But somedays I do wonder if I am a moron, especially after I’ve spent some time dealing with issues related to health care. I get to do this because I chair the personnel committee at Bigelow Laboratory where I work. Lately we’ve been looking at benefits, trying to anticipate how much health care costs are going to rise and how we are going to manage to stay within our budget, which unlike the federal guv’mint, but like that of average folk, is fixed. That means if health costs rise significantly, we’ll need to trim benefits. We pride ourselves on providing good benefits since we work in a competitive field, and it helps attract good people to rural Maine. We’re also nonprofit so as long as the bottom line balances out we’re OK and, oh it feels like the right thing to do.
My colleagues and I at Bigelow are fortunate to be employed and have employee provided healthcare, so the ongoing hullabaloo about health care bill, and the repeated attempts to repeal the Affordable Care Act (aka Obamacare) actually doesn’t affect us directly, except it does. Since Washington DC’s dysfunction, in general, is an excellent reason for corporate America to cry uncertainty and raise prices, which in this case contributes to everyone’s health care costs going up. In fact, we recently got our quotes for health insurance premiums for the coming year, and our scenario of a 20% increase in premium costs for our health care plan was significantly off — the actual increase was greater than 30%. So, we’ve dropped a couple of lesser used benefits, passed on a little cost, fudged with some numbers, and been able to adsorb this increase without major benefit reductions or cost increases….this year.
So let’s look at some numbers. Each month my contribution to cover health care costs for myself and my wife is $115/biweekly, or $2,875 per year that is deducted from my paycheck. This goes toward the premium we pay to our insurance company to cover health care costs. My employer actually covers 80% of the contribution or about $9,500/yr — you can kind of think about that as money taken away from me to do my actual job, and put into an account to pay for health insurance. But it doesn’t stop there, with this health plan, I am also responsible for a $2,600 deductible, meaning that I need to pay this upfront for most health costs before the insurance kicks in. So assuming my wife and I rack up some medical bills this year, then we’re paying $2875 + $3625 = $6,500 for health insurance, in addition to the $9,500 my employer is adding to pay my insurance premium (that could otherwise go me to do my job).
Healthwise, I am very fortunate (my wife is too), I estimate I’ve probably spent < $10,000 in total medical expenses in the last 20 years, while I’ve probably had around $45,000 dollars removed from my paycheck, and my employers have probably kicked in another $180,000 of health insurance premiums. So by me, or on my behalf, let’s say $225,000 has gone to my health insurance, of which I’ve actually used about 4%. Now, I could be diagnosed a couple of months from now with something nasty, and given the astronomical cost of health care in this country, gobble back my share of all those insurance premiums in pretty short order. But, that’s how insurance works. Lots of people pay in with the understanding that relatively few will need to make substantial claims. Indeed, there are entire office towers in large metropolitan areas full of people with university degrees using very powerful computers to figure all this out, and return record profits to insurance companies.
In reality, it’s kind of like taxes, except a worse deal. To give this example, they just paved the road in front of my house. When you ask the internet how much it costs to pave a mile of 2 lane road the top answer that comes back is $120,000. In the mile stretch of road I live on, there’s probably 15 houses, so that’s $8,000/household, and this housing density is about average for this 20+ mile stretch of newly paved road. None of us will see an $8,000 spike in our tax bill this year, thank goodness, because the cost is leveled out across the towns, the county, and the state through different taxes.
Call me a socialist, a Bernie bro, intelligent or just plain sane, but I wouldn’t mind paying another thousand or two in taxes, and seeing Bigelow, a non-profit, pony up a few thousand more to provide a good standard of health care, where you and I could just go to the doctor when needed and get treated and not get a bill, or not get a bill that’s going to cause us to lose the house or car, or not help the kids go to college (there’s another doozy). Basically the way things work in lots of developed countries. If it’s done even reasonably well, at end the of day, I could get another hundred dollars a month in my paycheck, and Bigelow would save some money that could provide me with some more resources to do my actual job (or give me a raise), instead of spending them on health benefits. Also, I wouldn’t have to spend so much time worrying about how we’re going to cover our employee’s health benefits (a job I suck at), and could spend more time figuring out better ways to maintain and improve healthy ecosystems and mitigate climate change (something I’m really good at).
I’ll close this rant with three numbers:
#1, the rank of the US compared to the rest of the world (ROW) on what it pays for health care, based percentage on gross domestic product.
#28, the rank of the US in health outcomes compared to ROW, based on a 2016 study published in the Lancet (the #2 ranked medical journal in the world)
#58, The rank of the US compared to the ROW for average life span.
Do you feel like a moron yet? I do.