A World of Rising Health Care Costs
By EDUARDO PORTER
Americans are used to hearing that health care will bust the budget. The Congressional Budget Office projected last year that Medicare, Medicaid and other government health programs would eat up 9.6 percent to 10.4 percent of the nation’s gross domestic product by 2037, crowding out many other vital programs.
But a new report from the Organization for Economic Cooperation and Development suggests that the United States is not the only country that will struggle to contain public spending on medical care. In fact, costs are likely to increase slightly less in the United States than in other industrialized countries and some big developing countries around the world.
Public spending on medical services has slowed much more sharply in other countries since the financial crisis hit government budgets around the industrial world. Government health expenditures across the O.E.C.D. grew only 0.1 percent in both 2010 and 2011, on average, after growing 4.9 percent a year between 2000 and 2009. In Greece they plummeted more than a quarter over those two years. In Britain they contracted by 2 percent. In the United States, by contrast, government health spending grew 3.3 percent in 2010 and 2.2 percent in 2011.
But health spending is expected to pick up as the economy recovers. The organization lays out two possible paths. In one, health care costs keep rising at the pace of the last decade or so – powered not only by growing incomes and the aging of the population but also by rapid medical inflation, technology advances and more intensive delivery.
Along the other, unspecified policy changes – perhaps like the Affordable Care Act — manage to slow spending to what would be justified by aging and income only.
U.S. Health Care Prices Are the Elephant in the Room
By UWE E. REINHARDT
Uwe E. Reinhardt is an economics professor at Princeton. He has some financial interests in the health care field.
Traditionally, the theory driving discussions on the high cost of health care in the United States has been that there is enormous waste in the system, taking the form of excess utilization of care. From that theory it follows that methods of controlling the growth of health spending should focus on ways to reduce the use of unnecessary or only marginally beneficial health care.
Largely overlooked in these discussions has been the elephant in the room: the extraordinarily high prices Americans pay for health care. However, as a group of us noted in a paper in 2004, “It’s the Prices, Stupid,” it is higher health spending coupled with lower – not higher — use of health services that adds up to much higher prices in the United States than in any other member nation of the Organization for Economic Cooperation and Development. Aside from a few high-tech services, Americans actually use less health care and rely on fewer real health-care resources than do residents of other industrialized countries.
Readers who want to get a peek at this elephant in the room should peruse the set of slides published a few days ago by the International Federation of Health Plans, a global network of private health-insurance plans with 100 members in 31 countries. The federation annually surveys prices actually paid for selected health care goods and services in the different countries.
Shown below are three slides from the set:
Shown below are three slides from the set:
In most other countries, prices for health care goods and services are not negotiated between individual health insurers and individual physicians, hospitals or drug companies, as they are in the private insurance sector in United States.
Instead prices there either are set by government or negotiated between associations of insurers and providers of care, on a regional, state or national basis. The single prices for other countries shown in the chart therefore can be taken representative of prices actually paid there.
By contrast, as can be seen in the charts, in the United States there is quite a range of prices for the identical good or service.
Website sheds light on new health exchanges
Posted: June 27Updated: Today at 1:25 AM
Individuals and small businesses in Maine can start learning about the health care process and all their options.
By JOE LAWLOR Staff Writer
While the uninsured or underinsured must wait until Oct. 1 to start purchasing health insurance on new health care exchanges, a key provision in President Obama's 2010 Affordable Care Act, they can begin learning now how the process will work.
The federal government this week rolled out a new website – www.healthcare.gov – that is designed to explain the choices available to individuals and small businesses with 50 or fewer employees – those most affected by the new exchanges.
Under the hew health care law, people must have health insurance or pay a penalty – the so-called "individual mandate" provision that was the subject of much debate and a 2012 U.S. Supreme Court ruling that mostly upheld the law.
The enrollment that begins in October is for coverage that starts in January 2014.
The website introduced this week is "a place where people will be able to do apples to apples comparisons," said Ray Hurd, regional administrator of the Centers for Medicare and Medicaid Services. "People will be able to purchase health insurance at rates that are affordable to them."
Maine Legalizes Prescription Drug Imports
AUGUSTA, Maine (AP) _ Mainers will soon be able to legally buy mail-order prescription drugs from licensed out-of-country drug companies.A new law that amended the Maine Pharmacy Act allows Mainers to save money by buying drugs through Canada's mail-order program called CanaRx and similar licensed programs in the United Kingdom, Australia and New Zealand.
The measure became law Thursday without the governor's signature. It goes into effect in 90 days.
Mainers for years participated in international mail-order pharmacy plans, but then-Attorney General William Schneider ruled in 2012 that the plans violated Maine law.
Big Changes Ahead For Those Who Buy Their Own Insurance
Gail Harriman’s health insurance costs rose four times in just over two years, from $550 a month to $1,171, an amount “more than my mortgage.” But when the self-employed San Francisco resident tried to switch insurers, she was rejected because of a minor health problem.Harriman, 60, is among the estimated 15 million Americans who buy their own insurance and face far bigger hurdles getting and keeping it than those with job-based coverage.
“Most people who work for a company have absolutely no clue about what goes on with people who buy their own insurance,” she said. “I would never consider going without. But there have been moments when I feel it’s the bane of my existence.”
Most of the debate about how the health law will change the individual market has centered on whether consumers will experience “rate shock” from higher premiums when key changes go into effect next year. But there’s a flip side: new rules that broaden benefits, prohibit discrimination against those with health issues and cap consumers’ out-of-pocket costs, which can cut far deeper than premiums.
Currently, about one in five plans sold to consumers makes them responsible for at least half their medical costs after they’ve paid their premiums and met their deductibles, according to an analysis of government data by U.S. News & World Report and Kaiser Health News. It could not be determined how many consumers have such plans.
http://www.kaiserhealthnews.org/Stories/2013/June/28/individual-insurance-market-affordable-care-act.aspx
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