Rising health-care costs are enough to make you sick [View all]
By Al Lewis
One of my best friends, going back to 6th grade, died in April. He worked as a heavy-equipment mechanic, even as he soldiered through many rounds of exhausting chemotherapy treatments. He remained incredibly strong and fit, mentally and physically. Throughout most of this ordeal, he looked and sounded like he would beat the odds, but he didn’t.
His wife and three school-aged children started packing after his funeral. A long battle with cancer had eaten away their savings. Their home had been foreclosed. They would soon be evicted. They had medical insurance. They had worked hard all their lives. Friends, family, and co-workers sent them checks and put on a fundraiser, raising tens of thousands of dollars. It would never be enough to keep pace with the mounting medical bills that were not covered by insurance.
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“The average American worker is one serious medical event away from financial hardship,” according to a study released Wednesday by Aflac. Aflac’s 2014 Aflac WorkForces Report gathered responses from 1,856 company benefits decision-makers and 5,209 employees. These are the lucky people in America who still have jobs and company-sponsored health-care plans. And here’s their outlook: 66% said they “wouldn’t be able to adjust to the large financial costs associated with a serious injury or illness.”
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These concerns persist despite out-of-pocket limits established by Obamacare. The maximum out-of-pocket cost limit can be no more than $6,350 for an individual plan and $12,700 for a family plan in 2014, but this more than what many Americans are prepared to pay. The limit includes deductibles, coinsurance and copays, but it does not include the annual premiums or payments to out-of-network providers that people faced with a life-or-death situation may feel compelled to use. Health-care insurance is not only inadequate to counter the risks for most working Americans, but the premiums keep rising. Premiums have risen 80% since 2003, according to The Kaiser Family Foundation. Inflation over that time has only risen 27%.
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Annual premiums for employer-sponsored family health coverage hit $16,351 in 2013, and on average workers paid $4,565 of that amount, according to Kaiser. And for what? Plans that might let them go bankrupt or lose a home to foreclosure if they become seriously injured or ill? It seems our health-care issues have been so politicized that no one can fix them. Amid all the dysfunction, costs keep rising for a lot of reasons: Regulators, bureaucracy, technology, the aging baby boomers, the obesity crisis, drug and alcohol abuse, and, let’s not forget, corporate profiteering.
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Just look at the recent earnings releases of health-care insurers Cigna Corp., WellPoint Inc., and Aetna Inc. You don’t see them missing earnings expectations. They beat them handily — even under the expected strains of Obamacare. Just look at the CEO pay. Mark Bertolini, CEO at Aetna, got $30.7 million in total compensation last year. Cigna CEO David Cordani got. $17.76 million. Wellpoint CEO Joseph Swedish fell just a little short of $17 million, but he was only CEO for nine months of the year.
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The main reason it still works is because employers providing health benefits to their employees can still find ways to pass these rising costs onto their workers... As long as there is still something more to extract from America’s middle class, the system still works.
http://www.marketwatch.com/story/rising-health-care-costs-are-enough-to-make-you-sick-2014-05-29
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