Just 1% of Americans accounted for 22% of health care costs in 2009, according to a federal report released Wednesday.
That’s about $90,000 per person, according to the Agency for Healthcare Research and Quality. U.S. residents spent $1.26 trillion that year on health care.
Five percent accounted for 50% of health care costs, about $36,000 each, the report said.
And this is surprising because? If you’re not talking about preventive care (cancer screening, etc.) then you’re talking about people who are sick or who have medical problems. In any given year, what percent of people who buy, say, flood insurance, actually use it? Five percent? One percent? If everybody were using it equally, it wouldn’t be insurance, by definition. It’s all calculated out when they set the premium. And recalculated every year. After Hurricane Irene, folks in Vermont who buy flood insurance are going to be paying more. And probably zero percent of them will use it.
Reminds me of an old science fiction move (made for TV) back in the 70’s. Due to costs, everyone had health coverage until aged 65. At age 65, you could no longer get any health treatment of any kinds, including drugs for BP, diabetes, etc. I believe that some of the policy wonks (academics) that contributed to Obama care, supported some sort of major limitations on health coverage from seniors, since they no longer contributed to society, and money should be shifted to younger people. This was from a couple of years ago, so I don’t remember the specifics very well. Remember, some of the money for Obama Care is going to come from cuts in Medicare.
I am the 99%?
Texas, I personally am no Obama fan or of the Affordable Care Act in total. There are parts I like. But whether you like Obama or not, you really need to get the facts straight. It is House Republicans that want to dramatically restrict how much the government pays for health coverage for the senior citizens and the disabled. There have been absolutely no proposals from the Obama Administration to restrict health coverage for senior citizens or the disabled. The money coming from Medicare to pay for a portion of the Affordable Care Act, was required to come from savings generated by cracking down on Medicare fraud. Whether those savings would arise or not is a different question, but there was to be no reduction in care.
The nightmare scenario you describe however is a possibility under the Ryan Medicare proposal with the addition it would be everyone over 65 and the disabled under 65.
Why can’t these people just do their patriotic duty and die! Honestly…
😉
Mithcell, sigh, sorry. I’m just used to using the term “cut” for “reduction” in the rate of spending. When Republicans want to reduce the rate of spending increase on a program, the MSM uses “cut”. The health care act does take $500 Billion out of Medicare by reducing payments to such things as Medicare Advantage program, and other fees. From PolitiFact:
Nearly $220 billion comes from reducing annual increases in payments that health care providers would otherwise receive from Medicare. Other savings include $36 billion from increases in premiums for higher-income beneficiaries and $12 billion from administrative changes. A new national board will be tasked to identify $15.5 billion in savings, but the board — the Independent Payment Advisory Board — is prohibited from proposing anything that would ration care or reduce or modify benefits. Then there’s another $136 billion in projected savings that would come from changes to the Medicare Advantage program. About 25 percent of Medicare beneficiaries are enrolled in a Medicare Advantage plan.
These are actual “reductions”, not cracking down on fraud. As for the Ryan proposal, we all know his plan will take grandma in the wheelchair and push her over a cliff. 🙂
I don’t know if the term “corporate socialized medicine” makes any sense, lol, but that seems to best describe my health coverage and care at the moment. From my perspective, it looks like it’s going to be a really good thing for me. I don’t know the flipside, though.
The insurance company I use is an HMO owned by a partnership of not-for-profit hospitals. Most of the doctors I see are actually employees of the hospital system. They had their private practices but, somewhere along the way, they either signed on individually to work for the hospital and the hospital set them up with office space and staffing or the hospital purchased their group practice lock, stock, and barrel.
So far, my care has been seamless. My doctors work for the hospital that provides my care and also owns my insurance. Everyone is on the same page so questions are easily handled and billing problems are rare. They’ve also been really fantastic when I’ve needed consultations and care out of network because the specialties/services aren’t offered locally. Approval is fast.
I can see this becoming the norm. Health care in my area has been kind of a “choose your side” game between the not-for-profit Baptist health system and the for-profit physician-owned hospital group. I went with the Baptist group. The icing on the cake was the HMO they started. It will be interesting to see if the physician-owned system counters with their own health insurance plan, too, by partnering with other physician-owned facilities.
I’m not sure what it means, though, when the hospital corporation owns the dominant health plan and employees the docs, too. Either it’s going to work super-well or it’s going to be a huge disaster since it’s all inter-related.
Texas, the problem is the partisan rancor, is preventing a serious discussion of how to save Medicare; and yes, I understand some do not want to.
I am sure Congressman Ryan believes what he says when he expresses his confidence the private insurance industry will step forward and sell policies to old, sick people for a price they can afford. I have no such confidence. In fact all the evidence is to the contrary.
If we are to end Medicare and replace it with a premium support payment, people need to understand they may very well be left with no health care coverage when they become disabled due to age or illness. They need to understand that insurance companies are unlikely to step forward and provide reasonable policies they can afford even with the government subsidy. If they want to go that route with that knowledge, so be it. But that risk should be in big bold print and underlined and should be a prominent disclosure in every discussion of the proposal.
To me its like a securities offering memorandum. If you sold securities, did not disclose such a material risk in those stark terms, and people lost money, you would be sued in a heartbeat.
But that is not what is happening, this plan was being sold as we will give you $8000 and you can use that to pay for private insurance of your choice. You will no longer be stuck with that nasty old governement plan. They neglected to add, assuming you can find a company that will sell you a policy thats will cover your needs. wink wink
As several above have said, naturally the majority of spending on medical care goes to patients who have something wrong.
More competition rather than less would bring down the costs of medical care for all, including for those who require help from the larger public.
The nature of for-profit insurance companies is not to sell as much of a product as they can, but to take in the maximum in premiums while paying out the minimum in benefits. That’s done by seeking out customers who are unlikely to need signficant benefits. There is no “competition” to sell insurance policies to old, sick people. It’s a money-losing proposition.
There is no such competition now, Catholic Mom, because the government monopoly (Medicare) destroys any market. When my husband and I reach 65 we will have no options other than Medicare or self-insurance. Medicare today is a one-size-fits-all product in which the “insurer,” that is, the Federal government, doesn’t take in anywhere near the cost of providing the service to current beneficiaries, all of whom are assumed to have the same income since they all pay the same price. It’s the ultimate experiment in egalitarian outcomes and it’s going bankrupt.
When my husband had two surgeries this summer, one minor and one invasive and quite serious, in both cases the amount the insurance company paid was 50% or less of the amount the hospital and physicians originally billed. Under the current heavily regulated and unfree insurance market, it’s hard to tell what the actual price of services is. In most other markets increasing competition results in reduced prices.
Katherine #11,
That’s where my insurance example is interesting. It IS Medicare Advantage and it’s owned by two non-profit health systems. Is the HMO for-profit? I don’t know. But rather than finding reasons to deny care, they’ve actually gone to bat for me to get me the care I need out-of-network.
This poses an interesting option — religious-based health systems providing insurance coverage as a Medicare option. Because that’s essentially what I’ve got.
Teatime2, Medicare Advantage programs are the ones targeted by the Affordable Care Act for cuts. I’m glad you still have the coverage you prefer. In general I don’t believe that “for profit” insurance companies are bad and “not for profits” good, necessarily. Our insurance company (very large for-profit) denied one medical test for my husband this summer. Our specialist surgeon told us that he reviewed the case and didn’t think the test was actually necessary. He assured us that he is perfectly capable and does force insurance companies to cover tests he thinks are needed. We told him if it would improve my husband’s outlook we’d pay for it ourselves. He said we didn’t need it, and he was right. My husband survived the procedure. I don’t fault the insurance company for the denial, and this is the only case in which we’ve had difficulty getting medical tests and procedures approved.
We don’t think “profit” is a dirty word when we deal with companies producing a wide variety of goods and services we want and need. It doesn’t become bad simply because the subject is medical care and devices. Fraud and sloppy business practices are a problem, but not profit per se.
Health insurances has been around longer than Medicare. Before Medicare over half of Americans over the age of 65 had no health insurance. While the records are less clear, it is estimated 75% of disabled Americans had no health insurance. If you dig down deeper into those numbers you would find that most of the people over 65 who had health insurance were urban dewellers who worked for large corporations or the government. Those employers provided retiree health care programs. That means if you were a farmer, or owner or employee of a small business your odds of having insurance over the age of 65 were slim. Why did the free maket allow this situation to exist? Why didn’t competition produce an abundance of affordable policies for old, sick people. After all medical care on an inflation adjusted basis was much less expensive then than it is today?
Mitchell, you’re thinking “inside the box.” Perhaps fewer people had health insurance because medical care was much less expensive. Health insurance as an employment benefit exploded after WWII as a tax-free way to increase wages without subjecting workers to the then-very-high income tax rates. Another example of unintended consequences. The entitlement of health coverage expanded from protection from catastrophic illness to the entitlement to go to the doctor anytime for a small co-pay. No one knows any more how much the “real” cost is, and with somebody else paying most of the bill consumers don’t much care.
“Perhaps fewer people had health insurance because medical care was much less expensive.”
That is what you want to believe, because it is the only way your theory that competition will provide health care to the masses works. But the truth is that affordable quality health care was not available to most people over the age of 65 or disabled, prior to Medicare. Prior to Medicare, people without health insurance were treated for serious illnesses by local general practice doctor in a charity hospital or county hospital. The care was minimal, but it was all they could afford. There were specialists in large well funded hospitals, but they were mostly available to people who could pay or were insured.
My mother in law is a staunch Republican. She was educated as a nurse at Columbia Presbyterian, and worked as a nurse in a New York hospital during the 1950s. The one area she disagrees with the Republican Party is health care. She recalls how in her days as a young nurse the poor were treated very differently than those who could pay for care. She watched poor children die because no specialists would take their case. She saw elderly patients placed in charity Wards with as many as 10 patients to a room sharing one nurse. The newest least experienced nurses and the youngest least experienced doctors were assigned to provide their care. They were “paying their dues”. Meanwhile, those who could pay were given private and semi private rooms and access to the best doctors.
My grandfather was a farmer. He contracted cancer in 1965. He had no insurance. He was treated by our local small town doctor with no specialized training in cancer in a county hospital. If he had insurance he could have been treated by a cancer specialist at a larger hospital, but he could not afford that. He died. I understand it was likely he would have died anyway. After all little money was flowing into Cancer research at the time, because most of the people with cancer could not afford to pay for expensive care.
I should have said, the one are upon which she disagrees with the Republican Party is health care.