The Long Slow Decline of Health Care

Earlier this month, a report was released "...suggesting that 30 percent of U.S. businesses will stop offering health care benefits to their employees after most of the provisions of the Affordable Care Act go into effect in 2014."   Worse yet, Wendell Potter photo above), author of the article about the report, former V.P corporate communications CIGNA, now whistle blower and consumer watchdog, predicts its eventual collapse. 

"When I began working in the insurance industry in 1989, the vast majority of Americans -- well over two-thirds of the population -- got their coverage through employers. Just about every year since then, the percentage has been declining."

Potter quotes a 2010 Gallup Poll reporting only 44.8% of American adults have insurance coverage through their employer.
 

My company's fiscal year insurance update was Thursday. We're taking a 19% increase in premiums for medical, 7% for dental,  with no improvement in coverage. Last year, we absorbed a 49% increase in medical and switch ed to a high deductible:  $3000  individual/$6000 family.  My Station Manager, in his mid-thirties, has two young children and is seriously contemplating not taking the insurance option this year because of the premiums.  His premiums and high deductible cost him more than his outlay for medical care.  Inotherwords, he's rolling the dice.

Our employer pays 50% of the premiums.  They contribute to our HSAs (healthcare savings accounts).  I know how lucky I am to have health insurance but I admit I took it for granted throughout my career.  I remember when health care was covered 100% by many employers in many categories of business.  

Fourteen years ago, my husband and I were self insured, living in California.  We had two small children, I'd taken a few years off, my husband had his own business.  At that time we had a $400 per month family premium with $750 deductible individual/$1500 family.  

The cost of health care has soared. The cost of medical care has gone up 136% since 1960 even when adjusted for inflation – from $8,100 in 1960 to $19,150 in 2010. Worse still, these numbers do not tell a complete story. Treating a sick child can be very expensive. High-tech medical advances have -while improving the quality of care – caused medical expenses to go through the roof. According a 2007 Congressional Budget Office report “about half of all growth in health care spending in the past several decades was associated with changes in medical care made possible by advances in technology.”  Skyrocketing Cost of Child Care: 1960 to Today

The other day I spoke with a close friend, also self-insured with a catastrophic policy.  She lives in Florida, is self employed.  She said when she receives treatment, she tells them she doesn't have insurance.  She has seen bills discounted by as much as two thirds!  She buys her prescriptions online from Canada.  What she pays for one month of Lipitor in the U.S. buys a 6 month prescription from Canada.

The Potter article concludes by commenting on the insurance industry's assault on small business,

"The reason more and more small employers are no longer offering coverage is because many of them have been "purged" by their insurance carriers. Insurers routinely "purge" employer customers they believe have become too much of a risk to profits. All it takes is one employee of a small business -- or the spouse or child of one employee -- to get critically ill for the company's insurer to jack up rates so high that the business owner has no choice but to drop coverage for everyone."

So, the insurance industry is having it both ways and our legislators do nothing.