"Apparently, this subject is the equivalent of the third rail" explaining why the Quality and Cost Council has still not published the cost and quality data
Good explanations in an article in todays NY Times about how employers are moving to high deductible health plans (HDHPs). This transition is happening more slowly than predicted by many advocates over the past few years - but these plans are growing more rapidly than any other plan design. Two large employers, Nissan and Delta Airlines, are offering only high deductible plans, while most employers offer a choice. Employees are likely to find that HDHPs work well for single people in good health, and they theoretically work well for families with overwhelming medical expenses (that exceed annual maximums). There is some danger that if the healthy low-cost employees leave traditional health plans, these could become prohibitively expensive.
The New York Times had dueling articles over the past few days about whether or not the business of health care is adversely impacted by a recession.
On one hand, hospitals are seeing a downtick in admissions in the context of the economic crisis. According to the article, patients are delaying elective orthopedic procedures, as well as hernia repairs. This is on top of the decrease in filled prescriptions over the past two quarters.
On the other hand, some business analysts suggest buying stock in health care companies because health care is “recession-proof.”
There has long been an argument about whether health care is a necessity or a luxury good. Necessities have inelastic demand, while luxuries have substantial elasticity of demand.
I’d say that there are elements of health care that are necessities – and these do not fluctuate with the economy. There are obvious elements of health care that are necessities, like repairs of hip fractures (which also have low variation in utilization in different geographic areas). I’d like to say that childhood immunizations would also not decline in an awful economy, but I’m not as confident. There are other types of health care that are unequivocally luxuries – like Botox for cosmetic purposes, or early knee replacements to preserve the ability to play competitive tennis. Of course, almost all health care falls between these two poles.
The worst of all worlds in terms of decreased health care utilization would be a severe economic downturn, such as that faced by Russia after the fall of the Soviet Union, or Argentina after it defaulted on foreign debt. In both instances, utilization of health care dropped dramatically. There was substantial loss of health in Russia as well.
Wage base is an interesting concept. Here is his description:
- It includes the employee’s cash take-home pay, all the income taxes and Social Security taxes and other deductions – for example, the employee’s contributions towards health insurance and pensions — withheld from the employee’s paycheck, as well as the employer’s share of Social Security taxes and the employer’s contributions toward the employee’s health insurance, pension, vacation pay, sick days and so on.
One observation. Total number of mentions of health care in the speech --- zero.
Prevention and Saving Medical Costs - Prevention Efforts Outside of the Medical Realm (Might) Pay Off
Interestingly, the kind of interventions that are modeled here include better access to nutritious food, more supervised recreational opportunities for kids, better nutritional labeling and higher tobacco taxes. Note these are all interventions aimed at the entire community, not at individual patients. None of these interventions lead to filing of medical claims.