Health spending slows, but Americans still squeezed hard

Despite the fact that healthcare spending and prices are at an historic plateau, out-of-pocket costs continue to rise for individual Americans.

This is what politicians called a "kitchen table" issue before billionaires started bankrolling their campaigns and they turned to xenophobia and other voter-divisive matters instead.

Americans can ill afford to cover these costs. Combined with the wage stagnation that has occurred in the U.S. over the past 15 years and the loss in household income created by the Great Recession, it has become healthcare's biggest ticking time bomb.

A new study by the Kaiser Family Foundation and the Health, Research and Education Trust concluded that the average deductible for single health plans has risen by two-thirds since 2010, and is now approaching $1,100 a year.

"The so-called great slowdown in healthcare costs has been all but invisible to consumers because deductibles have been going up so much faster than their wages," Drew Altman, head of the Kaiser Family Foundation, told Kaiser Health News. 

For a household, out-of-pocket costs are now close to $5,000 a year. Those working for a smaller employer pay nearly $6,000 in out-of-pocket costs. That's a year's worth of payments on a mid-size car, about half the room and board for a university student, or a nice two-week vacation (if you're actually taking vacation these days). In other words, money that could grow other parts of the economy and generally make people's lives better.

While this cost-shifting has been taking place, there's also been an astonishing run-up in pay for non-profit hospital executives, and it pretty neatly illustrates the haves versus haves-not dilemma in the country.

I recently finished numbers-crunching for a bi-annual compensation survey I conduct and I discovered that 61 executives with California's three-biggest non-profit healthcare providers earned at least $1 million in total compensation apiece in 2013. No, I'm not making that number up, and that is up significantly from two years ago.

The money to pay for those salaries comes from providing healthcare services, and that in turn has to come from somewhere. Most health insurers have negotiated the costs and can afford to pay them. Most patients have no say in what they're billed whatsoever.

Nevertheless, the financial burdens of the individual American are barely a blip during a presidential campaign where building a wall to stem a tide of immigrants that was stopped long ago and speculation about whether vanished emails are classified are apparently paramount issues.

Donald Trump did appear on "60 Minutes" Sunday and said he would repeal the Affordable Care Act and negotiate cheaper healthcare coverage for all of us. I'm not sure who is more pathological in a situation like this: Trump for floating such an absurdly unworkable proposal, the American public for believing that healthcare delivery and financing could actually work in that fashion, or my media colleagues for barely picking something like this apart.

I give Hillary Clinton some credit for coming up with a plan regarding healthcare costs, which included a proposal for capping drug costs at $250 a month per person. But it is piecemeal and mostly in reaction to last week's news that a firm called Turing Pharmaceuticals bought up a nearly ancient drug formula for treating toxoplasmosis and jacked up the price by more than 5,000 percent.

Where does it stop? Who knows? The negotiating tactics of hospitals and health plans means the former is always raising its chargemaster prices to gain an advantage. The latter is always shifting costs in order to earn a bigger profit. So, everyday Americans will continue to be squeezed in the middle.

The only good outcome about this vise effect is eventually the current system will become unworkable and hopefully will be replaced by a single-payer system that predominates in the rest of the world's industrialized countries and works remarkably well. The bad news is that every American who isn't filthy rich runs the risk of  facing bankruptcy in the meantime. - Ron(@FierceHealth)