Non-Profit Health Insurance

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There have been advocates in the United States and other nations calling for non-profit health insurance plans similar to the systems in places like Canada. Naturally, there have been strong critics against such a plan and linking it to “socialized” medicine. There are valid points both for and against such a measure but no matter which side of the debate any person stands, there does remain one fact that is undeniable: Some plan must be adopted to contend with the impending Medicare Crisis and the unnatural rise in healthcare costs over the past few decades.

Since 1974, the average cost of heath care has increased by an average annual rate of 9.9%. In recent years, there have been double-digit increases in medical costs and in a large number of health insurance plans to help offset these rising expenses. Now there is something very terminal about a 9.9% average annual increase for more than 3 decades: that growth is higher than both the average yearly increases in GDP and personal income.

Reasons for Non-Profit Health Insurance

It is estimated that Americans will spend just over 2 trillion dollars on health care in 2006. That figure accounts for 16% of all money in the U.S. economy in a fiscal year—and it is going to rise tremendously in the coming years as millions of baby boomers begin retirement! With tens of millions already un-insured because they cannot afford the cost of premiums, the call for some viable non-profit health insurance network are only expected to get louder in the coming years. Rising costs which continually exceed gains in personal income will force more people to run the risk of not having health insurance. Here are some of the other reasons commonly cited as justification for the development of some viable non-profit health insurance plan:

-Medicare Trust Fund expected to become overwhelmed by 2017 and no longer be able to cover annual costs of care
-National non-profit health insurance would ultimately drive down spiraling medical costs by imposing overall caps on care in a more unified manner than currently done by competing insurers
-Would provide more preventative care for those currently uninsured and thus drive down costs due to lower rates of uninsured being treated for catastrophic and expensive major illnesses
-Improve overall public health and provide equal access to medical treatment for all

Reasons Against Non-Profit Health Insurance

These all sound like great reasons for developing some comprehensive non-profit health insurance plan but some are skeptical that such a plan would actually drive down medical costs—even over time when the expected benefits of preventative care would kick in and supposedly lower overall costs. While imposing payment caps on treatment costs in a more universal manner, many critics of the non-profit medical health insurance idea point out that such caps are already imposed by Medicare and numerous PPO and HMO plans and have proven ineffective or less effective than planned where containing costs are concerned.

In addition, critics of any universal non-profit insurance program point out that such a program may literally bankrupt the entire nation. Each person’s average share of medical costs are already at $7,000/year and that number would surely rise according to critics. The fear is that many of the 45,000,000 people currently uninsured will suddenly overwhelm the health care system and the average share spent on medical treatment would skyrocket above that $7,000 figure almost immediately.

Opponents of a non-profit medical health insurance plan also contend that medical research and the overall quality of care would drop if some universal plan were adopted. Without the incentive of profits, some fear that drug and research companies would not be as likely to take risks on expensive research into untested areas of medicine. Plus, the quality of care would necessarily drop to account for more patients with less money.

Decisions

So who is right and who is wrong in the great non-profit health insurance debate? Both sides actually have very valid points and this may have caused the stalemate that currently exists. What is certain is that there are over 75,000,000 baby boomers and the oldest of their generation is turning 60 in 2006. Not only will this generation cease paying into the Medicare system—they will begin adding to the strain upon resources that is already taking place.

It is inevitable that average annual increases in health care costs must eventually be lower than average GDP and income gains or else the economy will collapse under the weight of this strain. At 2 trillion dollars per year and counting, the health care costs are already reaching critical levels. Perhaps non-profit health insurance is not the way to go but the price of “staying the course” with respect to rising medical costs and the impending retirement of the baby boomers—that is a sure way to fiscal insolvency and the total collapse of the medical care system.

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