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Saturday, October 30, 2010

Health Insurance Rises ...Again, The Great Divergence Continues to Gut Middle Class

We received our "new and improved" monthly health care insurance premium notice in the mail today. The increase came to a whopping 22% increase in one year!  This increase seems over the top given we have never filed a claim against the policy in more than sixteen years. 

We received notice the rates were going up with the billing notice from last month.  All of this makes us wonder what, if anything, is being done for cost containment.  The United States spends roughly 17% of our GDP on health care and even with that level of expense we are the only country on the face of the earth where people can lose everything they own (even with insurance) and become indigent due to medical costs. It is frightening to think a lifetime of saving and planning can be wiped out by one catastrophic illness.

Big Medicine, Pharmacy, and Insurance continue to lobby congress to protect their industries and the rights to charge citizens whatever they deem appropriate to sustain their profits and huge payrolls.

We do not have the free market working when it comes to health care in this country.  A number is written down on a bill and that is what we pay as consumers.  Medical tourism is the only weapon the consumer has at this juncture to fight rising costs and introduce some degree of competition in the quest to control medical costs.

There is another phenomenon going on in this country where the rich are getting richer and the poor getting poorer along with a gutting of the middle class in this country.  The name used by economists for it is THE GREAT DIVERGENCE. It is the moniker to describe what has been going on since 1979 in the United States.  It is nothing less than the systematic dismantling of the middle class in this country. Here's a link for more about THE GREAT DIVERGENCE TIM NOAH ON THE GREAT DIVERGENCE VIDEO


  1. Nobody wants to admit it but we are broke. Very few people have any money and it is keeping consumer damand low for goods and services.

    Meanwhile,both parties are serving up the Kool Aid about tax cuts. Bankers continue to reward themselves and CEO's of all stripes are giving themselves huge bonus checks for their failures.

    Is this the new normal for all uf us?

  2. I don't have a problem with paying a market value price for my wife and my health insurance. We just recived our renewall notice and our insurance is going up to $810 per month with a $7500 deductable each. We have no major heath problems. But I do have a problem with someone who chooses not to provide for them selves and their family walking into a emergency room and getting the same care we do and not paying a dime. If you make that choice you should be escorted out of the hospital and not be given the treatment.

  3. That's fine you don't have a problem with paying $810 a month for you insurance but what about the people on unemployment who have to decide between shelter, food, utilities, and the basic needs for their family. Do they forego those basic needs in favor of health insurance? Would you deny them basic health care because they decided to forego insurance in favor of basic needs.

    I am old enough to remember when we didn't have any kind of health insurance. Doctors were paid for services rendered at the time of service. My parents seemed to make ends meet with what Dad made for wages and still managed to save a little bit of money.

    How we got so far out of whack with health care costs is hard for me to understand. How did we get to the cost levels we see today?

    Even people with insurance are not immune to bankruptcy for medical reasons. I do not have a good answer or solution to this issue. The system and costs we have are not sustainable and present a clear and present danger to all of us. A lifetime of saving and planning can be wiped out due to health care costs in this country. Cost containment has to be addressed.

  4. My point was that people need to be required take resposibility for their own lives and not expect someone else to. If you want a service you should pay for it or don't demand the care . I have a family member who said for years that they couldn't aford health insurance. Then had some major problems and ran up a bill of over $400,000 and didn't pay anything. Is it fair that someone who is able to provide for themselves not be requried to and those that live in a responsible manner pay their bills. If someone is truely unable to provide for themselves thats one thing but for everyone in that situation there are 1000s that choose not to. Medical care is a commodity just like a car, should you be required to sell me your car for 1/2 its' market value just because I need a car and am not willing to pay the full price.

  5. I believe the consumers of health care are so removed from what things cost is a problem. All they know is their copay for drugs, hospital stays and doctors.

    If the consumer had to actually pay for services rendered there might be more interaction between consumers and providers. It's not a cure all but if services were paid from medical savings accounts rather than the current reimbursement system patients would enter the fray on costs.

    We see it all the time where procedures are not covered price competetion surfaces. The "invisible hand" of the free market is not present with the current delivery system.

  6. In the past there was a very simple and cheap solution to many dieases that people routinely survive today You died. Why should someone invest many years of their life to aquire the skills and knowledge to treat thease diseases and pay huge summs of money for their education and then not be paid their service . I have a friend who is a surgon . He pays over $200,000 a year for malpratice insurance in case someone decides he made a mistake. Why should a company spend millions of dollars to develop medicine and procedures and then be sued for a billion dollars because a fraction of 1% of the people they treat have a proplem . Would it be better to let the other 99 Plus percent go untreated? And no I am not in the medical field

  7. Bob has made a very good point. The time and costs for a doctor to achieve their credentials is a long expensive journey. Most of the doc's I know have well over $100k in expenses to repay, not to mention nearly a decade of lost wages to get the training.

    I don't know the cure for malpractice issues but when a doc makes a mistake how does it get rectified. Currently, money and courts are the only answer. Perhaps a peer review consisting of doctors and patients is needed to review and determine settlements something like the 911 settlements for victims is in order.

    The track we are on for medical costs in this country are not sustainable. Insurance companies, hosptitals and doctors do not deny this fact. We have to seriously address the cost side of our medical delivery system.

    My first job out of high school I made $2.41/hr in 1964. A journeyman carpenter made $4.91/hour. That was considered about the average pay for blue collar stuff. An office call cost $10 or about 4 hours of my labor to pay for an office call.

    Today the delivery system is totally out of whack with what people are paid, what employer's can afford for insurance costs and yet prices continue to spiral unchecked.

  8. If thease other counties have such great systems , why do anyone that can come to this country for treatment if they can. Most recently the premier of Canada came to the US for heart surgery . I have several friends that live in British Coumbia and they all carry a insurance policy that covers them in the US so they can get treatment Immediately for something serious and not have to wait for months for treatment.About a year ago a friend was here and got kidney stones . He was treated the next day and released the following day. He said 2 years ago in Canada he waited over 2 months for the same treatment because there only 2 of the ultra sonic machines in British columbia. He had to have a stent placed in his kidney to keep it open after 3 weeks of terrible pain until he could get the treatment he needed. Sounds like a great system to me. God help us if we don't see some major changes in the house and senate today.

  9. While it may elicit some chuckles, I'd say that the rest of medicine has something to learn from plastic surgery. As the surgeries are all elective the physicians performing them have to compete on price. I'd like to see something tried by one of the health insurance companies where they set a standard price and if the consumer is able to find a lower price they get to keep a percentage of the amount saved, say 10-15%. This gives the consumer the incentive to find a lower price and it hopefully this increases competition.

    Another option would be for the system to be modeled after Kaiser Permanente in which there's an emphasis on preventative care, doctors are salaried so they don't have an incentive to perform unnecessary tests, and they try to optimize the use of outpatient clinics for recovery.

    All that said I don't disagree with the ultimatum that you should pay in to the system or die in the gutter, your choice.

  10. Car insurance is mandatory, most people would not consider not having homowner's insurance, smart renter's take out a renters policy. Health insurance...fageddaboutit!

    Most people on an employer funded program do little to contain costs for their employer. They trot out to the doc every time they desire. The docs have to insure they are not overlooking something severe and order up expensive tests as defensive medicine. Most of the people a doc sees in the course of their day would get better with no care whatsoever. Yet they have insurance and want all the drugs they can get and by the way none of that generic stuff for me. I want the branded stuff because I have INSURANCE.

    It is a mindset that says hurray for me and to hell with everyone else. Even elder care is selling the big lie that old age is curable with no limits on end of life medical care. Pulling the plug is something we don't like to think about.

    Hospice care is not selling the medical miracle cure that will produce endless life

  11. I have employer provided insurance , and I can count the number of times I have "trotted out to the doc" in the past ten years on one hand. Additionally, even after the insurance would pay whatever it's miniscule share was, I usually go without the meds unless absolutely necessary because I can't afford them. Your assessment is tilted a little I think. My employer sure doesn't do much to pay me well enough to afford to pay for insurance on my own. At least when he provides it, he chooses which plan he wants and how much he wants to pay. Maybe we shouldn't have employer funded medical insurance as a benefit and all businesses can just pay their employees that much more so they can get there own. Are you suggesting socialized medicine is the answer? Or maybe employees aren't entitled to any health care at all and only business owners should be? Talk about class warfare! Health care is expensive. The rich want to get richer at the expense of the poor.

  12. There is very little competetion in the area of Health/Meds/Fees for services.

    Health insurance has not been around all that long. It came about as a way around wage and price freezes during WW2 as enticements to hire scarce war effort labor specialties. Post war the US was about the only economy untouched by the war and it was not an issue for companies to continue paying health insurance.

    Today the health care delivery system is 17% of our economy. This cost is not sustainable and is nearly twice as much as the rest of the world. There is little to control the costs.

    If employers simply quit paying health insurance and left it up to employees to get their own insurance there might be more price competetion across the board. That is supported by the heavy competetion for elective health care procedures.


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