Hidden Cost of the Uninsured
Jun 08, 2009 in Health Reform
In its June 8 issue, AMNews released an article pointing out that “Unpaid care hikes private insurance premiums by billions”. Sweet and straightforward, the title hits the nail right on the head — cost-shifting, spreading out the cost of charity care for the numerous uninsured Americans, puts the financial burden of caring for the uninsured on the shoulders of insured Americans.
“Hidden Health Tax: Americans Pay a Premium”, a report compiled by the independent actuarial group Milliman, Inc., concluded that of the $116 billion dollars in health care costs attributable to America’s uninsured in 2008, $42.7 billion dollars worth went unpaid for by governmental assistance or patients themselves. To recoup a $42.7 billion annual loss, hospitals have to negotiate higher payments from insurance companies. And higher payments make for inflated premiums.
A 2008 report from Kaiser Permanente pegged the average national insurance premiums for employer-provided family coverage at $12,680. $1,017 of the yearly cost is attributable to cost-shifting, as estimated by Milliman, Inc. And cost-shifting accounts for $368 per year of the $4,704 price tag for employer-provided individual coverage.
The burden of cost-shifting is exacerbated by the fact that uninsured individuals are more expensive to care for. Without the benefit of health insurance, preventative and continued care are effectively out of reach. Uninsured individuals end up neglecting their chronic and acute health conditions until they reach critical mass — they seek treatment when their condition is at its worst — and they usually end up in hospital emergency rooms.
Not only is emergency room care the most expensive care delivery outlet, but relying on emergency care creates a revolving door phenomenon. Without continued care to monitor their condition, uninsured individuals, many of whom have completely manageable conditions, end up back in the emergency room after their condition worsens again. Avoidable costs keep adding up, and cost-shifting ensures that insured health care consumers end up with the bill.
Extending coverage to the 45 million uninsured Americans has reached the point of necessity. No matter the mechanism — whether through mandated insurance with subsidies or an expanded public plan — covering the uninsured will result in a real cost savings. Reform will benefit every health care consumer financially while promoting better health for millions of Americans.
June 11th, 2009 on 11:48 am
what frustrates me about this cycle is that I myself do not have insurance but my occupation accomidates those who ultimately drive up the prices. As BLS providers, under our protocols, we are FORCED to transport patients who need no immediate care, but rather a warm safe bed to “sleep it off.” Because this is our only course of action in many cases, MY OWN ACTIONS make it even more difficult for me to acquire health insurance privately. what is even more ironic, that if I were to be injured on the job, there is no guarantee that I would be covered by my workplace insurance and would ultimately become one of the perpetuaters of this problem. a great example: while off duty I provided on scene care to a woman who was struck by a car. while working a piece of self provided PPE failed and I was exposed to the woman’s blood. VFIS, nor my home department was willing to cover the cost of the tests I needed to take. I ended up covering the costs and found my results to be negative. BUT had the results come back positive I would have been UNINSURABLE.