Monday, September 12, 2011

The early part of the 20th century saw the “Progressive” movement in the US. Men like Robert Lafollette and Louis Brandeis were it most notably adherents. As I understand their philosophy the Progressives thought that if society is to make progress it must address its problems. In the early part of the 20th century this focused on the social disruptions caused by the industrial revolution. Today one of the issues that must be addressed is the high cost of health care and the effect this has on our economy, consumer spending, job creation and general economic well being of the US economy.  As every business owner knows the cost of health care has been rising between 15 and 30% per year for the last fifteen to twenty years. Business’ response is to push more of this cost onto the employees. This means that an increasing part of discretionary income is being used to pay insurance companies, drug companies and doctors.
Every year business waits in dread fear for the insurance renewal quote from their health insurance company. Every business wants to keep this as low as possible because the increase in premiums will pressure business costs and employee expectations in re compensation. The medical profession, tort bar, drug and insurance companies seem to be happy with the current system but it cannot go on forever.
There is intense debate about the Obama administration’s recent health care reform plan. From the standpoint of the business owner I don’t know whether this will be a good or bad plan but at least someone has started to try to address the issue. As a country we can no longer pretend that this is not a pressing issue. To date the only plan we have had is to force people without health coverage to the ER, prohibit hospitals from denying care and ignore the fact that the more charity care the hospitals provide the greater tax on those of us who have insurance. Congress can no longer act as if nobody has to pay for this service. Insurance rates and hospital rates have to rise to cover this care and we all pay.
As more of our discretionary spending goes to pay for the one specific area (health care) the less is available for other areas of consumer activity. You cannot leave health care out of the national discussion about economic recovery.

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