Many people are discouraged by what has happened since the Affordable Care Act was passed in 2010. Most don't know enough about what was going on in healthcare prior to that to really have fact based opinions. What we all know is that change is needed, but how do we get there?
How do we fix the ever failing healthcare system in this country?
If you look up stats on other countries healthcare systems you'll see a disturbing trend. The US uses more care, but is sicker, dies earlier, and have more diseases and medications than all other developed nations. We even have the Highest Infant Mortality Rate in all OECD countries. With all of the advancements we have made, how can we justify the increased expense of care? How can we justify that no cure for any disease has been found since the Polio Vaccine? Why are we settling for more drugs and less car?
There is a serious growing concern in this era of rising deductibles, co-payments and Co-insurances, especially as those costs don't seem to offset the raise in Premiums the Insurance companies are charging as well. The Health Care and education Reconciliation Act from 2010 that lead to the Affordable Care Act (Obamacare) was supposed to make health insurance more affordable for all, But what it did was create more loopholes to increase premiums and cause more payments for care to be made by insured than by the insurance company.
The general history of what has occurred is that the overall rate of uninsured went from 14% to 8.6% as a country. Costs of Premiums went from an average of $12,680/year to $18,142/year. This rise in cost is said to be 11% less than the cost increase from 2006-2011, and 43% less than the cost jump in premiums from 2001-2006. High deductible plans ($2500/person insured in a family plan) have become the gold standard, But that's with the increased premium, so what is the insurance company paying for exactly? Unless you have a surgery or two, you likely won't hit the deductible. Even if you do, the out of pocket maximums have jumped from an average of $6,000 to $12,500.
So what happened in the decade before the Affordable Care Act? Total jump in premiums was 131%, even though inflation was only at 28%.
What does this mean? If you look at the rising cost of healthcare, the first place that we should be looking is the payroll for the C-Suite executives at the healthcare Insurance companies. In 2013, there was such a windfall for CEOs that they saw an additional $125 million in bonus's paid to them. Just incase your unsure what that means, 11 CEO's maid $125million extra, above there $11-$17million salaries for that year. That Nearly Doubled the Salary for EACH CEO of the 11 Major Insurance Companies. Why is there a need to pay anyone that much money to stop covering the basics and charge the public more? If you're looking in Colorado here are some figurative stats. At $11million, that CEO brings home about $366,000 per month after taxes are taken out at 40%. As you can see by the Data provided below from the Colorado Census for Wages by Occupation, The CEO makes more in a month than most providers actually giving care in Colorado in a year.
|Type of Provider||AVG. Monthly Take Home||Avg. Yearly Salary|
Why should the pay for non-medical business managers be so much higher than those of the providers who are scraping by to see you, care for you and get you at least somewhat better? I think we can all agree that the rise in Medication first, address the problem later may be driven by this startling trend.
Another thing we might consider is looking at programs run in other countries like Germany, Austria, New Zealand where the actual consumer (patients) are involved every step of the way. In those countries, the consumer can call, talk to an office representative and get and estimate of costs that are actually fairly accurate. They can compare those costs to a quote from another provider and make a best choice as to how much they want to pay for services. They pay upfront for the care they receive to the provider. Then, at then end of the month or the quarter, they gather all of their healthcare receipts and take them to the national system and the national system then process them and deposits, directly to their bank account, the money due back to them. Imagine the possibilities of actually having doctors compete for your business. They would need to price things so that they can sustain their business and lifestyle appropriate to fit the needs and costs of education; however, they would be able to tell you exactly what costs would be with no surprises later. They would have to prove why they are the best person to earn your business.
This model could cause the insurance companies to actually need to lower premiums and deductibles for the fact that if you have the option and are more aware of how to be a true consumer of healthcare, you could form a reasonable argument as to why your premiums should not go up and why they may actually need to go down.
Let us know if you'd like more information on the truth about what your Insurance company does for you versus what you can do for yourself as a consumer of healthcare.