The Moral Healthcare Blog

Facts About Healthcare Costs – National Coalition on Health Care

NCHC Facts About Healthcare – Health Insurance Costs:

In 2008, total national health expenditures were expected to rise 6.9 percent — two times the rate of inflation.1 Total spending was $2.4 TRILLION in 2007, or $7900 per person. Total health care spending represented 17 percent of the gross domestic product (GDP).

U.S. health care spending is expected to increase at similar levels for the next decade reaching $4.3 TRILLION in 2017, or 20 percent of GDP.1

In 2008, employer health insurance premiums increased by 5.0 percent – two times the rate of inflation. The annual premium for an employer health plan covering a family of four averaged nearly $12,700. The annual premium for single coverage averaged over $4,700.2

…………….

National Health Care Spending

In 2008, health care spending in the United States reached $2.4 trillion, and was projected to reach $3.1 trillion in 2012.1 Health care spending is projected to reach $4.3 trillion by 2016.1
Health care spending is 4.3 times the amount spent on national defense.3

In 2008, the United States will spend 17 percent of its gross domestic product (GDP) on health care. It is projected that the percentage will reach 20 percent by 2017.1

Although nearly 46 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 5.0 percent in 2008. 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 $12,700 in 2008. Workers contributed nearly $3,400, or 12 percent more than they did in 2007.2 The annual premiums for family coverage significantly eclipsed the gross earnings for a full-time, minimum-wage worker ($10,712).

Workers are now paying $1,600 more in premiums annually for family coverage than they did in 1999.2

Since 1999, employment-based health insurance premiums have increased 120 percent, compared to cumulative inflation of 44 percent and cumulative wage growth of 29 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 the end of 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 1999.2

The average employee contribution to company-provided health insurance has increased more than 120 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

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.9 Every 30 seconds in the United States someone files for bankruptcy in the aftermath of a serious health problem.

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.10

About 1.5 million families lose their homes to foreclosure every year due to unaffordable medical costs. 11

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.12

Retiring elderly couples will need $250,000 in savings just to pay for the most basic medical coverage.13 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.14

The United States spends six times more per capita on the administration of the health care system than its peer Western European nations.14

Acrobat version with references is here.

Presentation for Medicare 44th Anniversary

I gave a presentation in Avalon, PA on the occasion of the 44th Anniversary of Medicare, Thusday July 30, for Organizing for America. Thanks to everyone who came and were so kinly receptive to the talk, and of course to Terry, Al, Peter and Sylus for organizing things!

‘>The slides are here.

The references in the slides are all on this blog somewhere, just search in the upper left hand corner to find them.

Please Cut the Crap!: Deconstructing the Right Wing Lies on the Health Insurance Bill#more#more

Please Cut the Crap!: Deconstructing the Right Wing Lies on the Health Insurance Bill#more#more:

The right’s lies about the current health insurance proposals before Congress have rarely been compiled in such concise form before.

What follows is an article from the Right Wing blog ChronWatch:

Page After Page of Reasons to Hate ObamaCare
By Alan Caruba

The problem is, there’s something missing, such as context. See, the writer is expecting the reader to take everything as gospel, and agree that it’s bad, without any sort of explanation. It’s a list of all of the things that are wrong with the current state of the health care reform bill before Congress. If you’d like to follow along, feel free to click here to go to the bill itself. In fact, I would encourage you to look at it for yourself; it’s an easy way to learn what’s actually in it, without having to read through all of the legalese.

We’re not called Please Cut the Crap for no reason. Below each item the right wing assures readers we’re supposed to hate, I’ve inserted context, and explained why you really shouldn’t hate it. Unless you should. All of my responses are italicized and printed in red, so that you can tell whose words are whose.

I’ll warn you, this is a long one, but it’s an important one, so get a glass of tea, print this out, and read it to everyone who spews one of these talking points, because this really does touch on pretty much all of the right’s talking points. And now you’ll be able to refute them. Isn’t that cool?”

Follow the link to read it all.

A friend sent me this email from a right wing relative, and it was just too full of crap to spend the time debunking, but fortunately the good people at “Please Cut the Crap” did it for me!

Doctor Self-Referrals Part of Health-Care Cost Trend – washingtonpost.com

Doctor Self-Referrals Part of Health-Care Cost Trend – washingtonpost.com:

“In August 2005, doctors at Urological Associates, a medical practice on the Iowa-Illinois border, ordered nine CT scans for patients covered by Wellmark Blue Cross and Blue Shield insurance. In September that year, they ordered eight. But then the numbers rose steeply. The urologists ordered 35 scans in October, 41 in November and 55 in December. Within seven months, they were ordering scans at a rate that had climbed more than 700 percent.

“The increase came in the months after the urologists bought their own CT scanner, according to documents obtained by The Washington Post. Instead of referring patients to radiologists, the doctors started conducting their own imaging — and drawing insurance reimbursements for each of those patients.”

It is clear some oxen have to be gored, or at least hobbled, to “bend the curve.” Let’s start being explicit about where to do this. Private insurers, over-utilizing physicians, drug and equipment manufacturers and suppliers. Let’s start the hard discussions, please.

What the Mayo Clinic knows | Freep.com | Detroit Free Press

What the Mayo Clinic knows Freep.com Detroit Free Press:

Three goals underscore our nation’s ongoing healthcare reform debate: 1) insurance for the uninsured, 2) improved quality, and 3) reduced cost. Mayo Clinic serves as a model for higher quality healthcare at a lower cost.

President Barack Obama, after referencing Mayo Clinic and Cleveland Clinic, advised: ‘We should learn from their successes and promote the best practices, not the most expensive ones.’ Atul Gawande writes in the New Yorker, ‘Rochester, Minn., where the Mayo Clinic dominates the scene, has fantastically high levels of technological capability and quality, but its Medicare spending is in the lowest 15% of the country — $6,688 per enrollee in 2006.

Rationing? Say it ain’t so!

Blue Cross praised employees who dropped sick policyholders, lawmaker says – Los Angeles Times:

But documents obtained by the House Committee on Energy and Commerce and released today show that the company’s employee performance evaluation program did include a review of rescission activity.

The documents show, for instance, that one Blue Cross employee earned a perfect score of ‘5’ for ‘exceptional performance’ on an evaluation that noted the employee’s role in dropping thousands of policyholders and avoiding nearly $10 million worth of medical care.

WellPoint’s Blue Cross of California subsidiary and two other insurers saved more than $300 million in medical claims by canceling more than 20,000 sick policyholders over a five-year period, the House committee said.

‘When times are good, the insurance company is happy to sign you up and take your money in the form of premiums,’ Stupak said. ‘But when times are bad, and you are afflicted with cancer or some other life-threatening disease, it is supposed to honor its commitments and stand by you in your time of need.

‘Instead, some insurance companies use a technicality to justify breaking its promise, at a time when most patients are too weak to fight back,’ he said.

Lawmakers — Republicans and Democrats alike — decried the practice of canceling policies of ill policyholders and grilled insurance executives about it.

Doctors Oppose Giving Commission Power Over Medicare Payments – WSJ.com

Doctors Oppose Giving Commission Power Over Medicare Payments – WSJ.com:

But doctors are objecting to proposals that would allow a federal commission to set the size of Medicare payments to doctors, hospitals and other health-care providers. Under a proposal from White House budget director Peter Orszag, if the president accepted the commission’s recommendations, they would automatically take effect unless Congress acted to block them.
Doctors’ objections to the commission idea highlight the difficulty of maintaining the support of different health-care constituencies when the focus turns to controlling costs.
Surgeons would ‘vigorously oppose’ legislation that gave an unelected executive agency power to set Medicare rates, said the American College of Surgeons, which claims more than 74,000 members, in a letter to House Speaker Nancy Pelosi last week. Several surgical-specialty societies also signed the letter.
The AMA, which claims 250,000 members, said a commission shouldn’t be authorized to set Medicare payment rates for physicians. ‘If the solution is we’re just going to have a big board that will make draconian slashes, that’s not getting at the root cause of what the problem is,’ said AMA President J. James Rohack.

This is interesting. First, reimbursements are virtually set now by an unelected board, the RUC, made up largely of the highly paid, procedure based specialists.

Second, I just heard Chuck Grassley on NPR this morning saying the House and Kennedy Bills did nothing to bend the curve. This is what is required to bend the curve. Put up or shut up. Bending the curve isn’t some magical thing where everyone gets to keep making as much money, on the same trajectory as they do now.

And it’s worth pushing back on the AMA in particular. They’ve been talking a good game about what needs to be done to improve health care, reluctantly (because of fear of retribution, I suspect) pointing out whose oxen to gore, but they’ve been very silent about what physicians will be required to give up in all of this.

I frankly don’t expect to have to give up much, (I’m 49) and what I do give up will occur over ten to twenty years and so accommodation will be made by the “youngsters,” those going into and coming out of medical school and residencies now). They are the the physicians who will actually be affected by this. The old guys pissing and moaning are ready to retire soon, so shouldn’t be holding the country hostage to their reactionary, out dated ideas of what medicine should be about.

UPDATE: I was researching Medcare for a talk on the 44th anniversary of the program, and it is worth mentioning that one of the things LBJ had to do to pass Medicare was to cave to the American Medical Association and American Hospital Association, essentially giving them whatever was required to stop opposing the legislation. This had good and bad effects: lots of hospital construction, advances in medicine, and huge revenue boosts for hospitals and doctors.

On principle, we should not cave to get reform, but on a pragmatic level, fear works and the erosion in support for reform is evidence of that. But let’s call BS, at least, on Grassley and the other reborn deficit hawks: If you want to bend the curve, then you have to make some tough choices.

Health Affairs – 2 articles on the cost of private insurers to the system

Two articles from Health Affairs regarding the cost of Private Health Insurers, for profit and not for profit, to physicians’ practices, bottom lines, time and aggravation.

Peering Into The Black Box: Billing And Insurance Activities In A Medical Group — Sakowski et al. 28 (4): w544 — Health Affairs:

“Billing and insurance–related functions have been reported to consume 14 percent of medical group revenue, but little is known about the costs associated with performing specific activities. We conducted semistructured interviews, observed work flows, analyzed department budgets, and surveyed clinicians to evaluate these activities at a large multispecialty medical group. We identified 0.67 nonclinical full-time-equivalent (FTE) staff working on billing and insurance functions per FTE physician. In addition, clinicians spent more than thirty-five minutes per day performing these tasks. The cost to medical groups, including clinicians’ time, was at least $85,276 per FTE physician (10 percent of revenue).”

What Does It Cost Physician Practices To Interact With Health Insurance Plans? — Casalino et al. 28 (4): w533 — Health Affairs: “Physicians have long expressed dissatisfaction with the time they and their staffs spend interacting with health plans. However, little information exists about the extent of these interactions. We conducted a national survey on this subject of physicians and practice administrators. Physicians reported spending three hours weekly interacting with plans; nursing and clerical staff spent much larger amounts of time. When time is converted to dollars, we estimate that the national time cost to practices of interactions with plans is at least $23 billion to $31 billion each year.”

Medicare’s ‘No’ on Virtual Colonoscopy Stirs Expert Debate – Forbes.com

Just a marker for when the topic comes up. basically Medicare, for the first time, has indicated that the evidence for virtual colonoscopy is not yet adequate to warrant reimbursement at this time. This will be reconsidered if new evidence accumulates.

It’s worth saying that this is how medicine should work, but it has become a favorite piece of evidence for Sen. Tom Coburn that the world of American Medical Paradise is coming to a totalitarian halt.

Researchers do studies to evaluate treatments, medications, etc., and when a significant amount of evidence accumulates, the treatment enters general use.

Sad part is, this works exceptionally well when procedures are involved because of the fee basis for physician reimbursement and the lopsided reimbursement that hospitals and surgery centers receive for procedures.

It doesn’t work so well getting new methods of medically managing patients out into standard practice. This is what Comparative Effectiveness Research should help. Finding out wht works and what doesn’t and developing new standards and ways for physicians to implement them to the bedside or office.

What do other countries do? – Kansas City Star

What do other countries do? – Kansas City Star:

“In Britain, famously, they wait.

“To replace a hip, for instance, means months before surgery.

“Spaniards and Italians have single-payer health care systems, but they leave it to the cities and villages, not the capitals, to run things. The Greeks demand all medical bills be covered by universal insurance, but let doctors hit up patients for more.

“The Swiss are required to buy health insurance, and virtually all do.
Health care systems around the world vary like cuisine, reflecting customs and history. Some ingredients travel better than others.”

Bravo to writer Scott Canon of the KC Star for doing a piece on international health care systems.

I quibble with some of it, particularly the first line, and wrote Canon about it:

Thanks, Mr. Canon for your piece “A Universal Pain”, which appeared in my Pittsburgh Post-Gazette today. This kind of reporting is in very short supply and should be front and center in our ongoing discussions on health care, not relegated to the disparaging remarks hurled at Canada by conservatives.

But, I am curious about where you got some of your information. Some seems more up to date than mine, and some less so.

The most glaring one is in the first paragraph regarding waiting times in the UK. Here is more recent news:
http://cmhmd.blogspot.com/2009/05/exclusive-nhs-hospital-waiting-times.html

Further, there are countries with universal health care unlike us, but without significant waiting times, and with better quality outcomes than our own (and I know you praised Germany’s system, which is my favorite model):
http://cmhmd.blogspot.com/2009/05/oecd-waiting-times-study-executive.html

A final point, although health care is pushing budgets to the brink internationally, it is very important to remind the public that increasing expenditure from 8 or 9 or 10% of GDP by one or two percent, compared to our 17 or 18 or 19% in our system is a big difference.