By Janet Fang
Posting in Education
Though it could be as late as 2037 with the Affordable Care Act. A new study shows that the average annual increase in insurance premiums was 8.0% while household incomes rose an average of 2.1%.
From the Annals of Family Medicine: the cost of health insurance will be more than all the money you earn.
That is, according to Richard Young of John Peter Smith Hospital and Jennifer DeVoe from Oregon Health Sciences University.
DeVoe and colleagues previously estimated that the cost of a family health insurance premium would equal the median household income by the year 2025. But after that model was published, there was a slowdown in healthcare spending… so they updated the model.
Now, they estimate that the cost of health insurance for a family will surpass what the household makes by the year 2033.
But maybe as late as 2037… under the 2010 Patient Protection and Affordable Care Act.
Here are some highlights of the report:
- The annual inflation rate of health insurance premiums outpaced US household earnings, which stagnated from 2008 to 2011 and included an absolute reduction in average household income from $50,300 in 2008 to $49,800 in 2009.
- From 2000 to 2009, the average annual increase in insurance premiums was 8.0%; household incomes rose an average of 2.1%.
- If health insurance premiums and national wages continue to grow at recent rates and the US health system makes no major structural changes, the average cost of a family health insurance premium will equal 50% of the household income by the year 2021…
- and surpass the average household income by the year 2033 (pictured).
- If out-of-pocket costs are added to the premium costs, the 50% threshold is crossed by 2018 and exceeds household income by 2030.
So what do you think: does health insurance become moot at some point?
The report, “Who Will Have Health Insurance in the Future? An Updated Projection,” was published in the Annals of Family Medicine this month.
Image from Young & DeVoe (2012)
Mar 26, 2012
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No doubt as the graph ha showed it seems that the cost of insurance will be increased in future that household income would not be able to cope. http://www.ppiclaimuk.org.uk/ppi-reclaim
I found this blog worthy and that is something that is suspected to be happen, I think the income will be left behind by health insurance charges in future. http://www.absolutesurety.com/states/michigan-surety-bonds/
The graph nicely demonstrated the health insurance cost that is expected to exceed household income by the year 2033, I like reading it. http://www.carinsurancerates.com
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Since seniors account for a huge percentage of health care costs paid for by private and public plans, combined with Social Security cash benefits, it is fair to assume there will eventually -- fairly soon -- be an uncontrolled backlash against them by younger folks who are slammed against the financial wall but have to pay the cash costs. Europe, Canada, China and even the United States are suffering from this already. It is called ageism. But it is nothing compared to what is about to be unleashed. In looking for an answer to this pending severe economic and social backlash, some secret agencies are likely planning for and/or creating a specific pandemic that quickly culls a majority of the chronically and terminally ill, and old folks. Science fiction? Nope. Human nature just as civil wars and ethnic cleansing are today and have been throughout history.
Really the moral question is 'how can such a silly argument be part of such a serious public policy issue?' Your skewed hypothetical doesn't even make the case well, and your conclusion is ridiculous - I know of no Western country with what you might call 'socialised medicine' where the choice would be made on the basis of who is likely to pay the most tax, either by decree or covertly. Haven't you heard of triage? Because of course the real answer in 'free enterprise medicine' land is 'the one with the most money' - whether it was earned (legally or illegally), inherited, or won at poker. I just know I'm going to regret responding - assuming 'You can do better...' was being ironic that was probably a much smarter response.
A 25 year old women comes into an Er suffering a severe diabetic seizure. She weighs 300 lbs and is clutching a bag full of cigarettes and Twinkies. At the same time a 65 year old woman comes in suffering injuries from a bad car accident. She is a healthy weight and was on her daily jog when hit by a car. Here is the tough question. You have only 1 doctor on hand. Who lives? Who dies? Socialized medicine puts a priority on the younger person every time because it is WORTH IT to keep a young taxpayer alive. Elderly people costs more. Just look at the headlines out of the UK. As pointed out in the link from 1999, this age bias in health care has been around for decades in the UK. http://news.bbc.co.uk/2/hi/health/407362.stm http://www.telegraph.co.uk/health/elderhealth/9126976/More-than-half-care-home-residents-denied-basic-care-unpublished-data-shows.html
I live in Australia, and travel a lot, to all sorts of countries, from the First world to the thirdest of the Third world. And what links the thirdest of the Third and the US? My absolute determination to make sure that if anything happens to me, I have the means to escape the local health care 'system' and get back safe and sound to the Australian health care system - which is not perfect, but is excellent, and thanks to universal health care, affordable. Without going into too much detail, we have a very high quality safety net, paid for by a mandatory income levy of 1.5%, plus the ability to pay for 'gap' insurance. If I may - and I know that there is nothing more annoying than outsiders offering advice - it seems as an outsider that there are three major things undercutting the US's ability to fix healthcare. The first is the ever-increasing power of industries and corporations in your political system. The second is a wide-spread belief that there is no such thing as luck - good or bad - everything is down to personal effort and personal worthiness. And the third is an almost reflexive belief that the US has the best .... [insert legal, medical, prison, airline etc etc] system in the world. Nothing is more certain to block real progress than the belief that you already have the best in the world - even if it is true.
What you should hold into account is that these kind of growths can't and will not grow infinitely, their should and will be some kind of slow-down or stop along the way. Like, for instance, a scientific breakthrough that will decrease cost of healthcare.
The major reason that nobody can come up with a sustainable system is the health care industries stranglehold on improvements or any changes; twenty percent of our national economy is made up of healthcare insurance companies, pharmaceutical companies, hospital chains, and for-profit healthcare medical conglomerates, medical devices makers and last but the least all of the above tainted with greed! As you can see they make up one of the largest organized constituencies in our country; they control our government which is made even easier because of an ignorant electorate. The only workable system is as close as our nearest neighbor--Canada, be a copy-cat Americans, it is working! Also look at the rest of the industrial, civilized world's countries who have a single payer system, they all work for their citizens. We need to change immediately to maintain our great country's place among the world's elite! We are running out of time folks!
I'm sorry, but these kinds of projections are just silly. If we follow this logic, house prices will be free by the same year. Rising health care costs are a serious issue - maybe the report authors were being intentionally flamboyant - but still! == John ==
The problem with all health care (HC), is that the health care providers have been allowed to write their own contract for too long. We are into and era of 'early detection'. This is being touted as your only option, because otherwise you will die. We are being over-diagnosed and over-treated for conditions that probably don't require it. In other words, the HC pros have learned the fine art of fear mongering. Cut done on half (or more) of the tests, and you will cut about 2/3 of the cost. How do the other countries that have National Health care do it? The only allow certain, proven, tests. The Republicans are putting so much false information out there, that it is hard to get a proper look at it. You shouldn't be looking at how America should create a HC system, but any other country like Canada, Japan, China, France, Germany, England etc etc. They all have them, and they work well. Some are better than others. A good HC system is like a very successful American Corporation: Wal-Mart. The masses bring the cost down. Canada has approx 36 million people and a large, spread-out country. The USA has approx 360 million people and is smaller. Go figure who should have the advantage of the benefits of cost per person ratio. The answer should be obvious.
Sheer unbelievable. How do these premium projections compare with Europe & else where? If Japan & Europe can provide national healthcare plans at far less cost & delivering higher healthy life expectancy, there must be something seriously wrong with the way the US is doing it.
I just took a survey a few days ago where they were looking at which options people would take when the new health insurance laws take effect and people will start looking at health insurance plans from the "pool". They listed all the proposed options from all the major insurance companies and the expected costs, etc. The shocking thing is that the plans were priced at $2,200 to $4,000+ PER MONTH for a family of TWO. And the coverage, even with the best offered plan, would be worse than what I currently have. My current plan costs me over $1,600 per month and my employer only pays $150 per month toward it. That's over 30% of my income right now! It's just hard to image being able to afford medical insurance my longer at these rates.
The cost of health care will not exceed family income in 2033, or any other year. Notwithstanding the nice graph, it ain't gonna happen. Extrapolating current rates and rates-of-change beyond a few years is meaningless. There will be changes in our economic structure, as yet unseen, that will alter both incomes and costs. Not to be alarmist, but one such change is that the financial house of cards being constructed through excessive spending by our elected officials is going to collapse. Since neither major political party has any intention of balancing the budget, the only question is when the collapse will come.
Apart from the fact that this is untenable, the article does not provide much in terms of the authors' assumptions. A recent Wall St. Journal article on this subject pointed out that real health care costs are not rising as the authors claim. A short list of health care cost mitigating factors is: Technology is likely to reduce the cost of diagnostic procedures and treatment. For example, the first MRI machines were so expensive and of limited availability that an MRI was a major diagnostic cost. Newer, cheaper MRI machines using better imaging software have held the cost at or below the cost of 10 years ago. Likewise, robotic surgery is revolutionizing procedures such as arthroplasty. Lifestyle improvements, such as smoking cessation, have already reduced the per-capita instance of smoking-related illness. As obesity inevitably declines, so will related disease like diabetes, heart disease and weight-related orthopedic problems. Indexing health insurance premiums to lifestyle (as does life insurance) will provide incentives to improve lifestyle. Newer health care provider models can reduce costs by relying on nurse practitioners, physician's assistants and other para-professionals to treat minor and chronic ailments in medical groups and walk-in clinics. Giving patients incentives to shop for the best care for the lowest cost by offering various insurance options as opposed to the "one-size-fits-all" model offered by insurers, Medicare and "Obamacare". Reducing medical insurance premiums by litigation reform, including a workers compensation-type damages tables covering all but gross or criminal negligence claims.
We can fully expect more spin on HC as is election year and facts get tossed out in favor of 'Do not vote for me,but vote against them" that has ruined USA. So will ask the BIG question none seem to ever discuss, bit first a bit of background. Rather quietly with little press-media reporting, a huge increase in building/remodels, AKA big money invested in medical facilities, kind of mini "boom" in them last ten years or so. With that fact, we can now ask, WHO IS MAKING the profits off double digit price increase's. Were it any other sevice-goods going up at 10% or so each year, other then oil, papers would be full of data. None anywhere on HC. Then we must ask, how does Canada and rest of more evolved world do it, again never discussed unless the absurdity of "Canadians rushing to USA for care" blah blah . Note most of those nations have lower total effective tax rates then USA, that reality is often buried along with other truths. We are not getting reality/acts on HC.
It would be helpful to see how the previous 35 years looks like on the same chart. Health benefits were optional for a while and then became part of the expected package of benefits. The employers used to pay 100% of the premiums, back when the cost of insurance was significantly lower than it is today. As health insurance premiums increased, the employers began to offload some of the premium costs to the employees. The US has one of the best medical technologies in the world but has the worst access to that care than most other countries. The US has several systems of medical access from private inurance to corporate funded insurance to self paid medical coverage to unpaid emergency room care. Hospitals are mandated to accept anyone regardless of their abillity to pay, that lack of pay is hiked up for those who can pay (like $10 per aspirin dose). As premiums rise higher than can be afforded then there would be an increase in the number of uninsured people getting "free" medical care in the emergency rooms which feed back into higher premiums. This is the hidden "tax" we pay to maintain the same level of care we had 10 and 20 years ago.
Single Payer is the ONLY way to solve this mess with health care. Any other approach is just a rehash of failed policies. When will we realize what every developed country already knows? When will America become a developed country? We cannot trust corporate America with our health. The only thing worse than a government bureaucracy is a corporate bureaucracy. The government inevitably answers to its people, the corporation only ever to itself. The government exists to serve the people. Corporations exist to generate a profit. It couldn't be simpler. I'm not saying let's disband all corporations, I'm saying let's just get them out of our health care.
The cost of health insurance won't continually increase at any set rate any more than property values supposedly would 10 years ago. It makes absolutely no sense and buying into that mentality is foolish. My health plan's premium actually went down this year, not by a lot, but it is about 1% lower than it was last year...
...to anyone who actually buys their own health care. Mine has been going up consistently for decades, and at a far greater rate over the last several years. While the President promised that my rates would be going down $2500/year 4 years ago, it has instead increased by over 60% in the last 3 years alone. So yes, it's only a matter of time before my premium eclipses my income, which has not increased at nearly such a rate. (I've already forecast the date when it will eclipse my #1 monthly expense, housing) And as more healthy people find their premiums unaffordable and drop their coverage, the premiums will skyrocket even faster until the entire system collapses. (Which I believe is the real goal of the ironically-named "Affordable Care Act") This will eventually force us into what the Progressives envisioned all along, a "single payer" system like Britain or Canada. I've always argued that a "single payer" system would be far more advantageous over the massive cluster that the "Affordable Care Act" is. For one thing, without health care to pay for, I can pay off my house. Once my two biggest monthly expenses are disposed of, I can just retire (since the income taxes required to pay for the new system will make working barely worthwhile anyway) and let the people who voted for this morass work to pay for it all like I did all those years.
There are two big reasons that health care costs are soaring. First of all, we're not buying "insurance", we're paying into a pre-paid health care plan, kind of like a service contract for our bodies, so that we only pay $10-$20 for a doctor visit. We have a "let the insurance pay for it" attifude. Secondly, we ignore lifestyle choices that give us medical conditions that require treatment. The 2010 Patient Protection and Affordable Care Act isn't really about making health care affordable or more available. The non-partisan Congressional Budget Office project $1.7 Trillion over ten years, almost double the $900 Billion quoted by the President and Congress when they passed it. It's estimate the costs will top $2 Trillion by 2022. The CBO projected that up to 20 Million American will lose health insurance coverage due to the 2010 Patient Protection and Affordable Care Act. The CBO expects employers to drop insurance coverage primarily for low-wage earners, and they will, for good economic reasons. My employers spends about $10,000 on my health coverage, way more than the penalty for dropping coverage. Want to increase your company's bottom line? Drop health coverage. This is part of the plan to drive people into government provided health coverage.
Yes I was being sarcastic. Glad you are up to speed on that. The point is they already do that kind of age bias medical treatment in the UK. If a hospital only has enough cancer drugs to treat 1 person and 2 are due for it the younger person always gets the treatment. It is documented fact that the elderly are second class citizens in the UK healthcare system. Elderly people will wait months to get chemotherapy after a diagnosis. If they ever get it. If I lived in the UK the heart meds I am on become 100% my responsibility to pay for at age 70. The government has decided it is not worth it to cover. Forget about a donut hole. That is pushing most elderly off a cliff.
Make is so that the 65 year old woman was hit by the car being driven by the 25 year old woman. It adds a bit more injustice to the injury...
...is people assuming that it's someone's responsibility to pay for their own care. That costs are out of control is only the logical extension of what happens when people are allowed to consume something with absolutely no concern about what it actually costs.
Successful? They are broke or haven't you seen any news dispatches lately. They are throwing everything not tied down overboard in an attempt to keep from sinking. The German people are screaming 'No more' to bailing out failed economies - I hear them. And Health Care is just the opening volley in the U.S. The big debt problem in Europe is pensions that were promised because it was easier than trying to deal realistically with the unions. Health Care - yes we need one system for all - but certainly not the European model as it is a failed system.
Everyone who thinks healthcare is cheaper in Europe is looking at old data the Obama administration threw out to the public during the healthcare bill fight. It was an old 2000 study by the World Health Organization that declared all of Europe provided healthcare at a lower cost per person than the US. The sad part is they were wrong and later quietly admitted it. The original study in 2000 was flawed in that it only looked at premiums paid in Europe. They left out co-pays, deductibles and more importantly TAXES. All of which somehow made it into their US numbers. In 2003 they came out with a revised study based on a larger data set that included ALL SOURSES of money that paid for European healthcare. Once those factors were added in the US was the cheapest per person cost for healthcare among western nations. Italy was still one of the best in Europe. After reading the final report I have to admit to liking the Italian operating and funding model. Healthcare operations and costs are managed at the regional level. Healthcare taxes, done as a property tax, vary from region to region based on how effective the regional management is at managing costs. The regional healthcare management head is an elected position not a bureaucrat, so quality and cost effective service, good care and low taxes, are what gets them reelected. It would be comparable to our states managing it in the US with an elected official in charge of the State Health Department. Who would have guessed Italy would model something after the method preferred by our founding fathers. Let states manage their own systems. Get the feds out of our lives.
Most developed countries have public health care, the anticonstitution story is false and does not matter. Way before cost of insurance meets income it will be unaffordable for 99% of us at that pace of premium increase. Increasing costs is due to the fact that heath is a business in an financial capitalism. These countries like France for example keep costs in control by dictating what doctors and drug companies can charge so they basically take this business out of the capitalistic world and it's working great with the exception they go too far by not asking a large enough co-pay which causes abuses. Doctors still make a very good living but do not usually drive Ferrari's except a few exceptions like cosmetic surgeons. Recently we moved and my wife had to quit her job. She was offered "cobra" to keep her insurance and the cost was over $900 a month. If one does not work how can he or she afford $900 in insurance per month? In France or other countries with similar systems she would have been covered just like if she was working.The way people pay for it is a percentage of their income up to a certain amount just like social security in the US, it's actually called social security in France. The more people pay, the less they have to increase premiums so in bad times like now they run a deficit. The same principles apply to retirement and public education which is almost free all the way to university. The US will have come to such a system, there is no way around it. If auto insurance is mandatory why would that not be the case for HC? It concerns everyone and when someone is brought to the ER and can't pay the bill the others who do have insurance pay that cost anyway. I am certain that the vast majority of Americans support universal HC or would be in favor of it if they would stop listening to the lies of lobbyists such as the "fair and balanced" news channel.
As only those with incomes in the top 10-15% will be able to afford health care. It's not that the political parties don't have any intention of balancing the budget, it's that their corporate masters have no intention of allowing their gravy train to leave the tracks before there is no other choice.
To mikemce, I think your comment was the best rebuttal for this article. Personally, I don't think this will happen.
Why don't you just move to a 'developed' country and leave us be. Corporate America has been the most trustworthy provider of health care but it should be out of the business because it makes them less competitive with the rest of the 'developed' world. Your description of government vs. corporation is naive at best. At least businesses must appear to provide a needed product or service to consumers. Government is nothing more than Attorney welfare; of the lawyers, for the lawyers and by the lawyers. What a racket. And who do you think writes those illegible contracts and warranties? Yes single payer! Same coverage for Obama and the homeless lady I passed awhile ago on the street. No veterans health care system, no medicare, no medicaid, and bring a National ID. Thank you.
Actually, you better hope your health stays good after you retire - I'm already there, but still working too- so I get employer mandated coverage available, "Retirement medical coverage" has "PHANTOM Medicare" deducted from any benefit I might have received IF I actually had MEDICARE, and coordinated with the employer program. WHAT A MESS! I'm sure the "Affordable Care Act" will make it better - NOT!!!!!
...but a "payment plan". But worse than that, they want someone else to pay for that as well. Most people are completely insulated from the real cost of what they consume, and frankly, they don't want to know. Imagine how expensive your auto insurance would be if the government required the insurance company to pay for your fuel, oil & tires; you'd have very little incentive to drive efficiently.
Your politics is showing! The job of those evil corporations is to make a profit and in the meantime employ as many people as they need to make a profit. We need the 99% to better themselves, if they are really interested, not to become the 100% by destroying the 1%. Don't like your master? Quit. Don't like your job/duties? Start your own. Then we'll see who is a penny-pinching miser.
Those who look out only for themselves are any more trustworhy? Like he said it's more of a lesser of two evils. Personally my trust is endowed on a very small group.
That's why I think people should be looking out (being responsible) for themselves and making their own decisions instead of relying upon others to do it for them. You can't endow your trust upon a smaller group than that. Allowing either employers or the government to be responsible for your care makes you a slave to one or the other.