- “These trends are more evident among millennials, but not unique to them. I think people’s expectations have changed,” Harvard professor Ateev Mehrotra told the Washington Post.
The table below compares what companies and government have been paying their employees over the past 20 years: the percent share of employer costs for worker compensation and health benefits.
The table shows they paid more in benefits and less in wages and salaries, and that is especially the case among people who work for the unionized public sector.
Of all the different types of benefits, the cost of health insurance has consumed the most of the average worker’s compensation — representing 8.2 cents of a dollar in pay today versus 5.8 cents of a dollar in 1998.
source: Bureau of Labor Statistics
Health care costs remain a leading issue ahead of this year’s midterms, and voters have plenty of blame to go around, according to the Kaiser Family Foundation’s (KFF) latest tracking poll.
KFF health tracking poll of 1,201 US adults (Aug/2018) asked whether certain factors are a “major reason” health care costs are rising.
- Blame for the potential political culprits — the ACA and the Trump administration — was split about evenly
- But there’s a broader bipartisan agreement that industry is to blame: > 70% faulted drug companies, hospitals, and insurers
- Doctors caught a break, at 49%
- Partisanship reigns, though, on the question of whether President Trump will help
- 13% of Democrats are at least somewhat confident that Americans will pay less for prescription drugs under the Trump administration, compared with a whopping 83% of Republicans. Independents generally share Democrats’ skepticism
- Roughly a quarter of Democrats and roughly two-thirds of Republicans think Trump’s public criticism of drug companies will help bring down prices
- Surprise hospital bills haven’t attracted the same political uproar as prescription drug costs, but the Kaiser poll provides more reason to believe they could be the next big controversy
- 67% said they’re “very worried” or “somewhat worried” about being unable to pay a surprise medical bill
- 53% fear they won’t be able to pay their deductible
- 45% are afraid of the tab for their prescription drugs
- 39% experienced a surprise bill in the past year
To change nursing assignments and transform workforce management, hospitals need to plan differently!Posted by David Ledersnaider, Ph.D. | Healthcare Cost Savings, Hospital Finance, Innovation | No Comments
Massachusetts, New Jersey, Ohio, and Pennsylvania are getting ready to vote on legislation to mandate nurse-patient ratios like California did.
We learned from California that without a sound workforce planning methodology that can be consistently executed, hospitals won’t obtain the benefits of the increased staff .
The Nash Group SDM20/20™ planning methodology is proven to:
- reduce labor cost $2M-$8M
- dismantle consumption of premium dollars
- advance patient placement and aggregation
- improve patient disposition and reduce length of stay
- increase staff retention 20%-40% and improve recruitment cycles
- make workforce operations and schedules sustainable
 Petsunee Thungjaroenkul, Greta G. Cummings, Amanda Embleton, “The Impact of Nurse Staffing on Hospital Costs and Patient Length of Stay: A Systematic Review”, NURSING ECONOMIC$/Sep-Oct 2007, Vol. 25, No. 5
Mounting frustration from employers and employees will put cost controls on the table faster than you might think, making the next big battle in healthcare almost certainly about costs!
Right now frustration over healthcare costs is starting to percolate, particularly over the concern that the industry already maxed out the existing tools for cost control.
California, for example, has proposed moving the state to an all-payer system, to give the state more control over doctors and hospitals insurance plan charges (only Maryland has an all-payer system). Are we really going to have a debate about all-payer? Is this one of those times when California is the wacky outlier state, or one of those times when it’s a trendsetter?
Once employers reach the end of their rope on healthcare costs, the cost-control debate is going to ratchet into a higher gear. That is the prelude to a debate over all-payer in every state, but government intervention will probably be on the table, at least in some states. The cost-containment debate is coming because policymakers are not going to put too much new revenue on the table, and that means that both the private sector and Medicare will be paying the most.
Costs have risen modestly over the past few years, and private insurance has responded, in large part, by shifting more of those costs onto consumers through higher copays, deductibles, and coinsurance. But we’re at the end of what the market will bear on cost-sharing.
This is a scary position for providers. If employees are at their breaking point on cost-sharing, and employers reach their breaking point on cost growth, expect political systems to get serious about cutting those costs themselves. The question remains … are healthcare organizations and doctors ready for real changes in reimbursement?
In employer-based health plans, the average deductible for a SINGLE person is over $1,500, according to Kaiser — 3 times higher than it was a decade ago. The trend toward increasingly high deductibles means families struggle to afford their care, even with insurance.
While the Medicaid expansion was intended to be national, the June 2012 Supreme Court ruling essentially made it optional for states. As of June 2018, 17 states had not expanded their programs.
Medicaid eligibility for adults in states that did not expand their programs is quite limited: the median income limit for parents in these states is just 43% of poverty, or an annual income of $8,935 a year for a family of three in 2018, and in nearly all states not expanding, childless adults remain ineligible. Further, because the ACA envisioned low-income people receiving coverage through Medicaid, it does not provide financial assistance to people below poverty for other coverage options. As a result, in states that do not expand Medicaid, many adults fall into a “coverage gap” of having incomes above Medicaid eligibility limits but below the lower limit for Marketplace premium tax credits (Figure 1).
This KFF brief presents estimates of the number of people in non-expansion states who could have been reached by Medicaid but instead fall into the coverage gap, describes who they are, and discusses the implications of them being left out of ACA coverage expansions. An overview of the methodology underlying the analysis can be found in the Methods box at the end of the report, and more detail is available in the Technical Appendices available here.
Chronic disease management is a must when shifting to value-based care! The Milken Institute reported that the total costs in the U.S. for direct health care treatment for chronic health conditions totaled $1.1 trillion in 2016—equivalent to 5.8% of the U.S. GDP.
Chronic diseases also lead to indirect costs—lost income and reduced economic productivity—for the individuals suffering from the conditions, their family caregivers, and the overall economy. When the indirect costs of lost economic productivity are included, the total costs of chronic diseases in the U.S. increased to $3.7 trillion, equivalent to 19.6% of 2016 GDP—i.e., one-fifth of the U.S. GDP.
This trend is expected to get worse as an estimated 83.4 million people in the US will suffer from 3 or more chronic diseases in 2030 compared to 30.8 million in 2015.
The cold war on Obamacare is having an effect. The uninsured rate has begun to creep back up since Trump became president. After several years of major declines under Obama, the uninsured rate has grown from 10.9 percent to 12.2 percent, according to Gallup. It’s not hard to imagine, in just one Trump term, that we could see half of the gains made under the ACA, which led to 20 million Americans being newly covered, erased.
Poll after poll shows the public wants this assault on the ACA to stop. After all this time, the program remains at a record level of popularity. Fifty percent approve, even as the administration badmouths and undercuts it.
Mostly, Americans want this assault on their ability to care for their families to end so we can begin the process of building back what has been allowed to erode. Americans want to pay less, not more, for health insurance. They don’t want insurance companies to be given unlimited authority again.
They want to see Medicaid strengthened, not weakened. They want the basic dignity of being able to afford medication and an end to the constant fear that grips so many that if they get sick, they will lose everything.
Americans didn’t want last year’s war on Obamacare, and they don’t want this new cold war either.
The actual prices hospitals charge private health insurers are closely guarded trade secrets. But a widely circulated health economics paper, which received some new updates, uses actual claims data from three national insurers to show the inner workings of how hospitals get paid.
The bottom line: Hospitals make a lot of money off patients who get their health coverage through their jobs, and hospitals with little or no competition have the power to set their rates at will.