The cost for employer-provided health insurance for a family climbed 7.7% in 2005, to $11,500. That means employees are forgoing up to $1,000 a month in pre-tax income to cover what in for most people is less than $1,000 worth of care. Since health insurance and wages are two parts of total compensation, it would make sense that a rapid increase in health benefits would lead to slower growth in wages, but not to the Kaiser Family Foundation for expanding socialized medicine.
A piece of good news is that high-deductible health plans, a key consumer-driven element in slowing the growth of health care costs, now make up 4% of employer-provided plans.
A comment at Greg Mankiw’s blog makes some good points on these rising costs, namely that because the goal of medicine is to do no harm but the ultimate harm is death, but we all die, so we can never spend enough on health care — and with third-party payment for medical costs, most of us don’t have to worry about it.
Another comment points to this Slate article about the problems with most health studies — the 50% higher or 33% lower risk reported in studies are in comparison to low percentages, so someone with high cholesterol who took “Pravachol every day for five years reduced the incidence of heart attacks from 7.5 percent to 5.3 percent. This indeed means that there were 31 percent fewer heart attacks in patients taking the drug. But it also means that the ‘absolute risk’ of a heart attack for any given person dropped by only 2.2 percentage points* (from 7.5 percent to 5.3 percent).”
