Health care Archives - Inflation Watch

The costs of raising children in the U.S. continue to climb

Dr. Duru — Sun, 17 Jun 2012 14:53:25 +0000

On June 14th, the United States Department of Agriculture (USDA) released its 2011 cost estimates for raising children in the U.S. (see “A Child Born in 2011 Will Cost $234,900 to Raise According to USDA Report“). According to this report, the average cost of raising a child in the U.S. rose 3.5% from 2010 and rose 22.5% from 1960 (in 2011 dollars), the first year these data were collected. (Note the USDA cautions that its methodology has changed over the years so comparisons between now and 1960 are not “precisely comparable). The share of expenditures has changed dramatically in certain categories like child care and education, food, and health care. The following chart is from the end of the publication (click image for a larger view), and it demonstrates the big differences in how children are raised now versus 50 years ago:

Expenditures on a child from birth through age 17, total expenses and budgetary component shares, 1960 versus 2011

The amount families spend on children varies greatly based on household income, so these averages hide even more interesting stories. For example:

“A family earning less than $59,410 per year can expect to spend a total of $169,080 (in 2011 dollars) on a child from birth through high school. Similarly, middle-income parents with an income between $59,410 and $102,870 can expect to spend $234,900; and a family earning more than $102,870 can expect to spend $389,670.”

It is clear from the report that the costs increase according to income because of choices families make. Thus, it is not quite accurate to say child-rearing gets more expensive with income. Instead, families tend to choose to spend more on their children the more income at their disposal.

Read/download the full report here.

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Massachusetts rejects requests for increasing health insurance premiums

Dr. Duru — Sun, 04 Apr 2010 12:58:52 +0000

The Massachusetts Division of Insurance recently rejected 235 of 274 requested increases on health care insurance premiums for small businesses. While most of the requests were for 8-32% price hikes, Blue Cross Blue Shield of Massachusetts caught a lot of attention with a 46% price hike. The Eagle-Tribune describes some of the political implications and discusses the impact healthcare costs have had on small businesses in the state of Massachusetts in “Local businessman helps block insurance hike: His protests were heard, as state halts health cost jump.”

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Anthem Blue Cross raises premiums by as much as 39 percent

writejesse — Sun, 07 Feb 2010 10:39:42 +0000

We’re accustomed to seeing stories about rising health insurance rates, but this is really something else:

Anthem Blue Cross customers got a shock this week when the health insurer informed thousands of individual policyholders that their premium rates will jump as much as 39 percent on March 1.

The company, based in Woodland Hills (Los Angles County), declined to say how many customers received the increase or what the average premium hike was, but the insurer has the largest number of individual customers in the state. Last year, when Anthem Blue Cross raised rates by as much as 68 percent for some customers, the company said it had about 800,000 members.

“There aren’t any other parts of our society where people have no regard for inflation rate and increase their prices this much. I can’t imagine anything in the world that’s going up 39 percent,” said Josh Libresco, 54, of San Rafael, as he grappled with the news that his family premium will go from $858 per month to $1,192 – and that’s with a $5,000 deductible.

This comes on top of a 68 percent increase in premiums last year for some customers. (Hey, good news! Premiums are decelerating!)

Nearly three million Californians buy health insurance through the individual market.

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Great news for deflationists: health care costs continue to skyrocket

writejesse — Wed, 30 Dec 2009 14:05:33 +0000

This story will come as a surprise to no one except maybe the increasingly small handful of pundits who lie awake at night worrying about the perils of deflation:

Last month was open-enrollment season, and my wife and I got an unpleasant surprise. For 2010 we’re looking at an annual health-insurance premium that’s $1,600 higher than it is now, plus higher deductibles. Instead of flat co-pays, we’ll pay co-insurance, a share of the total costs. And this is with a plan provided by a Fortune 500 company that still spends big bucks on relatively generous benefits.

You may well be in the same boat. According to human-resources consultant Hewitt Associates, the average large-company employee will pay $4,023 in premiums and out-of-pocket costs next year — 10% more than in 2009 and more than three times the level in 2001.

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Medicare supplemental health insurance premiums are rising in Rhode Island

writejesse — Sat, 28 Nov 2009 10:53:08 +0000

The Warwick Beacon reports on rising Medicare Supplemental premiums in Rhode Island: “Even though they’ll get no cost of living increase in their Social Security, senior citizens who buy supplemental health insurance for Medicare will be paying, on average, 4 percent more next year for premiums.”

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Health insurance premiums still rising fast

writejesse — Sun, 22 Nov 2009 23:56:39 +0000

While Congress debates health care reform on Capitol Hill, employers throughout the country are bracing for double-digit or high-single-digit health insurance premium increases.

Colorado employers who responded to Mercer’s National Survey of Employer-Sponsored Health Plans said that if they made no changes to their current plans, their premiums would rise by 9.3 percent. They expect to lower the premium increase to 6.8 percent by making their plans less generous or by switching health insurers.

CantonRep.com reports that health insurance premiums in Stark County, Ohio, are soaring. One local engineering firm says its premiums will rise 25 percent:

The health insurer for Hammontree & Associates told the engineering firm in Green last month that it was raising premiums for 2010 by 40 percent.

The reason: Three or four of the firm’s 45 staffers had filed costly health care claims in the last two years.

Facing an extraordinary strain on its budget, the company negotiated the premium down to a more palatable increase of 25 percent. But under the plan, its employees’ deductibles will more than double — from $1,250 to $2,400 for families, for example.

About 240 miles northeast of Canton, the Buffalo News reports that western New York health insurance companies will be raising health insurance premiums substantially in the coming months:

Buffalo-based HealthNow is forecasting an average rate increase of 10.2 percent across its entire commercial book of business for 2010, before plan changes by employer groups.

Univera, which is owned by Excellus BlueCross BlueShield of Rochester, is projecting an average increase of 6.9 percent, but that’s after groups change plan features to lower their costs.

Independent Health Association, which released rates several weeks ago, said then that its premiums would rise 10.5 percent, before plan changes.

The story is the same pretty much everywhere–from Pennsylvania to Arizona to Massachusetts to Florida to Wisconsin to New Jersey to Virginia.

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High Drug Prices Attract Congressional Attention

Dr. Duru — Thu, 19 Nov 2009 13:57:26 +0000

It appears the proposed health care reform bills encouraging drug companies to increase prices ahead of passage. The New York Times reports in “Rising Prices of Drugs Lead to Call for Inquiry” that the following Congressmen have written a letters to the General Accounting Office (GAO) asking for a review: Charles B. Rangel of New York, chairman of the Ways and Means Committee; Henry A. Waxman of California, chairman of the Energy and Commerce Committee; and Pete Stark of California, and John Lewis of Georgia, chairmen of two Ways and Means subcommittees.

Senator Bill Nelson of Florida has also written to the inspector general of the Department of Health and Human Services seeking an investigation.

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Quote of the day

writejesse — Wed, 18 Nov 2009 23:28:53 +0000

“In discussions with dozens of health-care leaders and economists, I find near unanimity of opinion that, whatever its shape, the final legislation that will emerge from Congress will markedly accelerate national health-care spending rather than restrain it.”

—Jeffrey S. Flier, Dean of Harvard Medical School

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Massachusetts health insurance premiums rising fast

writejesse — Tue, 17 Nov 2009 10:58:26 +0000

In the state that serves as a model for Obamacare, officials are frustrated by a 9 to 15 percent increase in health insurance premiums:

State officials are so frustrated by the rising cost of health insurance they are getting ready to flex some legislative muscle and intervene on behalf of strapped consumers.

Barbara Anthony, the state’s undersecretary for consumer affairs and business regulation, said a recent review of health insurance premiums in Massachusetts shows a 9 percent to 15 percent increase from spring 2008 to spring 2009.

“That kind of increase, in the middle of these economic times, when we are trying to stimulate the economy and keep people employed, is not satisfactory to the governor,” Anthony said.

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NYT: Prescription Drug Prices up 9 percent in Past Year

writejesse — Mon, 16 Nov 2009 12:28:04 +0000

NYTimes:

Even as drug makers promise to support Washington’s health care overhaul by shaving $8 billion a year off the nation’s drug costs after the legislation takes effect, the industry has been raising its prices at the fastest rate in years. In the last year, the industry has raised the wholesale prices of brand-name prescription drugs by about 9 percent, according to industry analysts.

Medicare beneficiaries may have to shop for a better deal on a prescription-drug plan.

The average premium seniors pay for stand-alone drug plans will rise 11% to $38.94 a month in 2010, according to the Kaiser Family Foundation, a nonprofit that focuses on health-care issues. About 1.2 million Medicare beneficiaries would pay at least $10 more in monthly premiums if they remain in their current plan.

Changes are even greater for seniors receiving drug coverage as part of Medicare Advantage, private health plans subsidized by the federal government and offered through private insurers. The average monthly premium for those beneficiaries will rise by an average of 32%, to $48 a month, if they stay in their current plan, according to the Kaiser Family Foundation.

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