Renata Marinaro on Health Insurance Today
The Actors Fund’s Artists Health Insurance Resource Center (AHIRC) has been connecting artists, craftspeople and entertainment industry workers around the country to health insurance and affordable health care since 1998. Renata Marinaro, Director of Health Services, Eastern Region for The Actors Fund’s Artists Health Insurance Resource Center, tells us why the cost of health insurance continues to rise, and why reform is vital.
People are often shocked at how expensive health insurance premiums and health care in general have become. Entertainers who have spent time in other countries marvel at how inexpensive medication and office visits are abroad. When Mark, who you see in this video, came to me with his hospital bills, he was upset to find that his semi-private room at the hospital cost $3700 per night – and that was just for the bed! It would have been cheaper, and probably more comfortable, to stay at the Ritz.
Why are our health care costs so high in the US? There are many reasons, but I’ll list a few here. Our health care system creates very high administrative costs because it is extremely complicated. Each state has different regulations, and hundreds of insurance companies negotiate separate contracts with hundreds of thousands of providers. The New England Journal of Medicine estimated that administrative costs account for roughly 1/3 of US health care spending. The US also has a higher ratio of specialists to primary care physicians; specialists have a longer training period than general practitioners, and make greater use of expensive technology. Drug prices are also higher in the US because we allow pharmaceutical companies to charge us more than other countries do. And finally, the cost of providing care to the uninsured is extremely high; in 2008, almost $43 billion dollars was uncompensated (i.e. unpaid) care.
Employers and insurance companies are increasingly shifting the high cost of health care to consumers. Since 2005, the amount an employee contributes to their health insurance premium has gone up 47%; the average employee currently pays 30% of the total premium. In addition, employers are raising out-of-pocket limits, replacing co-pays with co-insurance, and increasing the use of high-deductible plans. More than a quarter of people buying their own coverage (not through an employer) have deductibles of $5000 or more, and more than 20% said they didn’t get medical care because of the high cost – even though they were insured.
The Patient Protection and Affordable Care Act of 2010 (also known as health care reform) is designed to address some of the problems with our expensive, inefficient system. A single set of operating rules for administrative and financial transactions will streamline the system. Additional funding will promote primary care and general surgery education. Drug costs have already been reduced for Medicare beneficiaries in the “doughnut hole.” And subsidies will help people afford insurance. (For example, it’s currently estimated that a single person who makes $21,000 per year will have their premium capped at 6.3% of their income, or roughly $110 per month).
Only such large-scale changes in the way we administer and pay for care will reduce health care spending and create a more equitable and affordable system that will make it possible for Americans to lead healthier lives.
*Statistics are from the Kaiser Family Foundation, the Journal of the American Medical Association, Families USA, and the Society for Human Resource Management.