So American Health Care is Even More Costly than We Thought…

admin March 23rd, 2011

Not-unexpected but useful news item that got buried behind Tokyo’s contaminated water story – apparently Americans aren’t spending 8K a year on health care costs, they are actually spending 10K a year on health care costs.  Is this the time for one of those choruses of “We’re number one!”

These “hidden” costs of health care — like taking time off to care for elderly parents — add up to $363 billion, according to a report from the Deloitte Center for Health Solutions, a research group.

hat amounts to $1,355 per consumer, on top of the $8,000 the government says people spend on doctor fees and hospital care.

“We’re surprised that this number came in so high. It’s significant,” said Paul Keckley, executive director with the group.

The out-of-pocket costs that the government tallies usually include only insurance-related costs like premiums, deductibles, and co-payments.

Keckley said the study is the first to estimate how much consumers dish out on health care related goods and services not covered by private or government insurance.

These include: ambulance services, alternative medicines, nutritional products and vitamins, weight-loss centers and supervisory care of elderly family members.

“These costs can add up to billions of dollars, even eclipsing housing as a household expense,” said Keckley.

The study found that more than half of those costs were the cost of caregiving in lost wages.  This is a number we can only expect to see rise radically.  Many states have already cut aide and home health care support, assisted living kicks you out as soon as your income runs out, disability housing and services for the disabled are among the first convenient targets when budgets get tight, and the state funded nursing homes are both closing and becoming increasingly dire.  Add to that an aging population, and the outcomes are predictable.  The only alternative is for people to do caregiving at home – and at considerable cost in both wages and personal terms.  For those unlucky enough to have no one to take care of them, the outcomes are worse.

This is something I know something about – I worked for many years in elder care and hospices, then cared for Eric’s grandparents in our home, and eventually I will be my oldest son’s caregiver, since he is unlikely to ever live independently.  We are also guardians for our disabled niece whose mother is a generation older than I and who will also probably never live independently.  Giving care is something I expect to be doing for a long time.  I’m very comfortable with that part of my life, but I don’t claim it will be easy or that the costs will be easy to bear.

The hard reality is that a lot of people will have to come out of the workforce in order to do the work of caring for children, the disabled and the elderly.  The good/bad news is that a lot of people are coming out of the workforce, of course, but their obligation is to look for work full time – which pretty much precludes taking care of Grandma, your brother who is a war amputee or any children who need it.

Apparently many economists were surprised by the high cost of caregiving, of transporting the ill too and fro, of all the attempts to find alternatives and to soften side effects that go will illness and disability, aging and ordinary childhood health costs.  Anyone who lives them is not.  The reason these are surprising to some people is that they are “housewifized” out of existance – our society doesn’t recognize the value of caregiving except when it is professionalized and industrialized.  It erases domestic and family support, implies they are valueless and best undertaken in professional settings.  Then, when the money isn’t there or the professional settings are unhealthy, we pretend that this is not “real” work.

The shifting of nearly everyone into the industrial, formal economy resulted in the radical impoverishing of the informal economy – an impoverishment that must be reversed if outcomes are to be better than worst.


12 Responses to “So American Health Care is Even More Costly than We Thought…”

  1. Claire says:

    A good friend of ours had a stroke last week. We and other friends are in the middle of providing extra assistance right now – sitting with him in first the hospital and now in the rehab facility, keeping him from pulling out the tubes or from eating too much at one time, and so forth. I expect this to continue for a period of time. Since those of us who are sitting with him work odd hours or not at all for pay, the extra care we are providing wouldn’t even be counted as a hidden cost. But it will cost us some – in sleep for his partner, in less time for leisure or for other pursuits like cooking or gardening for myself and others. Sickness costs us in a lot of ways, some that can be counted (open or hidden), some that can’t.

  2. MEA says:

    We (not Sharon’s readers, but the collective equivalent of “they”) at Third World Countries where family members go into hospital with the patient to proved the nursing care, but that is exactly what is happening here. In theory, if family and friends don’t stop people pulling out tubes or spoon feed them or get them on and off bedpans, or help turn them to prevent bedsores,the nursing staff will. However, more and more often the staff are stretched so thin that these very basic parts of nursing just don’t get done.

  3. P.J. Grath says:

    Read current New Yorker article about studies showing that early childhood trauma (prolonged stress) can cause seemingly unrelated major illnesses later in life. Chemical changes in the brain are the explanation. Later illnesses in these cases have nothing to do with adult behaviors, and this is a widespread phenomenon, cutting across economic and cultural strata.

  4. Mitty says:

    Hear! Hear! As you say, no one who lives these situations is unfamiliar with the cost. As I have done caregiving for chronically ill family members, I have seen the income from my home-based business go down while my gasoline and associated expenses have gone up. Three additional points: In today’s society, where extended family often lives far away, one or two caregivers frequently pay the cost of their own health as they attempt to do the work of several people. Second, the “supplements” and “alternative treatments” that the government doesn’t count are frequently prescribed by doctors, altho’ not reimbursed by insurance. I stopped my most expensive “supplement” for a time to try to save money and found my health negatively affected. Third, as programs are eliminated and remaining services see staff cuts, an enormous amount of time is expended in looking for options (or for any service at all) and in advocating for the patient’s needs.

  5. Richie says:

    The cost of heath care is out of control. I have been paying in for years and have not even used it but the cost for insurance continues to rise every year.

  6. Chris in MT says:

    Whilst I have the utmost respect for the front line staff, health services in the US are a cruel joke. The worst bandits, by far, are the insurance companies.

    My temp job was recently made permanent, and my employer now spends $700 paying my monthly health insurance premium. I’ll NEVER use it because the deductibles and co-pays are beyond my ability to pay. A much more useful benefit to me now is paid vacation and sick days, which are worth $100 in my pocket each time.

    Like probably 100 million Americans, I hope each day that I don’t become seriously ill. It’s a crap shoot, and the (insurance) house always wins in the end but, like the unpaid caregivers mentioned in the article, we keep soldiering on until we drop down.

  7. EngineerChic says:

    I’m not sure I understand the purpose of the study. They are surprised that it costs time (and therefore money) to take care of sick relatives? And they see this as an indictment of our healthcare system? I don’t agree with that.

    Why do we have to put a dollar figure on everything? This reminds me of the studies that say a stay at home mom would earn $120k for equivalent work in the private sector. Those studies never made sense to me, either. Yes – people earn money cooking meals, shopping, cleaning, and running errands. But aren’t there some things we are just supposed to do as a result of being here and alive? Not to put too fine a point on it, but each of us is responsible for wiping our own behinds – although in theory you could say that since nursing assistants get paid for doing the same thing then there must be some value to it. Personally, I don’t understand our fascination with assigning “equivalent income” to every task.

    But back to this study … My father was sick for the last 4 months of his life and I spent at least $5k on flights, hotel rooms, and rental cars to take care of him & his house in another state. I didn’t think, “Geez, our healthcare system is really broken if I have to do this.” If anything I was grateful to have the chance to do it. How many people don’t get the chance to say goodbye (albeit indirectly) or express that much love & appreciation for people before they are gone from our lives?

    Maybe I’m missing the point – but did we need a study to say, “It is hard to see people you love become ill and it’s hard to take care of them. It will reduce your free time and discretionary income.” And why do we care so much if “society” recognizes the value of anything we do?

  8. Christina says:

    @EngineerChic: I think the point is that our value system is broken – the many other broken systems (economic, healthcare, education) are just symptoms of this underlying disease. I completely agree with your assessment, and I think Sharon states the same in her description of caregiving in her own past/present/future – many of us do these things because they are the right thing to do. Nevertheless, how many people lose their jobs because they take time to care for a sick or dying loved one? How many people lose their own good health because they provide that care while simultaneously holding down their full-time-or-more job and other responsibilities?

    We no longer live in a culture that supports and values caregiving as an important contribution – primarily because it does not “produce” in the capitalist sense of that term. Good, hard work that maintains our humanity has no value (even when it IS done money – see salary charts for nurse’s aides, teachers, childcare providers, etc.). These studies that calculate the estimated GDP value of occupations like householding, caregiving, etc. are merely trying to demonstrate value in the only way most people understand value to be measured any more. “Show me the money.”

  9. Rick says:

    @EngineerChic: totally agree with you. Another attempt to build-up the dollars figure to validate the study. Yes, are there not some things associated with living and dying that we just do ? To say that is a failure of the overal health system is bogus. We could solve many of the issues with “health care” with a good dose of common sense and personal responsibility. People need to start living, eating, and exercising “better” to improve the quality of their lives. Until this happens and we stop running to the “system” for help and expecting someone else to foot the bill the situation really can not get better.

  10. admin says:

    I think Christina has it – the recognition that caregiving is a valuable part of society, worthy of social support has existed in various societies, including variations on our own in the past, and needs to again. Without that, people lose their jobs when their kids or parents or loved ones get sick. They lose their health trying to keep up with their jobs and care for others. That doesn’t have to happen – you can have social and legal support, as well as cultural valuation of this work.

    Consider, for example, welfare, which obviously a lot of people don’t support, but which emerged from a basic assumption that mothers of young children should be able to raise their children – that this was societally valuable work, and worth supporting economically. Whatever else you think about welfare, that was the underlying message – that the best way to protect children in poverty was to provide social supports to their mothers doing the critical job of caregiving. Later, as women moved into the workforce, and caregiving became professionalized, while the income assumptions came to imply that two incomes were necessary, women resented that poorer women got to do what they didn’t – stay home and caregive, and we undercut that assumption. Now instead of welfare we got “workfare” and short term childcare and training assistance, rather than the ability to stay home – and sometimes not even that, since we don’t like poor single mothers much as a society. We shifted from a home based valuation of caregiving to a professionalized one.

    This is not an argument for welfare, but it is evidence that once upon a time in this society, and certainly in other societies, we have valued caregiving as meaningful work and arranged societal supports for it. What we have shifted to is a society that doesn’t support home-caregiving, but has supported professionalized caregiving – ie, the state will pay for a nursing home, but not a subsidy to let a daughter quit her job to care for her parents. But those state supports are also being cut – so now we have the situation where the former welfare mother has to work long hours – *and* there’s no subsidized daycare, where the daughter can’t get her mother into the state sponsored nursing home, but also can’t get the time off or the subsidy paid for respite and home health care. It is the worst of all possible worlds.


  11. Anisa says:

    Agreed Sharon and Christina – The point of this is not to complain about what we are not getting from our government, but more to recognize that there is a real financial toll to caring for family, as well as the gaping hole that is swallowing up families that can’t afford to pay that price.
    Ideally, we’d all be able to afford the care we need, weather in the form of paying a professional or taking the time to do it ourselves. But many many families are faced with terrible choices today. I worked with a single mother once who never took a day off of work, even when she was very ill, because she needed to save her paid days off and limited health care dollars for the chance her teenage son might get sick. How awful to have to chose between your own health and the health of someone you love.
    My mother is constantly taking time off of work to care for my grandfather. Her employer has very good benefits and she can earn more time off as she works, but it used to cost her $500 a day when she would take a day off. Now he lives closer, and though the cost is still significant, it is much less. Yet now she has the emotional toll of her father’s complaints about leaving the home he lived in before (but can no longer manage alone).
    I would love to help my mother in this, as he now lives quite close to me. But I have two children, with another on the way, and just my husband’s income. We live on a very tight budget and to be honest, just the extra gas to get him and take him to an appointment can put a strain on my family. I can’t chose to help my mom and grandfather and then not be able to feed my kids.
    The insurance companies and their being in bed with our government has left us all in a very tight pickle. Some people are very fortunate to not have felt the squeeze of it – yet. And generations of voters were lied to about “socialism” making it even harder to get any changes made, and those lobbyists and insurers are very happy in the mean time – they aren’t paying any of those hidden costs, we are.

  12. stephanie says:

    The value system is broken. My mom was in the hospital for months two states away from home and my father’s work gave him an incredibly hard time about shifting his schedule to four days so he could drive the 11+ hour round trip to see his wife in the ICU for more than one day a week. Luckily I was in school nearby and was able to drop to part time (if I withdrew, I would lose my financial aid entirely and be unable to graduate) so I was hanging out twice a week when visitors were allowed. Dad was using paid vacation time to see her and saving FMLA time (unpaid) for when she came home and would need after transplant care. Later, when it was clear that she was too sick and we brought her home he took the FMLA time until she died. The only reason he could afford to do that is because he burned through all his accrued paid time while she was in Boston.
    Fortunately he hadn’t taken vacation or used sick time for a few years and it hadn’t expired yet.
    If he didn’t have paid time to use first or worked for an employer with less than 50 employees (no FMLA) I don’t know how on earth we would have coped.

Leave a Reply