When health insurance will cost more than annual income

A couple of weeks ago I posted about the high costs of health coverage in the US, and the ensuing commentary was quite interesting. So this recent headline from my home state paper caught my eye:

Health insurance will cost more than the typical family earns in 2033, Oregon study predicts

I checked out the study, published in the Annals of Family Medicine, and the headline did not exaggerate. The authors were updating their previous work with new numbers generated by the 2010 passage of the Patient Protection and Affordable Care Act (which has to be the worst title ever for a law — no wonder everyone calls it Obamacare), and concluded that the health industry reforms in this Act have barely slowed the rocketing costs of health care in the US.

Here’s the scariest graph in their article.

medical expenses against income

The authors explain:

If health insurance premiums and national wages continue to grow at recent rates and the US health system makes no major structural changes, the average cost of a family health insurance premium will equal 50% of the household income by the year 2021, and surpass the average household income by the year 2033. If out-of-pocket costs are added to the premium costs, the 50% threshold is crossed by 2018 and exceeds household income by 2030.

A similar graph, taking into account that many people do not pay the full price of their health insurance due to employer subsidies, is not appreciably less scary. As the authors note, this trend is not supportable. Unless dramatic reforms take place, the whole system is headed toward a meltdown. They offer several ideas for those reforms, including rationing of care, which means making hard choices about exorbitantly expensive procedures or drugs that have limited benefit (their example was “the recent approval by Medicare of the prostate cancer drug sipuleucel-T (Provenge), which will cost an estimated $93,000 for treatment to increase life expectancy by 4 months.”

The very mention of care rationing will no doubt set off general hysteria among the American right, who were already convinced by Sarah Palin that Obamacare meant everyone’s grandparents were going to be offed by the government. Just last month, presidential candidate Rick Santorum claimed that Obama’s socialization of health care would result in the sorts of terrible travesties currently seen in Europe — such as elderly Dutch citizens having to wear bracelets reading “Do not euthanize me.” He went on to say:

Because they have voluntary euthanasia in the Netherlands, but half the people who are euthanized every year — and it’s 10 percent of all deaths for the Netherlands — half of those people are euthanized involuntarily, at hospitals, because they are older and sick.

(The Dutch were rather puzzled by such outrageous and easily disproven lies by a candidate running for the nation’s top office…but that’s because they don’t understand American politics. Lies are not an issue.)

But the odd thing is that for all the hysterical claims about the health care rationing that hasn’t occurred, nobody seems to be talking about the health care rationing that is already occurring — for all of those Americans who don’t have and/or can’t afford insurance. Their health care is rationed so strictly that they don’t have any at all.


About Fletcher DeLancey

Socialist heathen and Mac-using author of the Chronicles of Alsea, who enjoys pondering science, politics, well-honed satire (though sarcastic humor can work, too) and all things geeky.
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7 Responses to When health insurance will cost more than annual income

  1. Lilaine says:

    …American politics. Lies are not an issue.

    Or ‘American issue lies in politics.’ 😉

    About the healthcare predicted nightmarish catastrophe, as long as the system is based on individual(Doctors) or corporate(clinics/hospitals, pharmaceutical companies, insurance companies…share-holders…) profits, there will be no viable solution.
    The ideal would be to set a nation-wide system that would control the health costs and sanction(or refuse) excessive prices(pharmaceutical, medical, insurance….) and excessive and health-wise unjustified demands from the people.
    Ha! never going to happen in an ultra capitalist and individualist country.
    That said, the healthcare system in France is really not ideal, though many efforts are being done(for a number of years) to limit the system’s deficit (le trou de la Sécu, as we call it).

  2. Brigitte says:

    Now, you have always to look on the bright side of life 😉 – this could help to create hundreds, nay thousands new jobs in just a few years: street dentist, street ear specialists, street herbalist, street midwife and so on. India shows how its done :

    You can get 4 new teeth for only 6 Euro in India…… when I think about my last dental bill – a flight to India might be worth to consider. 😉

  3. xenatuba says:

    Heading for a melt down, I suspect. Until we can get religion out of politics, we’re just a circus here. If you really want to laugh, take a look at the argument that is boiling over contraception…and if you want to cry, take a look at where some states have gone with abortion.

    We were doing some calculating recently, and are anticipating spending about 25% of our income in retirement on insurance (home, vehicle, medical and long term care). The last may have to go, since our calculations were based on a fairly decent program that I don’t qualify for.

  4. The current portuguese government wants to do the same here, they want to remove the government from the health care services and ending the NHS.

    • oregon expat says:

      I’ve heard the government wants to privatize health care, but I still can’t believe anybody could be so stupid. That is a failed experiment, and the US has proved it quite adequately. However, a blend of privatized and socialized can work…assuming some basic intelligence on the part of lawmakers. (Which is assuming an awful lot.)

  5. kepler20f says:

    I have so much to say about my continuing state of disbelief regarding the U.S. health… business (I refuse to call it care) that I don’t even know where to start, so I won’t.

    Let me just give you this: we are currently paying $3 500 a year for our “health coverage” (besides the dental plan, which is an additional $1 000). That gives me… nothing. There’s a $5 000 yearly deductible that has to be met until the insurance company actually covers any expenses (if they do). Since we are reasonably healthy (knock on virtual wood), not once in a single year out of 5 have we even come remotely close to reaching that number.
    Additionally to that, I have an HSA, which is basically a tax-free savings account that we put $100 a month into, to pay for… all medical expenses under $5 000.
    All things considered, I have paid – not to a Social Security system, which would benefit people who can’t pay, but to a private insurance company – almost $15 000 worth of nothing over the years.

    The “good news” is that the HSA will soon reach the deductible, provided we don’t need to use it for regular health expenses. Then we’ll be “insured”.

    To be honest, there are a few preventive services covered outside the deductible, but almost negligible.

    And on that topic… today the wonderful Robert’s SCOTUS starts to rule on the “individual mandate”, one of the contentious provisions of what the propaganda machine calls “Obamacare” and which is basically a “best I could do, sorry” effort of this Administration.

    Not much hope there.

  6. Johnny says:

    Health insurance is becoming so crazy. It’s so expensive for a reliable plan that can cover my needs. I’ll pay it because it’s something I NEED, but the cost of it is just insane.

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