Wednesday, October 28, 2009

Why medical insurance is so expensive

My note is to share some facts about why medical insurance is so expensive:

+ Medical treatment costs e.g. MD visits, hospitals, out patient treatment, prescriptions, etc. have been increasing much faster than inflation since 1988!

+ Over 85% of each dollar that goes to pay medical insurance premiums is used to pay for the ever expanding amount of medical treatment people are receiving. A breakdown of how a dollar is spent is shown on this chart.

+ Here in Connecticut one of our health insurance companies has reported over 70% of treatment dollars are connected to conditions resulting from life style choices e.g. smoking.

What is being done in Connecticut's General Assembly or in Washington DC to respond to the things that have caused medical insurance to be so expensive? The answer - not much if anything at all! !

All most all health reform efforts have focused on getting access for more people and other things such as pooling. All the state and federal efforts, if they were to accomplish anything, would just affect costs which are a part of the 15% of the premium dollar that goes for administration.