A healthy lifestyle is less about getting everything right the first time and more about continuous improvement.
This is from volume 1 of the February 2017 – Inspiring Healthy Lifestyles eNewsletter. In this issue we discuss “The Answer to the High Cost of Healthcare is…“; along with “Your Network’s News” and “And the Oscars goes to Repeal & Replace“
Your Wellness – “The Answer to the High Cost of Healthcare is…“
Not Health Insurance Reform…but Health care Reform. In this post the election of Donald J. Trump period, many in the health insurance, healthcare and political worlds are asking what the new administration’s “repeal & replace” strategy will look like. To me, that frames the problem incorrectly. The answer to the crushingly high cost of health insurance, is reduced utilization of the healthcare system, not just some new set of tax code policies, redesigned by think-tank gurus, leading to more insurance reform. However, the current healthcare system has grown, as a result of a combination of poor tax and regulatory policy and a lack of personal responsibility, by most Americans, to maintain their own “state of health“.
Therefore, although these type of changes may be necessary, and the answer is simple. All groups need more focus, and spending, on what keeps us in a state of wellness (or good health), less on treatment on the “symptoms” of poor health (illness), and therefore less spending on health insurance (claims).
To illustrate my point, here are some data points and some opinions by fellow wellness advocates, that support my view. BTW, if you did not know, I spent 30 years as a health plan manager and fully realize that I am partly responsible for where the U.S. healthcare system is found today. But… this experience gives me a unique understanding on what worked, why, and experience on what has not. So here goes…
Most Americans would agree that their health insurance costs have been increasing too fast, and for too long. It really doesn’t matter whether you have worked for a big employer, a small business, or for yourself. Health insurance costs are eating up a greater share of our budget. In fact, it impacts everyone in one way or another. For example, healthcare spending is now 17.8% of our entire Gross Domestic Product (“GDP”). That effects everyone no matter where you live, work or play.
Every dollar spent by every employer, is a dollar not paid in wages, earned in profit, and to added to the cost of goods sold, or bought for that matter. But everyone needs and wants affordable health care and a key part of that is health insurance. And, it is your right to receive care…right? However, is there a limit that you can ask others to bear? The more challenging question is, who should decide your limit.
Before I answer that, let’s look at how much we currently spend and where we spend it.
Per the published reports I read, we spend a total of around $3.2 Trillion at least we did in 2015. So, let’s move on to where we spent it all.
First off, the biggest portion of health care spending does not go to insurance companies. It goes to….hospital care, physician & clinical services, and then Rx. It was not surprising, given the fact that these three receive over 62% of all our healthcare dollars spent each year. And I am sure, most of that was for treatment of illness and not the prevention of illness. Let’s dig a little deeper.
“Hospital services, from a payer perspective, experienced faster growth in Medicaid and private health insurance spending; however this strong growth was slightly offset by slower growth in Medicare hospital spending.”
“Spending on physician and clinical services increased 6.3 percent in 2015 to $634.9 billion. “
“The strong spending growth for prescription drugs is attributed to the increased spending on new medicines, price growth for existing brand name drugs, increased spending on generics, and fewer expensive blockbuster drugs going off-patent.”
Who did we spend the $3.2 trillion in Healthcare on?
Here is a little more on what I found.
20% went to Medicare for 54.3 million individuals over age 65 came in at $646.2 billion (thats about $11,900 per covered member per year)
17% went to Medicaid for 68.9 million individuals earning less than 108% of the FPL) which appears to account for almost $545 billion (about $7910 per member)
11%, or almost $339 billion was spend on “Out-of-Pocket” expenses with the remainder or about $1.1 trillion paid for by private employers, individuals thru private insurance.
Now you have to remember that on top of this, you need to factor in how much employees paid in payroll contributions for their employee health insurance plan (that 156 million workers contributing on avg. about $5k per year). This would amount to around $780 billion a year. Plus their contribution in Medicare taxes, estimated to be around $257 billion a year, (or 2.9% of your pay, split between the employer and employee)
“Four health insurance programs — Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), and Affordable Care Act (ACA) marketplace subsidies — together accounted for 25 percent of the budget in 2015, or $938 billion. Nearly two-thirds of this amount, or $546 billion, went to Medicare, which provides health coverage to around 55 million people who are over age 65 or have disabilities. The rest of this category funds Medicaid, CHIP, and ACA subsidy and exchange costs. “ –http://www.cbpp.org/research/federal-budget/policy-basics-where-do-our-federal-tax-dollars-go?
The numbers are just staggering and a key indicator of American’s competitiveness in the growing world economy. With all that money going the healthcare, it is understandable why healthcare related industries (healthcare education, hospitals as well as other treatment centers, pharmaceutical, medical devices, and insurance) are all working to get their piece of the action.
The fact is, I could go on and on, but let’s just say Americans pay a lot of money on their health care. That said, the number, or better yet the amount spent is less important than what it was spent on. And, who gets to decide on how your share get’s spent on you? Here is an interesting, and critical, piece of the puzzle you need to study and incorporate into your life. Upwards to seventy-five percent (75%) of all health care is spent on “lifestyle”, or avoidable conditions what could have been prevented.
In response to this fact, an whole new industry has jumped in to try and capture a share of the $3.2 trillion dollar market. — This is the Health & Wellness industry. And to be totally transparent, I have joined that field myself, because I believe it has a missing element others in the healthcare fields have missed. My mission is simple to inspire healthier lifestyles. My challenge is to over-come a population skepticism after so much mis-information on the state of their healthcare. To learn more, visit my health coaching events page at Core4-Plus Events
The health & wellness industry currently looks like this…
“…the Health & Wellness market space is dominated mostly by beauty and anti-aging product sales at $679 billion, followed by fitness and mind + body exercise ($390 billion) and health eating, nutrition and weight loss sales ($277 billion).”-Kerri Krom.
After a century of health care advancements that saw life expectancy rise, and many health conditions eradicated ( ….) we are now facing a different challenge.
Healthcare spending has continued to increase dramatically, but many are concerned our 20th century life expectancy advances are “eroding”.
“Despite past successes, substantial public health challenges persist, and they represent grave threats to our nation’s health and to our health care system (in terms of both cost and capacity). Of particular concern are rising rates of non-communicable chronic conditions such as obesity, diabetes, high blood pressure, heart disease, and cancer. In 2005, nearly half of adults – 133 million – had at least one chronic illness. In 2009- 2010, more than one third (35.7 percent) of U.S. adults were obese, and 8.3 percent had diabetes.4, 6 In 2005-2008, over 30 percent had high blood pressure. The prevalence of these conditions has grown substantially over the last 20 years…, and these trends are eroding previous advances the U.S. made in life expectancy and other determinants of population health. “
Many agree the system is broken, but where do we go from here?
Maybe this will help you understand my view and what other American’s have in mind. It is based on a leading source on healthcare policy.
A Key Finding in the Kaiser Health Tracking poll finds the following two approaches most popular.
62% of Americans prefer “guaranteeing a certain level of health coverage and financial help for seniors and lower-income Americans, even if it means more federal health spending and a larger role for the federal government”
And, 31%, prefer “limiting federal health spending, decreasing the federal government’s role, and giving state governments and individuals more control over health insurance, even if this means some seniors and lower-income Americans would get less financial help than they do today.” -Kaiser Tracking Poll.
Share what you think with others interested in health and wellness, by commenting over on my Facebook Fan page community where this post has been share at https://facebook.com/yourwellnessnhealth
Sources and Inspiration
“Healthcare Spending a Top Priority for President Trump” -Kaiser News Room.
“Medicaid Enrollment” -Statista.com
“Current U.S. Federal Government Tax Revenue” -Kimberly Amadeo,
“The Next Trillion Dollar Industry” -Kerri Krom.
“The Prevention and Public Health Fund..” -Vanessa Forsberg, Caroline Lichtenberg, et al.