Forum Post: Americans are rationing food and utilities in order to cover medical expenses

America’s Healthcare Disaster

Mike Stathis, Chief Investment Strategist, AVA Investment Analytics

Last week, the U.S. Supreme Court upheld the Affordable Care Act (ACA), often referred to as Obamacare. Despite the fanfare from the media, most Americans remain distracted by the bipartisan theatrics. In reality the ruling was a non-event. The ACA never offered a solution to begin with because it failed to address the single biggest problem in healthcare; runaway inflation.

The fact of the matter is that with or without Obamacare, the U.S. healthcare system will continue to be run like Wall Street because industry lobbyists have bought off Washington officials. With or without Obamacare, affordable medical care will take a back seat to profits.

Millions of Americans will continue to suffer from unnecessary illness, premature death and medical bankruptcy, all while America’s medical-industrial complex rakes in trillions of dollars of wasteful spending from consumers and taxpayers.

America’s profit-centric healthcare system is the most costly, least accessible and most inefficient in the developed world. For instance, the United States spends twice as much on healthcare as Western Europe but receives a lower quality service. In fact, due to an epidemic of medical errors, U.S. physicians now represent (at least) the third leading cause of death in the United States. Clearly, Obamacare does nothing to address these issues.

In contrast, citizens in most other developed nations have achieved longer life expectancies; lower infant mortality rates, and higher levels of consumer satisfaction with their less costly, single-payer healthcare system.

Even with America’s public and private healthcare system, nearly 50 million Americans have no medical insurance. The White House estimates 30 million uninsured Americans would obtain coverage under the ACA. But according to a preliminary analysis by the nonpartisan Congressional Budget Office, total net additions to the insurance pool would amount to only 17 million because the ACA would cause millions who currently receive insurance to lose their employer-based healthcare.

The ACA provides tax deductions and tax credits to low-income Americans. But millions will still be unable to afford health insurance due to the trend of soaring healthcare costs. Thus, similar to previous healthcare laws, the ACA adds more taxpayer subsidies to the industry without much benefit to taxpayers.

As a result of unfair trade policies established by Washington, millions of U.S. jobs and entire industries have been exported to the developing world. Because the U.S. is the only nation in the world with employer-based healthcare, losing one’s job not only means the loss of income; it also means the loss of affordable access to health insurance.

Those without employer-based healthcare are forced to enter the more costly private insurance market. After Obama whittled healthcare reform down to health insurance reform, insurance lobbyists bought off key officials with $100 million in order to prevent real reform of the health insurance industry. This was accomplished once the White House pulled the government’s medical insurance option from the ACA. As a result, Obamacare does very little to address price controls for those seeking private market alternatives because there is no government option, so industry collusion will persist. And all added costs to employers and insurers will be passed on to consumers.

The high costs of healthcare and lack of basic medical access have positioned medical bankruptcy as the leading cause of personal bankruptcy in the U.S. Of the two million personal bankruptcies each year in the U.S., more than one-half of the cases are due to medical bills or medically-related events. Moreover, of the one million Americans filing for medical bankruptcy each year, most had full medical insurance according to researchers at Harvard University.

These findings imply that America’s health insurance system does not provide true medical insurance. Rather, Americans are being sold a pre-paid medical plan disguised as medical insurance with co-pays, deductibles and other out-of-pocket expenses. The insurance industry is constantly changing policy terms, co-pays and deductibles in order to meet the profit expectations of its shareholders. In my opinion, the entire medical insurance industry is getting away with one of the biggest con jobs in U.S. history.

In no other nation does the ability to pay for medical services have such a strong impact on one’s health and life expectancy. Millions of insured Americans neglect minor ailments and preventative screenings because of high deductibles and lack of coverage. This often leads to more costly medical conditions.

Every day millions of Americans ration food and utilities in order to cover the high costs of prescription drugs, insurance premiums, and out-of-pocket medical costs. In contrast, the rest of the world pays much lower prices for prescription drugs and medical services without ever worrying whether they will have access to medical care.

Excessive healthcare inflation continues to adversely impact the finances of both consumers and employers while compromising the health of millions. Meanwhile, healthcare costs continue to grow at three times the inflation rate and twice the rate of economic growth. As a result, healthcare costs have become the fastest growing expense for U.S. corporations.

As medical plan costs have soared, employers have shifted a disproportionate share of cost increases to employees. As you can imagine, this has resulted in a hidden pay cut. This trend will continue as employers shift the added costs of Obamacare to employees in the form of lower wages.

Other employers have eliminated medical plans altogether. Since 2000, the percentage of Americans with employer-based health coverage has plummeted from 69% to 58%. Soaring premiums have also led to the exportation of millions of jobs overseas. Thus, Obamacare is likely to expand this already devastating outsourcing trend.

Despite public perception, America does not guarantee a basic level of medical care for millions of Americans living in poverty. Even those with full health insurance often lack affordable access to the most basic preventative medical services.

A minimum level of basic medical coverage is necessary to ensure the financial and emotional security of the entire family. Providing a basic level of medical care to every American would also minimize the progression of minor ailments that often lead to costly acute medical emergencies and chronic disease. Obamacare fails to provide basic medical care for millions of Americans.

Of all of the things to worry about in life, the ability to pay for basic medical care should never enter the picture. If you are an Iranian citizen, you will not have these worries. The same is true for citizens of Cuba, South Korea, and many other nations. Thus, it is an embarrassment for the United States, a nation that claims to be the world’s economic superpower, to impose these devastating financial hardships onto millions of its citizens.

Although nearly 50 million Americans have no healthcare coverage whatsoever, U.S. taxpayers contribute enough money to fund a system of universal healthcare. After accounting for public healthcare expenditures, tax deductions for employer-sponsored care and employee premiums, it turns out that taxpayers fit the bill for the majority of the nation’s total annual healthcare expenditures at nearly 60%, or more than $1.3 trillion. Thus, the taxpayer-funded portion of annual healthcare expenditures, at more than 10% of GDP is sufficient to provide for a universal healthcare system.

This remains a well-guarded secret in America, never discussed by the media because if Americans realized the truth, they would demand free healthcare for their tax dollars. This of course would threaten to reduce the profits of the medical-industrial complex.

The rest of the article is here http://www.veteranstoday.com/2012/07/13/americas-healthcare-disaster/