RTRP Health Care: What’s Wrong With Our Health Care System, Access

The second group of problems with our health care system are related to access to health insurance. You’ve all heard about the 46 million uninsured? How about the ever increasing burden of health care premiums. Those are access issues.

Is Access Really A Problem?

While it is certainly questionable whether or not the government should be involved in expanding health care coverage or trying to make it less expensive, there does seem to be significant support for addressing such concerns. When asked by Gallup to rank their concerns with the current system, Amercians cited "access" and "cost" as their top two concerns. Not surprisingly, liberals cited lack of "access" by a 2-1 margin over “cost” as their primary concern. More surprisingly, however, conservatives and moderates ranked “access” and “cost” equally.

And indeed, lack of access to health insurance does have societal costs. According to the American Enterprise Institute, 27% of the nation’s 1.2 million yearly bankruptcies are caused primarily by medical debts (between 36% and 55% (depending on the source) involve at least some medical debts). Moreover, hospitals provided $35 billion worth of “uncompensated” care in 2008, though 80% of this was ultimately compensated by the government.

Presumably, expanding access to insurance could solve these problems.

The 46 Million Uninsured

The most obvious issue with regard to access are the “46 million uninsured Americans.” No doubt you’ve heard this figure repeatedly. And while it is true that in 2007, 46 million people (15% of the population) were indeed without health insurance for at least part of the year, it will probably not surprise you that this number is not what it appears.

Of these 46 million, 17.5 million lived in households with incomes above $50,000 and are considered able to afford insurance. Another 11.5 million are eligible for public assistance, but have failed to avail themselves of that assistance. Thus, the actual number of uninsured persons who are in fact unable to become insured because of lack of income are only 17 million.

Moreover, another 9.7 million of these uninsured are non-citizens, whose health care expenses should be paid for by their country of origin. If they are removed, the total number of persons who cannot obtain insurance due to lack of income is really 7.3 million.

The Uninsurable

Another 5 million of those without insurance are considered uninsurable because of pre-existing conditions.

The Costs Of Becoming Insured

The side of the “access” problem is the ever increasing cost of health insurance. Health insurance premiums are increasing at twice the rate of inflation.

Currently, 59.3% of Americans receive their health insurance coverage through an employer. The annual premium for private insurance is $4,700 per single person and $12,700 for family of four. Another $2,500 per person, was spent in 2007 out of pocket on medical expenses.

Compared to the median household income of $50,233 (according to 2007 Census Bureau figures), these costs are significant. Moreover, this insurance is susceptible to being lost during employment changes.

Another 27.8% of Americans receive their health insurance coverage directly from the government (Medicaid (39.6 million), Medicare (41.4 million), Tricare, etc.). However, these programs are massively expensive. In 2007, the federal and state governments spent a whopping $11,093 per enrollee in Medicare and Medicaid. That is 2.4 times what private insurance paid.

Conclusion

Thus, effective reform must do the following:

1. Dramatically reduce the costs of Medicare/Medicaid.
2. Maintain or reduce the costs of private insurance.
3. Provide insurance coverage to the 17 million who cannot afford it, and the 5 million who are considered uninsurable.
4. Provide insurance for the 9.7 million aliens through their home governments.
5. Eliminate the problem that job loss can lead to loss of insurance.