Category: Economic

Americans’ Challenges with Health Care Costs

Mary Pat Campbell

Link: https://www.kff.org/health-costs/issue-brief/americans-challenges-with-health-care-costs/

Graphic:

Excerpt:

  • About half of U.S. adults say it is difficult to afford health care costs, and one in four say they or a family member in their household had problems paying for health care in the past 12 months. Younger adults, those with lower incomes, adults in fair or poor health, and the uninsured are particularly likely to report problems affording health care in the past year.
  • The cost of health care can lead some to put off needed care. One in four adults say that in the past 12 months they have skipped or postponed getting health care they needed because of the cost. Notably six in ten uninsured adults (61%) say they went without needed care because of the cost.
  • The cost of prescription drugs prevents some people from filling prescriptions. About one in five adults (21%) say they have not filled a prescription because of the cost while a similar share say they have instead opted for over-the-counter alternatives. About one in ten adults say they have cut pills in half or skipped doses of medicine in the last year because of the cost.
  • Those who are covered by health insurance are not immune to the burden of health care costs. About four in ten insured adults worry about affording their monthly health insurance premium, and 48% worry about affording their deductible before health insurance kicks in. Indeed, large shares of adults with employer-sponsored insurance (ESI) and those with Marketplace coverage rate their insurance as “fair” or “poor” when it comes to their monthly premium and to out-of-pocket costs to see a doctor.
  • Health care debt is a burden for a large share of Americans. About four in ten adults (41%) report having debt due to medical or dental bills including debts owed to credit cards, collections agencies, family and friends, banks, and other lenders to pay for their health care costs, with disproportionate shares of Black and Hispanic adults, women, parents, those with low incomes, and uninsured adults saying they have health care debt.
  • Notable shares of adults still say they are worried about affording medical costs such as unexpected bills, deductibles, and long-term care services for themselves or a family member. Additionally, about half of adults would be unable to pay an unexpected medical bill of $500 in full without going into debt.

Author(s): Lunna Lopes, Marley Presiado, and Liz Hamel

Publication Date: 21 Dec 2023

Publication Site: Kaiser Family Foundation

Is Ed Kane’s “Gathering Crisis” Still Gathering Steam?

Mary Pat Campbell

Link: https://govmoneynews.com/bills-blog/f/is-ed-kanes-gathering-crisis-still-gathering-steam

Excerpt:

Back in 1985, Ed Kane penned a prophetic volume identifying a blooming mess in financial markets. His book, The Gathering Crisis in Federal Deposit Insurance, reliably warned of taxpayer exposure to losses ultimately unleashed in the savings and loan crisis. 

Cycles of ensuing regulatory reforms, crises and scandals have only reinforced the timeliness of the lessons that Kane offered us decades ago. Those lessons became particularly poignant in light of the failure of Silicon Valley Bank and several other large banks earlier this year. 

Kane’s 1980s warnings remain worthy of scrutiny and reflection, and underscore questions whether industry and regulatory reforms have simply left us on the edge of another precipice. The financial conditions of the FDIC and the Federal Reserve – and their implications for the U.S. Treasury and American taxpayers – deserve close scrutiny, as well as recommendations for fundamental reform.

….

“In an economic environment in which deposit institutions are highly levered and entering new businesses every day and in which interest rates are highly volatile, systematically mispricing deposit insurance guarantees encourages deposit institution managers to position their firms on the edge of financial disaster. Metaphorically, deposit-insurance authorities are paying deposit-institution managers to overload the deposit-insurance jalopy, to drive it too fast, and even to break dance on its hood as it careens through interest rate mountains and over back-country roads. Reformers’ ultimate goals must be to confront institutions whose risk-taking imposes socially unacceptable risks on its federal guarantors with a combination of reduced coverages and increased fees sufficient to move them to adopt safer modes of operation.” (p. 147)

“Of course, just how safe, reliable, and comfortable a ride the nation enjoys depends also on the macroeconomic policies that the government follows. If Congress could bring government spending under long-run control, monetary policy would not have to push interest rates over so wide a cycle. Reducing the volatility of interest rates would relieve the car’s drivers of the need to take it over quite so dangerous a set of roads.” (p. 165)

Author(s): Bill Bergman

Publication Date: 20 Dec 2023

Publication Site: Bill’s Blog at GovMoneyNews

Is There a “Pecking Order Theory” for US Government Debt?

Mary Pat Campbell

Link: https://govmoneynews.com/bills-blog/f/is-there-a-pecking-order-theory-for-us-government-debt

Video:

Excerpt:

I got a great question from a finance student today, asking whether the “pecking order” theory of corporate capital structure could be applied to the government. OK, let’s think this out. Who comes first, in the pecking order?

Author(s): Bill Bergman

Publication Date: 6 Dec 2023

Publication Site: GovMoneyNews, Bill’s Blog