The Money/Medicine Mix Mistake

The free market at "work" in health care = increased costs.

Says Kevin Schulman of Duke U:

“These costs keep growing despite the recession, and health care is going to
shoot up as a percentage of our GDP even more. It’s just spooky.”

From AHLA newsbriefs:

The Palm Beach Post reports that the "giant companies that dominate Florida's health insurance market are stifling competition and escalating premiums," a new report by Health Care for America Now argues. The report said health insurance "premiums in Florida rose 3.6-times faster than wages from 2000 to 2007"; and two companies, "Blue Cross and Blue Shield (BCBS) of Florida and Aetna Inc., control 45 percent of the health insurance industry in the state." ... But United Healthcare spokesperson Roger Rollman charged, "The idea that UnitedHealthcare market share is driving premium costs is nonsense." Rollman contends that "the growth in premiums is mostly driven by overall health costs."

Similarly, the Houston Chronicle (5/21, Ackerman) noted that Texas health insurance premiums rose "nearly six-times faster than wages between 2000 and 2007"; and the report showed that "BCBS and United Healthcare control 68 percent of the Texas market." ... Notably, the Justice Department "considers a market 'highly concentrated' if one company holds more than a 42-percent share."

The Chronicle quotes an HCAN researcher: insurance companies’ profits between 2000 and 2007 belie their arguments [that an ageing population is the reason for increased costs]. He noted that the net incomes of the 10 largest insurance companies grew from $2.44 billion in 2000 to $12.8 billion in 2007. The Chron continues, During that time, Texas premiums have increased 87 percent, according to the report — 5.8 times faster than wages. For family health coverage, the average annual combined premium for employers and employees rose from $6,635 to $12,403.

That's bulls**t.

Okay, rant time.

Do we care about money or people? The cost of health care, the cost of treatment, the cost of an ageing population, the cost of premiums, profits, profits, profits, the market, the cost of innovations, pharmaceuticals, insurance, HMOs. This is what you hear in the news when you hear about health care. The only time people come in to the equation is when you hear "46 million uninsured." But again, look at that statement--"46 million uninsured." Not 46 million without health care, not 46 million people who are unhealthy or don't have access to preventative medicine. And even less frequently do you hear about the "underinsured," who pay their hard earned money to be "covered" yet still face huge bills and forgo medical treatments. Why? Because no matter what they're under, at least they're INSURED.

And being insured means you get the care you need right?

Well...certainly not in countries with the wrong kind of insurance--public. People in those places face long waits, and certain technologies aren't as widely available, right?

And, well...not in a place that's mandated insurance coverage for everyone either--say, Massachusetts. How long is the wait there now for a visit to the doctor? Many offices have stopped taking new patients, and the wait for an appointment can be up to a year.

So the country's discourse--and whatever possible "solution" comes of it--is based on faulty logic. Having insurance DOES NOT EQUAL having care.

I can't say I have the answers, but I can say the question needs to be rephrased.

"Cadillac Insurance" Tax

During the presidential campaign, one of the legs on which McCain's health plan platform stood was an elimination of tax breaks for employer sponsored health benefits in exchange for creating a tax credit for individuals and families who then chose to purchase insurance on the Free Market instead. The plan was that encouraging people to obtain insurance on their own instead of through their employer would create a more competitive insurance market, though McCain acknowledged this plan was effectively a tax on the wealthy.

What are those tax breaks? Briefly, the money an employer spends that is received in health benefits are not taxed as income. Further, an employer is able to contribute to those benefits with pre-tax dollars. McCain wanted to say bye-bye to that. What did now-President Obama say? No way.

Fast forward to May 2009. The plan to remove the tax breaks is still on the table. Somewhere. Some members of Congress (read: Baucus) and unnamed members of BO's administration are supportive of elimination of the employer benefit tax breaks. What will the President say now?

The obvious move for employers if this were to occur, which was part of the McCain health plan ideology, is that without the breaks, employers will cease to offer benefits, or offer less attractive (expensive) packages. This affects many many Americans as approximately 2/3 of those under 65 who are insured receive benefits from their employers, according to NYT. Of course, NYT does not differentiate on how good those benefits those are, but I suppose that doesn't matter when (1) something changes and (2) suddenly you're paying more for the same thing. No one likes that, right?

There is no talk in the NYT article about "balancing the platform," as McCain was to do with his tax credit. Why? Because the balance would be people using the public option, and that's an article of a different color, for both the NYT and this blogger. More to come........