Hospital Expenses May Cause Health Care ‘Crisis’, Rovner Writes

As Congress "correctly" deals with the "immediate security threat" related to the Sept. 11 attacks on the World Trade Center and the Pentagon, a "potentially serious health care crisis is quietly taking shape" -- "spiraling" health care costs, CongressDaily/AM reporter Julie Rovner writes a 'HealthMatters' op-ed. Prescription drug costs have been at the forefront of health care inflation for the past several years, but according to a Center for Studying Health System Change report, hospital costs -- "thought" to be "eas[y]" for managed care companies to handle -- "outstripped" spending on pharmaceuticals last year. This is "even more ominous" news, Rovner says. Rising costs of care and increasing health plan premiums are "link[ed]" directly to a consumer trend toward "less ... regulated" health plans, and specifically, a shift to PPOs, Rovner says. With more patients in PPOs, hospitals have had more "leverage ... to demand" higher reimbursements from insurers, Rovner writes. Health cost increases "threaten" the ability of employers to provide health care coverage and workers to afford the premiums. Although employers had "absorbed" those costs when the economy was "booming," a Kaiser Family Foundation/American Hospital Association Research and Education Trust survey found that 44% of surveyed companies plan to increase their workers share of health costs next year.

Not a 'Silver Lining'
Although some people might see the recent Census Bureau figures showing a drop in the number of uninsured as a "silver lining" to the increasing health costs situation, Rovner writes that "what appears to be a large decrease" in the number of uninsured actually is "much smaller." The bureau figures show that the number of uninsured dropped from 42.6 million in 1999 to 38.7 million in 2000. The drop is because the bureau has changed the way it collects data, Rovner writes. Surveyors recently asked participants if they had private insurance, Medicaid, Medicare or military health benefits, marking them down as uninsured if they answered negatively. In 1999, surveyors began asking, "It sounds like you had no insurance last year -- is that true?" after they asked the first question. Thus, Rovner writes, if the verification question is taken into account, the 1999 uninsured figure is actually 39.3 million, "meaning [that] only about 600,000 more people had insurance in 2000 than in 1999" (Rovner, CongressDaily/AM, 10/11).