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HSFPP Weekly Update #123—Health Care Insurance Revisited

 Message from Bob & Chris: Health care coverage is not something most young adults think about when selecting a job. Last week’s update looked at how medical bills cause nearly half of all bankruptcies. Health care coverage is becoming one of the most important fringe benefits that companies can offer.

What isn’t being discussed often enough is the impact of rising health care premiums on job creation. Most new jobs are created by small companies, which increasingly cannot afford to offer their employees health care insurance. Right now, only 63% of small businesses offer health insurance, down from 71% in 1999.

 It is interesting that Congress and the President all returned to Washington to protect the life ofTerri Schiavo, who had a heart attack and suffered brain damage in 1990 and has been in the same condition ever since. They enacted legislation to protect one person. But, without adequate health care insurance, more people could end up like Ms. Schiavo or could even die because they are not able to pay for preventive medical services and needed medication. Many people must wait until their condition becomes an emergency and then go to the emergency room, rather than receiving preventive care.

The next update will be sent out April 4 th, when you return from spring break. Have a restful vacation, if you can; I have a feeling many of you will be completing your taxes. Don’t forget that it’s not too late for you to contribute to your IRA for 2004.You have until April 15, 2005, when taxes are due.

 

 LOOKING FOR A GRADUATE CLASS CLOSE TO HOME THIS SUMMER?
Trying to update your knowledge of financial management? Looking for the research on the most current financial issues and the resources to improve your teaching of personal finance? Do you want to take a course in which the student helps set the content to be taught? Look no further!

 Summer Class
June 9 – August 4, 2005
Financial Education Resources & Research

If my advertising pitch above has raised your alarm bells, don’t worry. I understand very well how unscrupulous businesses promise more than they can deliver, and it’s part of my job to alert people to the dangers they pose. Those of you who decide to take this course, however, will have the opportunity to tell me beforehand what you would like to know so I can design the course to meet your needs. Students who have taken this course the past two summers have found it very helpful, both personally and professionally. The knowledge you gain from the course helps both you and your students or 4-H’ers. Based on the input of students from previous years, this course will truly be new and improved!

Look in the University of Kentucky course schedule for the 2005 Summer Sessions (pg. 76). In the Second Summer Session, June 9 – August 4, I will again teach FAM 759 – Special Advanced Topics in Family Studies: Financial Education for Teachers. The course will take place Tuesdays and Thursdays, 5:00 – 7:30 pm, Eastern Daylight Time, via interactive video (live), at the following sites around the state: Ashland Community College; Northern Kentucky University; Owensboro Community College; Paducah Community College; Somerset Center for Rural Development; Franklin County (site to be specified later); and on the UK campus. For more information on this course, or to recommend other possible sites, call me here at UK to see if we can arrange a downlink closer to you. My phone number here is 859-257-7758.

 

Related Updates:

Update #122 - New Bankruptcy Laws - 21 March 2005
Update #103 - Health Care and the Upcoming Election - 24 October 2004
Update #91 - Uninsured Young Adults - 19 April 2004
Update #49 - Uninsured Rising - 20 February 2003
Update #28 - Healthcare Benefits - 9 September 2002
Update #27 - Disability Insurance - 3 September 2002

 

Website Pick of the Week:

http://www.msnbc.com/modules/quizzes/lifex.asp

This site provides a questionnaire that can estimate about how long you are likely to live. In order to complete the questionnaire, students will need to know information such as their cholesterol level. Because it involves private information, it might be best for you to present the Web site as an option for those who want to complete the questionnaire on their own. It is worth emphasizing here that lifestyle choices can greatly affect a person’s health and well-being, in financial terms as well as how they feel.

 

In the New$... Hospitals Price Gouging Uninsured?

“For Ed and Dianne Jellison, it was the perfect storm of bad luck. They had just dropped their health insurance to look for a cheaper plan, when one morning, Dianne Jellison found Ed unconscious.

“‘He was blue,’ she says. ‘He didn't respond to me at all, and so I just immediately called 911.’

”Ed Jellison was rushed to Florida Hospital, where for 18 days he was treated for a brain infection that destroyed his short-term memory.

“‘He had to learn to read all over again,’ she says. ‘It was like he had never had known how.’

“And then, as CBS News Correspondent Wyatt Andrews reports, the $116,000 bill arrived.

“Diane Jellison characterizes it as ‘price gouging.’

“As she studied the bill, she discovered an open secret: Uninsured patients routinely face hospital bills three or four times higher than patients with insurance.

“Take Jellision's [sic] $116,000 bill. An insurance company would have paid just $65,000 to $80,000. Medicare would only have paid $12,000 for the same care.

“‘ Florida Hospital appears to be worse than a used car salesman,’ says K.B. Forbes, an activist for the uninsured.

“‘These guys are giving the uninsured markups of 400 to 500 percent,’ says Forbes.

“He says it's like this everywhere.

“Hospitals claim there is only one sticker price for a given service, but, Medicare then gets a big discount. Insurance companies and HMOs also negotiate a discount. At the end it really is only patients without insurance who are ever asked to pay full fare.

“The reason, Florida Hospital's Rich Morrison says, is that the hospital is stuck in a bizarre and broken system. He admits that the sticker prices at hospitals have to be inflated to balance out all those discounts.

“‘Hospitals are forced to come up with some pricing structure that would try to account for this mishmash of how we are being paid,’ says Morrison.

“ Florida Hospital says it helps the uninsured, giving away tens of millions worth of free care and operating a clinic for the uninsured. That means most of the people stuck with full sticker price are uninsured patients with assets - patients like the Jellisons.

“‘We simply asked for a reasonable price,’ says Ed Jellison. ‘They just did it their way to try to stick you with it.’

“The hospital has tried to settle with the Jellisons but at prices they have rejected. They admit they owe money but have gone to court, arguing that a system that produces a bill like theirs should be sent to intensive care.

“They're not alone. A class-action lawsuit has been filed against a West Virginia hospital by patients without medical insurance. It's one of dozens filed by uninsured patients in the past year against hospitals in 26 states, all charging that uninsured patients were being charged more.”

 Source: CBS Evening News, Feb. 16, 2005.
http://www.cbsnews.com/stories/2005/02/16/eveningnews/main674598.shtml

 

Discussion Questions:

1. What is the effect on small businesses as more and more of them drop health care coverage for their employees? Currently only 63% offer health care coverage. Does this help or hurt their business? Yes ___ No ___ Explain why.
   
   
2. How is the economy being affected as so many small businesses drop health care coverage for their employees? Explain.
   
   
3. Is it fair to people to expect them to pay much more than they can afford for the health care they need? Should people who can’t afford the care they need be expected to do without? Yes ___ No ___ Explain why.
   
   
4. Do we need to revamp our current health care system? Why or why not? And if yes, what changes need to be made?

 

Kentucky High School Financial Planning Program

http://www.ca.uky.edu/fcs/hsfp

The purpose of this Web site is to assist county extension agents, credit union educators, and high school teachers in improving the economic well-being of our constituency, beginning with today’s students; and also, to assist teachers in Kentucky in meeting KERA’s goal that all students become technologically literate. Weekly Updates are provided by the University of Kentucky Cooperative Extension Service, and are free to all educators.