Reclaiming Common Sense

Digging into the Health Care Data

The health care debate has been raging since 2008. It was thought that the Patient Protection and Affordable Care Act would be a benefit to the American people. We were supposed to see lower premiums and better coverage. The problem is that "Obamacare," or "ObamaTax," was a burden on employers. There was the opportunity for employers to opt out of providing health care benefits for their employees. We are now beginning to see ramifications of "Government Mandated" health care in differences of coverage, premiums, and types of coverage. The Kaiser Foundation published their "Employer Health Benefits" report for 2018. What follows is a summary of their report.

Health Care Costs have risen, Employers are paying for less. There are four main types of programs that the Kaiser foundation identified: Health Maintenance Organizations (HMO,) Preferred Provider Organizations (PPO,) Point of Service (POS,) and High Deductible High Premium (HDHP) Programs.  The overall picture shows that The Average Total Premium was $12,600 per family during 2008. That same coverage jumped to $19,616 per family during 2018 (Pg. 10, Figure B.) The employers used to cover 74.01% during 2008, and that has dropped to 71.72% during 2018. The amount that the worker covers has seen an increase of 65.38% from $3354 to $5547. The employers saw their costs jump 50.87% from $9325 to $14,069.

Monthly Costs are much higher than is being reported in the Consumer Price Index Data. The average monthly cost for individuals is $572 a month for an individual with HMO coverage, and $1620 a month for families. The average cost for those with a PPO id $596 for individuals and $1694 per family. The HDHP program costs an individual $538 per month and $1550 for family coverage. According to the September CPI data we only spend 1.04% on Health Insurance. I hope that you are earning $650,000 per person or $1,921,600 per family. Think about it. If you are spending $538 per month on HDHP insurance that is roughly $6500 a year. Multiply that by 100 and you get $650,000

The Percentage of Companies providing Health Insurance for Employees has fallen 12% since 2010. The percentage of all employers who provided health care during 2010 was 69%. That number has dropped to 57% as of 2018. (Figure G, Page 15.) It is also important to note that there have been changes in the "take-up" rate for employees offered health insurance, and the percentage covered by employer benefits. The percentage of eligible employees is relatively unchanged from 81% of small employers during 2008 to 82% during 2018. Eligibility dropped from 79% to 77% for Large Employers. Total eligibility dropped from 80% to 79%. (Pg. 62.) The "take-up rate" has dropped from 80% to 73% for small companies, from 84% to 78% for Large Companies, and from 82% to 76% for all companies. The percentage of covered employees has basically dropped from 65% to 60% across the board.

Something that is not being reported is the change in the level of High Premium , High Deductible (HDHP) coverage. Conventional Health Insurance was 73% of the insurance market during 1988. That level is now less than 1%. HDHP coverage was 8% during 2008 and has ballooned to 29% (Figure 5.5 page 80, Figure 8.5 Page 138)

One piece of good news is the change in coverage for same same spousal coverage and opposite sex coverage. We saw 40% coverage for same sex couples during 2017 and 45% coverage during 2018. That number changed from 36% for opposite sex couple during 2017 to 45% during 2018 (pg. 2)

The data is eye-opening. A law that was supposed to improve coverage has reduced coverage. A program that was supposed to reduce costs for employees has increased their share of coverage and their costs of coverage. The level of High Premium, High Deductible plans are spiking. The percentage of employees who have access to health care plans who are taking up the option is dropping from the levels prior to the adoption of the ACA. Health Insurance costs are not being adequately reflected in the CPI data.Whenever you try and fix a broken system with a new law you have to remember the Law of Cause and Effect and you have to remember the Law on Unintended Consequences.

It's the economy.