THE BLOG

Featuring fresh takes and real-time analysis from HuffPost's signature lineup of contributors

Blake Fleetwood Headshot

52% of Americans Disgusted with Health Care Costs

Posted: Updated:

Several new surveys graphically illustrate the average American's growing disgust with the inefficient - largely employer sponsored - US health care system.

The annual Health Confidence Survey found that dissatisfaction with health insurance costs increased by 58% from last year - from 33% to 52%. Of the respondents dissatisfied, according to an article in the LA Times, most of this unhappiness is focused on rising costs.

The percentage of individuals rating the system as poor has doubled to 30% since 1998, according to the survey. 28% consider it fair while only 10% consider health care very good, according to 1000 adults polled.

60% of those polled said costs of their health plan -- premiums, deductibles and co-payments -- had gone up in the last year. Of that group, 28% said that because of health-related costs, they had trouble paying for housing, heat and food.

Overall, the proportion of employees covered by a company plan dropped from 81% in 2001 to 77% in 2005.

Asked to choose between a $6,700 raise and employer-sponsored health insurance, 75% of those polled picked the health plan.

Of those, 13% said no raise would be big enough to persuade them to give up their coverage. The average cost of employer-provided coverage was about $6,700 per worker in 2004. It has since gone up to more than $7,100 and workers are paying a larger and larger share.

"There is a continuing shift," said Dallas L. Salisbury, President of the Employee Benefit Research Institute in the LA Times article. "Even some of the companies in the unionized sector have introduced cost-sharing for the first time ever. Employees who were paying nothing are now paying something, and those who were paying something are paying more."

We will reach the "Tipping Point" very soon. Not only because people are needlessly dying, but because big and small business are being hobbled by astronomical health costs.

Companies that were successful in the forties, fifties and sixties are now feeling the bite of escalating health care costs for current workers and retirees. General Motors spends more on worker health care ($1,400 per vehicle) than they spend on steel for each car they produce.

If GM builds a car in Ontario, Canada, which boarders on Michigan, the company does not have to pay for the health care of their workers and can price that car on the world market for much less than a similar Detroit made vehicle. For the first time, more cars are slated to be produced in Ontario than in Michigan, the traditional heart of the auto industry.

In the third quarter Ford Motor Company lost $5.2 billion. If Ford just moved all its plants across the boarder to Canada, the health care saving would be astronomical because the Canadian Government would pick up most of the tab. Why would any auto company want to continue to manufacture in the U.S?

Aging Baby boomers are retiring in record numbers and the chickens are coming home to roost. I.B.M., the major airlines, GM, Ford, Chrysler, GE, the steel industry, and other manufacturing companies cannot compete in the global economy. Companies that don't offer universal health care, like Wal-Mart, or companies with a younger workforce, are not hobbled in the same way.

"We're spending more on health care and less on the auto business, and frankly that does not work," said John Devine, GMs chief financial officer. "A system that has relied solely on the back of U.S. business I don't think is going to be sustainable."

"The three big auto makers are "HMOs on wheels," says Goldman Sachs analyst Gary Lapidus.

The link between health care insurance and employment is an historical anomaly, which is particular to the United States. It had its greatest growth during World War II with the imposition of wage and price controls. In order to get around these regulations, employers began offering free health insurance instead of higher wages, with the added benefit that health care premiums would be tax-free.

The tax exclusion is very costly to the federal government. Estimates of revenues lost are as high as $150 billion per year. In a study released by the Manufacturers Alliance and the National Association of Manufacturers, Jeremy Leonard noted that in Canada the private sector spends 2.8 percent of gross domestic product on health care while in the United States the private sector spends 7.7 percent.

This is not a problem faced by foreign competitors since their health care expenses are largely assumed by taxpayers through nationalized single payer health care systems. To saddle the cash flow of American businesses with an obligation that other competitors do not have to pay," says Uwe Reinhardt, a Princeton economist, "creates serious long-run disadvantages."

This historic link between employment and health care may be what has kept the U.S. from following the lead of most urban countries, which developed more complete systems of universal care.

47 million Americans are not covered by any health care plan at all and many needlessly die each year because of a lack of medical attention. This may be why The United States lags behind 36 other countries in overall health system performance ranging from infant mortality, to adult mortality, to life expectancy according to figures from the World Health Organization.

20 countries in Europe and four countries in Asia have a better life expectancy than the U.S. If you are a male between the ages of 15 and 59 your chances of dying are higher in the U.S. (140 per thousand) than in Canada (95), Costa Rica (127), Chile (134), and Cuba (138).

The U.S. Health system looks especially dysfunctional when you consider how much money we spend per capita - more than $6,000 per year for health care, twice as much as any other country - and how little we get for it.

No wonder people are unhappy.