Family coverage to cost $24,000 by 2016, 45% of median household income

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Specializes in Vents, Telemetry, Home Care, Home infusion.

found at pnd news briefs - philadelphia metro edition

nov 19th, 2008

http://physiciansnews.com

the average premiums paid by employers and their workers for family coverage could top $24,000 by 2016, putting the cost of family health insurance at 45 percent of median household income if current trends continue.

the report - "the cost of doing nothing: why the cost of failing to fix our health system is greater than the cost of reform" - assumed that the cost of premiums will grow by 7.9 percent a year and household income by 0.77 percent. premiums for job-based family coverage in 2008 were around $13,000 -- equivalent to about 26 percent of median household income, reported the wall street journal. on average, employees in 2016 would likely pay $6,400 towards premiums versus about $3,400 now, assuming employers continue to subsidize coverage as they do today, while average co-pays would rise to $30 versus $21 now, and plan deductibles would hit almost $2,700 compared to $1,550 now, the journal added.

wall street journal, november 17, 2008 (subscription required)

read on...

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This does really point up the urgency of doing something - and the right thing.

Thoughts on the drivers of high cost:

1. The many administrative costs associated with our fragmented system. These costs are not only in the health insurers themselves, who spend somewhere in the neighborhood of 20-30% of every premium dollar on admin, profit and marketing. Note that a substantial portion of that goes to deciding who does not qualify to be insured and seeking ways to avoid paying for care after it is given - activities that contribute nothing to anyone's health. In addition, the system also forces doctors and hospitals to spend a fortune on the process of dealing with the insurers, getting permission for treatment and fighting for payment.

2. Over treatment at the end of life. As a cardiac rehab nurse I often see patients in the ICU so I see a fair bit of what goes on in there. At any given time about half the people in the unit are people with little or no potential to recover, but we are exhausting nurses and spending a fortune on their care. I wouldn't begrudge any of it if we were serving the patient's interest there, but we aren't - most of those patients would be horrified at what is being done to them, but intensive care develops its own momentum. We've gotten better at dealing with end of life issues, but still have a long way to go. Getting better at knowing when to stop should not be done to save money, it should be done to serve patients better - but it would save money too.

3. The obesity epidemic and its associated complications. I don't have a lot of answers here, but here's a thought: The rate of obesity in this country is enormously higher than it was 50 years ago when I was a child - but people are not themselves different. So it strikes me that the environment is an important place to look. Just for example: the supersizing of restaurant meals and soda pop, the irrational fear that keeps many kids indoors because their parents are afraid to let them play outside, urban design that discourages walking and biking. I'm sure we could think of lots more with a little time.

4. High and rapidly growing cost of prescription meds. I'm shocked at what my patients tell me about the cost of their drugs. The drug companies say they need all that to pay for research, but most of the real basic science research is paid for by the NIH and other grant makers. Most of what the drug companies pay for is research to develop the 5th new erectile dysfunction drug or the 8th cholesterol med - or research to prove that their drug is a little bit better than a competitors drug. My wife buys most of her meds from Canada and gets them for prices that average a third of US costs - exact same drug. And you just know the drug companies would not be selling in Canada if they didn't make a profit doing it.

Now just consider this: if we start with the first, by establishing a single payer system for financing healthcare, we immediately put ourselves in a much better position to deal with all the others - a unified national approach rather than a fragmented, erratic and uncoordinated approach.

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Specializes in Critical care, tele, Medical-Surgical.

"We have 900 billing clerks at Duke (medical system, 900 bed hospital). I'm not sure we have a nurse per (each) bed, but we have a billing clerk per bed...it's obscene."

--Dr. Uwe Reinhardt, hearing on healthcare reform, U.S. Senate Finance Committee, November 19, 2008

THE IMPERATIVE OF ENACTING HEALTH REFORM NOW:

An Economic Perspective

Uwe Reinhardt, Ph. D.

James Madison Professor of Political Economy

Woodrow Wilson School of Public and International Affairs and

Department of Economics Princeton University

Princeton, N.J. 08544

Statement presented to the

U.S. SENATE FINANCE COMMITTEE HEARING ON

"HEALTH CARE REFORM: AN ECONOMIC PERSPECTIVE"

November 19, 2008

http://finance.senate.gov/hearings/testimony/2008test/111908urtest.pdf

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Specializes in Critical care, tele, Medical-Surgical.

an opinion:

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