Friday, June 26, 2009

How much does 'Private' medical care cost the taxpayer?

The Economist blew me out of the water today with their analysis of the American Health Care system. In acknowledging it's strong points (like excellent cancer recovery rates) it exposed something I think most Republicans would find surprising.

Compared to other countries - including countries with entirely 'socialized' medicine like Great Britain - the American tax-payer pays just as much to treat people (and sometimes more.)

The American tax payer is already funding a public-medical system that exceeds the British NHS

For example, the average health care costs of an American individual are $7,000 dollars per year. Of that, private health insurance and out-of-pocket expenses cover just $4,000 of it. The rest is picked up by the tax-payer.

Compare that to Great Britain, where our (admittedly inferior) health care system spends just $3,000 a year on each individual (with people picking up about $500 out-of-pocket.)

What does that mean?

It means that the tax-payer burden of providing 'free' health care to every individual in Great Britain is actually LESS than the cost of providing 'privately funded' health care in America. What's even worse, is that on top of the American tax-payer paying more than enough to fund a system like the NHS, they're then asked to pay $4,000 on top.

They're basically paying for health care twice. And as good as the American health care system is, it's not that good.

I've argued before that 'socialized medicine' and universal health care already exist in America - but I can see that I grossly underestimated the problem. We, the health care consumer, are being fleeced - and Republicans who demonize so-called 'socialized health care' are unaware that they've been contributing to it for years now.


Tom said...

Question: How much of the education budget of the various European countries are included here? In the US, doctors take out loans for education, but in Europe, they tend to be subsidized.

Two Dogs said...

2.1 trillion a year on "healthcare" in the United States? That seems UNpossible. The Economist is wrong.

Roland Hulme said...

The GDP of America is about $13 trillion.

16% is spent on health care.

That's $2.8 trillion.

Divided by 300 million, the population, that's about $7,000

The Economist figures appear to be spot on.

Two Dogs said...

I have not spent more than 2000 dollars a year in the last 25, except for one when my kid had braces installed on his Chiclets. Where are all these hideously deformed and cancer eaten folks?

The 7000 figure is impossible, as well.

Coffee Bean said...

This is a shell game. We know that our personal cost is much higher than it ought to be... through our premiums, through the taxes we pay, and through our portion of all our medical bills. There is a problem with healthcare in this country... a big one. However, what is being proposed is not the answer. People will be giving up having a say in what kind of treatment they and their families receive. That is the bottom line.

Coffee Bean said...

Two Dogs,

We have had several years where our out of pocket medical expenses exceeded $10,000. I'm not certain... but, I think that we were able to deduct all of the expenses over $10,000 from our taxes. People are thinking that they will get the same or better medical care by switching and have it cost them lest money. They are wrong.

Coffee Bean said...

I really should proof read. Less money.

Roland Hulme said...

I agree with you in principle, CB - my frustration is that the current system supports 'free' medical care to illegal immigrants and those who can't afford insurance (or choose not to buy it.)

That cost is spread amongst insurance purchasers, meaning a small number of people (Us!) have to pay more. Although I'm against nationalized medicine, it does seem more logical to spread the existing cost of providing 'free' health care across EVERYBODY rather than just the few of us stupid enough to 'buy into' the system.

When Mini Militant was born, he lay in a crib next to a Hispanic baby, who had been born three months early. His parents didn't have insurance, so the hospital picked up the cost of over $150,000!!! That's why they need to charge their PAYING customers (like us) so much - to make up for the shortfall of having to provide 'free' service.

The downside? Those high prices drive up the cost of our premiums, which are already high since some healthy people (who would not use the insurance and bring the costs down) don't buy insurance.

It's a bad business model - like only people who KNOW their house is going to burn down buying homeowner's insurance.

Two Dogs said...

CB, 10,000 for a family of five that amounts to 2000 per person. Yeah, that sounds about right.

And yes, I am aware that there are those that do experience high medical bills. But, addressing an INSURANCE problem does nothing for the cost of medical services.

By the way, currently over 45% of the United States has government "healthcare." Their costs are significantly higher than mine because they had forty layers of bureaucracy with which to contend.

Compare apples to apples, Britain's privately covered folks versus the US's privately covered folks, and the same for government covered people. Britain's medical costs exceed 14% per year on average, ours is less than 5%. Yes, I am good at math. And have done the research to the nth degree.

Coffee Bean said...

I agree with what you are saying Roland. My point is that what is being proposed is NOT the answer.

Interestingly, there are doctors out there that will negotiate with you on prices if you are paying cash. In fact, a specialist our son sees is irritated by how high the co-pays are for some of his patients. Ours is $50 and the regular meds our son is on run between $80-$150 a month depending upon what time of year it is. If he gets sick it is more. He knocked our co-pay in half and every so often we don't have to pay a co-pay at all... if we've been coming in a lot. We did not say anything about the visits or the meds being a burden. He asked how much we were paying and went into a little tirade about how ridiculous the insurance companies are. Oh, he also gives us free meds when he can.

Maybe the entire system needs to be dumped and we should go to a pay as you go... with a stipulation that you cannot sue doctors/hospitals if a mistake is made. If most of the people cannot afford to pay the rates... they will drop.

There are also many doctors and nurses that already give their time with the system as it is to serve people that cannot afford healthcare.

In fact, medical services and education should go to a capitalist system.

Illegals that receive services should become bondslaves to work off their debt. That would solve all those problems right there.

I'm grumpy today.

Of course, I do believe that special provision should be made for the elderly (that are poor) and the handicapped.

Tom said...

For me, the unreality of health care costs is one of the big problems. A personal example:

I'll be going in for surgery, and so a couple weeks ago I visited the surgeon for a consultation. He sent my insurance company a bill for $600. They promptly returned an offer to pay him $127.88, which he accepted.

I think my point is that the pricing scheme for medicine today is rapidly becoming insane.