U.S. Pays $2.5 Trillion for Care Costing $912 Billion

[Joanne98]

July 28 (Bloomberg) -- The last time a president tried to overhaul U.S. health care, Americans were spending $912 billion on the system and 40 million were uninsured. Today they’re spending $2.5 trillion and almost 50 million lack coverage.

President Barack Obama’s effort to revamp the system faces resistance from lawmakers of both parties who warn that the more than $1 trillion cost of the plan will break the budget at a time when the government already faces record deficits.

“Despite what President Obama claims, the bill he is promoting today will make health care even more expensive,” House Minority Leader John Boehner said last week when the president visited Boehner’s home state of Ohio.

The experience of the 15 years since Bill Clinton failed to win passage of legislation suggests that the price of inaction may be even higher than the cost of Obama’s plan.

Congress refused to touch the issue for a decade after the collapse of Clinton’s 1994 bid. A similar outcome this year would likely add millions to the ranks of the uninsured, boost costs for businesses and workers, and do nothing about what may be the top threat to the government’s long-term fiscal health, proponents of the plan argue.

“The budgetary implications of doing nothing are continued exponential growth in health-care costs, a steadily increasing health-care share of GNP, an eventual bankruptcy of the Medicare trust fund, and health-care costs becoming a prohibitive share of the federal budget,” Lawrence Summers, head of the National Economic Council, said in an interview.

Soaring Costs

Health-insurance premiums for families have risen 119 percent since 1999, according to the Kaiser Family Foundation, a Menlo Park, California-based policy-research firm. Inflation has risen 28.5 percent over that period, according to the Labor Department.

Premium costs are projected to rise another 9 percent next year, an increase that 42 percent of employers plan to pass on to their workers, according to a report last month by PricewaterhouseCoopers. That’s likely to further squeeze millions of Americans who find themselves in high-deductible insurance plans as wages stagnate because of the recession.

Earnings per hour climbed by a 0.7 percent pace on average over the last three months, the Labor Department said earlier this month, the smallest gain since the agency began keeping records in 1964. Meanwhile, the share of insured workers with at least a $1,000 deductible has almost doubled since 2006 to 18 percent, according to Kaiser.

http://www.bloomberg.com/apps/news?pid=20601070&sid=ac_Ad5Car70M

[ihavenobias]

1. K & R. This is critical information.

I challenge anyone to read this and then argue that our health insurance system doesn't need some serious change.

[RUMMYisFROSTED]

2. Over how many years?

[Igel]

3. Of course.

Baby-boomers are older. My FIL, just ahead of the leading edge of the boomers, is a good example. He was working in '94, and healthy. By 2004 he had renal failure, by 2007 his diabetes was progressing nicely and they did all kinds of things to keep him alive. Seriously, they kept a regularly updated meds list to tell his various doctors--abdominal surgeon, orthopedic surgeon, endocrine specialist, neurologist, etc., etc., etc. Calciphylaxis finally did him in (there's an ailment you seldom hear about), but he was in a care center or hospital the last 6 months of his life, and in and out for several months before. With more people aged 68, you're going to have more cases like his.

Then there are things like the radioisotope they used in treating me. 15 years ago there were a half-dozen reactors producing it and the stuff was cheap (well, not real cheap, but it needed special handling and was very short-lived). Now there's one reactor producing it and it's a bidding war (one that could produce it is shut down, or at least was last summer).

Or there are things like the CAT scan I got. Routine now, yet expensive; in 1994 it would have been available, but while more expensive it was much more rare than these days. Without the CAT scan, the radiation therapy I got would have been nearly impossible, and in 1994 the type of therapy I got would, in any event, have been much more rare. The treatment would have been surgery, which even today would have cost a lot less than the CAT-scan/radiotherapy option.

Or take my SIL. She has breast and bone cancer, she's been through numerous cycles of chemotherapy in the last 5 years and has the breast cancer in remission and the bone cancer at a standstill. In 1994 the options would have left her dead by 1996. No matter, generics or fancy designer drugs, two years' treatment is cheaper than 5 years'.

I like using the earnings-per-hour numbers that include benefits. Not taxable income, perhaps, but nonetheless earned ... and with employers often increasing benefits at the expense of taxable income simply because US tax policy drives the behavior, it's a more accurate gauge, IMO.

[Festivito]

4. STRANGE BUT TRUE? Now we're with same numbers: .9T, 2.4T$

3K * 300M => 900B$
8K * 300M =>2400B$

$3000/year is about what countries pay per capita to insure everyone for everything, even tourists.

$8000/year is about what we, US, pay per capita, right now, last figure was 8160 and rising, and despite this being a per capita figure 40 to 50 million of our "capita" lack insurance -- also rising.

306 million is about how many Americans we currently have.

Oh, there is an update at the Bloomberg site:
""""
July 28 (Bloomberg) -- The last time a president tried to overhaul U.S. health care, Americans were spending $912 billion on the system and 40 million were uninsured. Today they’re spending $2.5 trillion and almost 50 million lack coverage.
""""

[JohnWxy]

5. recommended!