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Editorial: An unhealthy spiral

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Thursday, August 20, 2009

(Updated 3:00 am)

We may disagree about the best path to meaningful health care reform, but we shouldn't disagree about the critical need.

A report released on Tuesday has confirmed what many North Carolinians already knew: Health care costs in the state are growing so fast that worker pay hasn't even come close to keeping pace.

A report by two nonprofits, Families USA and Action for Children in North Carolina, reveals that, between the years 2000 and 2009, average health insurance premiums in the state grew by 96.8 percent, or five times the rate of median earnings, which rose by only 18.4 percent during the same period.

The trend dramatizes spiraling costs that are straining the budgets of both individuals and businesses.

The report notes that employers' average share of annual premiums for a family's health coverage grew by 79 percent between 2000 and 2009, from $4,687 to $8,714. The employer's portion for covering an individual grew by 76 percent, from $2,195 to $3,864.

The employee's share of the average annual premium for family coverage surged even higher during that span, from $1,782 to $4,370, a stunning 145.2 percent spike.

The two sources of the study have vested interests in health-related issues: Families USA in particular describes itself as "dedicated to the achievement of high-quality, affordable health care for all Americans."

But the numbers have no agenda. They simply point out, in stark and alarming terms, the spiral of health costs toward levels that neither business nor individuals will be able to bear. Is anyone listening?

The sound and fury of the health care debate has gotten so loud and so mean-spirited that the noise too often has drowned out the voices of reason on both sides.

This needs to be a serious and constructive conversation, not a name-calling contest.

This nation must get health care reform right or everybody loses, Democrats and Republicans.

Doing nothing should not be an option.

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jbcarper

August 20, 2009 - 8:49 am EDT

Why is doing nothing not an option? The presumption always seems to be that, when we have identified a problem, government has an obligation to find a fix. A reasoned evaluation of the issues should include the do nothing option along with costs and benefits.

Having personally experienced the significant climb in the costs of health insurance while pay stayed stagnant, I greatly appreciate the consequences associated with the spiral. What are the real numbers behind this spiral?

Some individuals proclaim that the health insurance industry profits are to blame. Looking at the 10-K reports from several companies, the return on equity hasn't improved significantly over the past decade. They have indeed gotten larger, but the returns don't appear to be keeping pace.

Others claim that it is the cost of illegal immigrants that are driving the costs up. While there are substantial numbers of these individuals, I don't believe the numbers add up. Medical care costs have risen a lot more than would be accounted for by illegals.

The medical profession complains that being a doctor "just isn't what it used to be". Doctor's don't make the same income relative to others that they historically have. Malpractice insurance, student loans, costs of covering non-insured individuals evidently eat up a lot of money.

Until we understand the truth behind what is driving these costs up, all options for changing the health care funding are suspect. You can't fix a problem if you can't define it. Right now we are operating under the concept that doing anything is better than doing nothing at all. I don't find that to be a rational approach to the issue.

As Sgt. Joe Friday used to say: 'Just the facts, Ma'm." Just give us the facts. Then let us all take a deep breath, relax a little, and discuss the issue rationally and without rancor.

Panacea

August 20, 2009 - 11:48 am EDT

Doing nothing is not an option. The numbers doubled in less than 10 years. In another ten years, do you really think the problems with affordable health care are going to fix themselves? That's naive.

I'm sure illegals have an impact on costs, but the factor is overrated. Much of the increase in health care costs is also coming from overpriced pharmaceutials, over use of expensive diagnostics such as CT and MRI, and unnecessary surgical procedures.

Specialists still make loads of money. It's the primary care cos who aren't making the income relative to others as you mention. So new docs are going into specialites, and fewer are going into primary care. We face a critical shortage of primary care docs.

The sources of increased costs are well known. It's the solution that is in debate. And we need a solution. Doing nothing is sticking our heads in the sand. Not a realistic option.

jbcarper

August 20, 2009 - 12:07 pm EDT

If we do nothing and the costs continue to sky rocket, then fewer and fewer people will be able to afford these high priced specialists. The 'rationing' of health care will be self-imposed when individual by individual decides they can't afford to be in the game any longer. You may not like this option, fair enough, but it is a viable, rational option.

If the cost spiral comes from overpriced pharmaceuticals, expensive diagnostics, and high priced specialists, what are you suggesting be done to reduce those prices? If you mandate that each person work for less, then you are advocating a form of indentured servitude. There are some ways to reduce pharmaceutical costs: reduce or eliminate patent protections. Free enterprise is dependent on easy of entry and common knowledge of process. If we want cheaper medical goods and services, increase the supply.

Break the strangle hold that the AMA has on deciding who can practice medicine. Most routine medical treatments do no require a M.D.. Allow nurses to run their own health care offices offering treatment for colds, runny noses, cuts and bruises. Why isn't an experience nurse able to handle these on his/her own without having a doctor as overhead.

There are lots of things that can be done without having government taking ownership of the process.

Illiterati

August 20, 2009 - 9:27 am EDT

Maybe I'm misreading this, but those are rising numbers for health insurance, not health care itself. Employers are putting more of the cost burden on their employees, as the numbers show, but they aren't being vilified the way insurance companies are.

I pay cash for basic medical care. You'd be surprised how affordable basic visits can be. My doctor's cash rates haven't increased over the years by the percentages stated in this report. So what is it? Is it health care or health insurance that has become unaffordable? How many people even know what a basic checkup would cost out of pocket? Maybe people would stop using their insurance for every little sniffle if they knew how it was driving up their costs, much like we handle our car insurance. Consumer education in this regard might save us all a lot of money.

Doing nothing is indeed sometimes the best option. It gives us time to study the real issues surrounding a problem before making hasty decisions that might hurt us even more in the long run.

Panacea

August 20, 2009 - 11:57 am EDT

I paid cash for health care for a while. Only, I needed the care--I couldn't put it off. It put me into terrible debt.

Both health care and health insurance are unaffordable. If you have a chronic illness like heart disease or diabetes you need regular follow up care to maintain health and stay out of the hospital.

Your comment re not going to the doctor for every sniffle only applies to those who do not have chronic health problems. Chronic health problems are expensive to treat. People's bodies are not like cars--you can't get a new one when the old wears out. You have to maintain it, and the cost of that maintenance is too high for some, inaccessible to others, or the knowledge of how to live a healthy lifestyle not available. Unfortunately, those who can't afford care put it off until they are so sick they HAVE to be in the hospital . . . and that is even MORE expensive.

Illiterati

August 20, 2009 - 12:21 pm EDT

I agree with you on those points, but not everyone has a chronic illness, and even for those of us who do—and I'm in that group—it's cheaper in the long run to not use insurance for relatively minor medical care. Insurance deals with the big stuff, I deal with the little stuff.

While it's true that people aren't quite like cars, our insurance coverage works much like car insurance. Last year, for instance, a stone cracked my windshield. The repair cost me $200 out of pocket. My deductible is $1000. However, I didn't file a claim, because if I had, my premium would likely have increased even though I hadn't met my deductible. Just filing a claim can increase your premium. Every time we use medical insurance for a bee sting or a cold or some other minor thing, we're jacking up future premiums for everyone.

There are ways to rethink and rework how we as consumers use and pay for medical care before we completely overhaul it and let the government make decisions for us. I hope we can get beyond the rhetoric and panic and instead slow down to consider all of our options. This is a sixth of our national economy. It's not something to be hasty about.

jbcarper

August 20, 2009 - 10:32 am EDT

so, how do we get doctors, dentists, pharmacies, and hospitals to post their prices? There is great resistance to making prices public because they adjust prices according to who is paying.

Illiterati

August 20, 2009 - 4:57 pm EDT

I've found it's a just a matter of asking my doctor how much he or she charges if I pay cash. Then I ask how much he would charge and get reimbursed from the insurance company. Haven't had any problem getting this info from my doctors. Of course, not every doctor is going to charge the same rates—it's a free market after all—nor will the doc charge the same rate for cash customers as insurance rates, because the docs don't have much say in the insurance rates. I've found that doctors are often quite open to negotiation when cash is in the offering since it saves them a lot of annoying paperwork and staffing time. It's simply about being a smart consumer, which is tough when it comes to emotional areas like health care.

Panacea

August 20, 2009 - 12:00 pm EDT

Consumers Union is right with you on that one. They've been advocating for public pricing for years.

The uninsured are generally charged more than the insured--because they pay cash, the providers hope to recoup coup costs from the underinsured, or poor reimbursement from private insurers, Medicaid,and Medicare.

Pharmaceutical prices are generally available, but vary widely according to region, cost to make, whether they are generic or still under patent, and popularity.

ePocrates is a free resource I use in part to look up drug costs for patients when a physician writes a prescription. Many expensive name brand drugs work no better than older generics but most people don't know this.

tonymo

August 20, 2009 - 12:22 pm EDT

And college tuition costs have risen how much during the same time? People are taking how long to pay off college loans? How many are defaulting on those loans?

Where is all the hysteria over the massive rise in those costs! Which is more important? We all have to make choices from early in our lives.

Yesterday I attended a health care seminar sponsored by the John Locke Society yesterday. The panel consisted of experts in many areas of healthcare. The numbers they provided did not match the numbers of the left leaning organizations mentioned above. They provided market based solutions to the problem similar to those being used by Safeway, and BB&T that have reduced, kept flat their healthcare costs!

They have proved that this can be done WITHOUT GOVERNMENT INVOLVEMENT! Just look at the latest example of government incompetence, the "Cash for Clunkers" program, where the program ran out of money because the bureaucrats underestimated the interest, then were unable to process the paperwork, and get payments to dealers because of the "unexpected" response. And that was a tiny $2-3 billion program, not a TRILLION, or more, dollar program.