Friday, February 29, 2008

Health Care and Spuds

This year has turned out to be a whirlwind of political activities related to the U.S. Presidential race. Over the past year since the current contenders threw their respective hats into the ring, Americans have been inundated with political ads, speeches, media reports and more about who is best fit to be #44. Debates over issues concerning the Iraq War, the economy, border security, illegal immigration and other hotly contested items on both the Democratic and Republican political agendas have been front and center in the nightly news, weblogs, newspapers and magazines, and every other possible media outlet short of scribbling on restroom walls. And based upon the topic dujour, we are blasted with soundbytes from all the candidates and other talking heads about who has the best response. The issues change as attention is focused on whatever the various news agencies deem as the lead story of the day.

Currently the big splash is about health care. This hot potato has now been elevated to the top of the political speeches giving a new meaning and twist to the phrase "This spud's for you," (with apologies to Budweiser). And now we have all the TV and radio ads touting how Americans will have all of our health care problems resolved if we only vote for "Senator So-and-So". Why, we won't have to worry about anything anymore! We will have free health care, and free insurance, and free meds. On and on and on it goes--promises made by those who don't have the power to make it happen. Here is the kicker: there ain't no such thing as a free lunch. Health care is not free, even to those who receive it and can't or won't pay. Someone always pays for somebody else's medical bills, usually the American taxpayers. Hospitals and medical providers who don't receive payment have to write off the expense, so they pay for it in lost revenues.

We continue to hear the cry for Universal Health Care from politicians and the "disenfranchised" who wish to continue getting entitlements from the U.S. government, a.k.a. the American taxpayers. We are bombarded by political ads all day long about how much our savings will be when we sign on to Universal Health Care model, and how our lives will be changed forever, and by the wonderful care we will receive when the government will pay the doctor bills. One look at Medicare, and you will wish you never heard of Universal Health Care if it becomes the law of the land. And what about enforcement? What if someone decides they don't want to participate. The proposal on the table from the Democratic side is that punishment in the form of fines, penalities and interest (very much like the IRS) will be mandated to collect from those Americans who don't want to be part of this new world insurance order. Can we say Marxism, or Socialism?

For example, the plan promoted by Hillary Clinton has stated that individuals will be required to get and keep insurance in a system where insurance is affordable and accessible. Additionally, employers will help finance the system. How this plan helps Americans is to include more government mandates, expensive federal subsidies and more government oversight and bureaucracy leading to increased wait times, a decrease in patient care and tax hikes to pay for it. The net effect would be a large increase in health insurance premiums for the vast majority of Americans, and health insurance would turn into a subsidy program requiring health insurance as a pre-condition of employment. Not having health insurance would be against the law, just as driving a car without automobile insurance isn't legal. However, to pay for her national program, Hillary needs everyone to have coverage so those revenues can be used to subsidize the coverage of those who are ill. The resulting mandatory plan would force tens of millions of Americans to pay for coverage they do not want and feel they don't need. And what about controlling the cost of this Universal Health Care?

And there is Senator Obama's plan--universal coverage for everyone, but with a twist. A new regulatory agency is proposed that would be responsible for regulating the insurance industry and also administering the new public insurance program he is promoting. The National Health Insurance Exchange would expect participation by the uninsured, the self-employed, and small businesses on one plan and a re-structured insurance market on another. The public plan would be open to everyone who feels they have a disadvantage. The details on the other one are still somewhat sketchy--participation by insurers may or may not be optional. Those that participate will have to offer minimum benefit coverage, put some of their monies into mandatory patient care, will need to justify any substantial increases in premiums, and will not be allowed to discriminate based on personal health history. Employers will have to pay into one or the other of these plan options offered by the new Obama mandate. However, there is one missing component; required participation by all adults is not included in his proposal. There are still unanswered questions about how all this will work, and that is the scary part.

One thing is for sure, though. When handling hot potatoes, it's always a good idea to let them cool off before you bite. In health care, the "take it, or else" mindset is not the best option. Americans don't like to be force fed. The menu should include options that are palatable and don't stink.

Until next time. Let me know what you think.

Wednesday, February 27, 2008

Health Care and Obesity

Americans love to eat. As a matter of fact, a study of employees released this month by Kronos has found that 65% of all workers are overweight or obese. Out of the study group analyzed of almost 10,000 people, those aged 40 and above showed that 65% of women and 77% of men fell into this category. Those under 40 were not as bad--52% of women and 68% of men were overweight or obese. Man! Are we fat, or what? It's a wonder that Americans don't fall over and can't get up. What showed up in the report in addition to the stats on who weighs more was that the overweight status of all of these workers (the majority of the population) has a huge impact on overall health. And the American Academy of Pediatrics recommends the use of BMI (body mass index) screening as an important first step in identifying individuals who are overweight or obese.

Obesity can result in greater health risks including heart attacks, high blood pressure, strokes, diabetes, and other chronic diseases including some cancers. No wonder health care is so expensive! Kronos has also stated that businesses in the U.S. suffer about $13 billion in losses every year due to health issues of obese employees. That's alot of Big Macs and Super Size Fries. Wellness programs, weight loss, and employer sponsored health initiatives and screenings would definitely help impede the battle of the bulge. Americans must consider the long term effects on obesity. Choosing to ignore being significantly overweight only postpones the inevitable health problems that will develop over time. There are steps that can be taken to achieve and maintain weight at an acceptable level of health. Certainly the lifestyle possibilities can improve when obesity is not a concern.

Obesity prevalence has increased significantly among adults and children in the U.S. over the last two decades. As noted in Medical News Today, a new study appearing in the journal Nutrition Reviews reveals that characteristics of neighborhoods, including the area's income level, the built environment, and access to healthy food, contribute to the continuing obesity epidemic. Researchers also found that neighborhoods with decreased economic and social resources have higher rates of obesity. Additionally, they concluded that residents in low-income urban areas are more likely to report greater neighborhood barriers to physical activity. There are limited opportunities for daily walking or physical activity and reduced access to stores that sell healthy foods, especially large supermarkets.

Obesity is at an epidemic proportion even on a worldwide basis, and children are also becoming heavier. The British United Provident Association has stated that over a billion people worldwide are now overweight, and 300 million are considered clinically obese. The London School of Hygiene and Tropical Medicine said that 287 million overweight children have been noted in the world as part of studies they have done. The childhood obesity epidemic is really twin epidemics of poor nutrition and diminishing physical activity as indicated by scientific study with the American Association for the Advancement of Science. Kids who load up on salty meals and snacks get thirsty, and too often they turn to calorie-filled sodas. Salt is a hidden factor in the obesity epidemic according to research reported last year from a British study published in an American Heart Association journal. About 80 percent of salt intake comes from processed food. Not only could less salt translate to fewer soft drinks and therefore fewer calories, but a modest reduction in salt has already been shown to lower blood pressure, which would lower the risk of later-in-life heart attack and stroke.

According to the American Obesity Association, an alarming 15.5 percent of children between the ages of six and 11 are considered obese, putting them on a collision course with the nation's biggest killer: heart disease. Chronic diseases, such as obesity, heart disease and cancer, which take decades to develop, have their roots in childhood, when exercise and eating behaviors are being learned according to Baylor University Medical Center in Dallas, Texas. Kids are getting too much of the bad stuff and not enough of the good:

TOO MUCH/MANY…-- sedentary time-- busy time-- calories found in lower-nutrient foods-- sugary beverages.

NOT ENOUGH…-- physical activity-- rest or downtime (To increase their energy, children usually eat more when they're tired.)-- fiber, vitamin C, calcium, iron-- low-fat dairy products.

Naturally, a medical professional should be consulted to assist anyone suffering from acute weight problems or obesity. Physicians and health care specialists can diagnose and treat this issue by recommending various treatments. Aside from medical problems associated with obesity, here are some simple tips to help combat weight problems:

1. Cut back on takeout, fast foods, and pre-prepared foods.
2. Prepare meals at home from scratch using fresh ingredients.
3. Stay physically active and start a fitness regimen.
4. Don't be overwhelmed by trying to do everything at once.
5. Gradually reduce intake of sugar and fat.
6. Involve the whole family in healthy eating and exercise.
7. Enjoy food, and enjoy being active.

Obesity will not go away anytime soon as a health care issue. Our intent is to fight it with the best resources available in the health care market place. Consultation with medical professionals, dieticians, weight loss management, and more will help put the focus on how to deal with this epidemic. Changes in lifestyle, exercise and fitness programs, and diet will also help.

Until next time. Let me know what you think.

Monday, February 25, 2008

Health Care and National Spend

According to a report by Employee Benefit News in January of this year, spending for health care in the U.S. rose over the past year almost 7% to over $2 trillion for the most recent published data (2006). That translates to a little over $7,000 per person based on info from the Centers for Medicare & Medicaid Services. They also reported that the health care part of our GDP was 16%--a little greater than the previous year. Additionally, the GMS said that overall private insurance premiums increased almost 6%. America's Health Insurance Plans (AHIP) based this slowest increase in the past decade upon cost containment and quality improvement activities by insurance plans. AHIP also feels that insurance plans are improving the use of health care dollars. Health care spending by businesses did not increase that much that year due to "deceleration of employer payments.'' This was primarily due to cost-shifting to employees.

The Employee Benefit Research Institute reported last year that couples should have about $300,000 in retirement savings to pay for health expenses based on the assumption that they live a normal life expectancy and Medicare benefits don't change. However, to anticipate how much Americans will need to cover medical expenses is a little like going to Vegas. You're betting against the house that you won't have huge health care costs over a couple of decades and that you will be able to pay for medical costs when they happen during that time. Usually when someone bets against the house, they lose. In gambling, the main thing to understand is that the odds always favor the house.

A representative with Nationwide said in a recent article published by that health care expenses now account for about 20% of all personal spending. Expenses for medical issues have risen 45% over the past five years and will continue to increase at a rate higher compared to other consumer spending. Even churches and religious organizations are not exempt from the increases in medical insurance and health care costs. A current article published in the online version of the Washington Post has reported that some protestant denominations are suffering the woes of paying more for health expenses. A spokesman for the National Council of Churches reported that health care problems are common among big and small churches.

Research that was provided in the report indicates that many Protestant clergy tend to have more health issues due to depression, stress and being overweight; these problems carry huge risks for health care. Some denominations have become more pro-active in encouraging ministers to get healthier--offering financial incentives for wellness options and using participating network medical providers. Even with these extra modifications, though, deductibles still increase and often double just to keep insurance premium costs from going too high. Everyone, including clergy, needs to get more actively involved in managing their personal health care.

The Kaiser Foundation reported this month that a large percentage of families worry about whether their incomes will keep pace with rising prices. These people also wonder if they will have to pay more for health care or health insurance--in part from the relatively fast increases in the costs of employer-based health insurance in the last few years. Many people directly feel the burden of health care costs when they use medical services. However, another way these expenses may affect families’ well-being is by slowing the increase in their paychecks each year. The KF report shows that the share of employee compensation going to health benefits has risen substantially over time, while the share going to wages has fallen.

According to Towers Perrin, Americans are being asked to pay a bigger share of the cost increases. Over the last five years, while employer costs have risen 40 percent, employee costs are up a whopping 60 percent, according to that same survey. And it's an even bigger bite for family coverage. With overall increases in technologies, new medications, provider employee raises, and more, the increases in coverage is taking a financial toll on everyone. There is currently a trend in employers moving from a co-pay system to co-insurance. Many workers are charged a $25 co-pay for a doctor visit. However, with co-insurance, instead employees pay 20 percent of the doctor's bill for that visit. Also, co-insurance can make a big difference when it comes to drug coverage. And as an added hit, healthy individuals generally live longer than unhealthy people (like those with obesity and smokers) and end up paying more for health care.

Lifetime health care costs for obese individuals and smokers are lower than those for healthy individuals who live years longer according to a recent study released by the Kaiser Foundation. However, the study found that obese individuals and smokers had lower lifetime costs because they died earlier. The answer is to make wise health care choices to stay healthy and save enough money to pay for medical issues that will develop later in life. According to the Kaiser Foundation, hospital care accounts for the largest share (30%) of health expenditures. Physician services are the next largest items, comprising one-fifth of the national health spending. Prescription drugs, while accounting for only 10% of total expenditures, has been one of the biggest contributors to the growth in spending.

Financial planning for the long term must take into account the costs associated with paying for medical needs, long term care, health care costs, and additional unseen health related issues that will require attention. Going into a nursing home broke is not the best option. Being able to pay doctor bills and medical costs during late senior years will be considerably better than living on government assistance. Plan now for the future.

Until next time. Let me know what you think.

Friday, February 22, 2008

Health Care and Young Guns

The Associated Press reported this month that there are over 13 million Americans in the age bracket of 19 to 29 that are not insured. They have no health coverage. There are a variety of reasons for this. Some of these in the under-30 crowd have never had any major health issues and feel they will not need insurance for now. Quite a number of them are just getting a start in careers and may not be able to afford insurance, or they may work for businesses that do not offer insurance benefits, or perhaps they are part-timers and do not qualify for employee sponsored health plans. Yet, there are even some of this group that take their health for granted as one of the "invincibles."

Small companies also contribute to the problem. People who work for small businesses are the least likely to get health care coverage from their employers. Forty-one percent of small businesses (3-199 workers) do not offer health benefits to their employees according to research published by the Kaiser Foundation. Obtaining eligibility may also be challenging for younger workers. The Institute of Medicine reports that the drop-off in employer-based health insurance for younger adults nationwide is traced primarily to a lack of eligibility and not whether young adults pay for insurance according to a study they released. The lack of health insurance for younger workers may be less associated with their willingness to pay and more associated with their employer’s ability to offer health insurance. Cost of premiums is one reason employers do not offer health insurance. Also, the inability of low-wage employees to contribute to the premium has been cited as another reason.

FierceHealthCare noted the study by the Commonwealth Fund by reporting that many get dropped from their parents' health insurance or public coverage for children when they turn 19 or graduate from college. And when they enter the working world, young adults often settle for low-wage or temporary jobs without health benefits. This lack of coverage puts their health at risk, and it can add financial stress to their lives just as these "Twenty-somethings" are starting out in the workforce.

Additionally, many of these uninsured young adults have other priorities. The purchase of a new car or getting a better place to live is more important. Many of them are more concerned with climbing the corporate ladder or increasing their social status. The idea of health insurance is typically further down the priority list. However, if a serious illness or accident occurs, the cost of recovery is significant. These people will need to consider alternative options for health care that will not be cost prohibitive, especially when a pre-existing condition may prevent them from getting private insurance. And, rates are much cheaper for individuals under age thirty.

The Institute of Medicine attributes over 18,000 deaths per year to a lack of coverage. And 42% of the uninsured have no usual source of care—they miss out on preventive screenings and care for chronic conditions. The Kaiser Foundation notes that about 50% of the uninsured postpone health care because of cost. Because they do not receive early treatment and regular preventive care, the uninsured are highly likely to be hospitalized and die from preventable causes. Even men and women in their Twenties get sick or suffer injuries from unexpected events. Younger adults change jobs more frequently earlier in their careers leading to periods between jobs when they are uninsured; and they tend to be single with lower paying jobs. Also, ethnicity widens these disparities: 47% of black and 62% of Hispanic 19-23 year-old men who are not in school full-time are uninsured as noted by the Institute of Medicine.

The Institute also discovered that uninsured patients have worse clinical outcomes than insured patients for several chronic conditions including diabetes, cardiovascular disease, end-stage renal disease, HIV infection and mental illness. Uninsured women with breast cancer have a 30 to 50 percent higher risk of dying than women with private health insurance. The Commonwealth Fund has reported that 39% of uninsured young adults stated that they would wait as long as possible to receive health care, compared to 16% of insured young adults. About 40% of young adults receive no preventive care each year, and about half of this demographic population go without necessary medical care. About two thirds of those with medical bills report not being able to pay them. So the cost of being uninsured is still high, even as a young adult.

When no one pays the bill, we all suffer the consequences. Uninsured young adults who default on health care expenses push the recovery of cost to taxpayers, the health care system and providers. Severe financial strain on health care providers often leads to loss of important community resources and redirection of funds away from core public health programs.

The young adults in the 19 to 29 age bracket need to recognize that good health is not a given. Even when there has been a lack of medical problems, a smart plan would be to have some type of coverage for major health issues, especially for catastrophic events. Options in the market place exist for young adults to make sure they have their bases covered for health care needs. Don't go without if at all possible. It will be one of the best decisions made among those that address important financial and physical needs. Being a Young Gun is more about hitting the bullseye than missing the target.

Until next time. Let me know what you think.

Thursday, February 21, 2008

Health Care and Hispanics

Americans like to feel secure. Those living in the U.S. legally as citizens or guests (not illegal aliens) also want to know that their health care is safe to use. People in the U.S. are basically creatures of comfort--living in air conditioned homes with indoor running water and working sewage systems. We like our microwaves, our TVs, our iPods and other techno-gadgets. We love the internet, and we love to eat. For the most part, life in America is good. Unlike Michelle Obama, I can honestly say that I am proud of our country. And I have been that way since childhood and now as part of the AARP demographic.

However, not everyone feels this way. Of course, there are the reported 47 million uninsured that are reported by the Census Bureau. These folks have to figure out how to work the health care system while flying wide open with no safety net. This works until you have a catastrophic medical event, then problems can get ugly in a hurry. Also, as reported in the Dallas Morning News online this month, Hispanic workers feel the most insecure. In 2007, the Rockefeller Foundation surveyed this group and found that about 25% were concerned about losing insurance coverage and about the same number said they did not visit a doctor due to the costs. Many of them take money from savings and pay cash for medical expenditures. As compared to whites at 13%, the numbers tell how much different the cultural aspects of health care in the U.S. are between various ethnicities.

Employers are shifting costs of health care and insurance more and more onto their workers. This puts a huge financial strain on those who are already struggling to make ends meet--choosing between rent, food and utilities and medical needs. According to a report issued by Consumer Reports not long ago, Americans who bought individual health insurance instead of through an employer had less coverage and higher costs. Also, people with relatively decent health can be declined individual insurance due to pre-existing conditions or treatment. The Commonwealth Fund found that about 89% of Americans who considered buying individual health insurance did not primarily due to cost, or the plan did not provide adequate coverage and benefits, or they were turned down for health issues.

This year, the political commercials on TV all espouse universal health care. This topic is huge, and politicos wants to talk about transforming the health care system in America to cover all those without insurance and everyone else. Some want to provide tax breaks, and others want the government to pay all the bills. There are discussions about letting the private insurance companies and the individual healthcare market place to sort it all out. The discussion about health care in the U.S. is reaching a fever pitch, and it won't go away anytime soon. News about people suffering from overpriced insurance and undervalued health care abound, and the media knows it sells. Stories about whites, blacks, and Hispanics dealing with health care problems are all over the internet and the printed page. And both Democrats and Republicans are telling us every day that they can fix it if we will just vote for them. Wow--talk about an easy button!

With all the hype and all the hoopla, Americans need to realize that health care is expensive no matter how you pay for it. Will the private health care industry figure out how to solve the key health problems facing Americans, or will we be forced into a situation where the government ends up telling us what doctor to see and when we can go? Tough questions, and tough times. No wonder people get scared and feel insecure. There is hope, though. And we need to work on finding solutions to the health care problem that are fair and equitable. Insecurity breeds fear, and fear leads to distrust and anxiety. Americans need to feel secure about their country and their health.

Until next time. Let me know what you think.

Friday, February 15, 2008

Health Care and Your Pearly Whites

Who doesn't want to be the picture of dental health? Evidently, about half of America. About 150 million people are without a dental plan of some kind according to the Association of State and Territorial Dental Directors. They also report that only 69% of adult Americans visited a dentist with the most recent annual survey they conducted. If everyone wants to have gleaming pearly whites, the public will have to do better than that. Dental work can be expensive, but not caring for them can be outrageously pricey if oral health problems develop.

The Academy of General Dentistry wants everyone to see a dentist especially for preventive measures since good dental health promotes overall health and wellness. Studies have been done recently that show the downside of not taking care of your teeth and gums. In addition to halitosis (bad breath) and ugly, discolored teeth, severe dental health issues can increase the cost of health care and create lifestyle problems. Over the recent years there is increasing evidence to support the fact that dental problems like periodontal diseases can cause other serious health implications. Bacteria enter the blood stream and travel to major organs and begin new infections. Poor dental care can definitely lead to severe health issues including heart disease, strokes, and more. Periodontal disease starts as an inflammation of the gums. And if left untreated, it can affect and gradually destroy the tissues surrounding and supporting the teeth.

Here's what the Mayo Clinic says: "Your mouth is normally teeming with bacteria. Usually you can keep these bacteria under control with good oral health care, such as daily brushing and flossing. Saliva is also a key defense against bacteria and viruses. It contains enzymes that destroy bacteria in different ways. But harmful bacteria can sometimes grow out of control and lead to periodontitis, a serious gum infection." What is the lesson? Fix oral health problems when they develop, not when it's too late.

Most Americans get their dental plan as insurance through their employer. But many also have individual dental benefits through a policy they purchase directly from an insurance company, usually from an insurance agent. There are several types of dental insurance including traditional indemnity plans, health maintenance organizations (HMO), and preferred provider organizations (PPO). When these plans are used by the insured, there are typically going to be waiting periods, annual maximums, and exclusions. Most of the time, dental insurance can be expensive, and the policy can be difficult to understand or limited in scope.

There are additional options to help keep your teeth healthy if insurance is not available. Discount plans have become very popular and usually can be purchased for not a lot of money. Discount dental plans are a great alternative to dental insurance. There is no claims process or waiting to use the plan, and members pay the participating dentist at the time of service a reduced fee based on a schedule of services. The patient receives immediate savings, and the dentist is happy to have payment at the time of service. Discounts range from 10% to 60% on most discount plans, and the patient is a member of the plan--not an insured. In many discount plans, the membership includes all residents of the household. Prior to joining one, check out the providers in the area, what discounts are available, refund and cancellation policies, and if the company is registered to do business in your state.

Also, an option that some consider is to visit local dental schools. Dental students provide supervised treatment at reduced rates. However, these locations are not always available for most Americans. Additional low cost options for dental care can be with various state and local health departments which maintain information on locations or groups who provide this for free or nominal fees. Government programs like SCHIP and Medicaid vary by state, and there are income qualifiers for anyone who uses these options. Medicare only covers certain dental procedures related to another medical treatment covered by that plan, such as an accident which caused severe mouth injury.

And if your credit rating is decent, the majority of dentists in the U.S. will work with you on certain financing options for major dental work. One company that many dentists accept is CareCredit--accepted by about 75,000 providers. Some banks, such as Bank of America, are also open to health care lending. But you still need to pay the bill when the statement comes from the finance company. They won't repossess your teeth if you don't pay the bill, but your credit rating will be negatively impacted--not worth the hassle just for a pretty smile.

Paying for dental care can be challenging, especially if the dentist has provided a treatment plan at the initial visit. This information will tell you what the dentist feels may be necessary to correct any problems detected during the oral exam. If you are lucky, you will get off with a bill just for cleaning and X-rays. More critical needs, such as crowns, root canals, fillings or orthodontia may require budgeting to pay for those dental health issues. Remember, the key is to keep your real teeth in your head and in good shape as long as you can. If you are able to afford dental insurance, then use it. If you need more help, find a good supplemental program that will knock the bill down to a more palatable amount. Don't put off dental hygiene until you have a problem. If your teeth start to hurt so bad that you're about ready to pass out from the pain, then maybe you've waited too long.

Until next time. Let me know what you think.

Monday, February 11, 2008

Health Care and Early Retirement

In 2008, there will be almost 3 million Baby Boomers that will be eligible for Social Security benefits according to USA Today. The problem is that Medicare eligibility is still three years away for these Americans. Those workers who wish to retire early or who lose their jobs will have the most difficult and most expensive challenges to find insurance that will bridge the gap from employment to Medicare. It's very unfortunate that health insurance for individuals in their 60's is very costly in the most radical sense. Figuring out how to afford private health insurance for this demographic group is the single biggest concern for many of them. Those aging Boomers who fall into this category and have poor health may find it almost impossible to be covered.

According to AARP, about 16% of people aged 50 to 64 do not have insurance. Some can't afford it, and some can't get it. The article reports that these folks hope that nothing medically happens until they can get Medicare. Millions of retirees this year will be looking for private insurance until Medicare will be available for them. Employers who currently provide health insurance for retirees are cutting back on benefits. Many companies are also requiring that these people pick up a larger share of the cost of coverage. The Kaiser Foundation reported that only a third of large employers even offer retiree health insurance--vastly reduced from the 66% of companies who offered it twenty years ago.

There are some options that will help soften the blow. One approach would be to purchase a High Deductible Health Plan (HDHP) and combine it with a personal Health Savings Account (HSA). The higher the deductible, the lower the premium. Consider that the biggest expense, even for retirees will be primarily for doctor visits, ancillary care, and prescription medications. The primary reason anyone needs health insurance is to cover the cost of catastrophic medical care, such as emergency room visits and hospitalization. Health insurance has been abused by most Americans, and has been turned into an easy way out to handle the sniffles or other minor illnesses. That is one reason insurance has become so expensive. The HSA is a great way to offset those types of expenses that are experienced on a day-to-day basis. And, it's a great savings and investment vehicle even if you only have it for a short time.

A second option would be to make sure that coverage may be available under a spouse's plan that still is employed. The recommendation from AARP, though, is to make sure that family coverage is available, and that the spouse's open enrollment season is not the only period it might be available. Some employer's plans will not permit adding anyone until that time. In that case, a retiree would have to probably wait until the spouse can add relatives on to their plan. So working slightly longer to be able to qualify would be worth consideration. Even though this opportunity is a more expensive, it still will likely be cheaper than individual private insurance.

Another consideration would be to stick with the COBRA plan that the employer has available, even though it would only last up to 18 months after retirement. By law, COBRA plans are guaranteed. According to the legislation, an insurer covering the employer is not legally able to refuse coverage even if a retiree has a severe medical condition. The downside is that COBRA is very expensive and requires that a retiree must pay for the whole premium and costs for administration of the plan. Usually, the former employer picks up about 70% of this cost in most cases. One way to look at COBRA is consider it as group coverage at a group rate.

There is also a possibility that retirees can qualify to purchase health insurance through membership in associations or professional organizations they belong to which offer this type of benefit. Although many of the plans are not too robust, they offer a decent stop gap until age 65 when Medicare can be picked up. And some insurance companies are now offering early retirement policies that will assist retirees as supplemental insurance. One key is to stay healthy during these years in order to afford premiums that are more expensive than those purchased by younger adults. Insurance companies will rate the policy based on medical history and other factors.

Those Americans who opt for early retirement have some major decisions to make, especially for health care. The best way to afford what you need is to make wise choices related to both physical and financial health, but start early. Don't wait til you are clearing out the office desk to figure out what needs to happen next.

Until next time. Let me know what you think.

Friday, February 1, 2008

Health Care and Employee Choice

Americans love the power to choose. Employers who wish to keep good employees long term will work with them to provide benefits that make them happy to work for them. Giving employees options for health care can be a great way for companies to keep good workers and maintain great morale on the job. Every year, lists of the top 10 best places to work are published for everyone to see what companies are the best place to be employed. In 2008, the ranking according to includes the following: 1.) Google, 2). Quicken Loans, 3.) Wegmans Food Markets, 4.) Edward Jones, 5.) Genentech, 6.) Cisco Systems, 7.) Starbucks, 8.) Qualcomm, 9.) Goldman Sachs, and 10.) Methodist Hospital Systems. Fortune surveyed about 100,000 employees at over 400 companies to compile their list of the top companies to work for in America. This is some impressive list.

But apart from unique benefits--such as on site fitness centers, scuba diving classes, on site day care, flex time, and more employee friendly options--workers want to know the most about how their employee health plan works. After the question, "How much does this job pay," every HR professional will hear, "What are the health benefits and insurance?" According to an online article from November, 2007, in the Wall Street Journal, some workers are choosing private health insurance over the employer sponsored version, especially those working at smaller companies. Employees often find it may be cheaper to get children and spouses covered with insurance purchased outside of the plan offered by the business. Employees are picking up a larger amount of expenses than ever before due to cost shifting and higher deductibles.

Also, Americans want to know more about their health plan and how it works. Employees want to be able to make more informed decisions, how their medications work and any potential side effects, what other sources are available to help them make better choices in their health care. The National Business Group on Health released phone survey results in December, 2007, and concluded that more than 70% of those contacted feel patients havae a responsibility to educate themselves about the costs for various treatment options and verify the necessity of those recommendations. Even more felt that their employers should be involved in providing them with health information. When making a decision about health care treatments, 90% of those who were surveyed would consult sources beyond their primary care physicians including the following: friends and family, websites, health plan information, media sources, and other medical materials.

The survey has stated that employers should provide a more proactive way for employees to source health information, and that employers should also reinforce the importance of employee lifestyle changes. Employees can benefit by obtaining health tips and questionnaires from their workplace, get involved in personal health coaching, and become more active in behavioral changes that lead to healthier lifestyles. Employers can help incentivize workers when they participate in these types of options provided by their companies. The conclusion of the report, published on the SHRM website last December, was that employees who choose available preventive health measures wisely can help prevent injuries, illnesses, and other health related disabilities. Employees want and should have a more integrated relationship with medical providers in order to improve and maintain healthy lifestyles. And, there is more than a really good chance the employer may pay for some of these options.

However, according to USA Today, the percentage of workers with employee sponsored insurance is shrinking. As a result, this has raised a debate about whether health insurance should be linked to employment. Also, there is anxiety among many employees who have this type of insurance that those benefits will someday be reduced substantially or altogether disappear--a possibility especially among small companies. Although it is unlikely that health insurance legislation at the federal level will be passed in 2008, there is significant pressure boiling up from the state level that is promoting fundamental changes in insurance. The Kaiser Foundation reported last year that only 60% of all employers are offering health insurance to employees--down 9% in only seven years. And when companies increase the premium costs to workers, this impacts everyone; but especially hard hit are lower income employees who must often choose to opt out of coverage or seek private consumer health insurance to cover family members.

The power of choice can be very strong and have significant impact on individuals, families and society as a whole. Employers who choose to pass costs along to their employees in order to save money for the business will have an impact far beyond the workplace. The trickle down effect makes its way into the market place, the tax base, and the economy. There can be grave consequences to families who may have to consider sacrificing lifestyle choices and preventive medical needs. Insurance companies who choose to increase premiums will eventually reach a point of diminishing returns affecting their own bottom line--shareholders, policyholders, employees, and the economy all take a hit. Workers who continue to ignore the need to make healthy behavioral changes and stay on top of their personal health will increase the costs of health care, decrease their own financial status with medical bills, and contribute to the overall decreased medical health of the community. As the old knight said in the last Indiana Jones movie, "Choose wisely!"

Until next time. Let me know what you think.