Strange Numbers on Health Care

  • by: |
  • 02/26/2008
In the recent on-line version of Health Despair there were two reports that seemed to send the same old messages: more folks unable to pay for increasingly expensive health care premiums. As Boomers move into Medicare, the cost will be unsustainable.

Wrong on both counts.

The U.S. Economy And Changes In Health Insurance Coverage, 2000-2006
John Holahan * Allison Cook insists the eroding insurance coverage is a matter of eroding wages and rising premiums.

Not so simple. Insurance coverage increased for kids and when you back out illegal immigrants the number is of uninsured kids is even lower. (I thought there was a SCHIP crisis!)

During the 2000-2004 period studied, the greatest percentage increase in adult uninsurance was among rich and middle class folks. 3.4 million increase in uninsured adults and children between 2004 and 2006, 700,000 were middle-income Americans and 800,000 were higher-income Americans. The authors fail to point out that there was an increase in people receiving coverage in the private market from 2004-2006 which is about the time HSAs began to expand. All other categories of coverage experience a decline. Except government coverage.

Turning to the growth in medical spending in the article: Health Spending Projections
Through 2017: The Baby-Boom Generation Is Coming To Medicare

The article states: "The primary drivers of personal health care spending growth during the projection period are medical prices and utilization, followed by smaller impacts from population growth and the age-sex mix."

Gee, I thought it was disease.

"As a result, health is projected to consume an expanding share of the economy, which means that policymakers, insurers, and the public will face increasingly difficult decisions about the way health care is delivered and paid for."

But what about technologies that reduce the burden of disease even as they increase life expectancy? Here's what another article in Health Affairs noted:

"A sixty-five-year-old with a serious chronic illness spends $1,000-$2,000 more per year on health care than a similar adult without the condition. However, cumulative Medicare payments are only modestly higher for the chronically ill because of their shorter life expectancy."

There are signals all over the place that our health care system has reached a tipping point on its own, pushed by consumers, mainly boomers, towards prevention, value, personalized care. The point would be to unleash this power by giving this generation and the next more control over the course of their health and care. Why not reward people for staying healthier, longer? Yet we are setting up a regulatory and reimbursement system that discourages such advances.

The closer we move to prevention and prediction, the more valuable health care becomes. The more we spend on more effective care the better off we are. If we spend 30 percent of out GDP on such things, isn't that better than spending 30 percent of it on services and technologies like heart and lung machines, drugs that only work half the time in half the people? Yet that is exactly where the command and control models of European, Canadian and Medicare want to take us.

Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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