The Real Cost of Healthcare In The US

[auditor0007]

I want everyone to thing about this very carefully. This has nothing to do with your political beliefs or what type of healthcare system you think we should have. This is strictly about understanding the devastating amount of money we spend on healthcare in the US.

In the US, we are paying right around $9000 per year per person for healthcare. That is $9000 per year for every single person living in the US, regardless of age and regardless of citizenship. It equates to over 17% of GDP. Here is what you need to understand about this number. Because it counts for every single person, for every year they are alive, the lifetime cost for healthcare in the US for the average person who lives to be 78 years of age is $702,000. This is the amount we are currently spending in today's dollars for a lifetime of healthcare for one person.

Now, that amount is broken down and divided between employers, individuals, taxes for Medicare and Medicaid, and numerous other programs. But the bottom line is that we are spending over $700,000 per person. Now consider an average middle class income of $50,000 per year. If a person earned an average of $50,000 per year for a full 43 years, working from age 22 until retirement at age 65, they would earn $2,150,000. Now that is for someone earning $50,000 per year. We know that many people never earn anywhere near that. But even at that level, we are saying that 1/3 of all income earned would go to cover ones healthcare expenses. Because the cost of healthcare is spread over 78 years, it only works out to $9000 per year, but it must be paid for during one's working years, so the total really works out to over $16,000 per year per person.

These numbers are mind boggling, and they really do not make any sense, but this is what we are paying. How did we let this happen? And what can we do to change this? This type of spending on healthcare is unsustainable, and it is only projected to increase. Healthcare costs are bankrupting this country. It doesn't matter if it's with or without Obamacare; healthcare costs are completely out of control, and the truth is that business cannot afford it, with or without Obamacare. American companies cannot compete in the global market where their competitors do not have these costs for employee healthcare.

When looking at these numbers and their effect on American business, I can tell you that we will almost certainly end up with a one payer system at some point.

 

[Underhill]

I want everyone to thing about this very carefully. This has nothing to do with your political beliefs or what type of healthcare system you think we should have. This is strictly about understanding the devastating amount of money we spend on healthcare in the US.

In the US, we are paying right around $9000 per year per person for healthcare. That is $9000 per year for every single person living in the US, regardless of age and regardless of citizenship. It equates to over 17% of GDP. Here is what you need to understand about this number. Because it counts for every single person, for every year they are alive, the lifetime cost for healthcare in the US for the average person who lives to be 78 years of age is $702,000. This is the amount we are currently spending in today's dollars for a lifetime of healthcare for one person.

Now, that amount is broken down and divided between employers, individuals, taxes for Medicare and Medicaid, and numerous other programs. But the bottom line is that we are spending over $700,000 per person. Now consider an average middle class income of $50,000 per year. If a person earned an average of $50,000 per year for a full 43 years, working from age 22 until retirement at age 65, they would earn $2,150,000. Now that is for someone earning $50,000 per year. We know that many people never earn anywhere near that. But even at that level, we are saying that 1/3 of all income earned would go to cover ones healthcare expenses. Because the cost of healthcare is spread over 78 years, it only works out to $9000 per year, but it must be paid for during one's working years, so the total really works out to over $16,000 per year per person.

These numbers are mind boggling, and they really do not make any sense, but this is what we are paying. How did we let this happen? And what can we do to change this? This type of spending on healthcare is unsustainable, and it is only projected to increase. Healthcare costs are bankrupting this country. It doesn't matter if it's with or without Obamacare; healthcare costs are completely out of control, and the truth is that business cannot afford it, with or without Obamacare. American companies cannot compete in the global market where their competitors do not have these costs for employee healthcare.

When looking at these numbers and their effect on American business, I can tell you that we will almost certainly end up with a one payer system at some point.

This is true.

The problem is the mind blowing complexity of the system.

Here is an example of how the average retiree surgery comes about.

They go to the local family doc. After spending a half hour filling out 5 pages of forms (which have to be manually entered into the secretaries computer) you can see the doctor. He runs 15 test and decides you need a specialist. So he sends you to one. It takes a secretary an hour and a half to process the claim through medicare and your private insurer.

The specialist has you fill out 5 pages in forms that the secretary has to put into the computer manually. He then prescribes 8 more test.. 5 of which you just had at the family doc. Looking at the results he decides you need surgery. His secretaries spend 2 hours processing claims and scheduling your surgery at the hospital.

You again have to fill out 3 pages of forms at the hospital which is manually entered into their computers. The anesthesiologist and surgeon both then have to perform the surgery with the help of hospital staff. They then have to have their secretaries again spend hours each filing paperwork so they can get paid. The hospital has to go through the same mess for the surgery and for all the prescriptions.

The point is you spent a grand total of 30 minutes with the doctors and an hour and a half in surgery, but the paperwork trail took 3 times that much time to process. Nothing is electronically transferred so in too many cases you have to start from scratch with each new doctor you see. A new batch of paperwork, new test....

The system is a mess. And it's been a mess for a long time. Add in the fact that people are seeing more doctors than ever, having more procedures than ever... adding even more complexity to a system already overloaded...

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

 

[auditor0007]

I want everyone to thing about this very carefully. This has nothing to do with your political beliefs or what type of healthcare system you think we should have. This is strictly about understanding the devastating amount of money we spend on healthcare in the US.

In the US, we are paying right around $9000 per year per person for healthcare. That is $9000 per year for every single person living in the US, regardless of age and regardless of citizenship. It equates to over 17% of GDP. Here is what you need to understand about this number. Because it counts for every single person, for every year they are alive, the lifetime cost for healthcare in the US for the average person who lives to be 78 years of age is $702,000. This is the amount we are currently spending in today's dollars for a lifetime of healthcare for one person.

Now, that amount is broken down and divided between employers, individuals, taxes for Medicare and Medicaid, and numerous other programs. But the bottom line is that we are spending over $700,000 per person. Now consider an average middle class income of $50,000 per year. If a person earned an average of $50,000 per year for a full 43 years, working from age 22 until retirement at age 65, they would earn $2,150,000. Now that is for someone earning $50,000 per year. We know that many people never earn anywhere near that. But even at that level, we are saying that 1/3 of all income earned would go to cover ones healthcare expenses. Because the cost of healthcare is spread over 78 years, it only works out to $9000 per year, but it must be paid for during one's working years, so the total really works out to over $16,000 per year per person.

These numbers are mind boggling, and they really do not make any sense, but this is what we are paying. How did we let this happen? And what can we do to change this? This type of spending on healthcare is unsustainable, and it is only projected to increase. Healthcare costs are bankrupting this country. It doesn't matter if it's with or without Obamacare; healthcare costs are completely out of control, and the truth is that business cannot afford it, with or without Obamacare. American companies cannot compete in the global market where their competitors do not have these costs for employee healthcare.

When looking at these numbers and their effect on American business, I can tell you that we will almost certainly end up with a one payer system at some point.

This is true.

The problem is the mind blowing complexity of the system.

Here is an example of how the average retiree surgery comes about.

They go to the local family doc. After spending a half hour filling out 5 pages of forms (which have to be manually entered into the secretaries computer) you can see the doctor. He runs 15 test and decides you need a specialist. So he sends you to one. It takes a secretary an hour and a half to process the claim through medicare and your private insurer.

The specialist has you fill out 5 pages in forms that the secretary has to put into the computer manually. He then prescribes 8 more test.. 5 of which you just had at the family doc. Looking at the results he decides you need surgery. His secretaries spend 2 hours processing claims and scheduling your surgery at the hospital.

You again have to fill out 3 pages of forms at the hospital which is manually entered into their computers. The anesthesiologist and surgeon both then have to perform the surgery with the help of hospital staff. They then have to have their secretaries again spend hours each filing paperwork so they can get paid. The hospital has to go through the same mess for the surgery and for all the prescriptions.

The point is you spent a grand total of 30 minutes with the doctors and an hour and a half in surgery, but the paperwork trail took 3 times that much time to process. Nothing is electronically transferred so in too many cases you have to start from scratch with each new doctor you see. A new batch of paperwork, new test....

The system is a mess. And it's been a mess for a long time. Add in the fact that people are seeing more doctors than ever, having more procedures than ever... adding even more complexity to a system already overloaded...

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

We will almost certainly end up with one-payer at some point. The only question is how long will it be until we get there. Cost will be the driving factor, but how high must the cost become until we wise up? Healthcare spending is pushing 20% of GDP. Are we going to wait until it hits 30% or more? I certainly hope not.

 

[Underhill]

I want everyone to thing about this very carefully. This has nothing to do with your political beliefs or what type of healthcare system you think we should have. This is strictly about understanding the devastating amount of money we spend on healthcare in the US.

In the US, we are paying right around $9000 per year per person for healthcare. That is $9000 per year for every single person living in the US, regardless of age and regardless of citizenship. It equates to over 17% of GDP. Here is what you need to understand about this number. Because it counts for every single person, for every year they are alive, the lifetime cost for healthcare in the US for the average person who lives to be 78 years of age is $702,000. This is the amount we are currently spending in today's dollars for a lifetime of healthcare for one person.

Now, that amount is broken down and divided between employers, individuals, taxes for Medicare and Medicaid, and numerous other programs. But the bottom line is that we are spending over $700,000 per person. Now consider an average middle class income of $50,000 per year. If a person earned an average of $50,000 per year for a full 43 years, working from age 22 until retirement at age 65, they would earn $2,150,000. Now that is for someone earning $50,000 per year. We know that many people never earn anywhere near that. But even at that level, we are saying that 1/3 of all income earned would go to cover ones healthcare expenses. Because the cost of healthcare is spread over 78 years, it only works out to $9000 per year, but it must be paid for during one's working years, so the total really works out to over $16,000 per year per person.

These numbers are mind boggling, and they really do not make any sense, but this is what we are paying. How did we let this happen? And what can we do to change this? This type of spending on healthcare is unsustainable, and it is only projected to increase. Healthcare costs are bankrupting this country. It doesn't matter if it's with or without Obamacare; healthcare costs are completely out of control, and the truth is that business cannot afford it, with or without Obamacare. American companies cannot compete in the global market where their competitors do not have these costs for employee healthcare.

When looking at these numbers and their effect on American business, I can tell you that we will almost certainly end up with a one payer system at some point.

This is true.

The problem is the mind blowing complexity of the system.

Here is an example of how the average retiree surgery comes about.

They go to the local family doc. After spending a half hour filling out 5 pages of forms (which have to be manually entered into the secretaries computer) you can see the doctor. He runs 15 test and decides you need a specialist. So he sends you to one. It takes a secretary an hour and a half to process the claim through medicare and your private insurer.

The specialist has you fill out 5 pages in forms that the secretary has to put into the computer manually. He then prescribes 8 more test.. 5 of which you just had at the family doc. Looking at the results he decides you need surgery. His secretaries spend 2 hours processing claims and scheduling your surgery at the hospital.

You again have to fill out 3 pages of forms at the hospital which is manually entered into their computers. The anesthesiologist and surgeon both then have to perform the surgery with the help of hospital staff. They then have to have their secretaries again spend hours each filing paperwork so they can get paid. The hospital has to go through the same mess for the surgery and for all the prescriptions.

The point is you spent a grand total of 30 minutes with the doctors and an hour and a half in surgery, but the paperwork trail took 3 times that much time to process. Nothing is electronically transferred so in too many cases you have to start from scratch with each new doctor you see. A new batch of paperwork, new test....

The system is a mess. And it's been a mess for a long time. Add in the fact that people are seeing more doctors than ever, having more procedures than ever... adding even more complexity to a system already overloaded...

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

We will almost certainly end up with one-payer at some point. The only question is how long will it be until we get there. Cost will be the driving factor, but how high must the cost become until we wise up? Healthcare spending is pushing 20% of GDP. Are we going to wait until it hits 30% or more? I certainly hope not.

The real question is, will it happen in time?

We have 2 looming crisis in this country. Lack of good middle income jobs and health care cost. There are others but they almost all stem from these.

 

[dblack]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

 

[Political Junky]

Medicare is in place, just make it cradle to grave.

 

[auditor0007]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

At some point, American businesses are gong to demand to be let off the hook. They should not be responsible for providing health insurance to anyone. It's killing them in the global market.

 

[editec]

In my lifetime we have gone from spending 4% of the GNP to 18% of the GNP on health care.

That trend in spending is obviously unsustianable

 

[CrusaderFrank]

Yes, the government programs distort the costs, just like they were supposed to.

Why is this news?

 

[dblack]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

At some point, American businesses are gong to demand to be let off the hook. They should not be responsible for providing health insurance to anyone. It's killing them in the global market.

The problem is our abuse of insurance, not how we pay for it.

 

[BillyV]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

At some point, American businesses are gong to demand to be let off the hook. They should not be responsible for providing health insurance to anyone. It's killing them in the global market.

I’ve heard this argument before, but how will “single payer” affect the cost to American businesses? Who, in fact, do you expect will be funding the “single payer”? If employers drop coverage and employees are then subject to either separate premiums or higher taxes, they are going to expect the employers to raise their pay commensurate with what they have lost.

I think the real point of “single payer” is to fund it through progressive income taxes so anyone below a certain income tax level is subsidized. I mean really, United Healthcare, which I use, has over 70 million insured, about double the population of Canada; if single payer made a difference, wouldn’t that be large enough?

 

[Antares]

So you are saying Obama lied to his Union buddies when he told them that a single payer system was his ultimate goal?

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

 

[Underhill]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

Not true at all. We could get rid of a third, and more in the long run, of all support personnel in the health care industry just by the reduction in paperwork alone. Billing would all go to one source. Pay doctors for outcomes instead of by procedure and the billing could be simplified by several orders of magnitude.

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

You may be right. But single payer will come. And I doubt it will be another 20 years.

 

[dblack]

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

Not true at all. We could get rid of a third, and more in the long run, of all support personnel in the health care industry just by the reduction in paperwork alone. Billing would all go to one source.

That assumes the primary source of health care inflation is overhead and inefficiency, and I don't buy that. The biggest factor fueling rising health care prices is that there is very little incentive, for anyone involved, to cut costs. The 'buck' stops at the consumer, and most consumers aren't paying (directly) for their own health care. THAT is the core problem, in my view, and single payer would only make that worse.

Pay doctors for outcomes instead of by procedure and the billing could be simplified by several orders of magnitude.

Sure. But as I pointed out in my post, if the goal is for government to dictate how doctors are paid, we can do that with straightforward mandates and price controls. I'm not in favor of that sort of draconian approach, but sliding it in the 'backdoor' via single payer is duplicitous.

You may be right. But single payer will come. And I doubt it will be another 20 years.

Corporatism uber alles.

 

[dblack]

So you are saying Obama lied to his Union buddies when he told them that a single payer system was his ultimate goal?

Single payer is the only way to get a handle on all this. And if you still think it can't be cheaper than what we have, all you have to do is look at the rest of the world. They've all managed it cheaper and without loss of quality.

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

Yes.

 

[Flopper]

I defiantly think single payer will reduce cost. Even with government inefficiencies single payer will be better than what we have today. We have the most expensive healthcare in the world but certainly not the best.

The idea that consumers will control cost does not work now and it never will. For anything resembling a free market approach, consumers would have to pay healthcare providers a lot more of their hard earn dollars than they do now and for most people that's just not possible. Even it were, the healthcare consumer would be faced with the daunting task of determining the value of a service versus cost.

 

[Antares]

Having worked in the Heath Care Industry for 10 years, I frankly disagree with your assessment. PPACA is designed for one thing and that is to make the system fail and usher in the single payer.

That has been the Progressive goal since FDR.

So you are saying Obama lied to his Union buddies when he told them that a single payer system was his ultimate goal?

Single payer won't reduce health care inflation directly. Initially, it would only throw gasoline on the fire. All it will do is wrap up all the problems of having a cartel of insurance companies into the monolithic problem of having one insurance company. The only way it might, eventually, bring prices down is by dictating prices and the rates doctors charge. But if that's the goal, why not just implement price controls directly?

It's all moot though, because the notion that PPACA will lead to single payer is delusional. PPACA was passed to prevent single payer for as long as possible, leaving people to suffer as pawns in the midst of power negotiations between government and the insurance industry.

Yes.

 

[Flopper]

I defiantly think single payer will reduce cost. Even with government inefficiencies single payer will be better than what we have today as far as costs are concerned. We have the most expensive healthcare in the world but certainly not the best.

The idea that consumers will control cost does not work now and it never will. For anything resembling a free market approach, consumers would have to pay healthcare providers a lot more of their hard earn dollars than they do now and for most people that's just not possible. Even it were, the healthcare consumer would be faced with the daunting task of determining the value of a service versus cost.

 

[auditor0007]

Having worked in the Heath Care Industry for 10 years, I frankly disagree with your assessment. PPACA is designed for one thing and that is to make the system fail and usher in the single payer.

That has been the Progressive goal since FDR.

So you are saying Obama lied to his Union buddies when he told them that a single payer system was his ultimate goal?

Yes.

In 2001, my wife was diagnosed with Acute Myeloid Leukemia. Ten months later she lost her battle. Total cost of her treatment and care during that ten months was over $1.3 million. That was over ten years ago. The average home sells for around $250,000. That is five homes paid off, for treatment of a cancer that didn't save her life in the end, and it was just for ten months of treatment. There just is no logic to what we are paying for healthcare.

 

[Flopper]

Having worked in the Heath Care Industry for 10 years, I frankly disagree with your assessment. PPACA is designed for one thing and that is to make the system fail and usher in the single payer.

That has been the Progressive goal since FDR.

So you are saying Obama lied to his Union buddies when he told them that a single payer system was his ultimate goal?

Yes.

Obamacare did not cause the problem. It may or may not reduce cost. Only time will tell. However, with or without Obmacare, costs will continue to increase at an unacceptable rate. It fixed a number of problems in the system but did not deal with the primary reasons for the increases in healthcare cost.