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For many small business owners, health care system is "Sicko"

Heart-wrenching responses from business people:

Posted: Monday, July 23, 2007 1:09 PM by Eve Tahmincioglu

I recently saw Michael Moore’s health care tragedy film “Sicko” and it got me thinking: What about a "Sicko" just about small business owners?

There’s a scene where Moore takes former 9/11 rescue workers, who can’t afford U.S. medical care, on a small boat to Guantanamo Bay, Cuba. His mission, albeit a futile one, is to get those poor ailing workers the same care now given to suspected Al Qaeda prisoners at the facility.

Moore should have taken along a boatload of entrepreneurs with him. Actually, he would have needed a cruise ship, maybe 10.


Brendan McDermid / Reuters file
Filmmaker Michael Moore speaks to the media on Wall Street in New York last month during a press event promoting his new film "Sicko."

We all think of lack of health care coverage as a problem for the poor and unemployed, but small business owners are also drowning in this nation’s medical black hole.

I figured I had to write my first blog entry about the one issue that is at the top of all your lists – health care. Over and over again, in study after study, small business owners say it’s health care stupid, and it’s TOO @%$#&* EXPENSIVE!

Entrepreneurs and small business operators are beginning to sound like broken records, at least to politicians and the whole health-care industry. Maybe everyone is just “sicko” of them. (Sorry, couldn’t help myself.)

The National Federation of Independent Business, a small biz advocacy group you should know about if you don’t already, keeps asking company owners and they keep getting the same answer.

From the NFIB’s latest health care survey:

“Once again small-business owners overwhelmingly voiced the need for Congress to address ever-rising health insurance costs,” said William Dennis, senior research fellow with the NFIB. “A difference in top priorities appears between Congress and America’s small-business owners. One is primarily interested in coverage and the other cost. If lawmakers can help reduce costs, small businesses can help increase coverage in the long-run.”

Everyone talks about how small business is the engine that drives the economy, but many firms sputter out when their engines are fouled by high health care costs.

There’s a host of reasons:
They can’t leave their corporate jobs to launch a business because they can’t afford to buy healthcare on their own;
They took the plunge, started a firm, but now realize the escalating cost of health care coverage may send them back to working for The Man;
Or they go without coverage, holding their breath that an illness doesn’t send them to the poor house.

Many of the many presidential candidates say they have their plan for saving the health care system. But for those of you who can’t wait that long for change, if it ever comes, check out what’s happening in your own state. Many states are now offering opportunities for small business owners to buy into high-risk pools that provide cut-rate plans for people with dreaded pre-existing conditions. Check your state’s insurance department to find out what’s available.

And don’t forget to contact your local chamber of commerce, which may offer group insurance plans. A bigger group should mean you have to shell out less money.

But none of these things are a panacea for the deeply “sicko” system.

One entrepreneur I spoke with recently told me her high cholesterol and the fact that her husband had smoked in the distant past made them pariahs to health insurers. They couldn’t even get a policy unless they dished out thousands a month, and that was only for catastrophic care. Forget about getting coverage for routine doctor visits.

“We live in constant fear,” she says about getting sick.

This is definitely movie fodder -- horror movie fodder.

Comments

The only way health care reform will work is to put all of the for-profit health insurance companies out of business and just have the federal government have a medicare style plan for every American with a special subsidary for Veterans. In other words, it's a dead horse. Corporations, Small Biz and entrepeneurs won't go for it. They'll all scream, "Government intrusion" and that will be the end of health care reform. Why bother? Just accept that it isn't going to happen.
Len (Sent Monday, July 23, 2007 10:40 PM)

My friend and I are in the process of starting our own business. I'll have no healthcare when I get out of the Navy in six months, so we'll see what happens there. I hope this business works out for us, because if it does, I'm moving to Europe so I can live a real life. I hope American politicians do fix the healthcare problem in the coming years, but for me its a day late and a dollar short.
Réal, Syracuse NY (Sent Monday, July 23, 2007 10:47 PM)

As an American I find it unimaginable that we do not have some kind of National Health Care System! We need a plan that must provede those in need with relief "when it is needed". We need Major Medical Expense coverage with a structured deductable plan, maybe similar to our Medicare System Plan, to protect people from the devastating financial and emotional loss they suffer when they get sick or injured. Maybe we cold have a plan where the deductable could be covered by private insurers just as the deductable is for people on medicare. We do need Action from our representatives. Please keep it in mind come election day.
Allen Hochhalter (Sent Monday, July 23, 2007 10:54 PM)

Everyone in this country should take a really long look at the health care industry in this country. The system truly is sick itself. If you don't believe it , just wait till the next time you need to have a procedure done or some emergency taken care of. You will freak at the cost and how difficult and problematic and confusing it is. A true nightmare. Please wake up America!
jeff (Sent Tuesday, July 24, 2007 12:17 AM)

Hi! just a short comment on the health care issue.
Sorry I don't own a business yet, but I work for a hospice company. My insurance rates just went up this month. For one child and one adult $374.00 bi weekly for medical insurance. This is insane!!!!
A. Reid (Sent Tuesday, July 24, 2007 2:06 AM)

I owned a small flowershop and worked 48 hours a week. I was never able to afford health insurance. It is an outrage... When is this country going to copy the french health care system... It is the best in the world and it works. It is affordable and accessible to everyone! I know, I was borned and raised in France. There is no waiting lines, you can choose you doctors. The care is great, and medications very inexpensive. It baffles me how anyone in the usa can be against Universal health care. It would profit everyone and the americans would be certainly healthier. Also, France offer affordable health insurance to its citizens living overseas. The health care system in this country is a real rip off and it needs to be changed. If those politicians do not know how, send them to take a class at the french ministry of health!! Also, no
one seem bothered by how much money is being spent on the military... 610 billions in 2006!! This money could have taken care of a lots of people for many years to come... Also, preventive care is Key to a successful health care system... preventive care should be accessable to everyone. In France a doctor visit is only $30.00
This country is backward!! Health care system in France is N0 1, american health care system is N0 37th... What a shame! And you think this country is the greatest in the world?? Right!!! No country is the greatest when it cannot provide something as important as health care! To us europeans, it is a right and a moral obligation! And for the one who think France is bankrupted, France has never been so rich!!
elisabeth schneider (Sent Tuesday, July 24, 2007 2:22 AM)

As a Teamster about to quit my job and open a business, so I can be a better mommy than truck driver, I am concerned about this very thing. I am middle-aged(Eeek! ) and hope to address my overweight condition before taking the plunge so I CAN get some kind of coverage for,say, drastic hospitalization and pay for routine doctor's visits out of pocket. If I keep my salary down I can deduct 100% of those expenses as well as whatever premiums I have to pay-I hope.

My job makes it extemely difficult to be healthy and I am accustomed to the comprehensive health care we enjoy as union members. I will get a double-whammy of reality when I make my move. Wish me luck! The alternative is to consign my young son to the indifferent care of a rapid turnover of caregivers and underskilled big-city teachers for the next 12 years or so while I continue to work 60-70 hours per week, on nights,weekends,and holidays for The Man. THAT dog ain't gonna hunt.
Sandy Collier (Sent Tuesday, July 24, 2007 3:23 AM)

Small business owners often overlook the resources at their disposal. Local Chambers of Commerse and Small Business Groups will offer low cost group insurance to members. If they are irresponsible enough not to get healthcare for themselves at least, they deserve whatever they get!
Amy, Macon, Georgia (Sent Tuesday, July 24, 2007 7:09 AM)

I researched opening a small-business with only 4 employees.
I got through all the tax-laws and my head was reeling...then I looked at getting medical insurance in a group plan for 4-people.
The quoted rate was 3X my projected first-year income after expenses.
I stopped looking into opening the business at that point.
I now understand why comapnies use the tatic of employing a bunch of part-time employees compared to a smaller amount of full-time employees.
This may decrease the insurance payments for the company but limits the businesses chances of employing hi-grade/long-term employees.
I for one will NOT even apply to a company unless they have medical insurance available after 90 days employment even if I have to pay a higher preimum as a lower time employee.

Rob C. (Sent Tuesday, July 24, 2007 7:12 AM)

I have worked in the health care industry for the past 40 years, the last 20 as a practice administrator. The whole health care industry as gotten completely out of hand. Insurance companies ask for and receive double digit increases each year while lowering reimbursement to physicians. DME companies and pharmaceutical companies are constantly involved in direct marketing campaigns that encourage more and more consumption. Americans don't need more care, they need to take better care of themselves. We are in desperate need of a single payor system that provides health care for all Americans and eliminates the "for profit" entities. Tell your elected representatives to stop taking money from the big corporations and do what is right. If they don't....fire them.
Gary Rowe, Albany, NY (Sent Tuesday, July 24, 2007 8:02 AM)

I was an exchange student to Sweden many years ago. After comparing maternity leave, medical care, among other items with what the Swedes have--my husband and I are considering moving there and possibly settling there. We also figured out I have less tax liability there making only $36,000 a year. I wouldn't be taxed at my husband's higher rate, which is about the same in Sweden. I say "screw it." The powers that be will not reform the system here because its their "turn to ride on the high hog." I'm sure I'll be slandered as un-patriotic for leaving, but my parents and grandparents understand. I'm doing what anyone would do for their kids--trying to give them the best life I can. Its exactly what my husband's grandparents did 40+ years ago in leaving communist Poland.
A. B-G. Boston, Massachusetts (Sent Tuesday, July 24, 2007 9:03 AM)

Overall, there is a simple fix, but we may have to endure our own civil war. Us versus Them. If we won, that sure would make us common folk happier in all manner of daily life with more of the best of American freedom.
I hope I can do this: please read Jane Bryant Quinns last Newsweek essay. P.S. In my dreams I see a populist pres., and an overpowering majority of young democratic congressmen and women. Remember the Bastille.
Tom Davis (Sent Tuesday, July 24, 2007 9:20 AM)

I used to own a small busimess with about 6 employees. I was able to cover them for a while, then rates got beyond what I could pay. I kept looking around, tho'. Amazing the scams I was offered. On one policy, the saleman flat-out lied to me about the terms. When the paperwork arrived I waded through it and discovered that there was a $25K deductible. Can you imgine? A twenty-five thousand dollar deductible! And it wasn't that cheap! I had to call and scream and threaten and finally got my money back.
Ivy Hamlin, NY, NY (Sent Tuesday, July 24, 2007 9:24 AM)

I work on the administrative side of a small business (30 employees) and every few years or so each employee completes a form stating their health issues so the company maybe able to get a lower premium. What sucks about this is the insurance company can then charge what they want when they see any underlying condition and heaven forbid we have anyone with cancer then ZOOM up goes the premium! I think the company pays like $890/month for the family plan.
A few months back I was going to have an elective proceedure done and I tried in vain to find out a ballpark on how much it was going to cost and do you think I could get a straight answer? Healthcare is about the only industry I can think of that you can't easily get a price quote on how much something is going to cost. I wanted to know so I could start saving ahead a little bit. My goal was to shop around to find the best deal so ultimately my insurance company wouldn't be over charged by some over zealous Dr. Granted, health insurance wasn't intended to cover every sniffle and sneeze and I think some Americans have that idea. Even those on government assistance should have to pay some sort of co-pay and for goodness sake find a family doctor and quit going to the emergency room for your rashes. And another reason healthcare is so costly is because us hard working Americans are paying for those that are here illegally and are sponging off the rest of us. Please excuse my rambling and misspelled words because this has stuck a nerve.
Renee in the Midwest (Sent Tuesday, July 24, 2007 9:26 AM)

For those who think that universal or government healthcare is the answer, all you need to do is look at the state of Wisconsin. Recently, the governor and Senate passed a bill to insure all people under the age of 65. This plan would cost 15.2 billion dollars, which is about $3 billion more than the state takes in yearly in taxes. This wonderful plan would increase the tax bill paid by residents by $510 dollars a month. Small businesses who do not offer insurance would see their employees costs sky rocket.

So, for those who think the answer is government control, I have one question. Who will pay for it? In case you can't figure it out, you will, with higher taxes. Personally, I like having the choice, even if I have to pay a higher premium.
Brian (Sent Tuesday, July 24, 2007 9:31 AM)

First of all, I know there has been a lot of talk about why America doesn't have national healthcare. The obvious reason: HMOs and insurance companies pump too much money into the governments pockets for this to ever happened. I believe you call it "contributions" But we all know they are "legal bribes". DON'T BELIEVE THE PEOPLE WHO SAY NATIONAL HEALTHCARE IS BAD!! I am from Europe and live here in the US and I have heard spokesmen speakign about how long it takes to see a doctor, get a surgeon, get your pills etc etc. Does it happen? Sure, but not the way these people describe it. They are all liars, not doubt in my mind paid by the health care companies to speak badly about national healthcare. How long do you wait for a doctor now? How many times have you been denied coverage? Or told what pills to take? What doctor to see? This is your life they are talking about!! What does some snot nosed kid taking a call in who knows where know about your medical condition to deny you anything!!?!?!? What are your premiums for? If I pay you to provide for me in times that I need help, then I do not expect to fight over bills. Why have coverage in the first place? When I was in Europe (Portugal) a few years back, my appendix burst and was rushed to a hospital. I had emergency surgery and stayed in the hospital for 9 days. NINE!! Here you'de be home the next day. On the 7th day, I had a temperature of 99.1. They wouldn't let me leave the hospital. Finally, when I left, I paid my bill: $6.35. (Phone call). Wake up America!!!
Mario Sousa, Hartford, CT (Sent Tuesday, July 24, 2007 9:38 AM)

Amy from Macon has the right idea. Instead of complaining about the lack of access to health care coverage, small business owners need only join their local Chamber of Commerce to get access to a real laundry list of health care plans. That is if the REALLY want the coverage or just want an excuse not to provide health care for their employees.
Plus, there are all the other benefits associated with belonging to a Chamber including the networking functions and education. And, no, although I belong to a good Chamber, I don't work for one.
Mike, Media, PA (Sent Tuesday, July 24, 2007 9:38 AM)

One thing to remember; the health care system in this country is NOT a free market / "capitalist" system. It is a very sick mixture of legally sanctioned monopolies (AMA, hospital associations, drug companies etc.), publicly funded programs (Medicare, Medicaid) and for-profit payers (insurance companies). There are huge amounts of money pouring into the system and most providers have a vested interest in the status quo (inertia). More and more small business and middle class people are falling through the cracks and face financial devastation. Just don't blame "capitalism." Entrepreneurs were squeezed out of the system a long time ago and now operate on the fringes.
Dave E, Milwaukee, WI (Sent Tuesday, July 24, 2007 9:42 AM)

People want nice things? People want more government funding for parks, healthcare, roads and other things? It's simple. Raise taxes. If you want nice things, you have to pay for them. Where else would we get revenue for a major crisis like this? Remove funding from NASA? Cut back Parks and Recreation funding? Not enough money there. Raise taxes, get more government income and then see what more money means more nice things. Of course there is always that problem of politicians hoarding it.....
Ray, Houston, TX (Sent Tuesday, July 24, 2007 9:47 AM)

I find it ironic that your "solution" to small business problems is a further abrogation of property rights and ending for-profit enterprises in health care.

As a business owner, I have suffered the increased health care costs associated with insuring my employees. I have also suffered the increased costs associated with giving my employees wage increases. Perhaps you could really help me out by putting all my workers on the government payroll! Better yet, how about forcing my customers to buy my products in quantities more than their needs!

Wake up America. The state and the consumer are more at fault for breaking America's health care system than greedy HMOs are. If you want to fix these problems, deal with them as the economic issues they are, not the emotional issues you want them to be.
JRS, Chicago, IL (Sent Tuesday, July 24, 2007 10:10 AM)

I am no fan of Michael Moore or his partisan rants, but your comment "(t)hey took the plunge, started a firm, but now realize the escalating cost of health care coverage may send them back to working for The Man;" sums up problems that I encountered after twelve years of owning and operating an incorporated small business. Health care insurance costs were the defining reason why my wife and I are now back working for "The Man" in another state. Small business might be the engine that drives the economy, but health care insurance costs are driving small businesses out of business.

Like everything else in the country that directly impacts average people these days, the system is broke and appears to be driven by nothing more than the insatiable greed of large corporations. Whether it's health care coverage; prescription drugs; gasoline and energy costs; out-sourcing of jobs and / or related illegal immigration; and a myriad of other problems --- we are in deep yogurt and there is no relief on the horizon. Politicans in both parties are enablers of this mess and chamber maids to special interests, which have been enjoying one big party at our expense for years.
Ted (Sent Tuesday, July 24, 2007 10:13 AM)

I encourage everyone to focus on their state legislatures to address the need for guaranteed healthcare for all. The feds may never deliver. E.g. California's legislature passed a universal health care bill last session that was vetoed by the Terminator Schwarzenegger. Many states have similar bills already introduced, e.g. Ohio, The Health Care for All Ohioans Act, H.B. 186 & S.B. 168. You can get info about similar bills in all states that have them at www.spanohio.org Do not be afraid of contacting your legislators.
Bob Krasen, Columbus, Ohio (Sent Tuesday, July 24, 2007 10:19 AM)

Universal Health Care seems to work in the countries I have visited. I would just be afraid the same people who screwed up the Katrina disaster relief effort so badly would be the people our Government would put in charge.
Robert, Ashland, Ohio (Sent Tuesday, July 24, 2007 10:26 AM)

Due to pre-existing conditions, I have been declared by the health insurers as "uninsurable in the United States" (their words). That means they will not sell coverage to me at any price... in the USA.

In 2000-2001 my consulting firm paid most of the premium to cover an employee other than me, but by 2003 I could not do that any more either. I left the country and took my 15 year old consulting practice with me.

I know people all over the world. Switzerland's health care sounds slightly better than France's. My chronically ill friend in Switzerland could easily be dead if she were in any other country. Instead she is not only alive, but working.

At present I am in the UK. I came here for personal reasons, not their NHS. I do not recommend emulating their NHS health care system, which even they admit costs more than other countries in the EU without matching quality of care. Now that I am outside the USA, I have been able to buy private insurance and can get care in the private network, which is better.

If I return to the USA to live, I will again be unable to keep or obtain health insurance. Tax laws make it punitive to spend more than 30 days a year visiting in the USA. When I left, I supposed there will be no going back.

If rising anti-immigration emotions keep me from being able to renew my visa, I have chosen the next country I will go to. What I do improves the profitability of factories and telecom companies, which I hope will make me welcome.
Bonnie Huval (Sent Tuesday, July 24, 2007 10:30 AM)

Those of us with insurance are used to paying for it. If our taxes increased by 3% across the board, we could fund national health insurance, and 3% is far less than most of us pay now!!!!! Hmmm... less money, better coverage, coverage for everyone... is this really a debate? In a free market economy, we all want more for less - and Universal Coverage does this! HR 676 - tell your reps to support it!!!
Alexis, Washington DC (Sent Tuesday, July 24, 2007 11:04 AM)

The goverment should atleast be able to have a basic plan for everyone like Medicare. After that you could buy supplemental plans if you need it. We don't have a health care problem in this country. We have a delivery problem. When the only reason people work is to have health insurance, then how are we ever going to encorage people to start new businesses.
Neil, Nashville Tn. (Sent Tuesday, July 24, 2007 11:44 AM)

Interesting article. Even if you have health insurance with a major carrier you may not be completely covered. I have a friend in the business and she said people (me) don't read the fine print and will get caught out with a major illness. She saved my wife and I (both self employed) a lot of money by raising our deductible, and taking out an additional policy from an independent carrier to cover us in the event of a catastrophic medical event. . .
Jim Watson, Carlsbad, CA (Sent Tuesday, July 24, 2007 11:52 AM)

As long small business believes government is the enemy and votes Republican not progress will be made on health care. As long as people believe Canadians and Brits have substandard care and believe the rest of false corporate claims things won't change. And no the states can't fix this mess. A national health plan similar to Medicare is the only answer. You have control costs by limting profits for both the drug companies and medical industry. As long as you let rich folks spend whatever they can we might get something passed in the next for years.
Will Konyndyk (Sent Tuesday, July 24, 2007 11:53 AM)

Almost every day, people come into my small business and tell me how I should change this or that. Sometimes, people have great ideas, but 98% of the time, what they say just shows how little they understand the business I am in. The same is true for those who imply that I and other small business owners are stupid and deserve to die if we can't afford health insurance. Health insurance is very expensive and many small businesses can't afford it. Heck, businesses of all sizes are having a hard time of it. More importantly, many people have pre-existing conditions and are turned down. I am NOT too stupid to check with the Chamber of Commerce. Ours doesn't offer anything. We are not idiots, Amy & Mike. I have an MBA and experience in this area. I promise you that the only reasonably priced plans have very high deductibles and poor coverage.
Janet, Scappoose, Oregon (Sent Tuesday, July 24, 2007 12:03 PM)

I live in Canada and pay $44.00 per month for my health care coverage for the essentials (doctors visits, tests etc) plus about $5.00 for the rest (drugs and such). People always say that the American system is better than ours because of the wait times, but I recently had a scare where I could not move my leg because of a lump in it. I waited 45 minutes to see a doctor, and less than half an hour for an ultrasound. This was all at no cost to me or my company health plan, and my company offered health care plan covered the drugs that I needed to deal with the pain. I can not think of a better system than the one that we have here.
Amanda, Calgary, Canada (Sent Tuesday, July 24, 2007 12:37 PM)

Part of the problem with health care in this country is the high cost of prescription drugs. The drug companies say that they need to charge higher costs so they can recoup the cost of r&d for finding new drugs to treat diseases, this really puzzles me because the government pays drug companies to find drugs for diseases (r&d). Then they use us for guiney pigs to test their crap on and find what the affects are, then hide the results give the medication to other countries at lower prices and charge the people of the United States inflated prices, then make billions of dollars year and then to add insult to injury tell us that the price is the lowest that they can charge and still make a tiny profit. In one word B___S___ . This is another part of the problem that nobody seems to address. Our health care system is on its death bed. Please someone pull the plug.

Jeff Dill Old Bridge N.J. (Sent Tuesday, July 24, 2007 12:54 PM)

IT IS DISGRACEFUL THAT WE HAVE MONEY TO WASTE ON THE WAR,NASA AND OTHER THINGS LIKE THE BRIDGE TO NOWHERE.WHY CAN'T WE HAVE A NATIONAL HEALTH CARE POLICY AND PUT THE MONOPOLIES IN HEALTH CARE OUT OF BUSINESS?
JOHN SMITH,YUCCA VALLEY, CA. (Sent Tuesday, July 24, 2007 12:58 PM)

In August of last year I was diagnosed with Endometrial cancer. I work for a small company who did not have health insurance (I still work for them and they still have no insurance). The 4 employees here have husbands who have incredible insurance plans. I do not. My lifesaving cancer surgery wouldn't even be discussed by the healthcare professionals who are supposed to save me, unless I could pay at least 50% of it upfront and make incredible payment arrangements afterwards. Subsequently any private insurance wouldn't take me because of this condition (I had applied privately the year before, but I am overweight and was therefore denied by ALL of them). Even the federal medicaid system wouldn't help me because I'm 35 (34 at the time), have a job, have no kids, etc. Since all of this happened, everything is out of pocket. I'm not rich, I'm dying in this debt. My mother borrowed from retirement, friends pitched in. And the governments answer was "You have to be unemployed for 6 months, and THEN we'll have OUR doctors examine you and see if this is life threatening to be considered for anything". SIX months? I would have died. Now, I've been given a second chance at life, and am swimming in debt and I STILL can't get insurance. So now I miss work for all the doctors visits I have to make, don't get paid for that time, have no insurance and keep incurring debt with EACH visit. I don't know all the discussions about politicians and small business insurance availability, but I know SOMETHING MUST BE DONE. A year ago I would have died from my invasive cancer, now I'm dying because of the debt, and to this day any doctor that sees me sees only what I can pay... not my life, my humanity. Something must be done.
Susan, Illinois (Sent Tuesday, July 24, 2007 1:00 PM)

Regarding the comments by Amy in Macon and Mike in PA about simply joining a chamber of commerce or other professional organization to get group rates. Yes, you can do this, but the plans offered are *very* low-end plans in terms of coverage.

I run a 200 person consulting & development company and we moved to a self-insured plan 2 years ago after almost a decade of untenable double digit increases from our major carriers...we feel that providing good, fully funded healthcare is an essential benefit, but the cost is huge and will eventually outstrip our ability to pay for it even though we are fortunate to be in an industry that pays well.

For 2007, our insurance costs will be greater than our cost for 28,000 sq. ft. of office space, computer equipment, and our 401(k) plan COMBINED...there absolutely IS a healthcare crisis in this country and those who don't believe it are either ignorant, deaf, or both. If you're just listening to what the Republicans and the insurance industry (or their collective mouthpieces on right wing radio) are telling you, you're simply not tuned in to reality.
Richard, Seattle, WA (Sent Tuesday, July 24, 2007 1:06 PM)

We are living in a Third World nation so long as we do not have universal health coverage. I cannot start a business because I need health coverage. I am tied to my boring, unproductive job because I need the health coverage that it provides. Instead of opening a business, paying an employee or two, paying taxes and buying su

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Working Wounded Blog: 'Sicko'
What Is the Deal With Health Insurance and the Workplace?



(Photodisc)



By BOB ROSNER
July 11, 2007


Here is an admission that I've never made in the decade that I've been writing professionally -- I cried at a movie this weekend. It wasn't a chick flick. Or a horror movie. Well, maybe not a traditional horror movie, but it was still mighty scary.

The movie was "Sicko." Yep, that crazy Michael Moore's latest.

I bet you're wondering what this has to do with a workplace blog? Since most of us get our health insurance from the same place -- our job -- "Sicko" has everything to do with work.

Our jobs and health insurance have been inextricably bound since the late 1940s. With a flood of soldiers coming back after World War II, corporations positioned health insurance as a perk to attract the best and brightest. Ironically, the movie documents how England went in the exact opposite direction by introducing universal health care right after the war.

I never thought I'd encourage you to go see a movie that promotes a government run health care system, but then again I never thought I'd admit to crying in one either.

The movie contains heartbreaking scene after scene of people without health insurance literally being tossed on the street in hospital gowns. But the most painful parts of the movie aren't the stories from the uninsured. No, the worst parts are the scenes with people who have health insurance but who are denied treatment. Which raises the question, what is a safety net when it is full of holes that are big enough for you and me to fall through?

I have another personal confession to make. I once worked for a health insurance company. I saw how claims were reviewed. I didn't see any cases of people who died for lack of treatment, but I did see a process that was more concerned about cost savings than providing quality health care.

I wish I could offer a silver bullet based on my experience. A way to ensure that you or a loved one will get the treatment you deserve, heck that you paid for. But the system is built so that the maximum decision making power doesn't lie in the hands of your doctor but in the bowels of health insurance behemoths.


But rather than demonizing health care workers, the movie interestingly shows how debilitating the system is on them. After all, these are the Florence Nightingales who got into health care to help people. They didn't choose this career simply to write "denied" at the bottom of health insurance forms.

Moore contrasts interviews with U.S. health care workers talking about how they hate having to deny treatment to people who need it with health care workers from countries with national health insurance who revel in their ability to simply focus on the needs of their patients rather than billing and access to service quandaries.


Is this movie above reproach? Of course not. After all, this is Michael Moore. He falls too much in love with France's socialized health care system, to just give one example. But don't lose the bigger point. We are all betting our lives on a house of cards that spends millions to think of creative ways to deny treatment.

 

Healthbeat, California Healthcare Foundation June 15, 2007
Business Roundup for the Week of June 15, 2007 M&A, Financial Reports and Funding

"Ingenix has acquired the Lewin Group, a national health care and human services consulting group..."

Ingenix is a wholly owned subsidiary of United Health Group, the largest profit-driven health insurer in the world.  The Lewin Group has formerly been acknowledged as a reliably independent, unbiased source of information about the health insurance industry, comparable plans, systems, etc..  Now the integrity of information coming from the Lewin Group will be totally unreliable and virtually non-existent, but only to those who are paying very close attention.  Your reporting of only half of the story is a dereliction of duty, hopefully caused by lack of information rather than a deliberate misleading of your readership.  Now that I know you know the truth, the whole truth, and nothing but the truth, I and others will be watching to see if you report it.  It is your responsibility to do so.

Become a part of our new Business Coalition for Single Payer Healthcare. Sign Up Now! Email us Your info.

Business Perspectives on the Uninsured - Conference Report (PDF)

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APRIL 16, 2007

HEALTH
By Richard S. Dunham and Keith Epstein

Q&A With Ed Gillespie

One indicator of the changed atmosphere surrounding the health insurance debate is that Ed Gillespie, a former Republican National Committee chairman, is teaming with Big Business to push a larger role for government. Gillespie, a lobbyist, represents such clients as Safeway (SWY ), Tenet Healthcare (THC ), and Bristol-Myers Squibb (BMY ). Here are excerpts from his Apr. 3 discussion with BusinessWeek Senior Writer Richard S. Dunham:

What's changed that has prompted CEOs to push for universal health insurance coverage?
We're getting to the point where one in every five dollars in the economy is spent on health care. The health-care system we have is antiquated and unsustainable. American companies are at a disadvantage in an increasingly global economy. Businesses realize you're either going to be part of the problem or part of the solution.

While business largely agrees on the problem, isn't there a problem reaching consensus on the best solution?
Big business is split. Some businesses are trying to fix the system. There are some businesses trying to offload costs onto the federal government.

How do you see health-care reform playing out in the next election?
Health-care policy will be the defining domestic policy debate of the 2008 campaign.

Polls show that voters overwhelmingly favor Democrats when it comes to health issues. What should your party do?
Health care as an issue has not been good to Republicans in the past, and we have to be out in front on it. We have to push for access and affordability without destroying the market-based system.

Editor's Note:   And some businesses are stealing from other businesses -- stealing from their bottom line.  I speak, of course, of the insurance and pharmaceutical corporations.

TO JOIN NATHAN WILKES AND THE "BUSINESS COALITION FOR AFFORDABLE HEALTHCARE" FOR ALL," CONTACT HEALTHCARE-NOW, 1-800-453-1305

Nathan Wilkes is a businessman whose experience trying to get healthcare for his seriously ill child has shown that no one is immune to insurance company greed.  He traveled to Washington and to New York to work for a National Single Payer Plan  H.R.676

Colorado businessman, Nathan Wilkes, attacked by the insurance companies...fights for healthcare for his child..(More)

NEW YORK TIMES BUSINESS SECTION -- Single Payer is the Answer

Health Care Problem? Check the American Psyche

December 31, 2007

By ANNA BERNASEK

WHAT is the most pressing problem facing the economy? A good case can be made for the developing health care crisis. Soaring costs, growing ranks of uninsured and a steady erosion of corporate health benefits add up to a giant drag on the nation's future prosperity.

While the outlook seems scary, it doesn't have to be. There is a solution, proven effective for hundreds of millions of people: single-payer health insurance.

Yes, single-payer - that much-maligned idea that calls for everyone to pay into one insurer, typically the government or a public agency. The insurer then pays doctors, pharmacists and hospitals at preset rates. Patients who want unapproved procedures and doctors not willing to accept the standard payment remain free to deal with one another directly, outside the system.

Such a system makes it much easier to deal with the growing costs of medical care, like administrative expenses and prescription drugs. It could also reduce the mountains of paperwork plaguing the current system and provide insurance coverage for the 46 million Americans now doing without it.

What's more, as demonstrated in France, Britain, Canada, Australia and other countries with functioning single-payer systems, significant savings can come without hurting the overall health of the population.

There's only one catch. Most Americans just don't believe it can be done. The health care crisis may turn out to be more of a problem of ideology than economics.

The economic case for a single-payer system is surprisingly strong. Start with what we already know. Countries with single-payer systems have long records of spending less on health care than the United States does. The United States spent an average of $6,102 a person on it in 2004, according to the Organization for Economic Cooperation and Development, while Canada spent $3,165 a person, France $3,159, Australia $3,120 and Britain just $2,508.

At the same time, life expectancy in the United States, a broad measure of health, was slightly lower than it was in those other countries in 2004, the latest year for which complete figures are available. And the United States had a higher rate of infant mortality.

To be sure, a single-payer system has plenty of critics. Unattractive features of some such systems, including waiting lists for particular types of care, are often highlighted by skeptics. But supporters note that the overall health of people fares well in those countries.

"The story never changes," said Gerard F. Anderson, a professor at the Johns Hopkins Bloomberg School of Public Health. "The United States is twice as expensive with about the same outcome.

"As a consumer, I don't mind paying more if I'm getting more, but that's just not the case in the U.S.," said Professor Anderson, who publishes an annual review comparing the American health care system with those of its peers.

What may be less well known is the level of administrative waste in the United States health care system, versus that of well-designed systems elsewhere. Although Americans tend to equate efficiency with private enterprise, that's not the case with the current system.

The American system, based on multiple insurers, builds in more unnecessary costs. Duplicate processing of claims, large numbers of insurance products, complicated bill-paying systems and high marketing costs add up to huge administrative expenses.

Then there's an enormous amount of paperwork required of American doctors and hospitals that simply doesn't exist in countries like Canada or Britain.

"There's little disagreement among economists today that a single-payer system would lead to lower administrative costs," said Len Nichols, a health economist with the New America Foundation, a policy research organization in Washington. But he said that estimates varied widely over how big the savings could be.

One of the first major studies to quantify administrative costs in the United States was published in August 2003 in The New England Journal of Medicine by three Harvard researchers, Steffie Woolhandler, Terry Campbell and David U. Himmelstein. It concluded that such costs accounted for 31 percent of all health care expenditures in the United States.

More recently, in 2005, a study by the Lewin Group, a health care consulting firm commissioned to examine a proposal to provide universal health coverage in California, estimated that administrative costs consumed 20 percent of total health care expenditures nationwide.

Then there's the test of time. Health care costs tend to rise over time as new technology and procedures are introduced. Yet here, too, government-funded systems appear to help contain long-term costs.

Consider Canada's system. Professor Anderson points out that in the 1960s, Canada and the United States spent roughly the same per person on health care. Some three decades later, though, Canada spent half as much as America. How did Canada manage this? By controlling the use of medical equipment and hospital resources, which statistics show has helped Canadians keep a lid on costs without measurably compromising the overall health of the population.

Economic studies also show that a government-funded system could reduce costs while providing coverage for everyone. The Lewin report on the proposal to provide universal health coverage in California calculated that if such a system had been operating in 2006, it would have saved $8 billion, or around 4.3 percent of total health spending in the state. From 2006 to 2015, it estimated, savings would total $343 billion. Currently, California spends about $180 billion a year on health care.

Despite everything that is known about the economic benefits of a single-payer system, there's one big stumbling block: many Americans don't believe in it. They have heard horror stories from abroad, often spread by partisan advocates, focusing on worst-case examples. Such tales play upon the aversion of many Americans to government involvement in the economy.

Victor R. Fuchs, an economics professor at Stanford and a specialist in health care economics, explained it this way: "The Canadian system is a nonstarter for the U.S. even though it's a good system for Canadians. You're dealing with two very different countries. We were founded on life, liberty and the pursuit of happiness. They were founded on peace, order and good government. It's a difference of values."

Others in the field echo his skepticism. But that raises questions about how well Americans understand the system they have, and what the alternatives are.

JUDGING from other countries, many features that Americans really like - being able to choose their own doctor, for example - would remain available in a well-designed single-payer system. And a single-payer system need not mean government-provided care: it often means government-provided insurance that encourages competition among providers.

Much of the resistance to a single-payer system appears to stem from a lack of confidence in the nation's ability to make positive change. With all of its prowess in research and technology, can't the United States match the efficiency of other developed nations, or do even better?

Changing the minds of so many millions of people isn't done overnight. But sooner or later, persuading people to do something that's in their own economic interest ought to succeed

Editor's Note:  Healthcare-NOW is . on the way to persuading people to do single payer "in their own self-interest." and the interest of the nation.  See "Take Action" section to find out how you can help.

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THE BIG THREE --Resolving to Reimagine Health Costs , November 18, 2006

By JOE NOCERA

So they finally had that long-awaited meeting this week, the chief executives of the Big Three auto companies and President Bush — the one the automakers have been pushing for ever since the president suggested last January that their big problem was that they needed to make “a relevant product.”

“Relevant products,” however, were not on the agenda, at least not as it was described in the papers afterwards. During the hourlong meeting the three executives — Rick Wagoner of General Motors, Alan R. Mulally, the new boss at Ford, and Thomas W. LaSorda, head of the Chrysler Group — offered a litany of woes. The yen, they said, was too low, giving Japanese manufacturers an unfair advantage. (The yen is the problem?) They complained about the rising cost of materials, such as steel. And of course they talked about health care costs.

You know this part of the story, don’t you? Whatever you might think about a weak yen, there is no denying that health care costs are a crushing burden for the automakers. General Motors pays out more in health care than any other company in the country: some $5 billion a year. Health care costs add $1,500 to the price of every General Motors automobile. Over the decades, the company negotiated extraordinary retiree health benefits with the United Auto Workers. Even after negotiating back a little relief from the U.A.W. not long ago, General Motors still bears costs that its foreign competitors don’t.

And yet at the meeting, the automakers offered only one concrete idea — one that was hardly likely to warm the heart of a free-marketeer like the president. They suggested an idea that John Kerry had embraced during the last presidential race: the establishment of a large insurance pool, presumably government-funded, to cover the small percentage of employees and retirees with chronic illnesses. The statistic you hear a lot is that 1 percent of the beneficiaries eat up 30 percent of the costs. And the automakers — and, indeed, other large manufacturing concerns —would like to be relieved of that burden.

But even in the unlikely event they got that relief, it wouldn’t exactly be a game-breaker. The per-car health care cost would drop to, what? A little over $1,000 instead of $1,500? That’s still a lot of money.

“It is hard not to be somewhat contemptuous” of what took place in that meeting, said Uwe E. Reinhardt, the Princeton University health care expert. “They book an hour with the president and then don’t ask for anything except to beat up on the Japanese about the yen? Why tell the president about health care costs if they don’t have a solution? The man is busy.”

The larger question, though, is why so few people in American business have ideas about what to do about the health care problem. It is, after all, their burden — and I’m not just talking about the auto companies. Howard Schultz, the chairman of Starbucks, has testified before Congress about it, and has said that his company spends more on health care costs than on coffee beans. With the Democrats now in control of both houses of Congress, and the 2008 presidential race looming, it certainly would be useful if the business community had some ideas they could put on the table.

“There are a group of economists, including myself, who have long said that health insurance doesn’t have a natural home with work,” said Theodore R. Marmor, a professor of public policy and management at the Yale School of Management. He’s right, of course. The linkage of employment and health care benefits are a product of another age, when American business was utterly dominant, when it didn’t have to worry about global competition, and when unions made up a much larger portion of the work force.

I mean, really: if you had to build a health care system from scratch, would you build the one we have now? One where people who don’t have jobs can’t get affordable health care? Where some 46 million American have no insurance? Where even the insured and their employers feel constantly squeezed by higher costs? Of course you wouldn’t.

But here we are nonetheless, trying, more or less, to make the best of it. And so over the years, companies and business groups have made periodic attempts to grapple with the rising costs and other difficulties. For a time, they thought that moving to an HMO-style system would help stem the costs and make the health care burden more bearable. Well, that hasn’t exactly worked out as planned.

Then, in the late 1980s and early 1990s, a number of big companies, including the auto giants, came to Washington to lobby for health care relief. “I remember meeting with G.M. and Ford back then,” Mr. Marmor said. “They could see the handwriting on the wall.”

The sense of looming crisis, of course, led eventually to the ill-fated Clinton health plan, and in truth, business has been chary of getting involved ever since. “It just amazes me, the inability of business to get itself together and organize around this,” said Edward F. Lawlor, the dean of the school of social work at Washington University. “Executive after executive would complain privately, but they couldn’t create a mechanism to either put pressure on Washington or find solutions that would cut across firms.”

Partly, ideology gets in the way. “You couldn’t have done more to pay off corporate America than they did with the Clinton plan, but in the end, companies turned on it because it was viewed as a big government plan,” said Drew E. Altman, the president of the Henry J. Kaiser Family Foundation. “They are market people and corporate people. That is how they look at the world.” That very much includes General Motors, despite all its health care problems.

Partly, many companies are practical beasts and accept the world as it is. So rather than coming up with radical new ideas, they work to contain costs however they can. As, I suppose, they must. But one result of that effort is that more of the burden is being placed on employees, in the form of higher deductibles and so on. Just as companies have shifted more of the retirement burden to their employees, the same shift is beginning to occur with health care. Mr. Marmor believes that “the benefit structure is quietly unraveling” — first, as retirees lose health benefits, and then as current employees find themselves moved toward high-deductible plans.

Partly, though, it is just plain hard to figure out what to do. “Nobody has any simple answers,” said Helen Darling, president of the National Business Group on Health, whose members include more than half of the Fortune 100. Different companies, she added, have different needs and problems: what might help General Motors would not necessarily be what Wal-Mart and its employees needed.

The good news is that a conversation about health care is about to begin in Washington. There are few issues the incoming Democratic majority cares about more. And with longtime champions of universal health care coverage, like Representative John Dingell of Michigan and Senator Edward M. Kennedy of Massachusetts, poised to head important committees, a much broader range of possibilities will be explored over the next two years than the previous six.

There will undoubtedly be a push to find a way to help the ones who need it most: those 46 million uninsured. With President Bush still in the White House, it is unlikely that any big change in health care can truly be passed. But the next two years are really going to be about generating ideas — ideas that Democrats can run on in 2008.

The business community needs to get out of its shell and be part of that conversation. Jacob S. Hacker, the Yale political science professor and author of “The Great Risk Shift,” has been floating an idea to allow companies to enroll their employees in a kind of enhanced Medicare system. He believes that would save companies billions of dollars while not robbing employees of decent health care benefits. There are other ideas out there along the same lines, including a proposal authored by Representative Pete Stark, Democratic of California, who is also going to be a key player in the next Congress.

Maybe the auto companies are in a special category, so hogtied by their deals with the United Auto Workers that they have problems that can’t be compared to those of other companies. But when you listen to executives talk about health care — executives in all kinds of industries — that is not what it feels like. Rather, it feels as though the auto companies are the canaries in the coal mine. As global competition heats up, and as health care costs continue to rise, it seems to me that more and more companies are going to feel the same way the auto companies feel right now: placed at a serious disadvantage as they compete with companies abroad that do not have to offer health care to their workers, because that’s something their government does.

The employer-based system we have in the United States has served many millions of people for many years. “Will we always have this system?” asked Mr. Altman of the Kaiser Family Foundation. “Not for sure. But you would have to look over several horizons before you see it changing.” Maybe a single-payer system is the way to go — and maybe it’s not. I can’t say for sure. Maybe the Hacker plan is the answer. Maybe there are ways to revise the current system that would finally get it under control. What I do know is that business can’t stand on the sidelines anymore. This is a moment of opportunity far too precious to waste.

Recently, a flurry of national articles has explored the notion--held by several prominent economists--that increased healthcare spending reflects the choices of an affluent population, and will continue to drive a strong economy.

Many healthcare professionals--physicians, hospital executives, insurance administrators and analysts--see it differently. As one colleague bluntly puts it, "It's a train wreck everyone knows is just around the corner."

Healthcare insiders know that the industry's rosy prospects can continue only if its funding remains stable. Most also acknowledge that the dollars are not likely to flow as they have in the past.

The reality into the foreseeable future is that healthcare--at least beyond a narrow definition of "basic care"--will remain a voluntary buy. In fact, there's every indication that group purchasers are quietly abandoning the market.

A wealth of recent data shows that healthcare cost growth is pricing corporate and governmental purchasers out of the market for coverage. Reports from the Kaiser Family Foundation and the Department of Commerce’s Bureau of Economic Analysis show that, between 1999 and 2004, premiums--the point where costs converge from throughout the healthcare continuum--grew 5.5 times general inflation, 4.0 times workers earnings and 2.3 times the growth of business income.

The numbers are spectacular. And purchasers are responding. In September 2006, another Kaiser report on employer health benefits showed that, between 2001 and 2006, the percentage of employers offering coverage plummeted from 68 percent to 61 percent, a 10.3 percent drop over five years or a 2.1 percent annual erosion rate. During the same period, the percentage of employees with coverage dropped from 65 percent to 59 percent. Data from other sources show that certain workers--those in the private sector, service workers, retail employees--were particularly vulnerable to losing coverage.

Meanwhile, Florida's Office of Insurance Regulation released data showing that, between 1996 and 2004, 132,000 small employers (with 50 or fewer employees) stopped offering health coverage. This represents a 53 percent drop, while enrollees in small group plans fell by 760,000 individuals (42 percent, or 5.25 percent annually). The state's population grew by three million during this period. These precipitous enrollment drops make sense, particularly when you compare the scale of healthcare cost to earnings. The actuarial firm Milliman calculated that the total coverage costs for a family of four averaged $12,214 in 2005. But one-quarter of the nation's workers made less than $18,800, and one-third of its families made less than $35,000. How can mainstream Americans stay in a game that's stacked like this?

Most people understand the healthcare crisis in terms of its human costs: more uninsureds and underinsureds and more frequent cases of personal bankruptcy. But an equally daunting problem is that losses in coverage translate to reductions in the system's financial inputs. This means fewer dollars are available to buy healthcare services and products.

The situation is ominous. Nonprofit hospitals may be able to finesse shrinking revenues through cutbacks in staff, equipment or programs. But for publicly traded companies like Pfizer, United Healthcare, Medtronic or HCA, the drops in funding must negatively impact margin, stock price, market capitalization and credit. Worse, healthcare is 1/7th of the economy and 1/11th of its job market. If this sector develops a large demand-resource mismatch and becomes financially unstable, the disruptions could cascade to and destabilize others sectors, threatening the national economic security.

A theory of limits applies here. In a voluntary market, healthcare purchasers--employers or taxpayers--will tolerate only so much cost growth. Then they'll recede. It is preposterous to believe the well won't run dry.

Even so, and despite the handwriting on the wall, the healthcare industry remains profitable and resistant to collaboration on the structural compromises that are essential to re-establish stability and sustainability. Exceedingly well-financed, organized and influential, healthcare lobbies have shaped American health policy to their own purposes for decades. The only option for meaningful change, then, lies in leadership from non-healthcare business, which stands to suffer from the tidal wave of healthcare's turmoil. Good reason for them to mobilize and act. Several years back, talking about spiraling health costs, the vice president of benefits for a large corporation, commented that "No economy can indefinitely support a single business sector that grows continuously at a multiple of general inflation." That perspective is clearer, more to the point, and almost certainly more accurate than arguing that there's a silver lining in unlimited healthcare spending.

And that's why we worry.

Brian Klepper, Ph.D., is president of the Center for Practical Health Reform, a nonpartisan national effort to re-establish stability and sustainability in American healthcare. Alain Enthoven, Ph.D., is the Marriner S. Eccles Professor of Public and Private Management at Stanford University. They may be contacted at bklepper@cphr.com or enthoven@stanford.edu.

Running on Empty: Healthcare As the Engine of the Economy

By Brian Klepper, Ph.D., and Alain Enthoven, Ph.D., for HealthLeaders News, Nov. 7, 2006

Recently, a flurry of national articles has explored the notion--held by several prominent economists--that increased healthcare spending reflects the choices of an affluent population, and will continue to drive a strong economy. Many healthcare professionals--physicians, hospital executives, insurance administrators and analysts--see it differently. As one colleague bluntly puts it, "It's a train wreck everyone knows is just around the corner." Healthcare insiders know that the industry's rosy prospects can continue only if its funding remains stable. Most also acknowledge that the dollars are not likely to flow as they have in the past. The reality into the foreseeable future is that healthcare--at least beyond a narrow definition of "basic care"--will remain a voluntary buy. In fact, there's every indication that group purchasers are quietly abandoning the market. A wealth of recent data shows that healthcare cost growth is pricing corporate and governmental purchasers out of the market for coverage. Reports from the Kaiser Family Foundation and the Department of Commerce’s Bureau of Economic Analysis show that, between 1999 and 2004, premiums--the point where costs converge from throughout the healthcare continuum--grew 5.5 times general inflation, 4.0 times workers earnings and 2.3 times the growth of business income. The numbers are spectacular. And purchasers are responding. In September 2006, another Kaiser report on employer health benefits showed that, between 2001 and 2006, the percentage of employers offering coverage plummeted from 68 percent to 61 percent, a 10.3 percent drop over five years or a 2.1 percent annual erosion rate. During the same period, the percentage of employees with coverage dropped from 65 percent to 59 percent. Data from other sources show that certain workers--those in the private sector, service workers, retail employees--were particularly vulnerable to losing coverage. Meanwhile, Florida's Office of Insurance Regulation released data showing that, between 1996 and 2004, 132,000 small employers (with 50 or fewer employees) stopped offering health coverage. This represents a 53 percent drop, while enrollees in small group plans fell by 760,000 individuals (42 percent, or 5.25 percent annually). The state's population grew by three million during this period. These precipitous enrollment drops make sense, particularly when you compare the scale of healthcare cost to earnings. The actuarial firm Milliman calculated that the total coverage costs for a family of four averaged $12,214 in 2005. But one-quarter of the nation's workers made less than $18,800, and one-third of its families made less than $35,000. How can mainstream Americans stay in a game that's stacked like this? Most people understand the healthcare crisis in terms of its human costs: more uninsureds and underinsureds and more frequent cases of personal bankruptcy. But an equally daunting problem is that losses in coverage translate to reductions in the system's financial inputs. This means fewer dollars are available to buy healthcare services and products. The situation is ominous. Nonprofit hospitals may be able to finesse shrinking revenues through cutbacks in staff, equipment or programs. But for publicly traded companies like Pfizer, United Healthcare, Medtronic or HCA, the drops in funding must negatively impact margin, stock price, market capitalization and credit. Worse, healthcare is 1/7th of the economy and 1/11th of its job market. If this sector develops a large demand-resource mismatch and becomes financially unstable, the disruptions could cascade to and destabilize others sectors, threatening the national economic security. A theory of limits applies here. In a voluntary market, healthcare purchasers--employers or taxpayers--will tolerate only so much cost growth. Then they'll recede. It is preposterous to believe the well won't run dry. Even so, and despite the handwriting on the wall, the healthcare industry remains profitable and resistant to collaboration on the structural compromises that are essential to re-establish stability and sustainability. Exceedingly well-financed, organized and influential, healthcare lobbies have shaped American health policy to their own purposes for decades. The only option for meaningful change, then, lies in leadership from non-healthcare business, which stands to suffer from the tidal wave of healthcare's turmoil. Good reason for them to mobilize and act. Several years back, talking about spiraling health costs, the vice president of benefits for a large corporation, commented that "No economy can indefinitely support a single business sector that grows continuously at a multiple of general inflation." That perspective is clearer, more to the point, and almost certainly more accurate than arguing that there's a silver lining in unlimited healthcare spending. And that's why we worry. Brian Klepper, Ph.D., is president of the Center for Practical Health Reform, a nonpartisan national effort to re-establish stability and sustainability in American healthcare. Alain Enthoven, Ph.D., is the Marriner S. Eccles Professor of Public and Private Management at Stanford University. They may be contacted at bklepper@cphr.com or enthoven@stanford.edu.

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Insurance Company Health Plans Make More Money,

Pay Less in Health Bills in 2005

ONE-THIRD OF HEALTH CARE $$$ DON'T GO TO HEALTH CARE

ONE-FIFTH OF HEALTH INSURANCE PREMIUM DOLLARS ARE NOT BEING SPENT ON HEALTH CARE,
But are consumed by the insurers.

By Jonathan G. Bethely

If physicians needed any more indication of tightening reimbursement, how about this - not only did profits for the biggest health plans go up last year, but those plans also continued to cut the percentage of revenue they spend on care. The medical-cost ratio - also called the medical-loss ratio or medical-care ratio - is the key number for health plans in terms of their level of profitability. That ratio, simply, is the percentage of dollars the companies spend on health care.

Whereas 10 years ago many plans had medical-cost ratios in the high 80s or 90s, now the highest percentage among large, publicly traded health insurers is Health Net, at 83.9%. Aetna, which had a medical-cost ratio well into the 90s when CEO John Rowe, MD, took over in 2000, recorded a ratio of 76.9% in 2005, Dr. Rowe's final full year before his retirement. That was the lowest medical-cost ratio for the nation's largest publicly traded plans. Medical-cost ratios for 2005 (Source: Company 10-K, year-end filings with the Securities and Exchange Commission):

Conclusions:

ONE-FIFTH OF HEALTH INSURANCE PREMIUM DOLLARS ARE NOT BEING SPENT ON HEALTH CARE, but are consumed by the insurers. ADMINISTRATIVE BURDENS placed on the health care delivery system by insurers — billing and insurance related functions for physicians and hospitals — BURN UP ANOTHER 12 PERCENT OR SO OF THE PREMIUM DOLLAR (Kahn et al, Health Affairs, Nov/Dec 2005).

Added together, these costs account for ONE-THIRD OF THE PREMIUM DOLLAR THAT DOES NOT GO FOR HEALTH CARE. http://www.ama-assn.org/amednews/2006/03/06/bisd0306.htm

What does not show up in these numbers is the cost of the administrative burden that these insurers place on the health care delivery system. The billing and insurance related functions for physicians and hospitals burn up another 12 percent or so of the premium dollar (Kahnet al, Health Affairs, Nov/Dec 2005). Add these together, and that is about one-third of the premium dollar.

We are very concerned about the continued escalation of health care costs. New technology and pharmaceuticals are adding to the spending on physicians, hospitals, laboratories and other health care services. We fret about these expenditures within the two-thirds of the insurance premium that actually makes it down to the health care system, yet we are ignoring the one-third that is wasted on administrative services that provide no health benefit for the patient.

We are enriching this industry for providing coverage for the healthy workforce and their young, healthy families, and for covering the healthy
sub-sector of the individual insurance market. We taxpayers are footing the bill for the population subgroups with greater health care needs. We certainly are not receiving much value from the insurers - letting them have the easy stuff at a very high cost. Wouldn't it be more logical to target their waste, rather than slowing spending growth by making health care unaffordable for those who do have needs? Why do we keep hearing that eliminating this industry isn't feasible? You would think that anyone with a modicum of business sense would believe that keeping them in charge is no longer feasible.HEALTH INSURANCE UP 83% SINCE THE YEAR 2000 click below:

http://www.suntimes.com/business/73050,CST-FIN-health27.articl

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More Recent News:

PAYING MORE and GETTING LESS (from The Center for American Progress)  How businessses can help solve the national healthcare crisis.   Healthcare in the U.S. is not the best -- not even the best place in the world for doing business or the best place for people to live and work.  We are rich; we are powerful.  We can do it.  We can have the best healthcare system in the world for everybody in this country. But we need a serious change.

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How the cost of health care drove me out of business
By Alan Balkema

I started paying attention to health insurance costs after my wife and I turned 45 in 1993. Prior to that we had the same insurance provider for a number of years, and if there were increases in the monthly premium they had not been noticeable. We had a $500 deductible, and I don’t recall a year when we actually had the insurance company pay for anything. We were blessed with good health and were buying the insurance for peace of mind.

When we turned 45, however, the increase was substantial. This was the reward for years of paying the premiums and never collecting a nickel from insurance. From then on I discovered that I had to budget time every July to investigate a new insurance provider. more

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COMPANIES AND EMPLOYEES ARE PAYING TOO MUCH --

Premiums have risen 83% since the year 2000.

Health care costs continue to skyrocket. On Tuesday, the Kaiser Family Foundation reported that the cost of employee health insurance coverage rose 8 percent, according to a survey conducted from January to May this year. Businesses now spend about $8,500 a year for health insurance for the average family, the foundation said, with employees adding $3,000, not counting the cost of deductibles and other out-of-pocket payments.  SEE EXPECTED SLIDING SCALE EXPENDITURES UNDER SINGLE PAYER

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This is to inform the business community of a current proposed  national health care law in the U. S congress: HR 676,( John Conyers, Mich). It is now endorsed by 79 congressmen at this date-September 1, 2006. It would cover all Americans with affordable complete health-care insurance—to include in addition to all medical needs, drugs, long term care, dental care, eye-care, chiropractic, mental care, medical equipment. Choice  of doctors and hospital. More. Financing is spelled out. SEE BUSINESS BENEFITS OF HR 676. 

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The Best Corporate Health Plan
By Jonathan Tasini, Candidate for the Senate, New York, tompaine.com

The imploding health care system is finally making one thing crystal clear: Corporate America is shredding its own global competitiveness because it can't shake the death grip of an anti-government ideology. This short-sighted ideology leads big business to shun single-payer national health insurance, which could save businesses hundreds of billions of dollars. more ...

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State Watch - Lawmaker, Advocates, Businesses Debate Proposed Rules Under New Massachusetts Insurance Law
(Aug 10, 2006)

A Massachusetts lawmaker, some advocates and businesses are discussing recently drafted rules on the state's new health insurance law, the Boston Globe reports (Krasner, Boston Globe, 8/9). The law, enacted in April after the Massachusetts Legislature overrode vetoes by Gov. Mitt Romney (R), requires all state residents to purchase health insurance by July 1, 2007. In addition, among other provisions, the law will require certain employers in the state to provide their employees health insurance or pay an annual fee of $295 per worker; establish a low-cost, state subsidized health insurance program for residents with annual incomes less than 300% of the federal poverty level; and expand Medicaid coverage for state residents (Kaiser Daily Health Policy Report, 7/27). more of this article

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