The biggest issue for health care today is that there's limited transparency into the cost or quality of care. If we know that an insurance premium — whether it's for auto, home or health — is built primarily off the cost of claims, then it seems obvious that the objective is to reduce the amount of fender-benders, basement water damage and costly medical treatments.
The Healthcare Cost Institute outlined that health-care spending is up. Way up. That's because prices are up for treatments, doctor visits and prescription drugs, while usage has remained flat or going down in many instances. If you look across the world in terms of industrialized countries, the United States has the highest prices for health care by far, and not nearly the best quality. So we have a problem, and it's crushing consumers.
That problem is driven by a complete lack of transparency, particularly on the price side. So it's imperative to talk about prices.
Over the past nine years, employee out-of-pocket spending for a family of four increased 69 percent in the form of higher co-pays and higher deductibles, along with 105 percent employee premium contribution growth. Over the same period, employer premium contributions increased 62 percent.
In 2008 more than 8 percent of a family's income was spent on health care. In 2015 (last available data) it rose to 12 percent. This means people are making less money today as a direct result of the cost of health care.