Health-Care Reform: What the Consumer Wants

Article excerpt

When we talk about health-care reform, we routinely either talk about the relationship of health-care costs to the national deficit or about the uninsured. But we seldom address the question of how the average American feels about the health care he or she is getting.

A public-opinion study conducted for the American Association of Retired Persons (AARP) by DYG shows that most Americans believe the quality of their health care is very high but that they have a problem with the system that delivers and pays for this excellent care. In this regard a substantial majority, 87 percent of Americans, rate the current health-care system as only poor or fair.

Consumers are worried about those without insurance, but their number-one worry is that health-care costs are simply out of control. Last year we paid $838.5 billion for health care, approximately the gross domestic product (GDP) of Italy, according to Commerce Department statistics. To put it in perspective, 14 percent of the nation's GDP for 1992, or one dollar out of every seven spent, went for health care.

But it is more than health-care's share of the GDP that has consumers alartned; it is also the rate of increase in health-care costs. Health-care spending grew by 11.5 percent last year - nearly four times the general rate of inflation. The Commerce Department has predicted that this will continue and will add another 12.1 percent to total health-care costs this year. That will bring annual expenditures to $939.9 billion, near the one-trillion-dollar mark most health-care-cost experts said we would not reach until 1995.

If costs continue to balloon at this rate, we will surpass predictions that health-care costs will more than double in the decade of the 1990s - to $1.6 trillion by the year 2000, or about $6,400 per year for every man, woman, and child in America.

Most of us do not pay our own medical bills directly or in full. If we did, each of us would have paid $3,350 last year. But most of us never came close to paying that much because we have health insurance.

In fact, 86 percent of Americans have health-care protection, and for most the cost is paid for by their employers. That is part of the problem. Because most of us do not pay our own medical bills directly or the full cost of our medical insurance, we have little personal appreciation of the high cost of medical care. There are signs, however, that this is rapidly changing.

One reason is that consumers are feeling the pinch of growing out-of-pocket expenses for coinsurance and other costs, especially of prescription drugs. In addition, workers and retirees are also seeing their share of health-insurance costs rise as employers shift more and more of the burden to the employee. Some firms are reducing, even eliminating entirely, previously pledged health-insurance benefits for their retired workers. The reasons for this cutting and shifting of costs can be seen in statements from business executives.

The chairman of Ford Motor Company, Harold Poling, says his company spends more on health care than it does on steel. Chrysler Corporation's estimated health-insurance costs for employees and retirees is more than $1,000 per car.

Despite spending more on health care than any other industrialized nation, we still have huge gaps in our protection. For instance, we are nineteenth in the industrialized world in preventing infant mortality. Millions of American children miss getting early childhood immunizations because our health-care system does not provide adequate preventive medicine or prenatal care.

The case of the dangerously premature baby illustrates what we can do by improving preventive medicine, holding down medical costs, and providing better service, all at the same time. The cost of the high-tech equipment, the sophisticated drugs, the frequent treatments, and the high-incomes earned by doctors, technicians, and administrators involved in the care of just one premature baby could pay for superb prenatal care for thousands of expectant mothers. …