Tuesday, September 11, 2007

Bush's Katrina Like Track Record on Health Insurance

An Associated Press article painted a bleak picture for families getting and keeping health insurance coverage. Premiums rose 6.1% this year, well above inflation and wage increases. Since 2001 health insurance premiums rose 78% far outpacing wage increases of 19% and 17% overall inflation.

The annual cost of insuring a family of four is now over $12,100. Employers pick up 70% of this cost, however fewer do so each year. In 2000 69% of employers provided health insurance benefits. Now only 60% do so and the talk among business and political leaders indicates fewer employers doing so in the future.

Demographically this sounds like a struggling industry, but financially health insurers are doing very well. The article said "health insurance companies continue to see higher profits." How can that be, if so many customers are getting priced out of the market. Do the forces of supply and demand not work? One would think White House Economic Advisor Al Hubbard and Uncle Bucky would warn the President if that were the case. Both men shared the board table at large health insurer WellPoint ( see Allan B. Hubbard and William H.T. Bush). And don't forget The Carlyle Group's purchase of MultiPlan last year. The huge private equity underwriter (PEU) followed that up with the buyout of a medical cost cutting firm.

Guess what's coming? It's more of what anyone in the workforce experienced the last twenty years, greater cost sharing and benefit cuts. A survey of employers found more than half of the respondents planned to shift costs to employees through higher premiums, deductibles, copays or out-of-pocket maximums.

Businesses do less while the government drags its feet. Meanwhile, you feel it in your pocketbook, even postponing or avoiding care altogether. Does that produce greater cost to the system later? The good news is George W. Bush has a plan. I'll meet you in the Emergency Room.