Healthcare Must be Affordable

The Detroit Free Press recently reported that thousands of customers of Blue Cross of Michigan received notices that their premiums would increase 22% next year. When healthcare (insurance premiums, co-pays, deductibles, pharmaceuticals, etc.) becomes unaffordable, as housing did in 2006 despite the froth in that market, a crash soon follows.

The Detroit Free Press recently reported that thousands of customers of Blue Cross of Michigan received notices that their premiums would increase 22% next year.  A retiree friend of mine told me yesterday that his premium for a medicare supplement will be going up a similar percentage to over $3300 per year.  Numerous studies have reported that many households not currently experiencing a medical "situation" will consider opting out of health insurance when their total out-of-pocket costs reach 12% of income.  It all boils down to affordability.  The goose only has so many golden eggs.

When healthcare (insurance premiums, co-pays, deductibles, pharmaceuticals, etc.) becomes unaffordable, as housing did in 2006 despite the froth in that market, a crash soon follows.  If it can happen in housing, it can happen in healthcare as well.  When it happens, some people will die prematurely and needlessly.

Overall costs must come down!  That will threaten incomes and revenue streams.  Those interests will not stand by and watch that happen without a fight.  As that fight stretches out into weeks, months, or maybe years, Rand's notion of greed as a virtue will be sternly tested.