Re: HEALTH CARE costs are up! ............................11.2%........................WoW!

From: Andy (idontcheckthismailbox_at_yahoo.com)
Date: 09/13/04 

Date: 13 Sep 2004 09:22:49 -0700

Joel M. Eichen <joeleichen@yahoo.com> wrote in message news:<tod3k0levpjo63onjrsd2m6946uua01of5@4ax.com>...

> WASHINGTON - Premiums for job-based health insurance jumped an average
> of 11.2 percent this year, greatly surpassing the 2.3 percent
> inflation rate and 2.2 percent increase in salaries over the same
> period, according to a new survey of employers released yesterday.

A few weeks ago some economist (Alan Greenspan?) pointed out that
rising health insurance premiums were dragging down job creation, so
its now not just hurting individuals, its dragging down the whole
economy.

Obviously this trend cannot continue forever. At some point health
care costs are going to have to at least level off, and that will only
happen through market forces. The problem is that the way the health
care market works these days is pretty dysfunctional. Consumers don't
shop around for competitively priced health care providers because
most consumers don't pay their own health care bills, their health
insurance does. So the market works instead by health insurance
getting more and more expensive, which leads employers to drop or
limit health insurance benefits, which results in more uninsured
people, which results in health care providers needing to charge more
to customers with health insurance to cover their losses on growing
numbers of uninsured patients, which results in higher health
insurance premiums, etc......, repeat cycle until system completely
fails.

The whole system needs to be restructured by government intervention
at some point because market forces are not working to contain costs.
We can wait until growing health insurance costs completely strangle
job creation and put us into a depression, or we can act now and get
it over with.

Andy

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