Posts Tagged US
Profits for insurance companies and drug companies are skyrocketing. Data from CMS (2013 and 2014) are tabulated below. The big finding is the cost of healthcare is going up much faster than inflation. And, the lack of regulation is allowing insurance companies and drug companies to gouge consumers in the US.
Between 2013 and 2014 prescription drugs increased by 9.8% and net insurance cost (i.e. profit) increased by 12.1%. If life expectancy was going up at the same rate it would be a good deal — but, that’s not happening.
Despite the complexity there are rather simple solutions.
- Limit insurance company profits (these are not healthcare providers — these are paper shufflers!).
- Inform prescribers which drugs are cost effective. That means expanding FDA oversight or starting a new agency less influenced by industry lobbying.
- Limit drug company profits to 7% like most other developed countries.
The table below lists the expenditures for various categories of health care. The figures are in millions of dollars. The total expenditures for US healthcare in 2014 were over 3 trillion dollars.
Spreadsheet: US Healthcare Costs 2014
Graph from N Engl J Med 2012; 367:3-6July 5, 2012
The graph above comes from an article in the New England Journal of Medicine by David C. Radley, Ph.D. MPH and Cathy Schoen, M.S. It shows the distribution of uninsured adults across the United States. Large parts of Texas, New Mexico and Alaska have over 50% uninsured adults. Wisconsin and Massachusetts have less than 15% uninsured adults. The graph is the result of an analysis of US Census Bureau data from 2009-2010.
The areas with low rates of insurance are also the areas with other health problems. The authors conclude the uninsured areas are associated with low quality care, poor access to care, unsafe prescribing, increased visits to ER for avoidable conditions, and more avoidable deaths.
The bottom line is the US healthcare system is designed for high cost and low quality care especially for those who choose not to have insurance or those who can not afford insurance. Unless a person is extremely wealthy it is very unwise to forgo insurance in this environment. The maldistribution of insurance enhances the argument for those in states with high rates of insurance not to pay more in taxes to cover those in states with low rates of insurance. It seems strange that the states with enhanced revenue from oil and gas can’t seem to correct the insurance gap.