February 2, 2011

Seniors Stressed Out by Medical Costs

From Mississippi Valley Health News Online

Seventy-six year-old Joyleen Sherwood, Wilton, Iowa, is a widow who is still very active and enjoying her retirement years. So, it came as a surprise that when she expected to renew her driver’s license, she failed the vision test. “I have to have my license in order to get anywhere, but they told me they couldn’t renew it until I passed the test,” she says. A quick trip to her local doctor confirmed she needed cataract surgery in both eyes. “I noticed I had problems reading the newspaper at home, and things were getting a bit fuzzy, but now I had to actually do something about it.”

Last April, Joyleen checked into the Mississippi Valley Surgery Center (MVSC), Davenport, to undergo cataract surgery on her right eye (her left eye was treated a month later.) The surgeries were performed by fellowship trained cataract surgeon, Siv Brit Saetre, M.D., Davenport Eye Group. Dr. Saetre’s practice is also a member of the Mississippi Valley Health Network and aligned with the surgery center to provide cost-effective outpatient surgical care that also ensures patients recover at home. “The surgery went really well, and I was home by lunchtime,” recalls Joyleen. “Dr. Saetre and the nursing staff were great. I see so much better now, and am grateful I have my license!”

Joyleen feels fortunate, not only because her cataracts were treatable, but because she had the insurance to cover the costs. “I have Medicare, but am grateful for a supplemental policy from my previous employer of 27 years. As a widow on a fixed income, I also have heart disease and diabetes. What would I do without coverage?”

Medical Debt

Many Iowans and Illinoisians are facing the grim answer to her question. According to the AARP, more than a quarter million Illinois residents and more than 63,000 in Iowa aged 50-64 are completely uninsured. Many more are underinsured. People in this age category are not old enough to qualify for Medicare, but they face significantly higher private health insurance premiums. High enough, in many cases, that they have to go without coverage.

Because being underinsured requires more out-of-pocket spending and because income growth has slowed, the 2007 Commonwealth Fund Biennial Health Insurance Survey found that 72 million American adults under age 65 reported medical bill problems or accumulated medical debt in 2007.

An American Journal of Medicine study reported by CBS News found that medical debt is a reason for 60% of personal bankruptcies. That’s an increase from just eight percent in 1981. Mike Leavitt, former head of the U.S. Department of Health and Human Services, said recently, “If we had any idea how many mortgages were foreclosed because people were crowded out by medical issues…Health-care costs are at the heart of many things happening.” A Kaiser Family Foundation poll conducted before the recession found that 28% of Americans reported they or their families had serious problems paying health insurance or medical bills because of changes in the economy.

Yet medical insurance is becoming less and less affordable. The number of people who spend more than 10% of family income on health care continues to grow. The Commonwealth Fund survey also found that, between 2000 and 2008, the average total premium for single coverage increased 95% to $4,704; the average family-coverage premium increased 95% to $12,680.

Those numbers do not include the steadily increasing deductibles and co-pays and other payments consumers must make in addition to their premiums. People are responsible for a bigger piece of a more costly pie. “Retirees especially are finding that the health insurance they enjoyed while being employed changes dramatically when they retire,” explains MVSC Administrator Dr. John Dooley. “Many employers are cutting health-care benefits or capping payments, which leaves seniors on the hook for a greater portion of their bills.”

For those who retire without a pension, the economic crisis has caused many nest eggs – like 401(k)s – to plummet in value, reducing retirees’ ability to pay ever-escalating costs.

Americans covered only by Medicare pay 20% of their health-care costs – regardless of the overall price. That 20% is especially significant for those on a fixed income. According to the MedPAC March 2004 Report to Congress on Medicare Payment Policy, patients typically pay less coinsurance for procedures performed in an Ambulatory Surgery Center (ASC) such as the Mississippi Valley Surgery Center, Davenport, than for comparable procedures in a hospital setting.
Surgery Centers Save Patients Money
Facilities like the Mississippi Valley Surgery Center offer patients undergoing cataract surgery or colonoscopy (two common examples) a surprisingly less expensive alternative to having the same procedures in a hospital outpatient department. According to the MedPAC report, for example, a Medicare beneficiary could pay as much as $496 in coinsurance for a cataract extraction procedure performed in a hospital outpatient department (HOPD), whereas the same beneficiary’s copayment in the ASC would be only $195. A Medicare beneficiary could pay as much as $186 in coinsurance for a colonoscopy performed in a HOPD, while that same beneficiary’s copayment for the same procedure performed in an ASC would be only $89. By having surgery in the ASC, the patient may save as much as 61% or more than $300, compared to their out-of-pocket coinsurance for the same procedure in a hospital.

Not only are surgery centers dramatically less expensive than hospital outpatient departments, they offer patients improved techniques and technology, lower risk of infection, lower risk of medical errors, and quicker returns to home, activity, and quality of life, according to Kathy Bryant, President of the Ambulatory Surgery Center Association. “The benefits of ambulatory surgery centers are more important, to more people, than ever before,” explains Dr. Dooley.

“We offer real solutions to the problems that plague the health-care delivery system: waste, excessive cost, medical errors and a general lack of responsiveness. The MVSC offers cutting-edge procedures with superior outcomes; it uses financial and human capital efficiently; it increases productivity; it is more accessible and responsive to patients; and it presents less risk of medical error and infection. All of that is combined to offer dramatically reduced costs to patients.”

That’s good news to folks like Joyleen and her retired peers. “I retired in 1998, and I watch how I spend my money,” she explains. “Health-care costs can be big worry. I had heart surgery, and I am diabetic, so I keep an eye on expenses. I just feel sorry for folks who only have Medicare, because it’s just getting too expensive to get help.”