care spending continues to rise at the fastest rate in our history.

In 2007, total national health expenditures were expected to rise 6.9 percent — two times the rate of inflation.1 Total spending was $2.3 TRILLION in 2007, or $7600 per person.1 Total health care spending represented 16 percent of the gross domestic product (GDP).

U.S. health care spending is expected to increase at similar levels for the next decade reaching $4.2 TRILLION in 2016, or 20 percent of GDP.1

In 2007, employer health insurance premiums increased by 6.1 percent - two times the rate of inflation. The annual premium for an employer health plan covering a family of four averaged nearly $12,100. The annual premium for single coverage averaged over $4,400.2

Experts agree that our health care system is riddled with inefficiencies, excessive administrative expenses, inflated prices, poor management, and inappropriate care, waste and fraud. These problems significantly increase the cost of medical care and health insurance for employers and workers and affect the security of families.

National Health Care Spending

  • In 2007, health care spending in the United States reached $2.3 trillion, and was projected to reach $3 trillion in 2011.1 Health care spending is projected to reach $4.2 trillion by 2016.1
  • Health care spending is 4.3 times the amount spent on national defense.3
  • In 2005, the United States spent 16 percent of its gross domestic product (GDP) on health care. It is projected that the percentage will reach 20 percent by 2016.1
  • Although nearly 47 million Americans are uninsured, the United States spends more on health care than other industrialized nations, and those countries provide health insurance to all their citizens.3
  • Health care spending accounted for 10.9 percent of the GDP in Switzerland, 10.7 percent in Germany, 9.7 percent in Canada and 9.5 percent in France, according to the Organization for Economic Cooperation and Development.4

Employer and Employee Health Insurance Costs

  • Premiums for employer-based health insurance rose by 6.1 percent in 2007. Small employers saw their premiums, on average, increase 5.5 percent. Firms with less than 24 workers, experienced an increase of 6.8 percent.2
  • The annual premium that a health insurer charges an employer for a health plan covering a family of four averaged $12,100 in 2007. Workers contributed nearly $3,300, or 10 percent more than they did in 2006.2 The annual premiums for family coverage significantly eclipsed the gross earnings for a full-time, minimum-wage worker ($10,712).
  • Workers are now paying $1,400 more in premiums annually for family coverage than they did in 2000.2
  • Since 2000, employment-based health insurance premiums have increased 100 percent, compared to cumulative inflation of 24 percent and cumulative wage growth of 21 percent during the same period.2
  • Health insurance expenses are the fastest growing cost component for employers. Unless something changes dramatically, health insurance costs will overtake profits by 2008.5
  • According to the Kaiser Family Foundation and the Health Research and Educational Trust, premiums for employer-sponsored health insurance in the United States have been rising four times faster on average than workers’ earnings since 2000.2
  • The average employee contribution to company-provided health insurance has increased more than 143 percent since 2000. Average out-of-pocket costs for deductibles, co-payments for medications, and co-insurance for physician and hospital visits rose 115 percent during the same period.6
  • The percentage of Americans under age 65 whose family-level, out-of-pocket spending for health care, including health insurance, that exceeds $2,000 a year, rose from 37.3 percent in 1996 to 43.1 percent in 2003 - a 16 percent increase.7

The Impact of Rising Health Care Costs

  • National surveys show that the primary reason people are uninsured is the high cost of health insurance coverage.2
  • Economists have found that rising health care costs correlate to drops in health insurance coverage.8
  • Nearly one-quarter (23 percent) of the uninsured reported changing their way of life significantly in order to pay medical bills.9
  • In a Wall Street Journal-NBC Survey almost 50 percent of the American public say the cost of health care is their number one economic concern.10
  • In a USA Today/ABC News survey, 80 percent of Americans said that they were dissatisfied (60 percent were very dissatisfied) with high national health care spending.11
  • Rising health care costs is the top personal pocketbook concern for Democratic voters (45%) and Republicans (35%), well ahead of higher taxes or retirement security.12
  • One in four Americans say their family has had a problem paying for medical care during the past year, up 7 percentage points over the past nine years. Nearly 30 percent say someone in their family has delayed medical care in the past year, a new high based on recent polling. Most say the medical condition was at least somewhat serious.
  • A recent study by Harvard University researchers found that the average out-of-pocket medical debt for those who filed for bankruptcy was $12,000. The study noted that 68 percent of those who filed for bankruptcy had health insurance. In addition, the study found that 50 percent of all bankruptcy filings were partly the result of medical expenses.13 Every 30 seconds in the United States someone files for bankruptcy in the aftermath of a serious health problem.
  • One half of workers in the lowest-compensation jobs and one-half of workers in mid range-compensation jobs either had problems with medical bills in a 12-month period or were paying off accrued debt. One-quarter of workers in higher-compensated positions also reported problems with medical bills or were paying off accrued debt.14
  • If one member of a family is uninsured and has an accident, a hospital stay, or a costly medical treatment, the resulting medical bills can affect the economic stability of the whole family.15
  • A new survey shows that more than 25 percent said that housing problems resulted from medical debt, including the inability to make rent or mortgage payments and the development of bad credit ratings.16
  • A survey of Iowa consumers found that in order to cope with rising health insurance costs, 86 percent said they had cut back on how much they could save, and 44 percent said that they have cut back on food and heating expenses.17
  • Retiring elderly couples will need $200,000 in savings just to pay for the most basic medical coverage.18 Many experts believe that this figure is conservative and that $300,000 may be a more realistic number.
  • According to a recent report, the United States has $480 billion in excess spending each year in comparison to Western European nations that have universal health insurance coverage. The costs are mainly associated with excess administrative costs and poorer quality of care.19
  • The United States spends six times more per capita on the administration of the health care system than its peer Western European nations.19

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