|
DynamicTrends.com
|
 |
|
DynamicTrends.com
|
|
|
|
|
With all of the recent press over the past week aimed at
the rising healthcare costs at General Motors, I began to
think about how overall inflation has compared to wage
growth and overall wealth of employees. Employer provided healthcare has been an “employee benefit“ since World War II. Over the years, business owners have been able to use these “benefits“ to reduce growth in other forms of compensation, such as wages. Now, due to rapidly increasing overall cost, many employers including General Motors, are pushing healthcare costs onto employees as fast as they can. Employers are also increasingly requiring employees to pay part of their own healthcare costs. Inflation Facts: The consumer price index (CPI) combines inflation (which the FED can control), with cost-of-living changes (which the FED cannot control) Inflation refers to (the dollar cost of things), or the value of the dollar. If the FED creates too much money (increases Liquidity by lowering Interest Rates), the purchasing power of the dollar falls. In effect, the dollar price of things rises. Cost of living refers to income relative to prices. The cost of living, (the real cost of things), increases as the dollar price of things rises (Inflation). If I bought goods or services for $1.00 in 1967, the same goods or services would cost $6.15 today (August 2007). Use the this calculator , compliments of the Federal Reserve Bank of Minneapolis, to find the value of today’s dollar Trends in higher healthcare costs are causing government funded healthcare insurance to compete for scarce dollars with other government programs and services. In 1967, per capita healthcare expenditures were $247 In 2007, per capita healthcare expenditures should have been $1520 but because healthcare costs are outpacing inflation, they are estimated to be about $7000 An Alternative Plan to Affordable Healthcare for All Employees and U.S. Citizens What if, instead of employers supplying healthcare, they increase wages by the amount of the premium they are now paying, then increase wages at the rate of REAL inflation. (Not the cooked numbers that are now used) All employees would then be able to shop around for the best value and buy their own healthcare insurance. This would cause competition between healthcare insurance companies and drive costs down. All CITIZENS who are unemployed, would receive government subsidies to assist in buying healthcare insurance at market prices. In exchange, those who receive the subsidies would be required to perform public service work according to their ability, in proportion to their subsidy. In NO CASE, would healthcare insurers be allowed to exclude pre-existing conditions. By Michael Scoglietti Copyright DynamicTrends.com
DynamicTrends.com Copyright©DynamicTrends.com 2008 |
|