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by Candy Sagon, AARP Bulletin, February 5, 2010
Whether older Americans think the latest health care reform bill belongs on the “Do not resuscitate” list, or they still hope that it can be taken off life support and recover, few dispute one key point: Ignoring the growing problems of health care will only make it worse. And a new report issued Thursday that showed U.S. health care spending is on track to grow faster than the overall economy this decade dramatically underscores that point. Economists at the Centers for Medicare and Medicaid Services said in their report that without changes in the system, medical spending—and the number of uninsured Americans—will continue to grow. Today, the United States spends what amounts to about 17.3 percent of the economy on health care, and by 2019 nearly 20 cents of every dollar spent here will go to health care.
What this means, experts say, is that health care costs are taking increasingly bigger chunks out of Americans’ personal budgets, reducing the number of jobs employers can offer, and decreasing the money each state has to spend on other vital services.
Republicans as well as Democrats agree all these numbers argue for action.
As Bob Moffit, director of the conservative Heritage Foundation’s Center for Health Policy Studies, put it, “The status quo is not a solution. The health care system needs reform in both the private and the public sector. The question is, what is the best way forward.”
The figures are stark and disturbing: Without some real, fundamental reforms, there is no avoiding the fact that the costs of prescriptions, doctor visits, hospital stays, and insurance copayments and deductibles will continue to rise at an alarming rate, threatening the financial security of older Americans, according to financial and health policy experts. Often, even those who have health insurance can’t afford the policies they really need, and wind up underinsured. Of the 1.5 million Americans who filed for bankruptcy last year, 60 percent did so because of overwhelming medical costs. And nearly 80 percent of those people had health insurance.
Being covered by Medicare isn’t a safe haven, either. Expect premiums to go up as Medicare and Medicaid expenditures grow faster than inflation or the economy, according to figures released in January by the nonpartisan Congressional Budget Office. Older Americans are already struggling to pay their growing medical bills, sometimes skipping needed medication when their drug costs hit Medicare’s Part D “doughnut hole” and they are forced to pay out of pocket.
Unfortunately, those with long political memories say the country has always been reluctant to embrace changes in its health care system. America kicked and screamed when, in 1949, President Harry Truman first proposed providing medical care for older men and women and those who were disabled. It took another 16 years of stalling on the issue before Lyndon Johnson signed Medicare into law in 1965.
This time, the consequences of stalling may be just as disturbing. Consider:
A Kaiser Family Foundation survey found that only 60 percent of U.S. firms offer health benefits to any of their workers. Among those firms, 21 percent said they recently reduced health benefits or increased cost-sharing or copays for their employees, while 15 percent reported they increased the worker’s share of the premium.
The equation is simple, reports the Council of Economic Advisers. Slowing the cost growth of health insurance costs would lower the unemployment rate. Or, as White House adviser David Plouffe wrote recently in the Washington Post, “Health care is a jobs creator.”
Finally, despite the deep public and congressional split over the latest health care reform proposals, a new poll finds that there is still support among voters for a number of the bills’ specific provisions.
The January poll by the Kaiser Family Foundation of 2,000 adults found that a majority of Americans reported feeling more favorable toward the legislation after learning about key provisions, such as tax credits to small businesses that offer coverage to employees, the creation of health insurance exchanges, forbidding insurers to deny people coverage because of preexisting conditions, and the move to close the Medicare drug benefit’s gaping doughnut hole.
Candy Sagon is a writer for the AARP Bulletin.
If you would like to discuss health care reform in AARP’s Online Community, please join the group Health Action Now Mythbusters.
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