The Cost of Doing Nothing on Health Care

[WhatsHisNuts]

The cost of doing nothing on health care

<!--subtitle--><!--byline-->By Reed Abelson

New York Times


<!--date-->Posted: 02/27/2010 06:06:40 PM PST
<!--secondary date-->Updated: 02/27/2010 07:33:22 PM PST

<script language="JavaScript"> var requestedWidth = 0; </script>
<script language="JavaScript"> if(requestedWidth > 0){ document.getElementById('articleViewerGroup').style.width = requestedWidth + "px"; document.getElementById('articleViewerGroup').style.margin = "0px 0px 10px 10px"; } </script>"Hands off my health care" goes one strain of populist sentiment.
But what if?
Suppose Congress and President Barack Obama fail to overhaul the system now, or just tinker around the edges, or start over, as the Republicans propose ? despite the Democrats' latest and possibly last big push that began last week at a marathon televised forum in Washington.
Then "my health care" stays the same, right?
Far from it, health policy analysts and economists of nearly every ideological persuasion agree. The unrelenting rise in medical costs is likely to wreak havoc within the system and beyond it, and pretty much everyone will be affected, directly or indirectly.
"People think if we do nothing, we will have what we have now," said Karen Davis, the president of the Commonwealth Fund, a nonprofit health care research group in New York. "In fact, what we will have is a substantial deterioration in what we have."
Nearly every mainstream analysis calls for medical costs to continue to climb over the next decade, outpacing the growth in the overall economy and certainly increasing faster than the average paycheck. Those higher costs will translate into higher premiums, which will mean fewer individuals and businesses will be able to afford insurance coverage. More of everyone's dollar will go to health care, and government programs like Medicare and Medicaid will struggle to find the money to operate.
Policymakers, in the end, may be forced to address the issue.
"It will break all of our banks if we do nothing," said Peter V. Lee, who oversees national health policy for the Pacific Business Group on Health, which represents employers that offer coverage to workers. "It is a course that is literally bankrupting the federal government and businesses and individuals across the country."
Even those families that enjoy generous insurance now are likely to see the cost of those benefits escalate. The typical price of family coverage now runs about $13,000 a year, but premiums are expected to nearly double, to $24,000, by 2020, according to the Commonwealth Fund.
While some employers will continue to contribute the lion's share of those premiums, there will be less money for employees in the form of raises or bonuses.
"It's also cramping our economic growth," said Frank McArdle, a consultant with Hewitt Associates, which advises large employers and reported on the need for change for the Business Roundtable, an association of CEOs at major companies. Spending so much on health care is "really a waste of people's money," McArdle said.
The higher premiums will also persuade more businesses, especially smaller ones, to decide not to offer insurance. More people who buy coverage on their own or are asked to pay a large share of premiums will find the price too high. It doesn't take too many 39 percent increases, like the recent one proposed by Anthem Blue Cross that has garnered so much attention, to put insurance out of reach.
While estimates vary, the number of people without insurance is expected to increase by more than a million a year, said Ron Pollack, the executive director of Families USA, a Washington consumer advocacy group that favors the Democrats' approach.
There will be a cost in lives, too. Pollack's organization estimates that as many as 275,000 people will die prematurely over the next 10 years because they do not have insurance.

 

[DOGS THAT BARK]

The cost of doing nothing on health care

<!--subtitle--><!--byline-->By Reed Abelson

New York Times


<!--date-->Posted: 02/27/2010 06:06:40 PM PST
<!--secondary date-->Updated: 02/27/2010 07:33:22 PM PST

<SCRIPT language=JavaScript> var requestedWidth = 0; </SCRIPT>
<SCRIPT language=JavaScript> if(requestedWidth > 0){ document.getElementById('articleViewerGroup').style.width = requestedWidth + "px"; document.getElementById('articleViewerGroup').style.margin = "0px 0px 10px 10px"; } </SCRIPT>"Hands off my health care" goes one strain of populist sentiment.
But what if?
Suppose Congress and President Barack Obama fail to overhaul the system now, or just tinker around the edges, or start over, as the Republicans propose ? despite the Democrats' latest and possibly last big push that began last week at a marathon televised forum in Washington.
Then "my health care" stays the same, right?
Far from it, health policy analysts and economists of nearly every ideological persuasion agree. The unrelenting rise in medical costs is likely to wreak havoc within the system and beyond it, and pretty much everyone will be affected, directly or indirectly.
"People think if we do nothing, we will have what we have now," said Karen Davis, the president of the Commonwealth Fund, a nonprofit health care research group in New York. "In fact, what we will have is a substantial deterioration in what we have."
Nearly every mainstream analysis calls for medical costs to continue to climb over the next decade, outpacing the growth in the overall economy and certainly increasing faster than the average paycheck. Those higher costs will translate into higher premiums, which will mean fewer individuals and businesses will be able to afford insurance coverage. More of everyone's dollar will go to health care, and government programs like Medicare and Medicaid will struggle to find the money to operate.
Policymakers, in the end, may be forced to address the issue.
"It will break all of our banks if we do nothing," said Peter V. Lee, who oversees national health policy for the Pacific Business Group on Health, which represents employers that offer coverage to workers. "It is a course that is literally bankrupting the federal government and businesses and individuals across the country."
Even those families that enjoy generous insurance now are likely to see the cost of those benefits escalate. The typical price of family coverage now runs about $13,000 a year, but premiums are expected to nearly double, to $24,000, by 2020, according to the Commonwealth Fund.
While some employers will continue to contribute the lion's share of those premiums, there will be less money for employees in the form of raises or bonuses.
"It's also cramping our economic growth," said Frank McArdle, a consultant with Hewitt Associates, which advises large employers and reported on the need for change for the Business Roundtable, an association of CEOs at major companies. Spending so much on health care is "really a waste of people's money," McArdle said.
The higher premiums will also persuade more businesses, especially smaller ones, to decide not to offer insurance. More people who buy coverage on their own or are asked to pay a large share of premiums will find the price too high. It doesn't take too many 39 percent increases, like the recent one proposed by Anthem Blue Cross that has garnered so much attention, to put insurance out of reach.
While estimates vary, the number of people without insurance is expected to increase by more than a million a year, said Ron Pollack, the executive director of Families USA, a Washington consumer advocacy group that favors the Democrats' approach.
There will be a cost in lives, too. Pollack's organization estimates that as many as 275,000 people will die prematurely over the next 10 years because they do not have insurance.

Hmmm I thought this guy might have some facts on--

"This bill does not control costs (or) reduce deficits. Instead, (it) adds a new health care entitlement when we have no idea how to pay for the entitlements we already have."

? "The bill has 10 years of tax increases, about half a trillion dollars, with 10 years of Medicare cuts, about half a trillion dollars, to pay for six years of spending. The true 10-year cost (is) $2.3 trillion."

? "The bill takes $52 billion in higher Social Security tax revenues and counts them as offsets. But that's really reserved for Social Security. So either we're double-counting them or we don't intend on paying those Social Security benefits."

? "The bill takes $72 billion from the CLASS Act (long-term care insurance) benefit premiums and claims them as offsets."

? "The bill treats Medicare like a piggy bank, (raiding) half a trillion dollars not to shore up Medicare solvency, but to spend on this new government program."

? "The chief actuary of Medicare (says) as much as 20% of Medicare providers will either go out of business or have to stop seeing Medicare beneficiaries."

? "Millions of seniors who have chosen Medicare Advantage (Medicare through a private insurer) will lose the coverage that they now enjoy."

but I see his article is supported mostly by opinion--again.

I do see he did bring one stat--the 39% increase in on the left coast--and makes it appear to be the rule rather than exception-- I've had 4 groups renew so far in 2010 and largest increase so far was 12% and smallest 3%.

 

[WhatsHisNuts]

That's right Wayne, continue your campaign to do nothing! That's what the guy is talking about.

 

[hedgehog]

I just got a memo from my employer, our health care costs have skyrocketed over last year, its that time for renewal. beginning march 15 my cost is going way up, at least its before taxes are taken out.:sadwave: Its still better than Obamacare. :shrug:

 

[Trampled Underfoot]

I just got a memo from my employer, our health care costs have skyrocketed over last year, its that time for renewal. beginning march 15 my cost is going way up, at least its before taxes are taken out.:sadwave: Its still better than Obamacare. :shrug:

I bet you don't even have a clue what Obamacare is.

 

[WhatsHisNuts]

I just got a memo from my employer, our health care costs have skyrocketed over last year, its that time for renewal. beginning march 15 my cost is going way up, at least its before taxes are taken out.:sadwave: Its still better than Obamacare. :shrug:

You base that on what? The current system is pounding you in the ass and you are willing to keep on keepin' on.

 

[bleedingpurple]

You base that on what? The current system is pounding you in the ass and you are willing to keep on keepin' on.

I think some of the righties like the ass pounding..Like to blame it all on Obama. This thing should of been nipped long ago

 

[WhatsHisNuts]

I think some of the righties like the ass pounding..Like to blame it all on Obama. This thing should of been nipped long ago

They'd rather take a bath financially than show any support for a black man. It is sickening and sad.

 

[WhatsHisNuts]

If Obama lowered the tax rates, attacked Iran, and pandered (more) to big companies, Raymond, Hedge, Wayne, and Skully would be pissing and moaning. Comical.

 

[bleedingpurple]

I just got a memo from my employer, our health care costs have skyrocketed over last year, its that time for renewal. beginning march 15 my cost is going way up, at least its before taxes are taken out.:sadwave: Its still better than Obamacare. :shrug:

You can bitch about health care, the cost, and Obamacare all you want, but you are part of the problem.. You are admittingly overweight, stressed out with high blood pressure.. Instead of exercising and eating properly you have admittingly adhered to bad eating habits with little exercise.. And to top it off you stress yourself out posting in on - line political forums. People who do not adhere to stay in shape should get no health care. I think you would like that... You say no job .. No welfare. I say no treadmill.. No healthcare.. What do you think of that??

 

[Trampled Underfoot]

You say no job .. No welfare. I say no treadmill.. No healthcare.. What do you think of that??

No more cupcakes for you!

 

[MadJack]

Buffett: America Desperately Needs to Change Healthcare If It Wants to Be Economically Competitive

<CITE>Posted Mar 01, 2010 11:11am EST by Vincent Fernando in Investing, Healthcare Information, Newsmakers, Recession</CITE> Related: BRK-B, AET, JNJ, WLP, UNH, IXJ, PFE

From The Business Insider, March 1, 2010:
Warren Buffett explains how America has to change its health care system and fast. He doesn't agree with everything the Obama administration is doing. For one thing, he believes it hasn't been focused enough on attacking costs. Yet the current system is a disaster according to Mr. Buffett.
But he points out how under the current system, America has less doctors per thousand people, less nurses per thousand people, and less hospital beds per thousand people. Yet the U.S. pays far more on health care, as a percent of GDP, than all other countries. This makes the nation horribly uncompetitive.
0:50 -- "If I were President Obama, I would just show this chart of what is happening, and say this is the tape worm that is eating at American competitiveness and one way or another we're going to attack costs, costs, costs."
5:00 -- "If the only choice I had in the world was the present system or the present bill, I would take the bill, but I think that it would be far better to see that costs is it and we're gonna go back, and we're not going to come back until we can show how to bring down the 16 and a quarter [~17% of GDP] down." [Paraphrased:] 'You're not going to sell automobiles or airplanes when you have these costs. You're not going to be competitive worldwide.'
9:15 -- "insurance isn't the problem, the problem is at the point of care" ... "That isn't the reason that GDP is at 17% of GDP." ... "The reason is that we're doing an awful lot of things we don't need to do... we have payment for procedures and not payments for results"
It's an interesting discussion which basically shows how both polarized sides of the current healthcare debate are wrong.
More coverage from The Business Insiderhttp://www.businessinsider.com/bill...ll-of-warren-buffetts-investor-letters-2010-3:

• Bill Ackman's first piece of investment advice: Read all of Buffett's investor letters
• 12 huge bets hedge funds are making now

Click here for the video of Buffett on health care.

 

[DOGS THAT BARK]

That's right Wayne, continue your campaign to do nothing! That's what the guy is talking about.

Not campaining on doing nothing Gary--I'll back any method they have on cutting cost healthcare cost as long as it doesn't involve spending more--

--I have a hard time listening to all all the liberal opinions/conjectures when I see the facts of where they have led before--

http://www.forbes.com/2010/02/25/democratic-states-bad-financial-shape-personal-finance-blue.html


Political Litmus Test: Bluest States Spilling The Most Red Ink

---The five states in the worst financial condition--Illinois, New York, Connecticut, California and New Jersey--are all among the bluest of blue states.---

--so we see without a doubt who the falures are--what about histoty of success-
Hoosiers and Health Savings Accounts

An Indiana experiment that is reducing costs for the state and its employees

By MITCH DANIELS

As Washington prepares to revisit the subject of health-care reform, perhaps some fresh experience from Middle America would be of value.
When I was elected governor of Indiana five years ago, I asked that a consumer-directed health insurance option, or Health Savings Account (HSA), be added to the conventional plans then available to state employees. I thought this additional choice might work well for at least a few of my co-workers, and in the first year some 4% of us signed up for it.
In Indiana's HSA, the state deposits $2,750 per year into an account controlled by the employee, out of which he pays all his health bills. Indiana covers the premium for the plan. The intent is that participants will become more cost-conscious and careful about overpayment or overutilization.
Unused funds in the account?to date some $30 million or about $2,000 per employee and growing fast?are the worker's permanent property. For the very small number of employees (about 6% last year) who use their entire account balance, the state shares further health costs up to an out-of-pocket maximum of $8,000, after which the employee is completely protected.
The HSA option has proven highly popular. This year, over 70% of our 30,000 Indiana state workers chose it, by far the highest in public-sector America. Due to the rejection of these plans by government unions, the average use of HSAs in the public sector across the country is just 2%.
What we, and independent health-care experts at Mercer Consulting, have found is that individually owned and directed health-care coverage has a startlingly positive effect on costs for both employees and the state. What follows is a summary of our experience:
State employees enrolled in the consumer-driven plan will save more than $8 million in 2010 compared to their coworkers in the old-fashioned preferred provider organization (PPO) alternative. In the second straight year in which we've been forced to skip salary increases, workers switching to the HSA are adding thousands of dollars to their take-home pay. (Even if an employee had health issues and incurred the maximum out-of-pocket expenses, he would still be hundreds of dollars ahead.) HSA customers seem highly satisfied; only 3% have opted to switch back to the PPO.
The state is saving, too. In a time of severe budgetary stress, Indiana will save at least $20 million in 2010 because of our high HSA enrollment. Mercer calculates the state's total costs are being reduced by 11% solely due to the HSA option.
Most important, we are seeing significant changes in behavior, and consequently lower total costs. In 2009, for example, state workers with the HSA visited emergency rooms and physicians 67% less frequently than co-workers with traditional health care. They were much more likely to use generic drugs than those enrolled in the conventional plan, resulting in an average lower cost per prescription of $18. They were admitted to hospitals less than half as frequently as their colleagues. Differences in health status between the groups account for part of this disparity, but consumer decision-making is, we've found, also a major factor.
Overall, participants in our new plan ran up only $65 in cost for every $100 incurred by their associates under the old coverage. Are HSA participants denying themselves needed care in order to save money? The answer, as far as the state of Indiana and Mercer Consulting can find, is no. There is no evidence HSA members are more likely to defer needed care or common-sense preventive measures such as routine physicals or mammograms.
It turns out that, when someone is spending his own money alone for routine expenses, he is far more likely to ask the questions he would ask if purchasing any other good or service: "Is there a generic version of that drug?" "Didn't I take that same test just recently?" "Where can I get the colonoscopy at the best price?"
By contrast, the prevalent model of health plans in this country in effect signals individuals they can buy health care on someone else's credit card. A fast-food meal costs most Americans more out of pocket than a visit to the doctor. What seems free will always be overconsumed, compared to the choices a normal consumer would make. Hence our plan's immense savings.
The Indiana experience confirms what common sense already tells us: A system built on "cost-plus" reimbursement (i.e., the more a physician does, the more he or she gets paid) coupled with "free" to the purchaser consumption, is a machine perfectly designed to overconsume and overspend. It will never be controlled by top-down balloon-squeezing by insurance companies or the government. There will be no meaningful cost control until we are all cost controllers in our own right.
Americans can make sound, thrifty decisions about their own health. If national policy trusted and encouraged them to do so, our skyrocketing health-care costs would decelerate.
Mr. Daniels, a Republican, is governor of Indiana.
+++++++++++++++++++++++++++++

Jack Its interesting how we get 2 entirely diff reviews from same speach

from NPR
http://www.npr.org/blogs/thetwo-way/2010/03/warren_buffet_health_care_bill.html

<SCRIPT type=text/javascript>var am_pm = 'AM';var am_pm_lower = am_pm.toLowerCase();document.write(' ' + am_pm_lower);</SCRIPT>By Frank James

Warren Buffet, the oracle of Omaha, suggested President Barack Obama and his fellow Democrats go back to the drawing board on health-care overhaul legislation and work with Republicans to come up with new legislation that deals with the "cost, cost, cost," that he calls a "tapeworm eating at American competitiveness."
In comments made during a lengthy CNBC appearance Monday where he talked about the economy and financial markets, he criticized the Democratic legislation as not doing enough to slow the cost increases that are making health care an ever larger share of the U.S. economy and making American companies less competitive globally.
While he didn't say the Democrats should "scrap" the bill in response to a question to that effect from interviewer Becky Quick, he clearly suggested as much.
Buffet's comments are likely to draw wide notice since Obama was fond of dropping the mega-billionaire's name as one of his informal advisers earlier in his presidency. Buffet's position certainly doesn't help the president as he tries to push his plan through Congress in coming weeks.
Meanwhile, Republicans wasted little time seizing on Buffet's comments. House Minority Leader Rep. John Boehner's office posted the clip of Buffet on CNBC along with a transcript to its website and e-mailed it far and wide.
Here's the transcript:

WARREN BUFFETT: We have a health system that, in terms of cost, is really out of control, and if you take this line and you project what has been happening into the future, we will get less and less competitive. So, we need something else. Unfortunately, we came up with a bill that really doesn't attack the cost situation that much and we have to have a fundamental change. We have to have something that will end the constant increase in medical cost as a percentage of GDP.​

BECKY QUICK: Then, are you in favor of scrapping this and going back to start over?​

BUFFETT: I would be -- if I were President Obama, I would just show this chart of what's been happening and say this is the tape worm that's eating at American competitiveness, and I would say that one way or another, we're going to attack cost, cost, cost, just like they talk about jobs, jobs, jobs in the economy. It's cost, cost, cost in this side. That's a tough job. We're spending maybe $2.3 trillion on health care in the United States, and every one of those dollars is going to somebody and they're going to yell if that dollar becomes 90 cents or 80 cents. So, it takes -- but I would try to get a unified effort saying this is a national emergency to do something about this. We need the Republicans, we need the Democrats. We're going to cut off all the kinds of things like the 800,000 special people in Florida or the Cornhusker Kickback, as they called it, or the Louisiana Purchase and we're going to get rid of the nonsense. We're just going to focus on cost and we're not going to dream up 2,000 pages of other things. And I would say as President, I'm going to come back to you with something that's going to do something about this, because we have to do it.​

QUICK: Just focus on cost or focus on cost while insuring more people?​

BUFFETT: Well, yeah --​

QUICK: Is there two different problems?​

BUFFETT: Universality -- yeah, I believe in insuring more people, but I don't believe in insuring more people until you attack the cost aspect of this​