America's Healthcare System Continues To Spiral Downward
Posted on Wed, Jun 23, 2010
Even though medical insurance reform laws passed in March, the U.S. could have a major crisis before many of the provisions of the law become law in 2014.
Many state governments that have been struggling because of the recession are considering more cuts in medical care help for the poor, even though more money is promised to these states by the federal government.
Meanwhile, there are millions of people in the U.S. that have been using assistance from the federal government as a way to hold onto their medical insurance that will be losing their coverage within the next few months since that assistance will be expiring. Those people that have jobs are facing more cost shifting to employees in regards to the medical insurance that their company has, or their company is considering dropping the coverage altogether.
Everyone is facing increasing medical care costs and rising medical insurance premiums. In some areas of the U.S., people's medical insurance premiums are increasing at double-digit rates in 2010.
The White House Office of Health Reform has acknowledged that medical insurance premiums will continue to rise, and some Americans will still lose their insurance coverage.
From now until 2014, it is a bridge period, until Americans receive medical coverage that's guaranteed and federal subsidies that amount to billions of dollars in 2014.
Since the law has been passed, the government has been offering new tax credits to small companies in order to sway them into offering medical coverage to their employees. The government has also been developing regulations that will oversee medical insurance companies and to stop huge rate increases from happening.
States have been working with the Department of Health and Human Services to establish high risk pools. These high risk pools will help people obtain coverage who have been declined coverage. However, preliminary research states that the $5 billion that's set aside for these new high-risk pools is not enough.
A survey that was conducted in March of this year showed that among 507 large companies, their premiums would increase by 6.5% on average this year. That is about 3 times faster than prices in the entire economy are rising.
Therefore, many large companies are having their employees pick up more of the share of cost of these medical insurance premiums. Small companies typically are not as likely to offer their workers medical insurance because of the costs, some of which are being increased by at least 20% in some areas of the U.S. Many of these companies are slashing benefits or laying off employees to help offset the increasing costs of medical care.
In 2009, Congress authorized about $2 billion to go towards medical benefits for about 2 million Americans that had been laid off. However, there is a lot of pressure to contain this spending. It is likely that Congress will stop the COBRA aid, which gave laid off employees a 65% subsidy to help them keep their Cobra coverage. Without this assistance, laid off workers will have to pay the entire cost of the premiums, which is prohibitively expensive for most.
Since the recession started, there has been an enormous increase in the enrollment in Medicaid programs. Democrats have been trying to give extra funding to states, but for a lot of states, that extra funding will not be enough.
In California, officials are intending to place revised limits on the amount of prescriptions and physician visits for Californians on its MediCal program. Officials in North Carolina have slashed payments to physicians and other medical providers and are considering ways to cut down the amount of people that are eligible for certain services, like home health care. State leaders in New Mexico, who have also cut payments to physicians and other medical providers, are now looking at methods to cut some prescriptions and long term care services.