Pre-Existing Conditions...Pre-Obamacare. Remember Them?

I am so f***ing tired of politicians claiming that Obamacare is an obvious disaster and failure without explaining why they think so.  It's true that it's not perfect.  Insurance rates and deductibles are rising.  Networks of available doctors are shrinking.  But how would you feel if you had type 2 diabetes and couldn't get coverage at all!

Doesn't anyone remember what it was like to have insurance companies tell you that your pre-existing conditions were being excluded from your policy for 1-2 years or that they were charging you double or, worse yet, they were denying issuing a policy entirely?

I have pre-existing medical conditions.  My family has them.  In fact, most everyone I know has one or more health issues.  Here are some sobering stats:

• ~50% of all Americans have one chronic condition
• 1 in 4 Americans have two or more chronic conditions
• 7 out of 10 deaths in the U.S. in 2010 were due to a chronic condition

Source: CDC

Change the word "chronic" to "pre-existing" and you'll see just how big an issue this is.

I suspect that most of the ACA critics are covered under group policies that did not permit  pre-existing conditions to prejudice rates or coverage.  Certainly politicians who decry ACA are all covered under such policies.  I wonder how they would feel if they were forced to carry individual policies (not group) and were at risk for such exclusions.

So if the ACA is repealed, some politicians believe that increased competition between insurance companies will prevent pre-existing exclusions from returning.  Without mandated coverage, I highly doubt that.  There was plenty of competition before the ACA  and that did nothing to prevent these exclusions.

So try to remember what it was like before the ACA only 6 years ago!  Then see if your finances could survive an emergency treatment for pre-existing condition (after you have been denied coverage) or not.

I can already hear my critics saying that the rising deductibles are like being denied coverage.  But even the higher deductibles that ACA plans now have will be a pittance if you have to have any type of surgery for a chronic condition that was denied coverage.  

So, please remember.

U.S. Census Report on Health Insurance

In case you have a lot of free time, the U.S. Census just issued a 44 page report on the state of health insurance in the U.S. for 2015.   This report does not attempt to suggest a cause/effect of the decline in uninsured.  It's "just the facts".  But the facts are fascinating.  You can download a link here:

U.S. Census Report

Key takeaways (in my opinion):

• Percent of Uninsured Americans fell 1.3% to an all-time low

• 29.1 million Americans are uninsured (9.1%) (another all-time low)
• Private insurance continues to be the primary source of health insurance over public insurance (e.g., Medicaid, Medicare, etc.)  67.2% vs. 37.1%
• The breakdown of the types of insurance for 2015 was:

• 28.9 % of noncitizen adults were uninsured.  This is ~2.5x greater than uninsured American citizens (10.8 %) 

The Costs of Not Going to the Gym ($500 Billion)

Most of us know that we should be eating healthier and exercising more.  It's not a complicated formula.  And yet, the statistics on preventable illnesses are staggering.  Here's just a small sampling:

• Nearly 10% of the US population has diabetes (~30million)
• Approximately 1.4 million new cases of diabetes reported annually
• 30% of all Americans are obese
• Obesity related illnesses account for ~$200b per year in health costs
• 17% of all Americans over 18 are tobacco smokers
• Another 16 million Americans live with a smoker.
• Smoking causes $300b a year in health costs and lost productivity
• Cigarette smoking is responsible for 480,000 deaths per year and is the leading source of preventable deaths

(sources:  American Diabetes Association and CDC) 

The statistics on exercising are not very good either:

• 191 million Americans (60%) don't get the recommended amount of weekly exercise
• 25% don't exercise at all (79 million people)
• # of gyms in the U.S.:  30,500
• # of Americans with gym memberships:  58million
• % that don't use their memberships:  67%

(sources:  CDC and StatisticBrain) 

The average cost of a gym membership is about $60 per month.  That's $720 per year.  Many diabetes medicines cost far more than this.

So let's generously assume that there are ~85million people in the U.S. (27%) with a preventable illness.  If the government spent $720 per person on a gym membership for each of them, the cost would be $61billion per year.  

So the big question is:  could this $61b reduce health care spending by more than that amount?  If ~$500b is being spent on preventable illnesses, that means that it would have to result in 12.2% savings.

I haven't found any conclusive studies one way or the other.  But, personally speaking, I prefer the idea of spending $61b on gym memberships as opposed to the same amount on diabetes medicine.  

Of course, the big problem is how to encourage (or require) that people use their gym memberships?  Any solution would certainly be very controversial (just ask any ACA opponent about the mandate).