As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Wednesday, March 11, 2009

The Health And Welfare Crisis

The combination of soaring costs and economic meltdown means that more and more people have to forego health insurance, which is a given. That's what part of the stimulus tries to stop by offering subsidies to keep the jobless on their old coverage through COBRA. But since health insurance does not translate into health care, we're seeing an additional crisis - people with insurance scrimping on treatment because they can't afford the co-pays.

Take South Dade Realtor J. Berry Hamilton, 57. She's gone to a policy with a $5,000 deductible, meaning she has to pay most costs out of her own pocket. Recently, she brushed off her doctor's request for a diagnostic exam when she got a sinus infection. As her business has declined, she figures: "Let me see if the antibiotic works first, and if it doesn't then maybe I'll have the X-ray."

"Patients are spending less, no question about it," says Bernd Wollschlaeger, a primary care doctor in North Miami Beach. "A patient needs a echocardiogram. And they say they can't afford the $100 or $200 co-payment, so they're deferring. In the long run, this just can't be good for healthcare."

People are certainly pinching their pennies. For the five hospitals in Baptist Health South Florida, Vice President Karen Godfrey reports that patients are now hesitating on tests and procedures even with co-pays as low as $15, "which is very surprising.

"One of the registration managers was telling me some are negotiating for services. If a woman gets a prescription for a mammogram and an ultrasound, she wants to know the co-pay for both," then pick the test with the cheaper co-pay.

I should mention that this is the DESIRED state of health care for Republicans. It's what they've argued for years. They think Americans should all be smart shoppers with health care and then the spending won't be as wasteful. Of course, when this means neglecting needed drugs or tests, it cuts into preventive care, which when used effectively actually saves the patient and the system money. So a short-run savings causes long-term catastrophic costs, and raises overall spending. Not to mention the fact that people get sicker as a result.

This is not to say that there aren't wasteful treatments and procedures offered to patients - that's why comparative effectiveness research, to measure and weed out those treatments, is an important element of reform. But that's a far cry from what's happening now, which actually is the dreaded "rationing" that Republicans like to warn everyone about. In fact, controlling costs and making treatment more affordable is the only way to actually be able to improve health outcomes. Right now we spend and spend, more in some regions, less in others, without value for that spending.

And if you're aging and have some aches and pains and need to be freaked out more than just about the fact that health care becoming too expensive, your pension just shrunk, too.

A wave of US companies are suspending payments to their staff 401(k) retirement plans in a bid to cut costs amid the economic downturn.

Saks, General Motors, newspaper group McClatchy, clothing company J.Crew, FedEx, UPS, Coca-Cola Bottling, Reader’s Digest, Motorola, Regions Financial and Sprint Nextel are among the growing list of companies which have suspended contributions in recent months.

Even the AARP, the influential advocacy group formerly known as the American Association for Retired Persons, will suspend contributions to its staff 401(k) plan from March 22 for the rest of the year.

The growing number of suspensions appears to strike a blow against the viability of 401(k) plans, which were introduced 30 years ago as the main way that Americans should save for retirement, replacing defined benefit pension plans. Companies typically offered to match employee contributions up to 5 per cent of annual salary.

Considering that so much of that 401(k) wealth vanished in the stock market, maybe this isn't such a bad idea. But with defined-benefit pensions going the way of the dinosaur, these defined-contribution plans were, other than a meager Social Security benefit, the only retirement planning a lot of people had. And now that's evaporating.

Have a Smurfy day!

...and by the way, this is why we have to tackle multiple challenges at once. Of course the economy and the financial sector needs to be managed, but our craptacular social services structure was decaying in the 1990s, and just barely limped along during the post-9/11 jobless recovery. A downturn just finishes it off, and we have no choice but to rebuild it.

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