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The Cost of Health Care November 26, 2008

Posted by Kate Ryan in Economy, Health Care, National Politics, Unions.
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If you are a public employee, as I and my husband are, November is the month where you can make changes to your health insurance carrier.  The Federal Government and the state we live in (New York) provide their employees with a menu of carriers and options that are available at varying prices.  New York State, my husband’s employer, pays about three-fourths of the cost of our family insurance policy.  My employer, Uncle Sam, pays two-thirds of the premium up to $352.00 biweekly.  We take our coverage from New York State as it is the most cost-effective option for us.  Still, my husband is paying $140.00 every two weeks for our coverage.  At one-fourth of the cost, that means our insurance costs $560.00 biweekly, or $14,560 per year.  That equates to an extra $7 per hour.  Holy Cow!  If I was carrying the same coverage, it would cost us $190.00 biweekly.  The cost I have cited here is what we paid in 2008.  There is an increase every year, and we expect to be paying at least 25% more in 2009 (about $175.00 biweekly).

I started thinking about this earlier this year when John McCain said that his answer to the uninsured was to give each family a $5,000 tax credit to go out and purchase health insurance.  Senator McCain said that the $5,000 would be enough for a basic family plan – not  “gold-plated” coverage.  Since our plan costs over $14K, I guess it’s platinum-plated.  I never thought it was.  We each get one complete physical with blood work every year.  I get a pap smear and mammogram.  Our doctor visits are a $10 co-pay.  We need referrals to see any doctor other than our primary physician.  We are not permitted to go to the emergency room without preauthorization from our physician – if we do, the co-pay is $100.00 rather than $25.00 (you don’t have a co-pay if you’re admitted).  Prescription drugs are covered under some hard-to understand “formulary” system.  They either cost $5, $15, or $35 if they are covered.  If not, full price.  We do not get vision care or dental care for this premium.   

Since my husband and I are young-ish and relatively healthy (knock wood), we have not had to use any of the hospitalization benefits or any chronic disease (ie – adult-onset diabetes) related coverages.  I’m sure that someday we will.  Perhaps what we’re paying now will offset those costs in the future.  Who knows?  All I know is that there are a lot of things that I could be doing with $140.00 every two weeks and if the government had to rely on me to save that money from my paycheck and go out on the open market for insurance – we probably wouldn’t have insurance right now.  We are trying to figure out, like everyone else, how to keep pace with rising prices, how to pay for college next fall, how to keep saving for retirement, and how to meet our monthly obligations.  We have good jobs, but our salaries haven’t kept up with inflation, either.  When you’re squeezed like that and you are pretty healthy, insurance seems like an expendable luxury.  And that’s the problem with the way we provide health insurance in this country.  Too often it is seen as a luxury – we call it a benefit – when it is actually a fundamental right.

The cost of health care also comes to mind when you consider the current crisis in the U.S. auto sector.  It is said that $2,000 of the price of every new American car is the cost of health insurance for workers.  Indeed, when a foreign auto maker wanted to open a new North American factory a few years back, it selected Canada over the U.S. because of the cost of health insurance.  Of course, Canada has single-payer government health care.  And we don’t.  And it affects our ability to be competitive with almost every other industrialized country in the world.  So when we’re talking about whether or not we should bail out the auto makers, perhaps we should be looking at the larger picture.

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