Health Care Insurance Reform

On Thursday, September 30th, I was part of a panel of the Houston Hispanic Chamber of Commerce’s Second Annual Health Summit. Given the nationwide debate on health care insurance reform, the Summit was particularly timely.

The Health Summit began with a presentation by David Lopez, President and CEO of the Harris County Hospital District, who discussed his observations on Hispanic health disparities. Then, he, I and Randy Giles, CEO of United Healthcare, spoke for a few minutes and answered questions.

You might wonder why a university president is speaking about health care reform. Actually, I ran a small health center with several clinics. Later, I obtained my doctorate at Stanford in public policy with a focus on health care. These are some of the points I made in my presentation.

In 2007, according to the Journal of Health Affairs, total health care spending in the U.S. was $2.4 trillion or $7,900 per person, without addressing health care costs and extending insurance coverage to the uninsured and under-insured, total health care spending in the U.S. could rise to $8 trillion a year by 2025.

Health care and insurance costs are out-of-control. Medical tests and procedures, pharmaceuticals, lack of competition, malpractice insurance, among others, all affect the cost of health care and all are rising at rates faster than inflation. Health care insurance has simply skyrocketed.

In Texas, in the past nine years, average insurance premiums rose from $6,638 to $12,271 a 91.6% increase! By contrast, during the same period, wages rose only 19.7%. Of all states in the U.S., Texas ranks first in the percent of its population who are uninsured and first in the percent of non-elderly who are uninsured. One-fourth of Texans lack medical insurance. Roughly 60% of all uninsured Texans are Hispanic. That’s 3.4 million Texas Hispanics without health insurance.

The U.S. has more than 46 million people without medical insurance and 25 million people who are under insured. The recession exacerbated the problem as 7 million additional Americans have lost health insurance. Of the more than 3 million bankruptcies filed in the past two years, over half resulted from medical bills.

The U.S. spends nearly $100 billion per year to provide health services to the uninsured, often for preventable diseases or for those that physicians could have treated more efficiently with earlier diagnosis. The human cost is great. Last year a research team at Harvard Medical School estimated that roughly 45,000 Americans die each year as a direct result of lack of coverage.

The huge number of uninsured Americans costs all of us. Hospitals provide about $34 billion worth of uncompensated care each year. Another $37 billion is paid by private and public payers to cover the uninsured. According to the Baylor Health Care System estimates, patients with insurance are charged 150% of actual costs to offset costs for the uninsured. The Center for American Studies estimates that families pay about $1,000 of their annual premiums and individuals pay over $400 per year to cover the cost of providing medical care to uninsured patients.

Without health care insurance reforms those numbers will grow. Let’s hope that this time Congress will pass some form of medical insurance reform. It won’t be perfect, but it will be a starting point. We can’t wait another ten years to begin solving the problem.