Health Insurance Premiums Are Too High! Sign to get the attention of the US Governement!
Health Insurance Premiums Are Too High! Sign to get the attention of the US Governement!
The Issue
Today, Americans are paying larger proportion of their income towards bills, subscriptions, food, and other necessities than ever before. This means less income goes towards leisure, and more importantly savings for general funds and potential emergencies (Kearney, et al.). Emergencies often take up the majority of Americans’ savings, in which America leads in the most preventable medical emergencies. However, health insurance never guarantees full coverage of every medical bill, which means a potentially larger proportion of our income is taken away from savings and other necessities. However, this is not the case for many other first-world countries, such as the U.K., New Zealand, and Canada, where health coverage is considered universal and takes a substantially less proportion of income than in the U.S. Stakeholders of this disproportionality in America are health insurance holders, the U.S. government, health insurance companies, medical researchers, and doctors and nurses, all of which contribute to the health insurance premiums and medical costs. Some of these stakeholders propose solutions to high costs or place blame on another stakeholder, while others are more silent and indirectly affect the issue.
The main stakeholders of health insurance issues in America are the ones paying the bills: insurance holders and medical patients. Average cost of health insurance in the U.S. has risen about 47% in the last decade, regardless of the size of household (Kearny, et al.). This has occurred while the average GDP of a U.S. citizen has only risen about 7%, meaning that the rise in income does not proportionately offset the growth of health insurance cost (Davis).
Tara Sullivan, a 58-year-old woman living alone in West Virginia, stated that “[my] job as a legal assistant pays [me] about $28,000 a year – about $1,800 dollars a month in take-home pay” while paying “about $600 for health insurance and medical costs” (Tozzi). The average American allocates about 23% towards health insurance and other medical costs (Kearny, et al.), however in the case of Tara Sullivan, she allocates about 33% of her income to health insurance and medical costs. This leaves Sullivan to account for rent, transportation, food, and other essentials with only $1200 a month (Tozzi).
Sullivan is a part of the 47% of Americans who pay for health insurance despite their disproportionate monthly income (Kearny, et al.). Although nearly half of the country is willing to pay this much for their health insurance, about 23% of Americans are uninsured as of 2020, which is up from 16% in 2011. About 29% of Americans are insured through employers and government assistance, which leaves only about 1% of Americans who have health insurance costs that proportionately match their monthly income (Davis). These statistics are consistent with a multitude of studies conducted by private organizations and the government.
As of now, there is no solution this stakeholder can directly provide that can help the general populace. However, at an individual scale, insurance holders and medical patients can seek lower premiums through employee benefits or competitive market premiums. Finding these lower premiums may not offset remaining medical costs as a result of cheaper and more accessible health insurance (Davis).
The second stakeholder of health insurance issues in America is the one who can formally regulate insurance premiums and provides solutions and alternatives: the U.S. government. Whether it is the President or members of Congress, they have proposed potential ideas and solutions to combat the issue with varying levels of success. The most prominent potential solution in the last decade is the Affordable Care Act, also known as Obamacare (Collins, et al.).
Although the Affordable Care Act established the government owned institution of Obamacare, the other purposes were to reallocate tax funding towards the lower-income population, mandate insurance companies to accept all health insurance seekers, and mandate health insurance companies to use United States Census data to determine competitive market rates rather than individual medical needs (Rasmussen, et al.). In theory, the ACA would cut the uninsured population in half and provide the bottom 40% and below income levels affordable health insurance relative to their income (Collins, et al.). Although the uninsured population from when the ACA was fully initiated in 2010 was cut in half, the uninsured population reached its previous level again in 2013 (Kearney, et al.) Instead of the bottom 40% and below income levels obtaining affordable health insurance from the government, only 23% and below did (Collins, et al.). As for private health insurance, the average price fluctuated between $300 and $450 in 2010 to 2013, but returned to the constant growth it had before the enactment of the ACA (Kearney, et al.)
Other government owned health insurance institutions include Medicare and Medicaid, both established in 1965 with the Social Security Act. Medicare was built in conjunction with the Social Security Administration to provide public health care for ages 65 and older by reimbursing “usual, customary, and reasonable fees to medical establishments and medical personnel and medical doctors” (Rasmussen, et al.). Medicaid was an attempt to provide public health care to families with dependent children who are arbitrarily categorized as “poor” by the state the family lived in. Essentially, Medicaid was built to tap into state-level budgets to provide public health care to lower income families with no formal categorization. This meant that states could choose who receives health coverage and to what extent they received that coverage. Although Medicaid greatly benefitted citizens in states with lower populations, such as New Mexico, Oklahoma, and Wyoming, citizens in higher population states received significantly less benefits. Both Medicare and Medicaid exist today, and with increases in state budgets, the effectiveness of Medicaid has increased. However, the ability for states to choose who receives Medicaid benefits has only increased the uninsured population.
The third stakeholders of health insurance issues in America are the ones providing the third-party services, private health insurance companies and institutions. As mentioned earlier, average cost of health insurance from third-party sources has increased by 47% in the last decade with only a 7% rise in GDP (Kearny, et al.). This has occurred for two main reasons: government regulation and capitalist agendas of private health insurance companies (Collins).
The most recent government regulation change that affected average health insurance cost is the Affordable Care Act in 2010, in which health insurance companies and institutions were mandated to quote premiums and provide their services to any eligible health insurance holder regardless of medical history, disability, and ability to afford the costs (Rasmussen). This is unlike any insurance for major assets in an average American’s life, such as home, renters, and auto-insurance. A vast majority, if not all, insurance plans outside of health insurance base their cost and services on the insurance holder’s past history and current conditions. For example, in the auto insurance industry, a driver with a dangerous car, accident history, and or long citation history will have more expensive auto insurance premiums than a driver with a safer car, no accident history, and or no citation history (“Insurance Explained”). In the case of health insurance, this means that an insurance quote is mostly, if not completely, based on the entire population of America, rather than the individual insurance holder. Statistically, America leads the world average medical costs per person and deaths from surgical mishaps, while also being one of the leading countries in preventable and accidental deaths (Davis).
The fourth stakeholder of health insurance issues in America are the ones who develop and innovate the medicines and treatments, medical researchers. The United States has led the world in budget towards medical research since 1991 by a large margin. This budget has led to breakthroughs that have saved hundreds of millions of lives internationally, however, not without expensive costs (Rasmussen).
Actual research and prototype manufacturing costs for developing medical drugs and vaccines only takes up about 13% of the average annual budget of medical research in the U.S. The rest of the 87% is somewhat equally divided between budgets for medical trials and manufacturing and distribution of drugs and vaccines to the masses (Kearney). The cost of treatment has gone up exponentially with the development of new practices and technology. When developing medical treatments, the most common issue that is tackled is the recovery time of the patient and the effectiveness of the treatment overtime (Hohman). This research can take years or possibly decades, which in turn costs around $121.8 billion a year for government sponsored projects alone. About $52.6 billion is spent by private American health research institutions every year (Kearney).
However, these annual budgets for medical research are not the true cost to health insurance holders. Innovations in medicine and treatment have led to higher costs as they reach the competitive market and are sampled and examined by the Food and Drug Administration of the United States. The FDA also conducts medical research at the total scale of private health research companies combined, spending about $49 billion a year analyzing drugs and treatments alone (Felter). These massive budgets account for almost the entire cost of drugs and treatments for patients. For the insured population, much of this financial burden falls to health insurance companies and institutions, which in turn raises insurance premiums to an unaffordable degree to many Americans. For the uninsured, these steep costs dig further into potential savings and funds towards essentials.
The fifth and final stakeholder of health insurance issues in America are those who provide medical treatment, doctors and nurses. Although the financial burden of primary and diagnostic doctors are taken over by hospitals and clinics, nurses are often included in medical charges, therefore increasing health insurance costs but at an insignificant margin (Kearney, et al.). Despite this fact, medical professionals are often the most blamed for high treatment costs and large insurance claims when other stakeholders affect insurance premiums more significantly.
When attempting to analyze stakeholders of an issue, stasis theory can be implemented to further analyze details related between two or more stakeholders. This can also be done within a stakeholder as well. In the case of health insurance issues in America, the three main stakeholders, insurance holders, insurance companies, and the U.S. government, are the stakeholders that stasis theory can truly apply to in relevance to the issue. At a factual level, the three main stakeholders remain in stasis. All are in census of the generally high insurance premiums but acknowledge them differently. For example, a health insurance company would never advertise their premiums as being higher than another company’s, but do advertise that their premiums have the potential to be lower than the competition, which indirectly references the issue. At the definition level, all stakeholders lose stasis. Generally, in surance holders often blame both the insurance companies and the government for high premiums, while insurance companies blame the insurance holders and the government, while the government solely blames insurance companies for the high premiums. In reality, all stakeholders affect the cost health insurance to some degree. Even within stakeholders, like insurance holders and the government, stasis is lost. Many sub-stakeholders in both groups believe that the market of health insurance premiums should naturally settle at lower premium costs because of capitalist competition and that government intervention negatively impacts that competition (CNN).
Works Cited
Collins, Sara R, et al. “Health Insurance Coverage Eight Years after the ACA.” Commonwealth Fund, Commonwealth Fund Organization, 7 Feb. 2019, https://www.commonwealthfund.org/publications/issue-briefs/2019/feb/health-insurance-coverage-eight-years-after-aca
CNN, Opinion Research Corporation. “Opinion Polls about the Affordable Care Act in 2010.” CNN Center, 19 Mar. 2010.
Davis, Karen. “Uninsured in America: problems and possible solutions.” BMJ (Clinical research ed.) vol. 334,7589 (2007): 346-8. doi:10.1136/bmj.39091.493588.BE
Elliott, Christopher. “How to File a Complaint about Your Insurance Company.” Forbes, Forbes Magazine, 21 Dec. 2021, https://www.forbes.com/advisor/life-insurance/how-to-file-insurance-company-complaint/
Felter, Claire. “What Is the FDA's Role in Public Health?” Council on Foreign Relations, 10 Sept. 2021, https://www.cfr.org/backgrounder/what-fdas-role-public-health
Hohman, Maura. “Why Is Health Care So Expensive in the United States?” TODAY, 22 Sept. 2020, https://www.today.com/tmrw/why-healthcare-so-expensive-united-states-t192119
“Insurance Explained - How Do Insurance Companies Make Money and How Do They Work.” YouTube, The Infographics Show, 21 May 2018, https://www.youtube.com/watch?v=qjXgpJpSlCc&ab_channel=TheInfographicsShow Accessed 24 Feb. 2022.
Kearney, Audrey, et al. “Americans' Challenges with Health Care Costs.” KFF, Kaiser Family Foundation, 14 Dec. 2021, https://www.kff.org/health-costs/issue-brief/americans-challenges-with-health-care-costs/
Rasmussen, Scott, et al. “History of Healthcare Policy in the United States.” Edited by Geoff Pallay, Ballotpedia, Ballotpedia Encyclopedia, 2016, https://ballotpedia.org/History_of_healthcare_policy_in_the_United_States
Tozzi, John, and Emma Ockerman. “What It’s Like Living Without Health Insurance in America.” Bloomberg, Bloomberg, 3 Apr. 2018, https://www.bloomberg.com/news/features/2018-04-03/what-it-s-like-living-without-health-insurance-in-america
Barkat, Sonia. “How Do Health Insurance Companies Make Money?” Edited by Ronnell Nolan, HealthCareInsider.com, HealthCareInsider.com, 18 Feb. 2021, https://healthcareinsider.com/how-health-insurance-companies-make-money-60577
2
The Issue
Today, Americans are paying larger proportion of their income towards bills, subscriptions, food, and other necessities than ever before. This means less income goes towards leisure, and more importantly savings for general funds and potential emergencies (Kearney, et al.). Emergencies often take up the majority of Americans’ savings, in which America leads in the most preventable medical emergencies. However, health insurance never guarantees full coverage of every medical bill, which means a potentially larger proportion of our income is taken away from savings and other necessities. However, this is not the case for many other first-world countries, such as the U.K., New Zealand, and Canada, where health coverage is considered universal and takes a substantially less proportion of income than in the U.S. Stakeholders of this disproportionality in America are health insurance holders, the U.S. government, health insurance companies, medical researchers, and doctors and nurses, all of which contribute to the health insurance premiums and medical costs. Some of these stakeholders propose solutions to high costs or place blame on another stakeholder, while others are more silent and indirectly affect the issue.
The main stakeholders of health insurance issues in America are the ones paying the bills: insurance holders and medical patients. Average cost of health insurance in the U.S. has risen about 47% in the last decade, regardless of the size of household (Kearny, et al.). This has occurred while the average GDP of a U.S. citizen has only risen about 7%, meaning that the rise in income does not proportionately offset the growth of health insurance cost (Davis).
Tara Sullivan, a 58-year-old woman living alone in West Virginia, stated that “[my] job as a legal assistant pays [me] about $28,000 a year – about $1,800 dollars a month in take-home pay” while paying “about $600 for health insurance and medical costs” (Tozzi). The average American allocates about 23% towards health insurance and other medical costs (Kearny, et al.), however in the case of Tara Sullivan, she allocates about 33% of her income to health insurance and medical costs. This leaves Sullivan to account for rent, transportation, food, and other essentials with only $1200 a month (Tozzi).
Sullivan is a part of the 47% of Americans who pay for health insurance despite their disproportionate monthly income (Kearny, et al.). Although nearly half of the country is willing to pay this much for their health insurance, about 23% of Americans are uninsured as of 2020, which is up from 16% in 2011. About 29% of Americans are insured through employers and government assistance, which leaves only about 1% of Americans who have health insurance costs that proportionately match their monthly income (Davis). These statistics are consistent with a multitude of studies conducted by private organizations and the government.
As of now, there is no solution this stakeholder can directly provide that can help the general populace. However, at an individual scale, insurance holders and medical patients can seek lower premiums through employee benefits or competitive market premiums. Finding these lower premiums may not offset remaining medical costs as a result of cheaper and more accessible health insurance (Davis).
The second stakeholder of health insurance issues in America is the one who can formally regulate insurance premiums and provides solutions and alternatives: the U.S. government. Whether it is the President or members of Congress, they have proposed potential ideas and solutions to combat the issue with varying levels of success. The most prominent potential solution in the last decade is the Affordable Care Act, also known as Obamacare (Collins, et al.).
Although the Affordable Care Act established the government owned institution of Obamacare, the other purposes were to reallocate tax funding towards the lower-income population, mandate insurance companies to accept all health insurance seekers, and mandate health insurance companies to use United States Census data to determine competitive market rates rather than individual medical needs (Rasmussen, et al.). In theory, the ACA would cut the uninsured population in half and provide the bottom 40% and below income levels affordable health insurance relative to their income (Collins, et al.). Although the uninsured population from when the ACA was fully initiated in 2010 was cut in half, the uninsured population reached its previous level again in 2013 (Kearney, et al.) Instead of the bottom 40% and below income levels obtaining affordable health insurance from the government, only 23% and below did (Collins, et al.). As for private health insurance, the average price fluctuated between $300 and $450 in 2010 to 2013, but returned to the constant growth it had before the enactment of the ACA (Kearney, et al.)
Other government owned health insurance institutions include Medicare and Medicaid, both established in 1965 with the Social Security Act. Medicare was built in conjunction with the Social Security Administration to provide public health care for ages 65 and older by reimbursing “usual, customary, and reasonable fees to medical establishments and medical personnel and medical doctors” (Rasmussen, et al.). Medicaid was an attempt to provide public health care to families with dependent children who are arbitrarily categorized as “poor” by the state the family lived in. Essentially, Medicaid was built to tap into state-level budgets to provide public health care to lower income families with no formal categorization. This meant that states could choose who receives health coverage and to what extent they received that coverage. Although Medicaid greatly benefitted citizens in states with lower populations, such as New Mexico, Oklahoma, and Wyoming, citizens in higher population states received significantly less benefits. Both Medicare and Medicaid exist today, and with increases in state budgets, the effectiveness of Medicaid has increased. However, the ability for states to choose who receives Medicaid benefits has only increased the uninsured population.
The third stakeholders of health insurance issues in America are the ones providing the third-party services, private health insurance companies and institutions. As mentioned earlier, average cost of health insurance from third-party sources has increased by 47% in the last decade with only a 7% rise in GDP (Kearny, et al.). This has occurred for two main reasons: government regulation and capitalist agendas of private health insurance companies (Collins).
The most recent government regulation change that affected average health insurance cost is the Affordable Care Act in 2010, in which health insurance companies and institutions were mandated to quote premiums and provide their services to any eligible health insurance holder regardless of medical history, disability, and ability to afford the costs (Rasmussen). This is unlike any insurance for major assets in an average American’s life, such as home, renters, and auto-insurance. A vast majority, if not all, insurance plans outside of health insurance base their cost and services on the insurance holder’s past history and current conditions. For example, in the auto insurance industry, a driver with a dangerous car, accident history, and or long citation history will have more expensive auto insurance premiums than a driver with a safer car, no accident history, and or no citation history (“Insurance Explained”). In the case of health insurance, this means that an insurance quote is mostly, if not completely, based on the entire population of America, rather than the individual insurance holder. Statistically, America leads the world average medical costs per person and deaths from surgical mishaps, while also being one of the leading countries in preventable and accidental deaths (Davis).
The fourth stakeholder of health insurance issues in America are the ones who develop and innovate the medicines and treatments, medical researchers. The United States has led the world in budget towards medical research since 1991 by a large margin. This budget has led to breakthroughs that have saved hundreds of millions of lives internationally, however, not without expensive costs (Rasmussen).
Actual research and prototype manufacturing costs for developing medical drugs and vaccines only takes up about 13% of the average annual budget of medical research in the U.S. The rest of the 87% is somewhat equally divided between budgets for medical trials and manufacturing and distribution of drugs and vaccines to the masses (Kearney). The cost of treatment has gone up exponentially with the development of new practices and technology. When developing medical treatments, the most common issue that is tackled is the recovery time of the patient and the effectiveness of the treatment overtime (Hohman). This research can take years or possibly decades, which in turn costs around $121.8 billion a year for government sponsored projects alone. About $52.6 billion is spent by private American health research institutions every year (Kearney).
However, these annual budgets for medical research are not the true cost to health insurance holders. Innovations in medicine and treatment have led to higher costs as they reach the competitive market and are sampled and examined by the Food and Drug Administration of the United States. The FDA also conducts medical research at the total scale of private health research companies combined, spending about $49 billion a year analyzing drugs and treatments alone (Felter). These massive budgets account for almost the entire cost of drugs and treatments for patients. For the insured population, much of this financial burden falls to health insurance companies and institutions, which in turn raises insurance premiums to an unaffordable degree to many Americans. For the uninsured, these steep costs dig further into potential savings and funds towards essentials.
The fifth and final stakeholder of health insurance issues in America are those who provide medical treatment, doctors and nurses. Although the financial burden of primary and diagnostic doctors are taken over by hospitals and clinics, nurses are often included in medical charges, therefore increasing health insurance costs but at an insignificant margin (Kearney, et al.). Despite this fact, medical professionals are often the most blamed for high treatment costs and large insurance claims when other stakeholders affect insurance premiums more significantly.
When attempting to analyze stakeholders of an issue, stasis theory can be implemented to further analyze details related between two or more stakeholders. This can also be done within a stakeholder as well. In the case of health insurance issues in America, the three main stakeholders, insurance holders, insurance companies, and the U.S. government, are the stakeholders that stasis theory can truly apply to in relevance to the issue. At a factual level, the three main stakeholders remain in stasis. All are in census of the generally high insurance premiums but acknowledge them differently. For example, a health insurance company would never advertise their premiums as being higher than another company’s, but do advertise that their premiums have the potential to be lower than the competition, which indirectly references the issue. At the definition level, all stakeholders lose stasis. Generally, in surance holders often blame both the insurance companies and the government for high premiums, while insurance companies blame the insurance holders and the government, while the government solely blames insurance companies for the high premiums. In reality, all stakeholders affect the cost health insurance to some degree. Even within stakeholders, like insurance holders and the government, stasis is lost. Many sub-stakeholders in both groups believe that the market of health insurance premiums should naturally settle at lower premium costs because of capitalist competition and that government intervention negatively impacts that competition (CNN).
Works Cited
Collins, Sara R, et al. “Health Insurance Coverage Eight Years after the ACA.” Commonwealth Fund, Commonwealth Fund Organization, 7 Feb. 2019, https://www.commonwealthfund.org/publications/issue-briefs/2019/feb/health-insurance-coverage-eight-years-after-aca
CNN, Opinion Research Corporation. “Opinion Polls about the Affordable Care Act in 2010.” CNN Center, 19 Mar. 2010.
Davis, Karen. “Uninsured in America: problems and possible solutions.” BMJ (Clinical research ed.) vol. 334,7589 (2007): 346-8. doi:10.1136/bmj.39091.493588.BE
Elliott, Christopher. “How to File a Complaint about Your Insurance Company.” Forbes, Forbes Magazine, 21 Dec. 2021, https://www.forbes.com/advisor/life-insurance/how-to-file-insurance-company-complaint/
Felter, Claire. “What Is the FDA's Role in Public Health?” Council on Foreign Relations, 10 Sept. 2021, https://www.cfr.org/backgrounder/what-fdas-role-public-health
Hohman, Maura. “Why Is Health Care So Expensive in the United States?” TODAY, 22 Sept. 2020, https://www.today.com/tmrw/why-healthcare-so-expensive-united-states-t192119
“Insurance Explained - How Do Insurance Companies Make Money and How Do They Work.” YouTube, The Infographics Show, 21 May 2018, https://www.youtube.com/watch?v=qjXgpJpSlCc&ab_channel=TheInfographicsShow Accessed 24 Feb. 2022.
Kearney, Audrey, et al. “Americans' Challenges with Health Care Costs.” KFF, Kaiser Family Foundation, 14 Dec. 2021, https://www.kff.org/health-costs/issue-brief/americans-challenges-with-health-care-costs/
Rasmussen, Scott, et al. “History of Healthcare Policy in the United States.” Edited by Geoff Pallay, Ballotpedia, Ballotpedia Encyclopedia, 2016, https://ballotpedia.org/History_of_healthcare_policy_in_the_United_States
Tozzi, John, and Emma Ockerman. “What It’s Like Living Without Health Insurance in America.” Bloomberg, Bloomberg, 3 Apr. 2018, https://www.bloomberg.com/news/features/2018-04-03/what-it-s-like-living-without-health-insurance-in-america
Barkat, Sonia. “How Do Health Insurance Companies Make Money?” Edited by Ronnell Nolan, HealthCareInsider.com, HealthCareInsider.com, 18 Feb. 2021, https://healthcareinsider.com/how-health-insurance-companies-make-money-60577
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Petition created on April 10, 2022