Bitter Pills

Kaiser notes that more than 25% of employees have annual deductibles of $1,000 or more, which helps keep down higher-frequency claims such as emergency room visits. Health plans are also making increased use of coinsurance, which defrays the cost of big-ticket procedures such as child delivery. Adult children dependents, while they can no longer be cut from plans thanks to the federal reform package, can be charged for independently, which makes their coverage less of a free ride. Plans may also begin making greater use of assessing policyholders with surcharges for spouses who could be insured through their own employers. Plans are also stressing that policyholders take care of preventative wellness plans, which is nothing new.

Such austerity measures are sure to gain a huge amount of negative feedback for the industry, but this could very well be another case of an unpleasant reality that everyone has to share, not just healthcare providers. Lest we forget, federal legislation is imposing sharp medical loss ratio requirements on the health insurance industry as it is, which is keeping profits fairly trim. And if anybody needs any more evidence that times are tough all over, just look at Microsoft – the software giant is synonymous with corporate profit, and yet even it is finding it necessary to ask its 90,000 employees to pick up an increased share of the company's generous healthcare benefits, starting in 2013. Those looking for a clear-cut bad guy in this story aren't likely to find one unless they have an axe to grind.

Perhaps the worst thing about the increased cost situation is that as the public and the industry push and pull to make ends meet, there is a bigger, and really, a more important issue unfolding. For years, the number of physicians has been declining in this country, for a number of reasons, not the least of which is the skyrocketing cost of medical malpractice insurance. (This alone has decimated the OB/GYN provider network in states such as West Virginia.) But also to blame is a sharply increasing demand for care, and a constricted number of residency positions. According to the AAMC Center for Workforce Studies, there is a growing gap between the number of doctors the country has and the number it needs. At present, that gap is around 13,700, but unless conditions change, the gap will grow to 130,600 by 2025, thanks to an exploding population, increased demand created by healthcare reform, and simply not enough doctors. This, more than anything else, is a catastrophe in the making, and it is not one that somebody can simply point a finger at the insurance industry over, either. Doctors of all specialties have been making it clear for years how difficult it is becoming to maintain a practice and yet nothing has been done to enable this industry to keep going. Perhaps when the sticker shock of open enrollment sinks in this quarter, and the inevitable onslaught of stories filters through the media of people grousing over the cost of healthcare, and people raising an eyebrow in the direction of the insurance industry, the industry can point to the doctor shortage and say, "Yes, the costs hurt. But you know what hurts more? Not having a doctor. Now what are we going to do to fix this?"