Affordable Health Insurance: An American Oxymoron

More Red Tape & More Self-Insurance

Healthcare reform in America was enacted as the “Affordable Care Act”, but who’s kidding who?

There’s nothing affordable about American healthcare – and it’s about to get much worse.

That’s because our aging baby boomers are about to become senior boomers.

And that’s likely to accelerate medical spending that’s already growing at multiples of non-medical inflation.

Most experts expect current medical costs in America to roughly double over the next ten years or so.

Deteriorating Employer Health Insurance

Companies recognize they have no other expense item growing as rapidly. About half are expected to respond by dropping health coverage altogether on the premise that employees will have better self-insurance options under healthcare reform.(1)

Others will respond as they have to date. That’s by accelerating the shifting of employees’ health insurance costs to their employees.

This means employees and self-insured consumers will bear a disproportionate increase in their medical costs more likely to exceed three times their current out-of-pocket costs.

This will take the form of…

  • A greater share of health insurance premiums;

  • More out-of-pocket costs in co-pays and higher deductibles; and

  • Increasing use of co-insurance – where employees assume responsibility for a percentage of their exorbitant medical costs rather than a fixed deductible amount.

Health Insurance Costs Will be Driven by

“Senior Boomers” & Obesity

Expecting this cost-shifting on so many fronts to triple your family’s medical costs over the next decade is not overly aggressive – not when they already increased by 21/2 times over the past decade.

And that was without the senior boomer movement to drive medical spending even faster, as we’re now facing.

Even before the boomer generation reaches its retirement years, seniors over 65 account for over a third of our medical activity – and a good deal more of our medical spending. Imagine what that will look like as our senior ranks grow with the largest demographic in American history added to our senior rolls.

And with more of them on Medicare – and more on Medicaid under healthcare reform – the unpaid costs for these publicly-subsidized patients will be shifted to private payers. This means even faster increases in private insurance premiums.

And the overweight and obese may fare even worse. Obese patients cost, on average, 34% more for their healthcare than non-obese patients.

You do the math: the truth is the almost 40% of Americans who now qualify as obese can’t afford to stay obese in America.

Seriously, do the math: the average annual cost for a family health plan today for employed Americans reached $15,000 in 2010-2011.

And that doesn’t count employees’ out-of-pocket costs for co-pays, deductibles, and other direct medical spending.

By 2021, the insurance premiums alone will approximate $32,000 a year, but the total costs with out-of-pocket spending will be closer to $45,000 a year.

Add 34% to that and you’ve got a $60,000-a-year eating habit.

Forget losing weight for the beach or the high school reunion.

Almost half of Americans will need to lose weight to stave off medical bankruptcy!

Time to Rethink Your Health Insurance – and Your Healthcare

There’s no getting around it.

Washington has no answers for our medical spending crisis.

It’s busy shifting the chairs on the Titanic, but the ship’s stuck on the same course – iceberg and all.

The Democrats’ answer is unlikely to significantly alter our current spending trajectory, while the Republicans’ would make it even worse.

“Free-market” solutions are doomed to failure in a market as fundamentally corrupted as America’s healthcare system – as amply documented in Our Healthcare Sucks.

In fact, they’d make it worse by giving even freer rein to the cowboy medical culture that’s behind our medical spending excesses.

It’s no coincidence that the biggest-spending states for medical care in America are generally the least regulated – and the least healthy.

No, politics has no answers for this crisis – and neither does the medical profession itself.

It’s stood idly by watching the ranks of unethical physicians grow by leaps and bounds – violating codes of medical ethics left and right.

The “good guys” in medicine have failed to police their own ranks – and we pay the price for that failure.

Looking Within

The answers aren’t out there; they’re within each of us patients and consumers.

Medical costs have reached such a critical scale as a portion of our family and business budgets that it’s time to face the facts.

The wise and genial Marcus Welby, MD is gone.

And his successors have morphed into a Jekyl-and-Hyde profession where you can no longer be sure which one will be treating you.

What this untenable situation demands is a repositioning of our healthcare players in which patients and consumers accept greater responsibility for a more active and informed role in their own healthcare.

This is what efficient markets require – informed consumers.

And that’s what Our Healthcare Sucks and the remaining MedSmart Members publications are all about: helping patients and consumers to better navigate our dangerous and deceptive medical system when they have no choice but to use it.

And helping them understand and adopt the diet and lifestyle measures proven most likely to reduce their reliance on our dysfunctional healthcare system altogether.

There’s no other way around it. No short cuts, magic pill, or superhero to bail us out of this crisis.

You either recognize and accept it for what it is – or you stay a victim of your local medical culture’s unethical misbehavior.

Passivity is no longer a viable option – as the meek shall inherit surgery they don’t need.

For more on health insurance, see MedSmart Members’ Health Insurance Under Health Reform: Rethinking Your Health Insurance – and Your Health Care.

And tell us what YOU think. Do you see any other ways out of this medical spending crisis?

(1) Study Sees Cuts to Health Plans. Wall Street Journal, 6/8/11.

This article is provided for educational and informational purposes only.
It does not constitute medical advice and should not be relied upon as such.

John Lynch: John Lynch was founder and CEO of Medical Diagnostics, Inc. - twice named to Business Week's "Best Small Companies" in America. He's since founded MedSmart Members to publish consumer health education publications.
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