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Originally Posted by Villages PL
You mean regarding health care costs to the employer? I don't see that as a big problem.
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No, health care costs in general. Old age and the age related problems it brings is by far the largest contributor to health care costs. Too many self righteous people want to point a finger and talk about certain groups and say they are the problem. Overweight people and smokers are such an easy and popular target to bash while wearing a crown of self righteousness. I don't know even one smoker or overweight person that is happy they have this addiction or problem just as a lot of other people are not happy they have many other problems.
What is driving health care spending?
While there is broad agreement that the rise in costs must be controlled, there is disagreement over the driving factors. Some of the major factors that have been discussed in cost growth are:
Technology and prescription drugs– For several years, spending on prescription drugs and new medical technologies has been cited as a primary contributor to the increase in overall health spending; however, in recent years, the rate of spending on prescription drugs has decelerated.[1] Nonetheless, some analysts state that the availability of more expensive, state-of-the-art medical technologies and drugs fuels health care spending for development costs and because they generate demand for more intense, costly services even if they are not necessarily cost-effective. [6]
Rise in chronic diseases – Longer life spans and greater prevalence of chronic illnesses has placed tremendous demands on the health care system. It is estimated that health care costs for chronic disease treatment account for over 75% of national health expenditures. The changing nature of illness has sparked a renewed interest in the possible role for prevention to help control costs.
Administrative costs – At least 7% of health care expenditures are estimated to go toward for the administrative costs of government health care programs and the net cost of private insurance (e.g. administrative costs, reserves, taxes, profits/losses).[1] Some argue that the mixed public-private system creates overhead costs and large profits that are fueling health care spending.[8]
From Health Services Research:
Principal Findings
Per capita lifetime expenditure is $316,600, a third higher for females ($361,200) than males ($268,700). Two-fifths of this difference owes to women's longer life expectancy. Nearly one-third of lifetime expenditures is incurred during middle age, and nearly half during the senior years. For survivors to age 85, more than one-third of their lifetime expenditures will accrue in their remaining years.
Conclusions
Given the essential demographic phenomenon of our time, the rapid aging of the population, our findings lend increased urgency to understanding and addressing the interaction between aging and health care spending.
The distribution of health care costs is strongly age dependent, a phenomenon that takes on increasing relevance as the baby boom generation ages. After the first year of life, health care costs are lowest for children, rise slowly throughout adult life, and increase exponentially after age 50 (Meerding et al. 1998). Bradford and Max (1996) determined that annual costs for the elderly are approximately four to five times those of people in their early teens. Personal health expenditure also rises sharply with age within the Medicare population. The oldest group (85+) consumes three times as much health care per person as those 65–74, and twice as much as those 75–84 (Fuchs 1998). Nursing home and short-stay hospital use also increases with age, especially for older adults (Liang et al. 1996).