Health Care Spending

Health care is an area of demanding and controversial health care programs, insurance and spending.  

Medicaid and Medicare are government run programs that account for a large portion of health care cost.

Insurance overall is a funny business – there is insurance for almost anything including pets, fire, medical, vehicle, and others. Insurance has become so essential that many either overspend for insurance or work in terrible jobs, just to get insurance.

But then there is the large portion of individuals, for whatever reason, are unable to get insurance at all.

Private insurance is even more difficult to understand. These programs are allowed by employers or private individuals and vary from company to company and policy to policy. It is believed that over the last 7-10 years, employee-sponsored health insurance premiums have increase over 100%. This is almost 5 times the amount of inflation over the same period of time.

This is markedly more difficult for individuals and employers. Less and less companies are able to afford these important programs. And this will continue to get worse and worse.

It is believed that by 2020 or so – it will cost a family of 4 more than $25,000 per year to cover health insurance. Currently it is almost $13,000 per year for health care.

Cost for employers will continue to rise as well. Currently the cost to employers for insurance is just over $300 billion dollars. Within 10 years that number may jump to the mid $800 billion dollar range.

Don’t be fooled either – the coverage will not improve as time continues. Increasing costs, number of sick, and rising average age will continue to worsen the actual coverage by each individual.

Increasing Health Concerns

1.) Health Care Spending

- United States is leading all countries in the percent of GDP that is spent on Health Care.

- United States currently spends 16.2% as of 2007 and was around 15% in 2006

- Switzerland and France follow at around 11%

- Other countries above 10% are: Canada, Belgium, Germany, Portugal and Austria

- most of these values are from 2006

2.) Cost

- as the cost per person rises – the burden increases for employers and individuals to get enough coverage and the correct coverage

- $2.2 trillion dollars were spent in the United States in 2007 on health care costs

- $700 billion in 1990

- $250 billion in 1980

3.) Bankruptcy and Foreclosures

- Over 50% of bankruptcy are linked to lingering health or medical expenses

- 1.3 plus million people loose their homes because they also have medical expenses that can’t be meet

- Many families with the above mentioned health care costs do have insurance – over 75% on average

4.) Aging

- It is believed in the United States that by 2030 the number of individuals over the age 65 will double

- Over 70 million Americans will be over 65 at that point

- This will comprise around 20% of the population

- The cost of an older individual is 5 times greater for someone over 65 than under 65 [on average]

- The overall projected spending is believed to increase by 25%

“The aging of the U.S. population is one of the major public health challenges we face in the 21st century. One of CDC’s highest priorities as the nation’s protection agency is to increase the number of older adults who liver longer, high-quality, productive, and independent lives.” Julie Louise Gerberding, Md, Director, Centers for Disease Control and Prevention – 2007

5.) Smoking, Poor diet, and physical inactivity

- It is believed that these 3 items result in 35-35% of deaths each year

- These are preventable conditions

- Are quite costly to individuals, companies, governments, and tax payers

- Are risk factors for serious medical conditions of: Diabetes, Stroke, Cancers, and Heart Disease among others

6.) The Uninsured

- Some do not qualify for government-provided health insurance

- Some do not qualify for private health insurance

- Not provided insurance by employer

- Some are unable to afford health insurance

- Some choose not to have health insurance

- As of 2007 – 15% of population or 45 million individuals were without health insurance

- 2008 numbers are expected to be statistically similar to 2007 despite the recession, but a rise to 46 million is anticipated

According to the US Census Bureau, in 2007:

Of the 45 million uninsured:

. 37 million between ages 18 and 65
. 27 million worked at least part time
. 38% had household income of greater than $50,000
. 36 million are legal U.S. Citizens
. 10 million are non-citizens (This may or may not include illegal immigrants)
. 20% could afford insurance
. 25% are eligible for public coverage
. 55% need financial assistance to cover health insurance

7.) Fraud

- It occurs daily and helps “almost” no one

- Occurs on many levels and by many individuals

- Health Care is often about profit

- The most visible areas are Medicaid and Medicaid

- However, fraud occurs in all health care areas

- It is believed to occur on 5-10% of all health care expenditures

- Your increased health cost is, at least in part, to health care fraud

8.) Disparities

Defined by the Health Resources and Services Administration as …”population-specific differences in the presence of disease, health outcomes, or access to health care.“

Goldberg, J., Hayes, W., and Huntly, J. “Understanding Health Disparities.” Health Policy Institute of Ohio (Nov 2004) page 3

- Medicare and Medicaid spending is often quite different from state to state

- Sometimes the spending amount is double in one state when compared to another
. Example [Medicare in Miami in 2006 - $16,351 and in San Francisco $8,331]

- Access to health care and insurance is often a cause point, but not always

- The cost for such disparities may directly impact social and economic status

- Race, ethnicity, socioeconomic, sex, age, medical conditions, sexual orientation, and more are all linked to disparity

All is not loss

We are doing several things well – probably not perfectly but well

1.) Improved overall medical quality and treatment allow for a larger number of patients to live longer

2.) Improved Mammogram screening

3.) Improved Cholesterol screening

4.) Overall awareness for preventative care increasing, it still must increase in importance to not only improve care, quality of life, and overall balance health care costs.

5.) Disparities have begun to be looked at more closely and continue monitoring and goal setting to manage specifically targeted areas have been put in place.

Post originally seen at InterActive Health: Health Care Spending

For further information take a look at the following

- http://www.nchc.org/facts/cost.shtml

- http://www.cdc.gov/aging/pdf/saha_exec_summary_2007.pdf

- http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5813a5.htm

- Goldberg, J., Hayes, W., and Huntly, J. “Understanding Health Disparities.” Health Policy Institute of Ohio (Nov 2004) page 3

- Centers for Disease Control and Prevention and The Merck Company Foundation. The State of Aging and Health in America 2007. Whitehouse Station, NJ: The Merck Company Foundation; 2007.

Is Medicaid really that important?

Medicaid began in 1965 under the Social Security ACT under Title XIX

Harry Truman initiated the idea of a national health insurance plan in 1945. Many worried about a “socialized health care” transformation and it wasn’t until 1965 that President Lyndon Johnson signed this plan into law. – Medicaid was initiated along with Medicare.

The purpose initially was to help families who would be classified as “low income“. These families would get help with their health care. the plan would typically cover hospital visits, doctor’s visits, medications , prenatal care, and other necessary treatments.

Other possible eligeble individuals that could qualify would include: foster children, adopted children, certain protected individuals, disabled individuals, and other pregnant or underage children.

Children who are U.S citizens are eligible even if the parents are not.

Medicaid is the largest resource of federal money that is spent on HIV/AIDS. Qualification to this program depends on T-cell count of less than 200 before qualification is often granted.

The area that is quickly becoming oversaturated with medicaid needs deals with nursing home residents. As the shift continues towards a larger portion of individuals who require this type of care, an increased strain will be seen on this program

The individuals applying for this program may have a small amount of insurance, however the insurance does not adequately cover the family or more commonly, no medical insurance at all.

This is a very expensive program and is often the second most funded program in each state behind education. It is believed that each states spends between 15% and 22% of their budget on medicaid alone.

Medicaid is funded by a joint governing body of federal and state programs.

The United States appears to have always placed some importance in the health care of the lower income status. It is administered by each states and guidelines may be subjective from each state.

Some 50+ million people take advantage of this program with some $200 billion or more spent on it annually.

Participation on a state level is strictly voluntary, but all states have been a party to this program since 1982

*** The concerning aspect of this program is that up to 60% of those who have fallen below the poverty line will not qualify for medicaid.

The need for this program appears to be evident in the number of those who attempt to get qualified.

Certain individuals however, are not so sure that this program is being effective. The strictness or restrictiveness of this program is currently under fire. Many argue that those who really need the program are not the ones on the program. Standards for this programs are state sponsored but a basic framework has been in place.

Who benefits from Medicaid?

Often payment while on medicaid does not go to the individual themselves but rather to the provider that is seeing them. A co-pay in some states is often required. Additional payment for services is done by the government.

Medical providers themselves are paid on a much lower basis per person on medicaid than an individual on private insurance. So they, in essence, take a loss of income when seeing a medicaid patient.

Each states “Medicaid Report Card” is different, with many states failing the quality of care and several large disparities may be seen. Therefore, specific states are at risk while other states are consistently in the top performance for their category.

In our world today, insurance is practically required with expounding medical concerns and cost. This program affords a large amount of people who would otherwise be without medical insurance or without an option for medical treatment.

The burden without this program would be so overwhelming that emergency rooms and other doctor’s offices would be forced to treat patients with little or no hope of recuperating any money from their visits. And although this still occurs in many cases – adding another 50 million insurance-less patients would be overwhelming to say the least.

Therefore – Is medicaid a good program – the answer has to be yes…but it is far from perfect.

As a result — health care reform may be better suited to improve the current program of medicaid then change the system and require an additional 50 years of pitfalls and problems that will most likely be seen with any new program.

This blog was originally posted at InterActive Health

Obama’s updated health care reform – where are we going??

Where is health care going??

A deadline of August for a Congressional decision to discuss the future of our health care appears to be in place. But increasing amounts of pressure has been placed on Congress and it is unknown what will be in the forecast.

Cost may be at the forefront. It has been estimated that “Covering 50 million uninsured Americans could cost as much as $1.5 trillion over a decade.” citation from “Obama team plans more active role on health”

Obama is attempting to allow Congress to progress at its own pace – which is slower than his initial anticipation and expectation.

Some beginning legislation is attempting to force employers to cover their employees or face a strict penalty. This would allow for coverage for every working employee. However, it is less known to what extent this would be applied.

Another option is an insurance plan that would be government sponsored. This would allow the public to choose between their current work provided health care or a government sponsored insurance plan. Those against this are private insurers who argue that they would be pushed aside and would soon be forced to shut their doors.

Obama stated in a radio and Internet address : “This issue, health care reform, is not a luxury. It’s not something that I want to do because of campaign promises or politics. This is a necessity. This is something that has to be done.”

Another recent issue that congress is muling over currently is to ask some 164 million Americans who are currently covered by their employers to “give up at least part of the longstanding tax exemption granted to such compensation.

Some believe that this will primarily affect the wealthy who receive the largest tax break due to exclusion of their income.

A similar idea was passed around during the Regan administration back in 1984

What does this actually mean? Currently we are not taxed on our insurance. Or in other words, our yearly income is not higher because our insurance does not play into our income. We therefore receive a “tax break”. This may lead to a coverage provided by employees that leads to higher deductibles or co-pays and/or a overall coverage that is less extensive and complete.

Recently Republicans from the Finance Committee gave a warning to President Obama and they insisted that he was making a mistake by supporting a government sponsored insurance plan directed at the middle class. Their concerns are that the government would begin to control the insurance market and that other private companies would be pushed out. Many Democrats remain mixed with many who support the idea but remain cautious with the finer details.

Reformation ideas are ever changing with the current need for a health care reform.

It will be interesting to watch as political dust is thrown in the air and watch where it lands and who is affected.

Originally seen at Health blog

Check out the following stories:

Health insurance ‘haves’ to pay for ‘have-nots’?

“Obama team plans more active role on health”