Health insurance premiums have become a major portion of a person’s budget. I believe if not corrected it will crowd out home ownership, children’s college funds, vacations and retirement savings.
What can we do?
- Look at taxes. Insured members are paying over $40 of tax per month. Insurance providers are paying over $13.9 billion dollars in taxes and that adds cost to your policy. Doctors are paying additional taxes through burdensome record keeping and additional taxes. The Cadillac tax is on the horizon. This is a tax on full coverage plans. All of these taxes seem contrary to the ultimate objective. That is to design plans that help people obtain affordable insurance coverage.
- Rein in pharmacy costs. Pharmacy has become the current runaway expense. The EPI pen is a small example of pharmaceutical inflation. You may remember the 600% increase. The pharmaceutical company did not change the pen it only charged more and their stocks increased dramatically. We are a country that bases savings and business health on the stock market. This obscene increase is just doing business. Since it is connected to saving a life, most of us are offended. Somehow we need to come up with a solution. More medical advances equate to expensive pharmaceutical solutions. Please do not think that restraining cost on pharmacy is the solution. Right now California health insurance members are protected by a $250 cap on per month prescriptions. That helps but it also adds to the insurance bill for everyone. Generic medications are not always the best solution, however they help. This is a difficult issue that needs attention from independent actuaries that are independent of the insurance and pharmaceutical companies.
- Improve Plan design choices I believe the overall exposure offered with the current plans protect the insurer not the member. Health plans are categorized in value by metal tiers. Plans that qualify as Accountable Care Act ( ACA ) plans come with an out of pocket maximum of $7,150 per person and $14,300 per family. Count on spending to that maximum if you are hospitalized. I don’t believe that is affordable for the average American.
- Rein in Hospital Cost The consumer does not have a choice and would not be able to find out the cost if they did. This needs to change. If hospitals were competing for your “business” they would become more competitive with their charges. Right now the charges they have are negotiated with the insurance companies.
- Increase wellness This is the theme for nearly every health insurance carrier, grocery store, computer app and employer program. It takes time for this sales pitch to work. Think about how long we have worked on the “Stop Smoking” message. You have to admit it has helped!! I believe we will see more healthy fast food options. My son owns a smoothie business and is currently working on the menu in order to offer higher protein/lower sugary drinks. Fitness can also equate to standing at your desk instead of sitting all day. One does not have to run 5 miles a day to increase their wellness. Every little bit counts. The medical community does work on this through podcasts, clinics and voluntary offerings.
At the end of the conversation, we will pay more for health care and insurance than we did before. We do need to design plans that affordably protect the average American. Right now I do not believe current plans do that.