In 2009, healthcare costs in the United States grew by 1.1% or the fastest rate since 1960 according to the New York Times (the whole article can be found here). To quote from the article:
A major factor in the growth of health spending was the increase in Medicaid enrollment and Medicaid spending as a result of rising unemployment. As people lost jobs, they lost private insurance, and many turned to Medicaid.
Wait a minute… Wait just a cotton-pickin’ minute… People lost their private insurance and had to switch to the government plan which forced costs to go up?!?! So, if the government provided a subsidy to these folks to keep their private insurance in a competitive market, than costs would have been lower. What a great idea. I wonder if anyone is recommending the competitive private sector as the best way to control costs.
Also, according to the LA Times, (the whole article can be found here):
…as early as next year, the country could mark another milestone as government picks up more than half of the nation’s total healthcare tab for the first time… Last year, CMS (Centers for Medicare and Medicaid Services) estimated that government spending on healthcare would not overtake private spending until 2016, compared with 2011 or 2012 in the current report.
Again, confirming that as the government increases its direct role in healthcare, costs rise faster than private sector options. Is this really surprising to anyone but the folks running our national government and the extreme left?
Lost in the debate is the fact that after 1 year in office, President Obama has still not nominated a Administrator for CMS. So while the government will shortly control 50% of healthcare expenses at a higher cost than private sector options there is no one in charge of the government program. Where’s Alexander Haig when you need him…
Charlie, as you know, if you are making the case that for-profit insurers spend less on “healthcare” than Medicare and Medicaid – that’s exactly what we are complaining about.
Private insurance companies deny coverage for pre-existing illness, cut people off from treatment with caps.
The “loss ratio”, fundamental to for-profit insurance, is how much of the premium they get to keep for profit vs how much has to be paid for actual medical services “healthcare”.
That business model is such that the less paid out for medical services, the better for shareholders and executive compensation. In some cases as much as 30% of premiums do not go to “healthcare”. Naturally healthcare spending goes up when more of the money is spent on healthcare.
The new health reform legislation seeks to limit that “loss ratio” to around 15%. Meaning for-profits have to translate 85% of our premium dollars into actual “healthcare” services. That means more treatment dollars available for sick people.
Private companies are also more inclined to come between doctor and patient in ways that benefit shareholders so less is spent on “healthcare”.
It’s not surprising sick people who switch over from “for-profit” to “for-patient” coverage like Medicare, tend to get more of what they need. We are talking about healthcare for sick people here, not just bean counting.
If you want to argue it’s cheaper to cut people off or deny coverage to sick people go ahead. But that’s the insurance company view of things, not the sick people’s view.
Premiums for small business doubled in the past ten years. Many of us want major reform of the system now, not ten years from now. Not another doubling of premiums, with nothing to show for it.
Hard to understand why otherwise good solid business minded folks like Charlie would still be clinging by their fingernails afraid to let go of this decaying status quo.
Seemingly more interested in the politics of this, than improving life for people in dire need of health services. Did you see the free clinics on TV? Lines and lines, droves of uninsured, underinsured, people denied, cut off, some not seeing a doctor in years. All lined up – like in Haiti – begging for help. They had one yesterday in Connecticut. Sad really sad.
We have before us a solid well argued piece of legislation that answers many of the problems. Points us in a new direction. Everything from buying across state lines, more clinics, ending denials and cut offs, giving small business individuals the power to buy as a group, taking pressure off emergency rooms.
Be against President Obama that’s fine, but don’t be against this health insurance reform.
In the business world there is a tool called a loss cost analysis. It is a report generated by your insurance carrier that itemizes what you pay, and what they pay out. No businessman would allow their carrier to double the premium without justification from the loss cost analysis. Bill, you love the Chicken Little sky is falling argument. If the insurance companies need 30% of premium for overhead and profit, the government will need twice that. Insurance companies are spending much of that money negotiating rates, pursuing fraud, and eliminating double and triple billings. In order for healthcare to be cost effective the people who utilize it need to have skin in the game. That’s why products like HSA’s are effective. You’re not going to get three opinions when it’s your money or fill a prescription you know you’re not going to use. No one wants anyone to be denied healthcare. We just don’t want another government boondoggle.
Anbupro, the Sky Is Falling when it comes to healthcare costs.
Can we agree we don’twant boondoggles – private or government? AIG American International Group is a huge private insurer. They just experienced the mother of all boondoggles.
Private sector does not equal no-boondoggle. Ask GM. Ask DuPont. The health insurance system we have now is a boondoggle.
I’m from the business world too. I don’t not recall any loss cost analysis accompanying the rate hikes. Not sure what business or what insurance company you are talking about.
The studies say Medicare runs way lower admin costs than for- profit. Health Savings Accounts are for people who can afford health insurance – can afford to pay all the other bills, plus then save money for out of pocket medical stuff. That applies to just a small percentage. Does not help for uninsured, no help for small business. You should consider these reforms. Once you get past the Democrat part, it really is a decent start on turning things around for America.
Hey Bill:
According to the AMA, the federal government (aka Medicare) denies coverage at a higher rate than the private sector (See metric 12). So, the rest of your comment is a non sequitur. Just focus on the facts, please.
Hi Charlie,
AMA has issues with the squeeze Medicare puts on spending. Older folks who want more than what Medicare pays for have plenty of places to buy Cadillac coverage. I have Medicare and a supplemental policy. Medicare does not include maternity coverage. You say . .
“So, if the government provided a subsidy to these folks to keep their private insurance in a competitive market, than costs would have been lower. What a great idea. ”
We finally agree! Your observation is precisely the model contained in the reform. Aimed at letting individuals purchase across state lines at large group rates. Those who still can’t afford what the new national exchange has to offer, will get the kind of subsidy you mention. There is great hope this expansion of choice will take pressure off of medicaid. It is one of the objectives President Obama set out during his recent Q and A. How do we take pressure of the future Medicare Medicaid deficit? The reform is one of the ways.
People are listening to ideas from conservatives. Many are incorporated in the reform. I think the provision for additional funding for community clinics will help a lot too.
Bill, I don’t care if it was Idi Amin who proposed a plan that really worked, I’d support it. Don’t play that Democrat BS with me. There is no American who shouldn’t have health care. Pre-existing conditions can be resolved outside of private carriers. There is nothing that government can do better than the free market. The lines that you reference for free clinics will be the norm for everyone if government takes over health care. You’re arguing over a plan that no one has seen, and has been unilaterally negotiated behind closed doors. This clown in the WH continues to lie to both his supporters and detractors. The Cheshire cat VP is an embarassment to wherever he calls his home. And just to show you how open minded my spite for politicians is, George Bush allowed his Neocon chronies to lead him by the nose and assist this economic death spiral our country is in. This country could produce jobs much quicker if five hundred people in DC lost theirs.
Bill: You seem to have been reading Alice in Wonderland again. I have posted many times what the data shows works and what I support. Neither the Senate bill nor the House bill accomplishes those tasks (and you keep talking about the bill as if there were just one). So quit making stuff up. Just present some facts — ahhh… you don’t have any…
Let me interject that Health care is an issue the GOP should own. In 2008 our plan Delacare was lambasted by Bill Lee as ‘socialist’ despite the fact it used pooling, competitive bidding, choice and health care courts.
In the Mass Senate race, of the voters who thought health care was issue #1, Coakley won those voters by 10%.
To the extent the GOP ignore health care it will never be the majority party.
Obama’s plan was and is a failure but we can’t stop towards a better end.
Mike Protack
Jeffrey Anderson’s “Small Bill”‘ proposal–A one page health care bill:
http://www.weeklystandard.com/articles/small-bill
The AMA study does not justify your premise that Medicare is somehow less reliable. Medicare patient satisfaction is higher than private insurance by a wide margin:
If you focus only on the top line of the AMA study Metric 12, you are missing the truth. On purpose.
Private insurance companies deny people on the front end (pre-existing) and on the back end (recisison, caps). Medicare does neither. But the AMA study does not account for these denials.
The AMA study also counts each denied “claim line” as a denial. This does not account for the skew caused by Medicare claims containing many more individual claim lines.
I could go on but I know you aren’t interested.
Chances are likely that people receiving government health care that they don’t currently pay for are going to be pretty “happy.” And the “happier” they are, the less likely the costs will be reined in.
Anbupro. let it all hang out there buddy! Not sure what the Democrat BS means. I’m Republican. Not a neo CINO or RINO just a plain old Republican from the sixties. I liked Ike.
Why is everything so extreme these “There is nothing the Government can do better than the free market.” That’s not true. Where do you get that stuff? Why have it as a slogan? Any political movement built on a foundation of lies is bound to head nowhere.
Charlie, what’s with the Alice In Wonderland stuff? Next thing you know you’ll be insulting me. A link to actual bill passed by Senate December 24 2009 might help you get your bearings. This is the legislation currently under discussion.
http://dpc.senate.gov/dpcdoc-sen_health_care_bill.cfm
As far as facts, please give your readers your opinion on one the cornerstones of the Reform –
1. What do you think of the National Exchange proposal? Individuals, small business shop as a huge new group, across state lines, in a national exchange. Private insurers would compete for customers in the pool.
Chances are likely that people receiving government health care that they don’t currently pay for are going to be pretty “happy.”
Really? How much do you think retirees over 65 should pay for their health care?
Go tell a retiree their Medicare is welfare, and you will be finding out if your policy covers removal of a cane from your rear end.
People love medicare because it’s as close to a national streamlined ez-pass insurance system as you can get. Eventually the whole system will work like that. Less paperwork, red tape. More efficiency.
“Go tell a retiree their Medicare is welfare, and you will be finding out if your policy covers removal of a cane from your rear end.”
Looking for where I said it was welfare. Not finding it.
“1. What do you think of the National Exchange proposal? Individuals, small business shop as a huge new group, across state lines, in a national exchange. Private insurers would compete for customers in the pool.”
A national exchange defeats the purpose of buying across state lines.
Dave, how do you mean defeats the purpose of buying across state lines?
Comeon, Charlie — Tell us exactly what you would stand for and do in Congress. Tell me why, instead of staying home on election day, I should vote for you, because, I’m telling you, right now, I have no reason or intent to get out and vote for you (I just won’t vote for a scumbag democrat).
Charlie, what is your opinion on the National Exchange? Where small business and individuals can pool to purchase at group rates across state lines and pick from a variety of private insurance plan offerings?