How Employees & Employers Get Bled by Health Insurance

Something is seriously wrong with this system.

The annual cost of the average health insurance family plan through employers — employer and employee contributions combined – rose another 4.9% in 2019, to $20,576. This is up 255% from 20 years ago, having soared five times faster than the Consumer Price Index (+52%).

Employees paid about 29% of the premium for family coverage ($6,015 annually, red portion) and employers paid about 71% ($14,561 annually, blue portion). Over the past 20 years, the employee contribution has increased by 290%.

These are among the findings of the annual survey of over 2,000 companies, both small (3-199 employees) and large (200+ employees), including non-federal public employers, by the nonprofit Kaiser Family Foundation. Employers and employees both are groaning under the relentlessly ballooning weight of health insurance costs. And the numbers are large: 153 million Americans are covered by employer sponsored health insurance.

At companies with few lower-wage workers, the employee contribution for family coverage was on average $5,968 annually.

But at companies with many lower-wage workers, the employee portion for family coverage was $7,047 annually.

“The single biggest issue in health care for most Americans is that their health costs are growing much faster than their wages are,” KFF CEO Drew Altman said. “Costs are prohibitive when workers making $25,000 a year have to shell out $7,000 a year just for their share of family premiums.”

Many lower-wage workers cannot afford the contributions and forego the health insurance even if their companies offer it. As a result, at companies with many lower-wage workers, only 33% of the workers are covered by the employer’s health insurance, compared to 63% at the other companies.

For single coverage of the employee only, the annual cost of the average health insurance premium — employer and employee contributions combined — rose 4.2% in 2019, to $7,188, with the employee paying 17% or $1,242 (up from 14% in 1999) and the employer paying 83% or $5,946 (down from 86% in 1999).

What the above chart shows is that over the past 20 years, the employee contribution to the average single plan has surged by 290%, compared to 52% for CPI. The employer portion has increased 200% over the same period.

Employers, who over the years have been straining to deal with the surge in these healthcare costs for their employees, have shifted ever more costs directly to the employee. This includes increasing the employee portion of the premium – see above. And it includes raising the deductibles (the portion of medical costs that the employee must pay before the insurance kicks in), copayments (fixed dollar amounts), and coinsurance (a percentage of the charge).

In terms of the deductible by itself, for employee-coverage only (single), the average annual amount in 2019 across all types of plans for employees who have a deductible rose by 5.2% to $1,655. Over the past 20 years, deductibles have increased by 183%:

Not all employees have a deductible, but the proportion has been growing: This year, 82% of employees face a deductible, up from 63% in 2009.

And the deductibles are getting big for a larger number of people: 45% of the employees at small companies have deductibles of at least $2,000, up from 16% in 2009; and at large firms, 22% have deductibles of over $2,000, up from 3% in 2009:

But there are big differences in the amounts of the deductibles by employer size: Employees at small firms (up to 199 employees) get hit with an average annual deductible of $2,271; employees of large firms (200+ employees) face an average deductible of $1,412.

Health care and insurance are large parts of the US economy. Effectively cracking down on the costs of the system would by definition crush the revenues of the companies in that system. And some of those companies would have to restructure and others would disappear.

But in terms of the overall economy, employees and employers would spend or invest the money that they saved on health care and insurance. For employers, it could mean money would be available to expand operations, hire more people, and pay higher wages.

The service sectors are Hopping. The #1 Biggie is Hopping the Fastest. It all adds to GDP! Read…  The Financialization of the US Economy

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  181 comments for “How Employees & Employers Get Bled by Health Insurance

  1. MCH
    Sep 26, 2019 at 1:14 am

    It is interesting how we as a society have tolerated certain middlemen, and let them make obscene profits for practically no gain to society as a whole. The very idea of everything beholden to the insurance industry has the feel of the tail wagging the dog.

    It is also interesting how we continue to pick on the wrong targets for our ire mainly because those targets are easier. If we look at pharmas and biotechs for example, they are regularly stomped on because it’s easy to point fingers at their high prices. Yet, at the same time, the middle of the chain such as PBMs, gets off practically scott free while earning profits from a system where they create very little if any value.

    Certainly there is a problem with many of the pharma companies around, companies like Mylan, Purdue, among others come instantly to mind. Yet, it is just so simple to lump everyone in the same group.

    But the flip side of it is if as a society, the US decides to dump some of these middle men, there would be suddenly hundreds of thousands of newly unemployed added to the rolls. And no one could stomach that.

    • hendrik1730 .
      Sep 26, 2019 at 4:18 am

      You are absolutely right, Europe ( and the whole “civilized” West ) has the same problem. Middlemen all over the place, a club here, a club there, most of them “lawyers”-“alpha’s”, added value deeply negative but o man, “we need them” ( self declared ).

      Bullshit, sack the bastards. They ( lawyers/politicians/alpha’ s ) are the lowest live form on earth.

      • Jack
        Sep 28, 2019 at 5:06 am

        Hendrik,

        The government won’t solve our problems!

        Every time private enterprise convince the establishment/ government that public funds for a certain area of economic life is warranted ( we) as consumers lose big time as costs are passed to you & I through the abhorrent Taxes!

        and new taxes my friends have the habit of sticking around for eternity as the next government sees it pleasing to have more dough extracted from poor citizens to spend!

        When Health is looked at in this light it becomes very easy to understand why the interference of government has done more harm than good as with every aspect of our life.

        The myriad of vultures that get attracted to such a feast with no control over the real cost of service get inflated over time by these “ middle men “ that you aptly pointed to.

        The Health should be entirely governed by the relationship between the provider ( hospital, clinic, individual physician, or the like) and the end user ( you & I)!

        In doing so the market will determine ultimately the amount of money that should be the real compensation for the particular service.

        You don’t need to use a service that is inflated by 10x the price and you’d shop to find an adequate service!

        The only role the government should play then is to make sure all providers are registered and qualified for the job appropriately!

        Another point is to have ( very heavy penalties) I mean HEAVY! For any registered provider that causes loss of life or for lack of care .

        Yes it should be that easy!

        The fact of the matter is lots of disciplines ( like doctors, engineers, and other professionals) have become sought after for the sole reason of using it as a get rich vehicle and NOT as a passion or to help the public that once existed in these areas of human knowledge and endeavors!

        You see a verity of under qualified doctors and engineers being put in places of responsibility that causes huge costs to the overall health of a functioning society!!

        In the same vein you can look at areas of finance that has become a total disaster and all that is thanks to big bloated government that is running our minuscule affair and causing us to lose freedom of choice and ultimately our freedom and prosperity.

        • Derek
          Sep 29, 2019 at 10:21 am

          I really dislike this oft stated notion that government is the problem. It is a known fact that the free market capitalist WILL use every tool available to gain more profit, whether that’s by gouging the customer or bribing the politicians to get favourable legislation.

          In this case it also totally ignores 2 facts:
          1. Most of the developed world have figured this healthcare business out, they manage to cover everyone & yet pay 50% of the cost in the US.

          2. Healthcare is often not a commodity which you can shop around for, it’s not an optional purchase when you have just been in a car accident. Also we have no idea WHAT exactly we are shopping for when it comes to healthcare, limited expertise makes the free market principle invalid.

          Please stop these talking points and get onboard with a single payer or universal system, it’s the ONLY way to solve this particular issue.

    • Wisdom Seeker
      Sep 26, 2019 at 2:18 pm

      I want to add that there is no good reason (other than historical circumstance) why health insurance should be tied to employment.

      Workers should be in charge of their own health and the choice of a job should not be based on quality of the insurance plan – which has nothing to do with the work or career opportunities.

      P.S. Right now I think the US economy could stomach those newly unemployed. With current labor scarcity, now would actually be the best time make the necessary transitions.

      • NoEasyDay
        Sep 26, 2019 at 6:17 pm

        > “Workers should be in charge of their own health…”

        Nobody forces the workers to drink soda pop rather than water.

        • Wisdom Seeker
          Sep 27, 2019 at 6:48 pm

          NoEasyDay – please read my original as “in charge of their own healthcare arrangements”.

          No one should need an employer (or employed family member) to have access to decent healthcare at a reasonable price.

          At the same time, a single-payer government system is not workable in the US under current management and corruption levels.

          The younger generations need to break the political statement on this issue by coming up with fresh ideas.

  2. Sep 26, 2019 at 1:45 am

    For your out-of-the-blue fun and for your surprise amusement, from our artist Kitten Lopzez, with love:

    • Steve M
      Sep 26, 2019 at 3:52 am

      Wow! With art like that proceeding an article like that (you should send it to the Sanders campaign if they didn’t send it to you), I can see you wearing a beret and smoking Gitano’s while sipping an armagnac.
      Mister, I suspect you’re a fun dude.
      Thanks for a terrific breakdown of an unsustainable affair.

      • joe saba
        Sep 26, 2019 at 8:28 am

        why do EMPLOYERS get to deduct employee healthcare premiums???
        the employees should be getting 1099’s for said premiums paid(part of their salary/pay)

        otherwise CORPORATIONS should NOT be able to deduct

        • HRBlah
          Sep 26, 2019 at 11:09 am

          Employers get to deduct the portion they pay, however employees in qualified plans do not pay income tax on the premiums they pay as well. So long as the plan and the enrollees is in accordance with Section 125 as many are.

          Typically the only people not receiving pre-tax benefits are those that pay for their own insurance or if you have a dependent that is non-qualified like a domestic partner.

          The stickiness is that total premiums are reported as part of the ACA, and talk that that could be taxed…

        • Steve
          Sep 26, 2019 at 11:51 am

          Because its considered a business expense under the IRS code. Which by the way is where Employer paid health care originated. If memory serves me, the Unions back in 1913, which is when the IRS was born, decided rather than take higher pay, which was now taxable, they would receive non taxable health care benefits.

          Though I agree that a first start is to eliminate all 3rd party payers and make each individual pay their own healthcare. Then maybe, we as a nation, will start taking better care of ourselves and not reach for a pill to fix what ales us.

        • Kerry
          Sep 26, 2019 at 5:43 pm

          They are getting closer to reporting the health insurance premiums on form 1099. That is why the employer premiums paid are now detailed on your w-2…

        • Brother J
          Sep 28, 2019 at 1:46 am

          @Steve

          I too wash my pills down with ale.

          *high five*

    • Crazy Chester
      Sep 26, 2019 at 4:16 am

      Is this the excitement of finally obtaining employer subsidized Health Care?  Or is it the excitement of cutting through governmental roadblocks to a not job related single payer system of Health Care?

      • Sep 26, 2019 at 9:11 am

        Crazy Chester,

        The excitement of being alive and vibrant with creative energy?

        • RD Blakeslee
          Sep 26, 2019 at 9:29 am

          Amen!

    • RD Blakeslee
      Sep 26, 2019 at 7:07 am

      Out of the blue comes stormy talent (again).

  3. Rob Henderson
    Sep 26, 2019 at 1:53 am

    The essence of the insurance sector gaming has much to do with the ‘behind the scenes’ actuarial manipulation of future liability projections that are then costed on a present value basis to increase costs for the future. The previous gaming of this process, which created surplus reserves (that miraculously disappear) for the here and now costs do not end up funding the present day costs which instead are increased. Regulators are lacking in necessary knowledge of the actuarial game which is funded by the industry itself. Comment by industry analyst.

  4. Tony
    Sep 26, 2019 at 1:59 am

    What I find most interesting in this debate is the argument that a single payer system financed with taxes is unaffordable, while the cost for the current (insane) system is already being spent by both employers and employees. There is no incremental cost, there is only a reallocation of who is paying and how.

    In addition, the government subsidizes the current employer based system heavily since a) the employer paid benefit is a cost that comes out of enterprise profits and therefore reduces the corporate tax liability, and b) the employees receive this benefit tax-free. I have seen numbers of about $600b/yr in foregone tax receipts (i.e. a subsidy to only those with jobs with good benefits), but I am sure Wolf could come up with more accurate figures.

    If you are self-employed and not setup with a corporate benefit plan, or unemployed, then the entire health insurance premium comes out of your post tax money. How crazy is that? Ever tried COBRA after loosing a job? Why would anyone ever want health insurance tied to an employer? How did we end up with this crazy idea that is uniquely American?

    And if you do not have insurance your hospital bill is typically triple of what they would invoice an insurance company that has a ‘deal’ with them.

    And then there is the fact that US health care cost are far higher per capita as compared to every other industrialized country, for a level of care that is at best average. With all the austerity in most of our hospitals and doctor’s offices, where does all this money go?

    Something big has to change here. The status quo is killing us slowly but surely.

    • Vespa P200E
      Sep 26, 2019 at 10:01 am

      I think what’s broken is our out of control spiraling cost of care with myriads of middlemen and need for TORT reform, and unless that is fixed the cost will creep up well beyond inflation. Obamacare had good intentions but did not address the broken system and ended up fanning it more.

      I’ve been self-employed for 3.5 years my Cali Kaiser premium has been rocketing up especially this year. I just cannot see how middle class self-employed or small business owner barely eking by can afford ever-increasing premium. I see where my premiums go as Kaiser is busy building new clinics/hospitals with fancy offices. BTW – I’m allowed to write off my insurance premiums pre-tax.

      • joe obvious
        Sep 26, 2019 at 2:15 pm

        Tort reform is such a tired talking point. California HAS tort reform – notice prices going down

        It’s the profiteering, stupid.

    • JR
      Sep 26, 2019 at 11:08 am

      I’m own a small businesses (one employee) with a family of 4. We spend about $22,000/yr before insurance covers much of anything.

      We just had a baby and looked at the bills. If we hadn’t had insurance over the last 2 years and just paid cash for everything (there was a lot for the baby), we’d have spend about $20,000 LESS. Stretch that out to 5 years and it’s probably $70,000. This is after tax money.

      I can relocate really easily and we’ve discussed leaving the country for this reason alone.

      Our system is crippling expensive. I have a lot of friends outside the country (Canada, UK, Europe.). They think:

      1) we are nuts.

      2) they have no idea what they pay for medical costs they just go to the doctor when they need it. It’s “free” in their minds.

      3) they all love their healthcare system. (Yes they all have issues, none are perfect, but I don’t know anyone who likes our insurance system)

      • MB732
        Sep 26, 2019 at 1:01 pm

        JR I agree and thanks for sharing. Say you pay $22,000 per year for two years and then have a $50,000 med expense with $2000 deductible and 80/20 copay.

        You’re out $44,000 premiums + $2000 deductible + $9600 copay = $55,600

        (BTW insurance company collected $44,000 and paid $38,400 copay = $5600 profit)

        BUT you are making the mistake of comparing costs (with insurance) to what your out-of-pocket costs would have been without insurance.

        Remember what Tony said above, you’re basing your calculation on the insurance company’s ‘deal’ price. Oh, you don’t have insurance? Your $50,000 event is now $250,000. Would you rather be out $55,600 or potentially ruinous $250,000?

        Your-money-or-your-life racketeering and extortion…couldn’t be more plain.

        Congress is concerned about the problem, so a while back they threw that price-gouging weaselly Epi-Pen kid in prison to show that they really care about protecting us from the Healthcare Industrial Complex. He claimed he wasn’t doing anything the big companies weren’t doing, and I believe him.

        • Steve
          Sep 26, 2019 at 4:54 pm

          People really need to read there policy. Under your example you would not necessarily pay $9,600. ALL policies have a max out of pocket that limits the maximum you will pay in a year. What is the max out of pocket? Then talk about the $9,600.

          You are practicing statistical manipulation to dramatize your point. Facts are far more authoritative.

        • MB732
          Sep 27, 2019 at 4:41 am

          Steve I would hope that whether or not the family reached their maximum out-of-pocket would be the least significant point in this generic example, but you sound like a nice guy so I took your advice and looked at my coverage to get you unmanipulated-for-dramatization-purposes real numbers.

          $50,000 medical expense

          $3000 deductible + $14,100 copay (70/30 so .3 x $47,000) = $17,100

          $15,800 max out-of-pocket so my copay is $12,800

          Have a nice day.

        • Steve Lewis
          Sep 27, 2019 at 5:43 am

          MB, thanks for the data.

          That’s one reason why I prefer the HSA’s. I may pay all costs up front but my max out of pocket is 2,800. When my kids where on the plan my max out of pocket was still only 4,500.

          The downside is I paid that amount every year, in addition to my premiums. Overall, however, I paid considerable less than what your paying.

      • nick kelly
        Sep 26, 2019 at 1:37 pm

        The Canadian system covers everyone at about half cost of the US. How the US price for insulin can be ten times the Canadian price is an obscene mystery. US Big Pharma did not invent insulin.
        The problem a lot of Americans have is understanding that the Canadian PRACTICE of medicine is almost entirely private. It is the insurance that is a single- payer public system. The admin cost is about 3 % versus 8% in the US. But, very important, this does not include the cost of the most valuable time in the system: the hours spent by US MD s arguing and negotiating with insurers. The total admin cost of private insurance might be as high as 15%.

        When a US politician elected to go the Canadian Shouldice clinic for surgery, a lot of commenters immediately explained that this was a private clinic and not therefore not part of the Canadian public system. So the well- heeled guy’s decision to seek Canadian care was not an endorsement of the normal Canadian system.

        The reality: of course Shouldice is private. It treats fully- covered Canadian patients all the time. Not the US guy, obviously. He had to pay whatever they charge, and decided it was worth it. He endorsed the quality that is available to all Canadians.
        Is it perfect? No.

        A personal anecdote. Wife is rushed to hospital with shortness of breath at 3 AM.
        Next day taken by ambulance (100 km) to Royal Jubilee in Victoria. Next day (or 2?) has stent near heart via wrist vein. Next day (or 2) she is released and I pick her up. Next week she is back at work.

        Cost to us, including ambulance was zero. The drugs, not so. Here her employer picked up a portion.

        What’s not to like?

      • alex in San Jose AKA Digital Detroit
        Sep 26, 2019 at 5:56 pm

        You are describing exactly why I advise people, especially if young, to get the hell out.

        Health, life expectancy, social mobility, are all lower in the US. There are towns in Italy that will *give* you a house if you can support yourself which you probably can working online, and a guy I’ve followed for a while on YouTube, shuttles between the US and Israel regularly and he’s always amazed at the day and night difference, where it’s so easy to get a job, see the doctor, etc. in Israel and those things are extremely difficult in the US.

        Get out. Go to Cambodia. Doesn’t matter. Just get out (with the possible exception of avoid places like Dubai).

      • Sep 26, 2019 at 11:51 pm

        Look into healthcare cooperatives. KNEW Health is one I just read about that sounds interesting. They say hospitals charge “cash payers” less, which makes your current equation even less fun.

    • polecat
      Sep 26, 2019 at 11:23 am

      Well, intermediary parasites gotta eat too, you know ….

    • GP
      Sep 26, 2019 at 12:03 pm

      The very concept of forcing employers to pay for healthcare is absurd. Employers aren’t forced to pay costs for housing, food, transportation, education etc. Why should health costs be any different. It’s the case of continuing to do something just because we have been doing it that way for a long time.

      People should be able to form groups and purchase insurance on own (Associated Health Plans). Right now larger employers can get better rates than smaller employers. And even small employers can get better rates than unemployed/self-employed. AHPs will change that.

      Costs are higher for variety of reasons – some easy to fix, some very complex. Two of them here:

      – Malpractice insurance very high. Jury need to realize when they hand over $10m penalties, that money is ultimately coming out of patients’ pockets.

      – Opaque pricing. When patients can price shop, prices will fall. Sunlight is usually the simplest and best disinfectant.

      • Harrold
        Sep 26, 2019 at 1:49 pm

        “Malpractice insurance very high”

        Texas reformed a decade ago and the malpractice lawsuits went to almost zero.

        Surprisingly, malpractice insurance did not decrease, nor did medical costs.

        Insurance companies, however, did very well.

        • GP
          Sep 26, 2019 at 3:15 pm

          Well, when you make such a claim, at least could have provided more details/ links?

          What was the reform? Did that reform remove the risk completely or is it still possible for someone to sue in 2021 for what happened in 2017? Are only practitioners off the hook or the hospitals too?

          Details matter.

        • Steve
          Sep 26, 2019 at 5:06 pm

          Insurance companies make about 2-4% net net. So how exactly are insurance companies raking it in? They are no different that your local grocery store whose margins are around 2%. They make their killing on volume.

          People need to do some research on the medical value chain and see who actually make the margins. HINT: it’s not the insurance companies. (Don’t misread this as an endorsement for insurance companies.)

    • Steve
      Sep 26, 2019 at 12:08 pm

      Tony, first of all when has the Government EVER run any system efficiently or effectively? Never.
      Secondly, the status quo is not killing anybody, its our choices that are. Our diets suck, we are lazy and we always look for someone else to solve our problems.

      At what point do we take responsibility for our own choices?

      As an aside. If health care becomes ‘Free’, basic econ tells me demand goes through the roof and supply is limited leading to long wait lines and substandard care. We already have a huge shortage of health care providers. We can turn more out by lowering standards, but then I’ll take my changes with eating healthy and regular exercise instead of participating in the health care meat grinder.

      • Harrold
        Sep 26, 2019 at 1:52 pm

        Social Security and Medicare seem to be run very well. So well in fact, I have never heard of a person* receiving Social Security or Medicare that is in favor of canceling the program.

        *there are of course, the occasional rich millionaire that suggests pumping that money into his stock fund

        • Wisdom Seeker
          Sep 26, 2019 at 2:24 pm

          Wrong. Medicare is a cesspool of waste and abuse. You’ve got massive overtreatment just because it’s paid for, fraudulent treatment for fraudulent ailments, the whole business of billing code inflation to pad claims, and then on the back side there’s under-treatment for any problem that isn’t covered. Expand that and it only gets worse because the non-elderly are going to have a lot more energy to abuse the system.

          Social Security only works because it’s a simple formula and it’s just moving money from one pocket to another. When you get away from the basic pension, and into SS Disability etc., there’s another cesspool of waste and abuse.

          Now, some amount of waste can be tolerated because of the benefits of the program, but that’s not where we’re at.

      • AlamedaRenter
        Sep 28, 2019 at 11:16 am

        Lots and lots of municipalities run electric and gas service better than private.

        Is PG&E better ran than SFWater or LADWP?

  5. Rowen
    Sep 26, 2019 at 2:27 am

    There are so many moving pieces in the health care crisis, but the one that literally is about greed, with almost no redeeming quality is surprise billing by out-of-network providers.

    When i first heard the stories, I had assumed that it was just garden variety unfortunate event. The ambulance brought the patient to the wrong hospital or something of that sort. Never would I have guessed that private equity firms like Blackstone and KKR were deliberately staffing oon providers at in-network hospitals just to wildly inflate the price, especially with emergency units like the ER and NICUs, where the patient can not price-shop.

  6. Sep 26, 2019 at 2:27 am

    The comparison to the French system is simple and clear.

    In the above example, the 25k employee AND his employer are paying 20k, or 80% of wages, for health care. Plus 6% medicare tax makes the total 86% of wages.

    In the French system, the employee pays 13% of wages to the government, which then pays for all major medical work. There are copays for routine work.

    13% vs 86%. Which is better?

  7. CRV
    Sep 26, 2019 at 2:29 am

    Here in the Netherlands there is also a lot of yelling about high medicine prices. But medicine costs only make up for 2% of the total healthcare budget. The money must be bleeding somewhere else much more, but ‘they’ don’t want us to see where.
    Our system was introduced about 15 years ago. They promised better healthcare for less money. You can guess that was a promise that was broken instantly.
    One thing they came up with to reduce medicine prices, is to limit the numer of suppliers. There is a list of needed drugs and companies who want to deliver have to bid for the privilage to become a supplier. The one with the lowest price wins. Quality or a good delivery track record don’t come into the equasion.
    When this was introduced my wife and i (both work-related to pharma) said this would eventually drive prices upwards, not downwards. The meganism is relativle strait forward.
    First round there are many suppliers who bid. Only one or two get the ‘job”. The rest have to seek for a market for their goods somewhere else and have to wait for the second round to have another go. This first round usually turns out to be lucrative for the one who won, because effectively they have a monopoly now. But that only lasts until the next round.
    Second round there are less bidders then at the first, because some pharma’s don’t bother to make an effort. They found better markets with less hassle. This alone makes prices go higher. Secondly the remaining do want the temporary monopoly, but see the problem with it being temporarily. So that also drives up the prise somewhat. It’s only logical that if a company has to make an investment for an indefinate time, it is willing to deliver at a lower cost, then when it has to make the same investment for , say, four years. There is much more risk involved. The companies who won the first round and lost the second can confirm that.
    The third round of bidding, there are only a few companies left who want to make an effort. They are willing to deliver, but want a better price. The government doesn’t want to pay up and decides that quality doesn’t matter that much and goes for unknow (maybe shady) Chinese and Indian companies.
    We are now at a point that we suffer more and more shortages of medicines that where supposed to be delivered by these ‘cheap’ companies. Cheap becomes expensive, because now you pay with lives instead of money.
    Does government learn from this? No … Instead of opening the market again for more providers, it promotes pharmacists to go make medicines themselves. In small laboratories and with less supervision on supply and manufacturing. Costs may be going down, but guess what will happen with quality. And still, continuity isn’t guaranteed, because the main ingredients have to be made somewhere. And these come from … the same companies that couldn’t deliver the end product.
    And the current situation is that there is not enough supply of raw materials to make the end product over here.
    What will that do for prices? Going down, or up? You don’t have to have a PhD to figure that out.

    • lenert
      Sep 26, 2019 at 8:25 am

      Get rid of government-granted patent-monopolies, pay for the research up-front, then all drugs can be made and sold for generic prices. Remember to include the medical device manufacturers. In a free market all this stuff will cost thousands of percent less. But if you really do want to get sick, look up the CEO compensation of your health insurance company.

      • polecat
        Sep 26, 2019 at 11:32 am

        In our vaunted neoliberal ‘free market’, polio would still be running rampant, even with generic drug pricing !! So no free sugar cube for youuuuu ! .. right ?

    • Paulo
      Sep 26, 2019 at 12:00 pm

      This Canadian has led an active life suffering broken legs (skiing), torn knees (soccer, rugby, and work), and the usual appenicitis and cancer treatments (declared cancer free by specialist as it was dealt with at stage 1). I have yet to receive a medical treatment bill and have a modest co-pay pharmacy plan which I never use because I am in excellent health and do not take medications. (age 64)

      The Cdn system is a minimum of 30% less than the US system in cost, with statistically better outcomes and longer life expectancies. It took just one Premier (Tommy Douglas) to get the single payer ball rolling. It also took staring down a 2 week Doctor’s strike, and all kinds of political interference to overcome. Today, our universal health system is considered to be our greatest uniting strength throughout the Country. Any political party that would ‘mess’ with it would be wiped out at the ballot box.

      Today, in this climate, I don’t think the US has snowball’s chance in hell of changing much of anything on this topic. The entrenched opposition are too well funded, too well connected, and too powerful.
      “You can’t fight City Hall” when it’s owned by corporate interests. However, I really really hope I am wrong.

      This is what it feels like in our system. We don’t even think about medical care unless we need it. Then, we pick up the phone and book an appointment….see the doc for whatever, then go home. Example: The local clinic pharmacy packages up my Father-in-law’s blister pack (heart meds etc) and one of the techs drops them off at his house on her way home from work. No charges. It’s the way it should be.

      • sunny129
        Sep 26, 2019 at 1:09 pm

        When profit (how much? 10%,50%,100%? ++) is a part of health delivery system, expecting no significant increase in premium, is unrealistic!

        This is the ‘fate’ decided every x2-4 year by the elected and the electorate B/w there is no free lunch! As you have already mentioned that various interest groups don’t want the change. All sorts of mis-information has biased the populace.

        Funny if they talk to any ‘main street’ Canadian, just across the northern border, they will get better informed. I am reired doc in US but partly trained in Canada. My daughter is now practicing in Vancouver. I know what you are talking! Anything associated with Canada brings a response of being ‘socialistic’

        • alex in San Jose AKA Digital Detroit
          Sep 26, 2019 at 6:03 pm

          And the “Socialism” boogie man has been talked about so much that among younger people it’s like hearing the oldsters talk about “reefer madness”.

      • Panamabob
        Sep 27, 2019 at 11:22 pm

        The only example that we have in the USA that resembles the Canadian system is Medicare. It’s a single payer that knock down charges 80-90% from billed rates.
        Before I was 65 my insurance company BCBS would get a knock down of 40-50%.
        Seems like single payer is the way to go as a power block to deal with providers with a huge group of subscribers.

  8. Mike
    Sep 26, 2019 at 5:05 am

    “Health Care” is the epitome of an oxymoron . True health care has nothing to do with doctor and taking “medicine” which is really thinly disguised poison.

    Health Care is eating the cleanest food and water possible in our grossly contaminated world, exercising, and otherwise taking care of your body. Health care is NOT the government sponsored quackery and snake oil that is our obese and grossly inflated disease creation and management system that we currently have.

    This is just another useless piece of the “economy”, another English word that has been abused. It depends on “consumers” throwing the largest amount of unnecessary crap in the landfill at the fastest possible rate. Unsustainable? not even close. The fact that anyone buys into and participates in this system only proves how incredibly ignorant, short sighted, and greedy we truly are.

    Take care of your obesity, heart disease and IBS with pills. I am out hiking or tending my garden. Yes I have to work too, a necessary evil that helps me be part of the problem.

    Have a nice day:-)

    • Stephen
      Sep 26, 2019 at 7:08 am

      You are correct. Other than true emergency medicine, most medicine that is practiced in western countries today is a scam cast on to ignorant people who think health comes from a doctor or other health care professional. I avoid doctors, I take no prescription meds, and I only have health insurance because I happen to work for an employer who offers a very inexpensive single plan. I have gone years without health insurance if the premiums were too high. I refuse to be shaken down by a scam. I am currently consulting for a health insurance company and the employees here are some of the most obese people I have ever witnessed in the work place! Get healthy and avoid insurance unless it is inexpensive. If you have children, well they now have you by the short hairs. Btw, yes I happen to be doing IT consulting for a health plan, but if this plan went away, there would be plenty of other industries. Everyone uses IT.

      It’s a good time to go childless if you are still young and single – unless you have lots and lots of $$$. Don’t expect that the ‘government’ is going to fix the problem. Don’t worry, the scam will collapse. If you are healthy, it will not matter.

      • Keeper Hill
        Sep 26, 2019 at 6:30 pm

        So having no children is your plan? Thanks. You and the globalists can keep your childless future.

        • Stephen
          Sep 27, 2019 at 11:17 am

          I made the decision to go childless a long time ago, and its been my best decision. I don’t like the globalist and the best way to deter them is to reduce the slave pool. Globalist know that middle class people will gladly provide them a new generation of wage slaves and tax mules. And the people who send their kids to colleges, even elite colleges? Guess what. They are still part of the slave labor and tax mule pool. The true power of the globalist elite is to get each generation to give them an increasing pool of people who will work for them. Spoiler alert: I don’t care if the show goes on here on plantation earth!

    • unit472
      Sep 26, 2019 at 7:16 am

      I’m not so sure ‘health’ really matters over a human lifetime. We are all going to die and for most of us that means requiring a huge amount of ‘healthcare’ at the end of our lives.

      One can be in robust good health and never needed a doctor for 85 years and then the descent begins. Organs wear out, bones become brittle and hospitalizations begin. Drugs are prescribed. If you hang on until 90 you rack up enormous medical costs. If you lose your mind you become hugely expensive. I’ve read that the major goal of Alzheimers research is just to delay its onset for 5 or so years because, the hope is, something else will kill you first.

      OTOH the ‘good citizen’ is the one who drops dead from a heart attack at 65 and thus incurs NO medical or pension costs

      • rhodium
        Sep 26, 2019 at 8:48 am

        Yes, I think although we could make healthcare cheaper by eliminating large profit margins and the bloated overhead cost called insurance companies, one of the biggest drivers of increasing healthcare costs is the fact that they keep inventing new expensive treatment options every year. These treatments cost a lot and may keep a person alive for a little while longer, but only at tremendous cost to insurance buyers. It’s understandable that people don’t want to give up the ghost so to speak, but regardless of whether we remain a private insurance system or go single payer, people will increasingly be unhappy about denial of claims, “medically unnecessary” responses with the former, and “death panels” (obviously would have a cheerier name) with the latter. Duty to die sounds terrible, but unless all drugs become cheap generics, and robots start nursing and doing surgeries, and your phone assistant bullies you into going to bed on time, exercising, eating well, and relaxing, then healthcare may just keep getting more expensive with all the political ramifications to boot.

    • Steve
      Sep 26, 2019 at 12:23 pm

      Best response of the day.

    • Kerry
      Sep 26, 2019 at 6:19 pm

      Well stated…

    • ultra
      Sep 28, 2019 at 8:47 pm

      Mike: People in the Middle Ages ate wholesome organic food, engaged in plenty of exercise (being a peasant was hard work), and avoided obesity because of the limited supply of food. They too avoided seeing doctors because there weren’t any available for mere peasants. According to you, they were living the ideal lifestyle, therefore they should have been healthy and long-lived. In fact, they were lucky to live to the age 30, and generally led short and miserable lives.

      Today, people who seem healthy and physically fit can die or be decapacitated unexpectedly from heart attacks, late-stage cancer, strokes, car wrecks, other kinds of accidents, murder or attempted murder, infectious disease organisms, genetic defects that manifest themselves later in life, etc. And it’s completely impossible to avoid exposure to the array of toxic substances that have been released by industrial society because they are now found all over the Earth. For that matter, toxic minerals and toxic substances that are produced by plants and some animals can be found all over the Earth.

      You are inferring to much from your own personal experience in this world thus far. You have a lot to learn.

  9. Michael Engel
    Sep 26, 2019 at 5:31 am

    1) There is no healthcare bubble for the Working Age Population.
    2) There is no SPX bubble. A correction is a cause for
    a new all time high.
    3) But the monthly DOW, linear chart, tell a different story :
    ==> there is the a “Great Leap Forward”, over the cliff, that will crush the global economy.
    4) It will correct zombie companies, zombie countries..
    5) It will correct the problems of the aging population.
    6) There are two powerful Lazers on the chart. One is tilting up, the other down.
    7) Lazer #1 from May 2013 til Feb 2015.
    Its very thick and narrow, with multi osc, creating radiation.
    8) The Jan 2018 til July 2019 period is a throwover.
    9) The DOW, on Dec 2018, breached Lazer #1, giving us a warning signal.
    10) It gave support to Apr/ Oc/ Nov 2018 and Aug 2019 lows.
    11) If the DOW will “JUMP” over the cliff it might land on Lazer #2.
    12) Why, the chart don’t tell. But its well, well below.
    13) It will create a 25Y arrowhead with a spitz in Jan 2000 that will end perhaps in 2024/25. Its the inverse of the 1929 to 1949 arrowhead.
    14) The two arrowheads are connected by a relay station from
    1966 to 1982.

  10. james wordsworth
    Sep 26, 2019 at 5:31 am

    Single payer is better for business:
    1. Companies focus on what they do (not on health care).
    2. Individuals have far less stress, therefore healthier.
    3. Easier for individuals to start their own business (don’t have to worry about losing health care with current employer).
    4. Standardized costs (not the current mess of negotiated bills).
    5. Doctors get to doctor not spend 1/2 their time on paperwork and arguing with insurance companies.
    6. Smaller companies don’t have to lose out on employees by not being able to offer expensive health care.

    Major obstacles:
    1. Americans don’t trust each other. I explain the benefits to american friends. They agree, but then they say “I’m not paying for THEIR health care”.
    2. Americans falsely think that if they “live right” they won’t get sick – they could not be more wrong.

    • ultra
      Sep 28, 2019 at 9:09 pm

      from James Wordsworth: Americans don’t trust each other. I explain the benefits to American friends. They agree, but then they say “I’m not paying for THEIR health care.” Americans falsely think that if they “live right” they won’t get sick – they could not be more wrong.

      I largely agree. It isn’t just lack of trust, some Americans genuinely HATE other Americans (e.g., members of other races or ethnic groups, and now political parties), and even want them to die, although they may be unwilling to admit this to themselves.

      Severe illness, serious injury, or unexpected death can happen to seemingly healthy people at any age. Infectious disease organisms have largely declined because of government regulations and the availability of subsidized health care (e.g., air pollution laws reducing respiratory disease, smallpox and other diseases being eliminated from the world by the availability of free or low-cost vaccines). Similarly, many kinds of accidental injury and death have been eliminated or reduced in severity by government regulation (seat belts & air bags reducing death and severity of injuries in car wrecks, reduction of workplace death and injuries in coal mines and other dangerous jobs through safety regulations and inspection).

  11. Steve Graves
    Sep 26, 2019 at 5:44 am

    Not to get all Biblical, but our health care mess stems primarily from two of the seven deadly sins.

    There’s greed, obviously, and lots of it. Insurers, drug companies, equipment makers, service providers, etc. The US health care industry is a massive industry with seemingly unlimited growth potential, so naturally the profiteers are seeking to extract every penny they can.

    And on the other end of the spectrum we have self-indulgence, a.k.a. sloth. The American people eat, drink and smoke more fat, sugar and processed muck than any other people in history. It’s a massive physiology experiment resulting in a witches brew of degenerative conditions which are for the most part incurable yet require enormous amounts of cash to manage.

    There are other factors, of course – innovation driving costs higher, for example, or the innate distortions of a third party payment system – but greed and sloth are at the root of our ongoing health care dilemma. Greed maximizes the cost of the supply while sloth maximizes demand. The left wants to “solve” the crisis by addressing the supply half of the problem only, which might help temporarily but would ultimately prove fiscally disastrous, while the right wants to double down on greed, as if that will somehow make things better (they would actually prefer to simply ignore the problem, but whatever).

    One thing nobody wants is to seriously address the demand side of the equation because that’s a very difficult problem which may in fact be unsolvable, so politicians of all stripes have no interest in opening that potentially bottomless can of worms. Long story short, with thousands of baby boomers retiring every day and younger generations being reared on mcnuggets and sugar water, the US fiscal outlook is grim. On a brighter note, for the moment there continues to be excellent investment opportunities in the largest growth industry in the history of civilization. So there’s that.

  12. Joe
    Sep 26, 2019 at 5:48 am

    Here is my dilemma…
    Since our scientists have mapped our DNA and gnomes, why do the medicines not match with the results of fixing the genetic problem?

    Oh, ya silly me, it would crush all these non-profit organizations out for money. To many boards and CEO’s begging for a hand out.
    Fixed the cancer problem, etc…

    • Steve Graves
      Sep 26, 2019 at 6:50 am

      Joe, the problem isn’t genetic. Sure, genetic disposition plays a role in many cancers, but diet and environment are what exploit these dispositions. The notion that we can cure cancer just because we’ve mapped our DNA is a wild stretch with no basis in the facts.

      • Joe
        Sep 26, 2019 at 7:27 am

        Our biggest problem…
        Is trust.
        We listen to our experts and never challenge that they could have made a mistake or have been bought off for money.
        Many products are pushed as being safe but, over the decades these products have been outsourced for bigger profits and are not safe.
        You now have to do due diligence to to see if your experts were bought off or products replaced with inferior ones.
        No one trusts Congress and yet they generate the laws and policies to follow and you know they have been compromised by lobbyists.

        • Lisa_Hooker
          Sep 26, 2019 at 1:23 pm

          I keep an intact and full decade-old physician’s sample box of Viox (rofecoxib ) on the corner counter of my powder room. Just a reminder of the effectiveness of the US FDA, drug trial reliability, and physician due diligence. They are still seeking re-approvals for new treatments to recover sunk costs.

  13. Kent
    Sep 26, 2019 at 5:58 am

    Health insurance is an interesting instance of humanity’s natural inability to see other ways of doing things. I work in IT and I see it all the time. You can easily automate something someone does, and they immediately recoil with “we can’t do that! This is the way we do it!”.

    And we’ve been doing it this way for so long that we now have massive vested interests in the status quo. Hospital administrations, PBMs, Big Pharma, insurance companies, the medical device complex, and government are all a waste in the process of getting a doctor to help you with a physical problem you are having. What should be simple and affordable has to carry this massive economic burden of CEOs and employees trying to make the best living possible out of your wallet.

    I get to see, in a HIPAA compliant way, the medical expenditures of my employer. We’re self-insured with Aetna doing the transaction work. Fully 50% of our expenditures were for 3 employees with cancer, each with bills well over $1 million. That out of a total population of about 550 employees. It doesn’t cost $1 million to treat these people. That’s stunningly ridiculous in the first place. But if that’s indicative of the rest of the industry, just have the government pick up the tab for those types of issues, and set a reasonable and much lower price. Suddenly corporations will have their prices cut in half. But people can’t change.

    • walter map
      Sep 26, 2019 at 7:28 am

      It doesn’t cost $1 million to treat these people.

      Of course not. That’s what it costs to keep profit margins rising. The actual treatment is a cost to be minimized so overhead can be maximized.

      US health policies are determined by the Medical Industrial Complex, and it is their policy to increase rentier returns, not to provide health care, which is why those returns increase while outcomes worsen, US life expectancy declines, and medical costs account for the leading cause of bankruptcy. So what you’ve ended up with is an extortion racket disguised as a health care system, because that’s what the people running the racket wanted.

      After all, if bank fraud can be legalized, why not medical racketeering? You can guess how that question was answered.

      The trick is to cultivate tolerance for higher costs, so they don’t jack up rates all at once, not for everything: that would generate too many complaints which might result in reforms that could threaten the gravy train. Better to jack up rates year by year so people get used to it, spreading out the pain, as it were, as much as they can get away with.

      In the meantime they continue to tend the pool of politicians with campaign contributions, politicians who can persuaded to sell out their constituents for a share of the booty. Public relations firms, legal specialists, social media trolls, advertisers, and other disinformation artists must also be paid to keep the suckers suckered. It takes a lot of money to run a national corporate racket, but ultimately it’s always somebody else’s money. Your cooperation is appreciated.

      Don’t take it personally. It’s just business.

    • sierra7
      Sep 27, 2019 at 9:19 am

      Kent et al:
      “PBM”……I just cringe when commenters post initials for some kind of program/process etc. without the generic definitions!
      We are not all smart like you.
      “PBM”: “Pharmacy Benefit Management”
      https://www.google.com/search?client=firefox-b-1-d&q=PBM
      If WR permits another link explaining PBM’s:
      https://www.newsweek.com/big-pharma-villain-pbm-569980
      PBM’s appear to be another medical business intermediary adding (?) additional costs to the system.
      Where does this all end?

  14. David Hall
    Sep 26, 2019 at 6:09 am

    Surgeons pay $50k/yr for medical malpractice insurance.

    A diet high in whole grains, fruit and vegetables may improve health.

    A diet high in saturated fat and cholesterol increases risk of cardiovascular heart disease.

    • Joe
      Sep 26, 2019 at 6:27 am

      Oh but what a way to go…
      Juicy steak off the grill…
      Fresh homemade bread smothered in butter…
      Or
      12 grain dry bread with chemical spread, yogurt.

      I choose to enjoy my life, I may be dead at anytime in a vast number of ways not of my doing…

    • Heff
      Sep 26, 2019 at 6:59 am

      Probably getting way off the topic here…but, what the heck.

      Your diet advice is pretty much stating generalities. In the last 10 or so years many cardiologists have come out and debunked the notion that “A diet high in saturated fat and cholesterol increases risk of cardiovascular heart disease.” Other doctors (Atkins) have found high fat, low carb diets reduce diabetes, obesity and total cholesterol.

      Anecdotally, I’m 62, have had high cholesterol for years, eat tons of meat, fish, eggs, VERY little carbs (causes heartburn/reflux) But, I run. been running for 20 years. after 3 MRI heart scans I have NO calcium/plaque in my arteries. I.E no heart disease and very little chance for a heart attack. High Cholesterol isn’t necessarily a death sentence.

      https://health.clevelandclinic.org/your-diet-and-heart-disease-rethinking-butter-beef-and-bacon/

      • Caspar
        Sep 26, 2019 at 7:50 am

        yeah I’m with you. 63, eat mainly animal fat and animal protein, vegetables, salad, very few carbs. Blood pressure/cholesterol both normal, weight normal. No artery plaque. That old advice never worked for me either.

      • IdahoPotato
        Sep 26, 2019 at 9:07 am

        My HDL/triglyceride ratio is best when I eat high fat low carb.

      • Harrold
        Sep 26, 2019 at 2:00 pm

        I remember Nolan Ryan requiring a quadruple bypass less than 10 years after throwing his last no hitter. The guy never drank or smoked in his life. Worked out constantly since he was a teen.

      • Kerry
        Sep 26, 2019 at 6:26 pm

        Most of your cholesterol is located in your brain. Americans are basically clueless…

        • sierra7
          Sep 27, 2019 at 9:27 am

          Ya gotta have “good genes”!
          Without that you are a goner……
          RE: I can’t digest hi-grained bread…….
          “Everything in moderation” still is the guide.
          In my opinion the “American Dream” diets are killing too many.
          Too soon many will be eating pure “chemical meals”.
          Another commenter mentioned the “Seven Deadly Sins” and I have to agree….Greed is killing our society.
          Thanks again WR for another great “discussion” article.

    • The Colorado Kid
      Sep 26, 2019 at 12:39 pm

      David Hall, it’s common misconception that Physicians pay 50k annually for Medical Malpractice insurance. The average M.D. pays less than 5k & the only Dr.’s that even come close to the 50k are OB/GYN’s.

      • william
        Sep 26, 2019 at 8:10 pm

        Where do you get your stats???

        I am retired, work part time as a school physician and pay $6500 per year which is half of the full time premium for primary care physician who do no surgery. I have never been sued. To clarify as you obviously don’t know math, the primary care premium is $13,000. Surgeons pay about $30-40,000. Ob pay close to $100,000

        • Jeff T.
          Sep 27, 2019 at 9:16 am

          Thank you William for taking your skills to a school. Community health centers in our schools should be the first step in a preventative health system. Money spent on prevention, not creating sick people who are an annuity for profiteers.

    • WSKJ
      Sep 26, 2019 at 2:20 pm

      For the opposing view on effect of dietary whole grains, saturated fat, and so on, on human health including a range of major diseases, see:

      the blog,
      the High-Fat Hep C Diet

      for thoughtful posts on diet and health. George is less active now, but his archive of informative posts is still available.

  15. panatomic-x
    Sep 26, 2019 at 6:24 am

    here in nyc my family’s health insurance is about $17k per year. that’s a bronze plan on the state exchange from unitiedhealthcare. none of our preferred doctors – with the exception of our pediatrician – except it. the deductible is so high that i have been putting off medical procedures so that i can get them all done in the same year. f these people.

    • lenert
      Sep 26, 2019 at 8:44 am

      Same here on the left coast for a “family” of 2 fifty-plus adults, bronze plan on the state exchange for $17k – and the CEO makes $25M a year – to collect premiums and deny claims.

      • polecat
        Sep 26, 2019 at 11:58 am

        We did not buy into the whole ACA nightmare, and chose instead to pay the Roberts Tax .. er penalty, in lue of Big Insurance/Big Hospital/Big Pharma induced penury … all with the Obama admins. cynical behest. Have avoided entering ANY medical establishment, as they are IMNSHO, the New Plague !!
        May they be disinfected beyond all recall, and a more humane and efficacious system .. sans grift & profit .. emerge !

        • TXRancher
          Sep 26, 2019 at 4:47 pm

          Ditto!

  16. timbers
    Sep 26, 2019 at 6:30 am

    Every $1 spent on implementing MedicareForAll for every single person in the United States, results in a savings of about $2.

    It’s amazing how many people don’t know this fact. Say it often, say it loud.

    And Medicare while leaps and bounds better than a private insurance system, it’s far from perfect in reaching it’s full potential for care and cost savings. It has tools it has been banned from using, for the express purpose of benefiting corporations and insurance companies.

    Getting insurance out of healthcare is a big part of solving the problem.

    • walter map
      Sep 26, 2019 at 7:32 am

      Your plan doesn’t provide for quarterly executive bonuses, so it will never be considered.

      • polecat
        Sep 26, 2019 at 12:02 pm

        Now, now .. Lets not forget to include the caviar and underage girls …..

    • Petunia
      Sep 26, 2019 at 8:08 am

      Insurance is for rare events like your house burning down, it is not for recurring events. This is the problem with our “healthcare” industry, you can’t insure for things that will happen to you for sure, you will get sick, guaranteed. I support a single payer system because what we call the healthcare industry is really a wealth extraction scam.

      I can guarantee that a single payer system is coming because the millennials are being squeezed in every direction, low wages, student loans, exorbitant medical costs, and unaffordable rents.

    • IdahoPotato
      Sep 26, 2019 at 9:05 am

      Not happening while we shovel socialistic subsidies to rich farmers and defense contractors.

      • polecat
        Sep 26, 2019 at 12:03 pm

        True that.

      • polecat
        Sep 26, 2019 at 12:05 pm

        True that !

  17. Benjamin Cole
    Sep 26, 2019 at 6:43 am

    Great post

  18. Old-school
    Sep 26, 2019 at 6:55 am

    I worked with a lot of people who were working just for the insurance. I got out of corporate life at 48. Used high deductable at around $200 per month until Obamacare forced me onto exchange. I always get a plan for free. I live off less than a million asset base and just spend a few hours each year optimizing my income to keep total state, Fed and Obamacare take to $1000 per year or less.

    I haven’t made an insurance claim in over 20 years. It’s a lifestyle choice to some degree. If you are at middle income level in private sector you are definitely pulling the wagon with too many riders on board.

    • Bobber
      Sep 26, 2019 at 10:31 am

      You got that right. I feel sorry for the Gen X or millennial that has to foot the bill for all the crazy debts the government has been running up. They’ll be on the hamster wheel 24/7.

      They’ll have to loosen the load, of course. Once Boomers and their votes die off, and everybody else is left with the prospect of repaying their debts, I think it will be a different story. The historical wealth accumulated by the Boomers, now sitting in stocks and bonds, will be subject to a wealth tax. The way Warren and Bernie are talking, it could happen soon.

      I’m betting we will have the wealth tax on large wealth accumulations. I don’t see any other way for me to receive the social security and Medicare benefits I have been promised.

      • Old-school
        Sep 26, 2019 at 12:32 pm

        Approximately 15 years ago I read that Congress had made promises that would require all of the growth in the economy from that day forward. It’s starting to bite now. Only way they are currently keeping the promises are running a trillion dollar deficit and extreme Fed policy.

        Only gonna get worse.

      • Javert Chip
        Sep 26, 2019 at 9:29 pm

        Leading edge of Millinneals have been of voting age since 1998, when the national debt was about %5.5T.

        Millennials can scream & stomp their little feet all they want, but they’ve been part & parcel of the problem for the past 20 years (including $15T more debt, $1.6T of which are student loans).

  19. RD Blakeslee
    Sep 26, 2019 at 7:03 am

    ” … the findings of the annual survey of over 2,000 companies, both small (3-199 employees) and large (200+ employees), including non-federal public employers, by the nonprofit Kaiser Family Foundation.” – Wolf

    Wolf, I am a retired federal employee and wonder how the (Federal) Government Wide insurance plans’ price structure compares to the prices shown in the Kaiser study?

  20. Rainmaker
    Sep 26, 2019 at 7:04 am

    The politics are distorted and watching the candidates explain how they are going to reduce drug prices never ceases to amaze me. When a family of 4 earning $60,000 has to pay $1000 per month in premiums something is wrong. Take out taxes, mortgage, autos, insurance, food, utilities and you see what most “middle class” people are joining the “lower class”. Don’t forget the high deductible of at least $4000 for a family.
    There is no regulation of Insurance companies…and these Health Insurers continue to raise premiums while at the same time denying the majority of claims. My daughter recently went to the ER for a respiratory virus that our family doctor told me to take her to the ER…$6,700 for an aerosol treatment..Insurance covered $3,000…I am working with the Hospital on the balance (deductible not reached yet)…The hospital informed me that they only submit claims one time…I asked them to continue to resubmit…the Insurance company paid it on the 4th re-submission…
    Forget the high costs of certain drugs…reduce our premiums…

  21. Old-school
    Sep 26, 2019 at 7:06 am

    I should say some of the best work I have seen on tax and Obamacare optimization is by a guy that goes by the name of ‘Curry Cracker’. He lays out the basic income tax code in visual form using graphs. You can Google him.

    Other good tool for retirement planning is ‘ORP’ calculator on line as it’s got it all in there and will spit you put an optimized tax retirement income.

    I think both of the guys that developed these free tools are computer programmers that just enjoy solving complicated problems.

  22. Sep 26, 2019 at 7:25 am

    The political fight over access and drug prices is completely a red herring argument, for it implies that healthcare works in the first place, which it plainly does not. According to numbers from Dean Ornish and from the American College of Lifestyle Medicine, 86% of healthcare spending is on treatment of “incurable” chronic, degenerative diseases (heart disease, diabetes, autoimmune diseases, etc.) which respond well and can be either prevented or otherwise wholly or partially reversed with lifestyle changes, including a whole foods, plant-based diet.
    There is a quiet, but rapidly growing healthcare reform going on in the form of lifestyle medicine, which really changes the medical paradigm to include nutrition and other lifestyle issues, and which eventually can eliminate that 86% of healthcare costs to a small fraction, for very little medical procedures will actually necessary any more. Heart disease is nearly 100% preventable or reversible except if it is totally critical, T2D is preventable and 95% reversible with diet, T1D prognoses are much improved with an 80% reduction in insulin needs and other meds, auto immune disease can be prevented or reversed, and so on.
    What is really at hand is a complete paradigm change of the difference between healthcare and the disease profiteering system that we now call “healthcare,” but which is really sick care. See here: https://www.bernardokastrup.com/2019/09/guest-essay-metaphysical-rubber-meets.html
    The economic incentive for so-called medicine is more treatment = more money, so we get over-treatment automatically. That much is EC101. But the fact that the medical paradigm is wrong is the real driver behind out of control medical inflation. To doctors, everything looks like a nail, because they only have a hammer (so far). Luckily we now have tens of thousands of doctors already who recognize the fact that we need to make this shift and it is slowly starting to happen. Here in NYC we have two initiatives, the Cardiac Wellness Program at Montefiore and the Bellevue Plant-Based Lifestyle Medicine Program.
    Briefly, the solution will hinge on a massive shift to lifestyle medicine-based primary care, that will shrink the 86% to perhaps 20% of its original size. It is already starting to happen, many who can afford to live this way, do that first part out of pocket and they only need insurance for the rest.
    But it is also happening in other areas. I am in touch with a network of 3000 doctors in NYC who for nearly a year have been doing one workshop a month giving Medicaid patients a 10-day immersion course in a Whole Foods, Plant-Based diet, and the results are dramatic, like an average 20% drop in total cholesterol and an average 9 lb weight loss. I am involved also with another, private program where they do a one month immersion. Generally, people can be mostly free of meds within 3 months. Of course, there is always Dr. Caldwell Esselstyn, who takes in heart patients that are often given less than a year to live, and after 30 years, he is up over 1000 patients with complete reversals, and many of them survived their prognoses by 20 years or more. So, these people come in with medical “prognoses” that they are terminal for one reason only: regular physicians know NOTHING about diet, beyond what they learned in highschool, as medical schools traditionally have ignored nutrition. This is the real healthcare revolution, and it will completely change the equation.
    Meanwhile there is no justifiable role for for-profit healthcare plans, who are profit maximizing entities that are in impossible conflict of interest as is so clearly documented by Wendell Potter in his book deadly spin. He was the former head of PR at Cigna, who came to his senses and quit in disgust for he saw from the inside how for-profit healthcare systems are the tapeworm that eats the economy. Except that realization is not enough unless you also realize that the monopoly on healthcare of the AMA model of medicine is a about 100 years out of date, since, on the whole, we no longer die from the diseases medicine can cure, we now diet mostly from chronic illnesses that are all diet and lifestyle related.

    • walter map
      Sep 26, 2019 at 4:58 pm

      Excellent. Well done. Thank you.

  23. Off The Street
    Sep 26, 2019 at 7:40 am

    Make a few more charts to show the middlemen and their tax on people.

    Superimpose the profitability of PBMs, pharma and their ilk.

    Show the portion of each premium paid to each parasitical middleman.

    Show that portion for a family.

    Show the deductibles relative to those profit shares, including insurers.

    For more fun, show a new graph with the Congressional fund raising from each of those.

  24. BET
    Sep 26, 2019 at 7:54 am

    I have been active, slim, always ate healthy, was a professional athlete
    Did it all right. Until I was bitten by a tick
    It all went to hell then. Treasure your heath , I fight like hell to get it back. Hubs and I are self insured. So far this year we have used our deductible of 7 k. Today we go to the oncologist for hubs. Hope it hasn’t spread. I trade stocks for a living
    Hustling like mad now. I figure we will be lucky if our 20% is 50k. It’s insurance reform. Always has been. It’s national security to make sure that all Americans have access. I have sat in front of emergency rooms. Do I go in? Walk through those doors is 1500. Go home and cross fingers? Yep. yet the American worship of the dollar insured more misery.
    I am not a bumper sticker. I lived it still do
    I pay out of pocket for my treatments
    So no insurancecompany knows i have a pre existing condition I am so deeply disapointed in my country. we can do better

    • wkevinw
      Sep 26, 2019 at 9:19 am

      Sorry to hear about these issues. Somebody who has never dealt with real health issues has no idea when they comment about health being important. Lose your health and see how fast you want it back.

      Best of luck and prayers.

      • polecat
        Sep 26, 2019 at 12:23 pm

        I’m losing my health slowly .. so biological disincorporation is in my foward view. Having said that, I will never submit to the fate of having what little assets I possess stolen, as a result of the financial raping & reaving that would be brought forth by the Medical Grifter’s Club ! I’ll go die alone in a high-mountain meadow if that’s what it takes …

    • MB732
      Sep 26, 2019 at 2:42 pm

      Thanks for sharing BET, best to you.

    • Kerry
      Sep 26, 2019 at 6:40 pm

      You would really be mad if you knew where the tick diseases originate from. Try looking at all the medical patents coming out of Fort Detrick…

  25. max
    Sep 26, 2019 at 8:04 am

    My Son’s Encounter With Government-Regulated Healthcare and the Drug War. What Saved Him Was His Death.
    The public knows that the present health care system is corrupt. Voters don’t know the half of it. This is a system in which hospitals send inflated bills to families without insurance coverage, while letting the indigent in for free and negotiating with insurance companies and lawyers.
    The system is corrupt. It is going to be made even more corrupt, with worse service, by endless government meddling and rationing.
    It all began with John D. Rockefeller and Abraham Flexner in 1910. Flexner was not a physician. He was an educational reformer. The Flexner Report promoted state-licensed medical schools to control the supply of physicians. The report persuaded state governments to regulate medicine and medical schools. The system gave physicians an oligopoly: control over rival practitioners.

  26. unit472
    Sep 26, 2019 at 8:14 am

    I’ve noticed that psoriasis seems to be a national emergency. At least by the number of TV ads for its treatment. Humira, Otezla, Cosentyx are three I can name off the top of my head.

    My mother had psoriasis and she complained about all the time. I suppose I wouldn’t like to have it either but is it something medical insurance should cover. I imagine the drugs ( biologics actually) are not cheap but if you’ve got insurance you will probably use it to buy them.

    Maybe we should restrict government provided healthcare ( Medicaid/Medicare) to life threatening ailments and make that universal. Psoriasis… you are own your own.

    • ft
      Sep 26, 2019 at 1:41 pm

      I’ve lived thru prostate cancer and the corrective surgery that ruins your sex life and leaves you dribbling in your shorts. I’ve lived several years with limitations imposed by arthritis. As a demoralizing ailment though, the psoriasis beats them both. Try some on before you belittle it.

  27. Philbq
    Sep 26, 2019 at 8:18 am

    The cost of healthcare in the U.S. is outrageous. It is $9,536 per capita – way more than any other country, while still failing to cover millions of people. . Every other advanced industrial democracy has some form of national government-sponsored healthcare. These countries spend far less per capita on healthcare, and cover all people. To any rational person not brainwashed with “free market” ideology, it is obvious that some form of national healthcare is needed in the U.S. We are simply not getting proper value for our healthcare dollar. Employer-based insurance already gets a huge tax subsidy, and still does not cover millions. Many workers find it unaffordable. It is inadequate for the nation. Medicare is far more efficient in processing claims than private insurance. It is time to expand Medicare to all.

  28. Brant Lee
    Sep 26, 2019 at 8:19 am

    I suppose basic care facilities at reasonable out of pocket fees, are out of the question in our advanced American scheme of business. Oversimplified thought I know but we can dream.

    A big shout out to Nurse Practitioners, give me one over a DR any day. The best care I have ever received.

    • lenert
      Sep 26, 2019 at 9:18 am

      We pay doctors more than any other advanced country because we don’t have free trade in medical services. Auto and IT workers have to compete in a world labor market but doctors have the protection of a mandatory US residency even for well-qualified foreign doctors who have already finished one.

  29. Sep 26, 2019 at 8:22 am

    This is why many doctors establish cash-only businesses or Direct Care businesses. The difference in doctor care is so stark that it really leaves you wondering what we are really paying for when dealing with insurance companies. Drugs at cost. 24/7 access to the doctor. Even house calls.

    But beyond this….you’re on your own. The cash payments to the doctor don’t cover hospitalization or specialists. You used to be able to purchase reasonably priced catastrophic health insurance. But Obamacare 86’d that. WE can hope for the Great Unshackling from Obamacare so we can get our freedom back.

  30. gordian knot
    Sep 26, 2019 at 9:00 am

    I am 60 and i am in a situation where i have decided to renew my million dollar life insurance and ditch the health insurance. there are only so many premium dollars available. at least i will leave my spouse and children something should i have a early death. For now i am in good health exercise eat a good diet but the actuarial tables predict the fun will find me sooner or later. Clearly the designer never intended the equipment to go the distance.

  31. IdahoPotato
    Sep 26, 2019 at 9:02 am

    The U.S. is 21st in median wealth per adult, below South Korea. All the countries above the U.S. have decent health care and education that do not bankrupt their citizens.

    https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult

    • Kent
      Sep 26, 2019 at 12:06 pm

      The important part in the graph is the column “% median to mean”. That shows you everything you need to know about why the US is in the shape its in. We are truly a 3rd world country.

  32. chillbro
    Sep 26, 2019 at 9:08 am

    The current “healthcare” policy ensures that working and middle class never accumulate any wealth over their life time unless they got luck of a lottery winner. It’s a feature, not a bug though. Everyone says they love capitalism so much, so that’s what they get. Play stupid games, win stupid prizes. I hope their idiotic ideology provides them sufficient medical services because their pockets won’t be able to afford it when they will inevitabily need it.

  33. wkevinw
    Sep 26, 2019 at 9:26 am

    The talk about greed is very interesting. Greed is and has always been present. The way it is controlled is by competition. If you have competition in your business, you can’t raise prices based on your narrow interests/greed.

    The medical system cost structure in the US is truly a disaster, but it is also truly due to several causes.

    Drug prices: the US basically does ALL medical R&D in the world (which is a catastrophe because there are a lot of smart people that could contribute who don’t because of this). This is because there is financial incentive to do that in the US. But, the price of meds is too high in the US because of this.

    The health insurance is a different game. There needs to be some kind of competition (that will have to be facilitated by the government – meaning the government will have to get out of being the main provider). The government can promote competition, but that’s a different discussion.

    Government control is like smoking. At first it seems OK and even feels good. After a long time, the patient/economy starts to die (of lack of innovation, individuals and firms trying to avoid government costs/taxes).

    • Kent
      Sep 26, 2019 at 12:08 pm

      How do the Canadians do it? How’s there costs relative to completely private sector in the US: private companies negotiating private contracts with health insurers who are contracting private contracts with hospitals/doctors?

      • wkevinw
        Sep 26, 2019 at 1:53 pm

        Those private contracts are not competition. They are promoted by the misguided US government policies.

        Part of it is that Canada does not support R&D (No other country is close to the US). The US subsidizes everybody. The US accounts for about 70% or pharma profits- with 27% of the income.

        Many citizens from other parts of the world go to the US for advanced treatment (small fraction of medical cases).

        I have two family members who had exotic cancer surgery researched and only available in the USA- at ~ age 40.

        We are very grateful for the US medical system, even though it does cost too much.

  34. QuadQ
    Sep 26, 2019 at 9:28 am

    Can someone explain why the ones that served in the US military for 4 years packing boxes on the mainland during wartime get medical benefits for life? From what I’ve found only 1 out of 12 military persons actually see combat.

    • Sep 26, 2019 at 9:32 am

      QuadQ,

      Well, Senators and Representatives get healthcare for life, even if they’ve only served one term. And they got rich while “serving” the country. I’d rather get the former Senator’s heath care than the health care offered by the VA.

      • polecat
        Sep 26, 2019 at 12:41 pm

        Senators and Representatives …

        It’s almost as though they can traipse any time they like into what is effectively a Capitol basement concierge medical facility, to be treated forthwith … All on the filty taxpayer’s dime ….

        Oh .. wait !

        • polecat
          Sep 26, 2019 at 12:47 pm

          Excuse my error. They supposedly have to cough up an ANNUAL fee of, I believe .. the insolvent inducing amount of $600.00, or some such, for the above privilege …..

          Tis such a burden !
          /s

    • Petunia
      Sep 26, 2019 at 1:17 pm

      In the military everyone is combat ready, that’s why. When you willingly put yourself in harm’s way to protect the rest of us, you deserve to get special consideration.

      • Harrold
        Sep 26, 2019 at 3:57 pm

        Its not for lack of effort.

        The military tried to stop covering all but retirees a few years back and they got sued by veterans groups.

  35. CreditGB
    Sep 26, 2019 at 9:31 am

    So there is this ad on TV for an App that shows how some poor mom gets her kid’s $67.00 prescription for $8.50.

    But the fine print on the HD TV screen says “cannot be used with insurance”.

    What?

  36. Mark_2
    Sep 26, 2019 at 9:32 am

    Here’s article that cites the WSJ to make it’s point in part. In a nutshell the author states the problem is incentives on several levels. I thought it meshed well with this article and what poster, MCH said about middlemen.

    Explaining the High Cost of US Health Care: No Skin in the Game

    https://moneymaven.io/mishtalk/economics/explaining-the-high-cost-of-us-health-care-no-skin-in-the-game-hDmB3UoWIkOK-J_D5BKQHA/2018-08-01T04:08:40.4122840Z/araXgrjJp0qNvFulEc_bPw/?replyPage=1

    • wkevinw
      Sep 28, 2019 at 7:30 am

      Mark_2: This article is an oversimplification, as usual. It says, “need a liver transplant, and can’t pay? Too bad”. That’s actually illegal in some cases. Lifesaving care must be provided, therefore the costs will be incurred. The other items are right- because there is no cost discovery, and it’s easy to be a quasi-monopoly, such as Pharma and hospitals, the prices keep rising.

      I have always had another system in mind. Basically everybody is insured in the US already. So, we can let people not buy private insurance, BUT if you have a large medical bill- the IRS or similar, just “attaches wages” or similar.

      That’s a good deal that is financially responsible. It would change everything for the better very quickly (prices would come way down).

  37. CreditGB
    Sep 26, 2019 at 9:34 am

    Add on question;

    Could it be someone is getting massive kick backs out of the $67 prescription processed by the insurance company, but the cash paid prescription is not?

  38. CreditGB
    Sep 26, 2019 at 9:36 am

    Mark2,
    Thanks, your message came while I was asking the question. I guess $58.50 on same prescriptions time hundreds of thousands, pays a lot of middle man commissions.

  39. Iskabibble
    Sep 26, 2019 at 9:43 am

    Here’s the “money” for medicare-for-all (MFA):
    https://www.governmentcontractswon.com/

    Now, do you want future, not-even-born-yet taxpayers to pay for never-ending perpetual wars and weapon systems year after year after year, ad infinitum, weapon systems that are oblsolete in a few years, or do you want those taxpayers to pay for MFA and vital infrastructure such as modernized electrial production and distribution systems? Take your pick.

  40. KY Asian
    Sep 26, 2019 at 9:56 am

    Wolf,
    Thanks always for your reporting. I’ve been reading your blog for a while but this is my first time commenting.

    Since I don’t think the transition to single payer system is realistic, I believe the most realistic policy change is the public option health insurance, with one big caveat.
    Right now most employers pay the majority of the premium (from the chart it looks like roughly 70%, or $14k of $20k).

    When employees start opting out to the public option plan, would employers be willing to convert that previously employer-paid premium to employee’s salary? (They should be, as it shouldn’t matter to employers whether they pay in salary or benefit)
    Assuming employers are willing to do so, an average employee (with family plan) would see a jump in annual salary of $14,000, which they can apply to the public option insurance premium.
    Government will then just have to do its best to lower the operating costs of the public option plan than the current system. I don’t imagine that’s impossible to do.

    • Harrold
      Sep 26, 2019 at 4:00 pm

      Employers will never do that. They will keep the savings to themselves.

      Not like a single company passed the Trump tax cut onto their employees ( a few gave 1 time bonuses).

      • Erle
        Sep 27, 2019 at 12:40 pm

        You are not a small employer.
        I want to dump all of the mess onto the employee with a raise to equal my costs. Perhaps then they will find out what the insurance/medical rackets are all about. I do tell the employees how much they would get in pay if they would leave the racket. That happens to be my cost.
        Perhaps then they would make a stink about being able to get a price quote up front for medical services. Assembly line procedures should not vary by 1000%.

    • Steve
      Sep 27, 2019 at 6:13 am

      Except that now the $14,000 is taxed for both FICA AND Federal and State income taxes. So that $14,000 just became 10,269 (7.65% FICA, 15% FIT, 4% SIT).

      Why can’t the Government make health care costs 100% deductible from income before itemization? Whether the company deducts it or the individual, makes no difference from a revenue standpoint.

      If the company grossed up the amount, why on earth would they raise their costs?

      I like the idea of eliminating company sponsored health care but it will not be a dollar for dollar economic transfer without Congress adjusting the IRS code.

      • Sep 27, 2019 at 10:40 am

        Steve,

        There is a way to get a deduction…

        If you have a qualifying high-deductible health insurance plan, you can get a Health Savings Account (HSA) with it. An HSA works like an IRA, and there are brokers and banks that offer them, and contributions to it are fully deductible from federal taxes (state taxes may differ).

        For 2019, the limit for an HSA contribution is $3,500 for an individual and $7,000 for families. Plus, there is a catch-up provision of 1,000 per person over 55. So a couple were both are over 55 can contribute $9,000 to their HSA in 2019 and deduct the full amount from federal taxes.

        But UNLIKE an IRA or 401k, this money is NEVER taxed. You can take it out anytime to pay for healthcare expenses, usually at the doctor’s office via debit card linked to the account, or you can just leave it in that account, invest it, and enjoy the tax-free gains until forevermore.

        This is a Bush law that is now at the core of Obamacare. It is not great for everyone, but it is awesome for people in a high tax bracket (another Bush tax cut for the rich, I know), who are healthy and don’t have chronic medical conditions. For these people, the amount in saved taxes pays for most of the premium of their very-high-deductible plan.

        If you’re healthy you can easily accumulate tens of thousands of dollars in an HSA, and when you get seriously sick, and your maximum out of pocket amount on your insurance is $5,000 that year, you just take that out of your account, no sweat. It’s the best deal around – if you’re healthy and in a high tax bracket.

        • Steve
          Sep 27, 2019 at 11:36 am

          Correct. Been doing this for the past few years. Pay all medical out of pocket and contribute the max, + my over 50 catch up. Best savings program ever. Fortunately I don’t get sick or injured (at least not seriously). knock on wood.

          I just do this through my current overlords (employer).

        • Steve
          Sep 27, 2019 at 11:37 am

          By the way love you site.

  41. Luke Kindred
    Sep 26, 2019 at 10:00 am

    At my last job, where wages ranged from $12-$55/hr, the cost to insure my family of three on the company insurance (at an S&P500 size biz) was $1800/mo. If I had decided to pay this, we would have had few options but subsidized section 8 housing or a meth lab trailer park. But that would have required fraud because my income was too high.

    So we continued to do what many people I know are doing – refuse insurance coverage, lie on our tax return every year, and use the ER when medical care is needed. Medical bills, even when in collections, do not appear on credit reports and city hospitals won’t refuse to care when you have unpaid bills.

    I am not proud of any of this and I really would like to be able to pay for coverage. But I am now over $100k in debt from requiring PICU last year. Even if we had been on the company insurance, our out of pocket would have been over $25k just for that one week in the hospital. We would have become homeless and I would have lost the job.

    This system is very broken.

    • Petunia
      Sep 26, 2019 at 1:21 pm

      The leading cause of bankruptcy these days is medical bills, you should consider it.

    • philbq
      Sep 26, 2019 at 1:50 pm

      If you lived in Canada, you would pay nothing. There are no deductibles, co-insurance, or co-pays. And you can see any doctor you wish. There is no “in-network or out-of-network” doctors. The bills simply go to one place : the Canadian government health authority. I have been to Vancouver many times, and you cannot find any one who would prefer our American private “free market’ system.

      • Steve
        Sep 27, 2019 at 6:17 am

        Oh please. NOTHING is free. The government has to take money from someone to pay that costs.

        That old diatribe that if the Government provides it its FREE is just so much BS.

        Some one is paying the Government. At least let’s be honest about who IS paying the costs because IT IS NOT the Government.

  42. Petunia
    Sep 26, 2019 at 10:24 am

    I almost forgot to mention a commonly forgotten part of healthcare, vision cost. The frames and lenses are a total ripoff. Yes, we go to a “cheaper” big box store affiliated provider.

    • bemused
      Sep 28, 2019 at 3:15 am

      We have gotten frames and lenses at zenni.com many times. They do have a nasty habit of ‘retiring’ frames that I wanted to buy again, but I’ve bought single vision lenses with frames for $20 with a basic coating. Their premium antismudge coating (which I do recommend) cost me an additional $15. They aren’t super-premium glasses, but they have certainly done the job for my wife and I at a very cheap price.

      They say you need to send in a prescription, but I never have. I just fill in the numbers, pays my money, and get the glasses about two weeks later.

  43. c1ue
    Sep 26, 2019 at 10:27 am

    It is interesting to see how much victim blaming there is in the comments.
    It seems people still aren’t up to speed concerning the ways by which “Big Sugar” has been distorting American diets.
    Also interesting that no one mentioned administrative cost. Administrative costs are one of the major drivers of health care costs – and that’s a direct outcome of health insurance companies and health provider medical billing dueling it out to split revenue.
    Lastly, no one mentions that the US is spending roughly twice per capita GDP on health care vs. all of the other 1st and 2nd world countries.
    The problem is systemic, it is the single biggest issue facing Americans and it isn’t get much attention – certainly not as much as it should.

    • IdahoPotato
      Sep 26, 2019 at 10:38 am

      Blaming the victim is the time-honoured American way. It’s patriotic. Almost.

  44. Dennis
    Sep 26, 2019 at 10:54 am

    In 1989 an article was published in the New England Journal of Medicine.
    The topic was Physicians for a National Health Program. The article provided the platform for a more honest and efficient system of delivering medical treatment.
    The authors looked at where the waste and inefficiencies are in our health care system and suggested changes to improve health care delivery.
    First of all, they noted that administration is about 1/3 of the cost of health care. We spend about $4 Trillion a year. Do the math.
    Hospitals have a lot of people bickering over claims and payments.
    There is no real competition, in health care, so why have so many insurance companies and pharmacy benefit managers? They don’t create any efficiency.
    The conclusion of their study led to suggesting several major changes.

    1. A single-payer system, since there is no competition. ( You can’t even find out the cost of most treatments, so you can’t comparison shop.)
    2. Hospitals should operate on an annual budget, not just bill for unnecessary treatments.
    3. Uniform fee schedules for Drs.
    4. Limit drug prices. Some meds cost thousands of dollars here, but only cost a few dollars in other countries. Same medicine, from the same company.
    Congress never even considered or debated this.
    The health care industry has blocked progress toward more efficient delivery of health care services. Politicians get paid not to make waves.

    • philbq
      Sep 26, 2019 at 2:02 pm

      In the forming of the Affordable Care Act (Obamacare) legislation, the same group, Physicians For A National Health Program, asked to present to the congressional hearings of healthcare reform. They were prevented from speaking or presenting. When they attempted to speak, they were arrested. Obama and his pointman in the senate, Sen. Max Baucus, had already decided to do a deal that pleased the heal insurance companies. (Baucus had received millions from the healthcare industry.) So the savings and economic advantages of single payer were not considered. The fix was in. And Obama betrayed his promise that there would be a low-cost public option. Obama agreed to a system of public subsidy paying the expensive premiums of the health insurance companies : public subsidy for private profit.

  45. Boatwright
    Sep 26, 2019 at 11:24 am

    Wolf,

    You should consider researching health-care economics in Michigan, where the biggest by far “private” insurance company is Blue Cross / Blue Shield. BCBS is a state chartered non-profit company that has no profit motive to keep ratcheting up insurance costs. The math is simple: The bigger the pie, the bigger the profits a given percentage of insurance skim yields.

    I received my annual notice in yesterday’s mail; my own Medicare supplemental policy premium will increase $1.00 for 2020. Before I retired, my non-group premium was about $4,500 / year. The coverage is excellent.

    • lenert
      Sep 27, 2019 at 8:07 am

      Blue Cross dropped coverage for our whole county 3 years ago.

  46. Sep 26, 2019 at 11:47 am

    Don’t most colleges provide healthcare for their students? Could be a method to the madness in rising student debt rates?

  47. Boatwright
    Sep 26, 2019 at 11:48 am

    We also need to look to other countries. An old friend’s granddaughter is studying in Paris. She is covered by the French system and reports that ALL of her health care records: patient demographics, clinical notes, Rx’s, lab tests, etc. are recorded on a smart card that she carries with her to the doctor. The records are easily available to the professionals, readily updated, and recorded to a master government system. Prescriptions are recorded on the card which is taken to the pharmacy. There are strict protocols about privacy. There is also a huge reduction in foolish paperwork.

    Compare this with having to fill out the same info forms over and over on this side of the Atlantic. My six doctor family practice has four people working in the back office in addition to six nurses running interference for the doctors and a lot of what the nurses do is keeping up with the bureaucracy.

    If we set out to design a stupidly inefficient system we couldn’t do much worse.

    • philbq
      Sep 26, 2019 at 2:08 pm

      Boatwright: you are making the case for single payer. Your excellent coverage is paid by Medicare, and your family in France is covered under the French national system – single payer.

  48. Dimitri Gaspard
    Sep 26, 2019 at 11:50 am

    Wolf, Have a look at this… https://boingboing.net/2019/09/26/kkr-and-blackstone.html private equity firms that own doctors’ practices, it’s beyond infuriating.

  49. Serge
    Sep 26, 2019 at 12:45 pm

    Last year my wife had a baby total cost was $400, but it was in Russia. For regular check ups went to private kids clinic with the baby, it was $8 for two different doctors. America is screw up with their outrageous health care bill. Average salary in Russia is about $500 a month. It would take about half a day working to pay for the doctors visits. Here in USA if you go to two doctors with no insurance they would charge you about $250 each. So for average American it costs about a week of work to pay for the doctors visits.

    • Just Some Random Guy
      Sep 26, 2019 at 2:01 pm

      This is why when people all over the world need top medical care they fly to Moscow and not New York City!

  50. Dan
    Sep 26, 2019 at 1:35 pm

    Get rid of the State-Based System with 50 sets of separate regulations. Form one national market with one set of regulations for medical related including education, licensing, insurance companies, hospitals, etc. Emphasize out of pocket payment for routine care to incentivize healthy living. Small business fought for this for decades but that effort was killed when Obamacare came along. Why isn’t Obama commenting on his disaster???

  51. Eferg
    Sep 26, 2019 at 1:48 pm

    Lots of good points being made here.

    One thing that seems to be missing is that healthcare should be a transaction between user and provider. If insurance is desired, that should be a separate transaction between the user and an insurance company.

    What we have is basically a cabal system where providers set astronomical “list prices” and insurers “negotiate” huge discounts. This drives the user to a small group of insurers basically out of fear of the “list prices” bankrupting them. This put the insurer between the user and provider.

    Then there is the government gorilla that insures the indigent and old folks. This gorilla favors certain players such as hospitals, imposes huge admin costs and shifts costs to other user groups by under paying providers (which is simply a hidden tax).

    In spite of all the babble about single payer healthcare, nothing is going to change. There is far too much money and power involved. The only changes that will be made are those that concentrate this money and power.

    My favored step towards a more equitable system would be for providers being required to offer their cash customers “most favored nation” pricing. But, that is just a dream because it would blow up the current system.

  52. Nurse Cratchett
    Sep 26, 2019 at 1:52 pm

    Wow, now even rich people on an investment website are complaining about the problem. It really must be bad.

  53. Just Some Random Guy
    Sep 26, 2019 at 2:00 pm

    Health care is the only industry where you have no idea what the cost will be. So as the patient/consumer there’s no way to shop around for the best price. Even if you call a doctor’s office and ask how much will X cost, you will never get an answer. I know I’ve tried.

    • ZeroBrain
      Sep 26, 2019 at 9:25 pm

      YES! The “market” only works when you have some idea of what you’re getting and how much it’s going to cost – before you sign!

      In my preferred version of capitalism, prices for products and services need to be posted publicly for them to be allowed to be sold at all. This would reduce the number of salespeople and change the focus to quality and service. This could be applied to everything from a dentist appointment to a course of chemotherapy to car sales.

      An exception should probably exist for one-off contract type work.

      • ZeroBrain
        Sep 26, 2019 at 9:27 pm

        EDIT – would “change the focus to *price* and quality and service.”

  54. philbq
    Sep 26, 2019 at 2:14 pm

    Let me add this point: single payer is good for business. Example: Toyota now builds RAV4’s (like mine) in Ontario, Canada. When Toyota considered whether to build a new plant in the U.S. or Canada, they chose Canada, because their costs for covering their employees would be far cheaper under the Canadian single payer system. Sure – Toyota will pay some tax, but it is a good deal for them. Hopefully, American corporations will wake up one day and see that single payer is much cheaper than what they pay now to cover their employees. Single payer is good for business.

  55. WSKJ
    Sep 26, 2019 at 2:44 pm

    A propos of this post re healthcare insurance, and yesterday’s housing bubble update post, I am wondering:

    what government agency, if any, is responsible for reporting income going specifically to Obamacare from the “ACA’s Medicare surtax” on capital gains on the sale of real estate ?

    Yes, there are limits on personal/married filing jointly Adjusted Gross Income (AGI); and also on profit on the sale, BEFORE the surtax kicks in. Also, a Forbes article from some years ago pointed out that the surtax applies to “investment profits and other non-wage income starting in 2013”.

    Whether you choose to call this a “wealth tax”, will obviously depend on your definition of “wealth”.

    • WSKJ
      Sep 26, 2019 at 2:53 pm

      I should add here that “surtaxes” on sub-headings of Medicare insurance (for instance, Medicare Part D ) kick in based only on income ( talking somewhere in the 6 figure range).

  56. Max Power
    Sep 26, 2019 at 2:49 pm

    People don’t understand that our crazy and unique employer-based health insurance system makes US companies seriously uncompetitive compared to other advanced economies. Two main reasons…

    1. Rather than concentrate on making widgets, US businesses have to putz around having to mess with all sorts of issues related to providing health insurance coverage to their employees.

    2. If someone has the next great idea, it is difficult for them to venture out on their own and try to make it happen if they have to deal with a health insurance system that’s geared towards being employed by someone.

    Both these things are complete non-issues in all other western countries. In every other country businesses are free to concentrate on the things they do best in their core business – without having to deal with this major distraction.

    • Just Some Random Guy
      Sep 27, 2019 at 1:16 pm

      That’s exactly why Google, Amazon, Facebook, Twitter, Salesforce and Apple all were started in countries with govt run health care systems.

  57. tommy runner
    Sep 26, 2019 at 3:56 pm

    about as close to talking about politics w/out talking about politics as we can get.

  58. Bad Hobbit
    Sep 26, 2019 at 4:13 pm

    Thanks for the article but you did not address exactly why health care is surging faster than wages?

    I would assume that people need health care so the insurance companies can charge whatever they want. I know the Insurance companies are supposed to be regulated (like power companies) by the states, but from what I know the boards are comprised of industry insiders.

    It would be interesting to know how the system got this way.

  59. Juan Sanez
    Sep 26, 2019 at 7:14 pm

    It is the same old story, the middle class always gets hit hard from taxes, fees, cost of living, car insurance, health insurance etc.

    I never had to buy health insurance from a private company because I am here in Canada but I don’t use the healthcare system here as I healthy as a 35 years old have had no health issues. My wife and kids are healthy as well with minor issues. However, car insurance is pretty expensive here, $2,500 to $3,000 a year for a 10 year old car like mine. Gas is at least $1.20 a liter which is about $4.60 per gallon.

    The problem I have is my pay for the last 16 years has not gone up much, 30% total and I am currently making $20.45 an hour, $51,000 last year . I paid last year $10,892.34 in total income taxes but then gas taxes, carbon taxes, H.S.T., alcohol taxes, car registration taxes etc. sales tax it is probably close to $13,000 last year in total income taxes.

    I guess since I have been smarter than most working full-time and overtime some months per year since I was 19 and saving and building that money up. I managed to put aside and build $365,000 avoiding the last 2 major stock market crashes being very conservative, GIC’s, provincial savings bonds. A good Canadian born friend still my friend today explained basics about this and how it is with the banks, credit unions etc.

    I rent and live in a modest 2 bedroom house with my wife and 2 kids and will never buy a house but that gives me more mobility to move where higher wages are if that is what I need or can get. We have no family here as we came here from El Salvador in 2000. We have lived in the same city all our time here in Canada.

  60. mtnwoman
    Sep 27, 2019 at 8:15 am

    I’ve worked as practitioner in medical trenches x 30yrs. Hating it more and more every year due to the rules set out by insurers.

    I’m self employed and pay $1100/mo premium an $ 6500 deductible. Insane and unsustainable. I have put off evaluations due to cost.

    It’s a byzantine,cruel system with the goal of profitting mightily off our suffering. Firmly for Medicare for All, and for Bernie Sanders rendition of it, not Warrens.

  61. Jeff T.
    Sep 27, 2019 at 9:33 am

    I will ask a simple question that young people need an answer to. If you break your arm in the US, where should you go to get it fixed?

    • Petunia
      Sep 27, 2019 at 12:02 pm

      Anywhere, tell them you are an illegal from South Africa, that way language and race don’t matter.

    • drDeath
      Sep 27, 2019 at 8:16 pm

      don’t carry ID, refuse to identify yourself, they must treat, and then sneak out, they can’t find you, they can’t bill you

      once they have your ID, then they just turn you over to a factoring company get 20% on the dollar, you end up pays 1/2 Million for the broken arm, or go to prison in some states that have debtors-prison

      I have rich friends, who just say to ‘negotiate’ with the hospital, tell them your poor, before the bill is due, tell them you can pay ‘a little cash’, then those $10 aspirin, can be dropped to a penny, if they know they can get cash without a fight up-front they drop a lot of the BS. Almost all US MED just sells their accounts-payable to a repo-factoring outfit for 30-40 cents on the dollar or less, and really don’t care what happens to the patient. These collection companys can go after assets and in debt-prison states they can take everything and make family members pay to keep their loved ones out of prison.

      It probably pays best to never live in a debtor-prison state, Arizona, Louisiana come to mind. Lot’s of states will lock you up, and then your debt actually explodes because the state will bill you for your incarceration.

      You can’t really win the game in the USA unless you exit, even if your rich, they’ll eventually make you poor.

  62. sierra7
    Sep 27, 2019 at 10:57 am

    In a “progressive” society some things should be profit driven; some not. Healthcare should not. High quality public education should not be exploited by private capital, etc.
    Until we reverse such ideas as, “Citizens United” and recognize that we have some priorities ass-backward we will continue to live under a complete totalitarian, multi-level justice system.
    The purists will always bleat, “choices”……but the reality is we have very few of those.
    Considering the healthcare cost crisis, bankruptcies, a so fraudulent financial system so multi-layered that it defies the imaginations, our corrupt political/money system we are headed for a requiem of epic proportions.

  63. drReal
    Sep 27, 2019 at 8:08 pm

    system is working fine,

    I had friends in 1980’s who were making a million dollars a year, out of college as ‘medical sales reps’, in fact one gal I knew, her father a surgeon, told her not to get her MD, but instead just get a BA in sales&marketing,…

    The problem of course is everybody in MED (AMA) gets rich, and of course that means everybody who gets sick gets poor.

    The nature of the USA system is to screw the other guy to get rich, not unlike the chinese system, the problem of course is eventually you end up with a system of a few rich left to be screwed and a lot of poor not worth screwing ( financially )

    [ The chinese system of course, goes so far to sell poison as medicine, but at least locals take things into their own hands by killing the parasite, this never happens in USA as the system protects the parasites ( lawyers & friends ) ]

    Or course the medical insurance racket is just “follow the money”, or “I rob banks, cuz that’s where the money is”, AMA big-med has been making a fortune since 1970’s ( probably medicare start era ), and now like a crocodile addicted to blood

  64. James R Chaillet, Jr., MD
    Sep 27, 2019 at 9:14 pm

    I have been in medicine over forty years, practicing medicine and being in management within an HMO. During that time the cost of healthcare and the cost of health insurance has risen in almost every year. During that time medical outcomes have improved mostly through new drugs and technologies; but nowhere near the increase in costs. (Diminishing marginal utility for you economists out there)

    There are many reasons for the increase: the new technologies and drugs, an aging and, at baseline, largely unhealthy population, a large and growing number of rent seekers(aka parasites) within and around the industry – insurance companies, regulators within and around the government, large healthcare organizations and providers of all types eager to offer services in return for mostly third party reimbursement.

    I see no fixes from the insurance industry, the healthcare industry or the government. Everyone has too much to lose including the politicians. Though I not a fan of it I see some sort of single payer system as the end game; but only out of desperation. (Remember Obama had the votes in Congress to get a single payer in his first term)

    It’s also worth noting that such a system’s introduction will not be without pain. For one people will die as access for some very sick will be curtailed. It’s also not likely the government will manage it well. The US does not have a history of dedicated, well trained professional government employees as in some European countries. The US could farm it out to the insurance companies as Medicare and Medicaid do now but your back to the parasites.

    One possible positive is that a parallel private system of insurance and healthcare delivery could be allowed initially or later develop for those can afford to escape the government run system. (Also for the politicians who create the monstrosity)

    I really don’t know what will happen but it will be interesting.

  65. Michael Gorback
    Sep 28, 2019 at 8:15 am

    It’s hard to come in on a thread running well over 100 comments but here are a few thoughts:

    The insurance-hospital complex is probably the single worst cost problem in the USA. These two entities are simultaneously opponents and allies; they may fight over prices amongst themselves but the current system makes them rich and they lobby accordingly.

    One of the most egregious things I’ve seen was when they created Medicare Part D, which covers medication. The law forbids Medicare from negotiating prices on drugs. That’s right: the largest insurer in the country can’t negotiate prices.

    Physician fees have not kept up with inflation for well over a decade and the government mandated electronic health record is both costly and impairs productivity. Physicians have figured out that the way to compensate for that is to invest in businesses that have better lobbies: pharmacies, labs, imaging facilities, ambulatory surgery centers, hospitals, etc. There were years where my passive income exceeded my practice income.

    Canada is not health care paradise. As far as I know, it’s the only country where wait times for care are so bad that legislation was passed to create web sites where you can look up how long it will take to obtain a service. You can look by hospital and by doctor. Go to one of these sites and see how long you wait for your child to have a tonsillectomy. In 2017 the median wait time to see a specialist after being referred was about 3 weeks. The median wait is about a month for a CT scan and about 3 months for an MRI. Median wait time for neurosurgery is about 8 months and orthopedic surgery 10 months. Eight months is a long time if you have a brain tumor, especially after you waited 3 months for the MRI that found it.

    In rural areas it’s even worse. The median wait time for a specialist in New Brunswick is almost 42 weeks, Nova Scotia, about 38 weeks and on Prince Edward Island, over 32 weeks

    Is Canadian health care free? Taxes to support the system run about $12,000/yr for a family of four. Treatment delays cost almost $2 billion annually in lost time and wages. There are about a million Canadians waiting for services.

    I’ve treated Canadians who moved here and at least from a pain specialist POV the care is appalling. People in pain seem to get bounced around for years with nothing being done other than narcotic prescriptions and physical therapy. I go to Italy about every 6 months and the pain management I’ve seen there is similarly substandard.

    Furthermore, Canada can’t provide care for all its citizens, as seen by the transfer of parturients across the border to the US.

    Canada can provide cheaper healthcare in large part due the fact that it is a government owned monopoly that can set “take it or leave it” prices.

    One commenter said that all the doctors should get the same pay. Well, as a doctor I’d like to know why if I have better skills and a long waiting list I can’t charge more for my services. Medicare has always paid the same rates no matter what, and with consolidation in the insurance industry I have the same Hobson’s Choice. You can see the best doctor in town for the same price as the worst doctor in town.

    Put me on a salary instead of fee for service and see how hard I work. Why stand next to an xray beam for hours doing fluoroscopically guided pain-relieving procedures when you can sit around writing prescriptions and referring out to physical therapy?

    Recently graduated specialists in Canada can’t find work because there aren’t enough funds to pay them, even though a Canadian orthopedic surgeon earns about half as much as an American orthopod.

    BTW, the socialized systems around the world are collapsing under their own weight, maybe because government run programs are so darn efficient.

    Speed, quality, price – pick any two.

    Be careful what you wish for.

  66. Michael Gorback
    Sep 28, 2019 at 8:44 am

    From an interview with Christopher Hayes of the Institute of Health Policy, Management and Evaluation University of Toronto.

    “On average, Canadians pay 30 percent of their total health costs where the provincial plans cover 70 percent. So in that bucket would be medications, if you weren’t in a program — durable medical equipment, other health disciplines like psychotherapy, physiotherapy, social work outside of the hospital, skilled nursing, or nursing care in your home. It’s not that none of that is covered, but a lot of that is not covered. And so most employed people will have either a group coverage through a private insurer, or individuals can sign up individually for themselves and/or their families to one of these private insurers, but have a private plan.”

    Ah, not quite so “free”.

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