Medical Costs

Until this week, Republican presidential candidate Mitt Romney had sought to make the election a referendum on just one thing: President Obama's handling of the economy. But by teaming up with Rep. Paul D. Ryan (R-Wis.), the architect of the House GOP's plan for cutting spending, Romney made a campaign issue out of one of the government's biggest programs, Medicare. Sure enough, the attacks on Ryan's proposal to transform Medicare from insurance into premium subsidies began within minutes after Romney announced Ryan as his running mate.

Woodland Hills insurer Health Net Inc. slashed its full-year profit outlook for the second time this year as some of the company's customers incurred higher-than-expected medical costs. The news sent company shares tumbling $4.34, or 19%, to $18.36 in trading Friday. Health Net cut its 2012 profit forecast to a range of $1.45 to $1.55 a share, down from $2.85 to $3 a share. Analysts said it will be difficult for management to regain investor confidence after two consecutive disappointing quarters.

Nearly 10% of employers expect to drop health coverage for their workers in the next three years as medical costs keep rising, according to a new survey by consulting firm Deloitte. The vast majority of companies, 81%, said they planned to continue providing health benefits even as new rules begin in 2014 under the federal Affordable Care Act. An additional 10% of employers said they weren't sure, the survey said. More than 160 million Americans get their healthcare through employer-sponsored plans.

Re "How to cure U.S. healthcare," Opinion, July 20 Dalibor Rohac proposes that patients should bear a greater proportion of their medical costs. However, imposing higher cost-sharing on patients will not curb the explosion in health spending. The vast majority of expenditures is concentrated on a small sliver of patients who hit their out-of-pocket limits, causing catastrophic insurance to take effect and costs to rise. Instead of raising cost-sharing on patients, healthcare providers should bear financial risk for the cost and quality of care they deliver, because they determine resource allocation.

Never one to mince words, investment poobah Warren Buffett described the U.S. healthcare system as a tapeworm in the digestive tract of the economy. This apt but disgusting metaphor does a good job of illustrating how our maddeningly dysfunctional healthcare system puts American businesses as a disadvantage compared with their overseas cousins. "The healthcare problem is the No. 1 problem of America and of American business," Buffett said in an interview with Bloomberg Television . "It's the tapeworm, essentially, of the American economy, and we have not dealt with that yet. Obamacare is a step in the right direction in many ways.

The gig: Pam Kehaly, 51, is president of Anthem Blue Cross in California, the state's largest for-profit health insurer and a unit of WellPoint Inc. The executive said she wrestles with how to control rising medical costs and find ways to keep coverage affordable for millions of employers and consumers. Strike up a conversation: Her family moved to Southern California from Michigan when Kehaly was 3. Her parents divorced and her mother worked two jobs — mail clerk at the Pacific Coast Stock Exchange by day and cocktail waitress by night.

Thousands of patients in California and across the nation who take expensive prescription drugs every month for cancer, rheumatoid arthritis and other ailments are facing sticker shock at the pharmacy. Until recently, most of these patients typically paid modest co-pays for the advanced drugs. But increasingly, Anthem Blue Cross, Aetna and other insurers are shifting more prescriptions to a new category requiring patients to shoulder a larger share of the drug's cost. The result: Pharmacy bills are going up by hundreds of dollars a month — on top of insurance premiums.

A Long Beach hospital charged Jo Ann Snyder $6,707 for a CT scan of her abdomen and pelvis after colon surgery. But because she had health insurance with Blue Shield of California, her share was much less: $2,336. Then Snyder tripped across one of the little-known secrets of healthcare: If she hadn't used her insurance, her bill would have been even lower, just $1,054. "I couldn't believe it," said Snyder, a 57-year-old hair salon manager. "I was really upset that I got charged so much and Blue Shield allowed that.

Paramount Pictures has agreed to pay $18.5 million to settle a lawsuit filed by a movie extra who sustained a serious head injury during filming of the blockbuster Paramount Pictures movie "Transformers: Dark of the Moon. " Gabriela Cedillo, 26, was driving a car in a background scene when she was struck in the head by a stunt vehicle that broke lose from a cable during filming of the movie in Hammond, Ind. The accident on Sept. 1, 2010, left Cedillo with permanent brain injuries.

Healthcare or a Hyundai? The average cost of healthcare for a family of four this year has increased nearly 7% to $20,728 annually, according to a new study by benefits consultant Milliman, or similar to the cost of a mid-size sedan. A quick online search turned up a 2012 Hyundai Elantra selling for $20,728 in Michigan sporting “volcanic” red paint. You can nab a 1956 Chevrolet Bel Air in Santa Maria for the same amount or for better mileage a 2010 Toyota Prius with just 36,000 miles in Miami.