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Jewish World Review Nov. 26, 2007 16 Kislev 5768 Choices on health often ill-advised By Gail Marks Jarvis
http://www.JewishWorldReview.com | (MCT) Around the dinner table Thursday millions of Americans undoubtedly uttered thanks for good health. Health often ranks close to the top of the list for giving thanks, for obvious reasons. But this year, health might have made it onto the list for financial - as well as physical - reasons. With health care costs surging at a rate far in excess of inflation and income, many Americans who receive health insurance at work say they are dipping deeper into their paychecks to pay for the insurance, doctor visits and prescriptions. And the expenses are becoming so difficult to bear that some are making major changes in the family budget, according to recent research by the Employee Benefit Research Institute, a nonpartisan think tank, and Mathew Greenwald & Associates, a research firm. In fact, many people who were interviewed for the survey said higher health care costs are such a burden that they are cutting out doctor visits, struggling to pay bills for other household expenses, reducing their saving for retirement and skipping some prescription drugs. This is the 10th year for the study, and Mathew Greenwald research director Ruth Helman said she was surprised at what people are doing to try to cope with rising costs. In 2007 half the respondents said they were delaying going to the doctor. In 2005, 40 percent were postponing care. And this year 64 percent said they were going to the doctor only for more serious symptoms and conditions. In 2005 only 54 percent were waiting for serious matters. "It suggests that people might be going too far, but we don't know," Helman said. "If they delay going to a doctor for a sinus infection they might get better. But if you find a lump you don't want to wait." About 28 percent said they were not getting prescriptions, or were cutting back on doses. The cost of health care has been rising sharply in recent years. According to the Kaiser Family Foundation, premiums for employee-sponsored health insurance rose an average of 6.1 percent in 2007. That's less than the 7.7 percent increase in 2006 but still substantially more than workers' wages, which climbed 3.7 percent on average. About 63 percent of adults under age 65 receive health insurance through an employer, according to Kaiser. And the average premium for family coverage is $12,106, with workers paying $3,281. Families are paying about $1,500 more out of pocket than six years ago, Kaiser found. Besides larger premiums, workers are bearing higher out-of-pocket charges for doctor visits, tests, hospitals and prescriptions, and 21 percent of employers say they would like to raise the amount employees pay in 2008. Meanwhile, the recent survey by the Employee Benefit Research Institute shows that the situation is having a major effect on some households. About 36 percent of respondents said higher health costs are making it difficult to handle bills for non-health expenses, and 29 percent said they were having difficulty paying for basic necessities. Many were coping by cutting back on saving. Thirty percent said they had reduced contributions to retirement savings plans and 52 percent were saving less in general. About two-thirds of people said they were talking to their doctors more carefully about treatment options and costs - a change that insurance companies, employers and some policymakers have said is necessary to reduce costs. Paul Fronstin, fellow of the Employee Benefit Research Institute, said that while it's good that people are asking questions, "They are flying blind. They may or may not be making the right decisions." Not only might people be sacrificing necessary health care but they are also dealing with rising costs by shortchanging their futures. "We already know that people don't save enough for retirement," Fronstin said. "They don't max out their contributions; they leave 401(k) matching money on the table. Now they are going to be less prepared for their future." Still, they are sure about one thing: They value insurance from their employer, despite the cost. When asked whether they would prefer $7,500 in health insurance from their employer or an additional $7,500 in pay instead, 76 percent chose the insurance. They aren't confident they could find affordable insurance on their own. If they did go off on their own, nearly half said they would need $10,000 or more in extra pay; 15 percent said no amount would be enough. Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Gail Marks Jarvis is a personal finance columnist for the Chicago Tribune and author of "Saving for Retirement without Living Like a Pauper or Winning the Lottery." Comment by clicking here.
11/13/07: Gradual retirement may not be key to happiness
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Arnold Ahlert | |||||||||||
