TW: The charts and Jim Kwak make a point about which we have been pounding the table: the status quo in private insurance is deteriorating. A key rationing mechanism in American health care is to push working class and middle class folks out of private insurance. The push results from escalating premiums and declining employer coverage options. Poor folks and the elderly are covered with Medicaid and Medicare, those either too young or not poor enough end up with less or no coverage.From Jim Kwak at Baseline Scenario:
"...The long-term trend is absolutely clear: employer-based coverage is declining and public coverage is increasing, but not enough to make up the gap. Looking at the underlying data, we can see that 2008 was the eighth consecutive year in which the proportion of people covered by employer-based health insurance declined.
...Not only is employer-based coverage deteriorating, but the reasons for that deterioration imply that it is likely to only accelerate. As health care costs continue to increase, even if the rate of increase stays the same, the rate of deterioration will increase, because each year health care costs become a larger proportion of total costs and therefore harder to absorb. (Put another way, if health care cost inflation remains around 7% per year, each year it will be 7% of a larger proportion of employers’ costs.) Deterioration will take three forms – some employers will drop health coverage altogether, some will increase the share paid by employees, and some will shift toward less-generous plans.
...because the employer-based system is slowly dying, people with employer-based coverage should not be thinking, “I don’t need health care reform, I’ve got my employer-based plan;” they should be thinking, “I’m afraid of what will happen when my employer drops its plan, so I need health care reform...”
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