The Wake

Illustration by Srijon Chowdhury

I. INVOCATION

Dearest Senior Class of 2008,

As you are already well aware, May is rapidly approaching and much of the anxiety regarding post-college life that was safely stewing at the recesses of our minds is about to manifest itself, plump and ugly, in our newly re-christened adulthood.

The age we are entering headfirst is certainly an exciting one — despite, or perhaps as a result of, current economic forecasts, a seemingly endless war, and end-of-times weather patterns… But alas! It’s at least the culmination of 16 or so years of education! The prolonged first step in floundering pursuit of answering the question: how are you going to pay the fucking bills when you grow up?

It’s also the time when we join the ranks of the garroted, true-to-form, everyday taxpayer-citizen. That’s right; against the loan payments we lose that precious student status. No more movie theatre or travel discounts! Oh my! We are now one — and near the bottom - with the system! We are also tempted to say it’s the end of binge drinking, precarious sexual relations and the occasional incapacitating episodes of self-doubt, confusion and frustration. But we should know better than that.

This particular time means a lot of different things to college seniors, the most obvious of which are a diploma and a job hunt. Beyond that, however, it means being hit with a plethora of costs and expenses that are no longer kept at bay by student status. Yes, once graduation hits, the vultures come swooping down to collect their student loan payments, graduation fees, etc. Among the fattest and most vicious of these scavengers are the affiliates of an insidious industry that strikes unsuspecting graduates immediately after graduation: medical insurance companies. Graduating means we will no longer be covered by policies provided by either our parent’s employers or by the University. Presumably with a gleeful efficacy, these entities will terminate our coverage the instant a diploma lands in our hands.

Nationally, we have been hearing for some time about our generation employed in the tedious health care reform tug-of-war between Sens. Clinton and Obama. Sen. Clinton often inanely posits we simply pay no heed to human fragility or mortality and need to be mandated, and thus learned in this regard. In contrast, Sen. Obama argues that if health insurance were made more affordable, we reckless and death-defying youth will invariably fall in line. Intriguing as it is, even subscribers to the latter argument must readily admit there always was, always are and always will be assholes that positively endanger themselves and others while refusing to pay for it.

As a rule, insurance companies such as Blue Cross Blue Shield and Health Partners will extend coverage of a family health care plan to dependents until they reach the age of nineteen, or twenty-five if they are in school. This means that graduation ostensibly makes students ineligible for coverage under their parents’ plans and robs them of their health insurance.

Now, congratulations to those students who are in line to be debt free after college or begin a job with health benefits, for you have been spared a royal pain in the ass. As for the loan-paying, unemployed majority: pay attention, else risk an aneurism when the cold hard truth behind the stupidity of American health care insurance catches you unprepared.

II. SO, HOW DOES THIS WORK?

A health care plan breaks down to this; a deductible, a premium, an out-of-pocket maximum and coverage maximums. The deductible is the amount that the holder of the policy is expected to pay before the plan actually begins to cover their expenses. The premium is the fee paid to the insurance company for the coverage; it usually is paid in monthly installments. The out-of-pocket maximum is the maximum amount that the holder will have to pay per year. Coverage maximums are the percentages of costs and dollar amounts that the plan will pay for. Most insurance plans also include copayments, which are fees paid up front by the holder for certain services, such as urgent care.

What this basically means is you pay a certain amount per month to the insurance company, in addition to smaller amounts and a larger amount when necessary, and in return they will pay your medical bills so long as they cost over a certain amount and under another. Summed up in a sentence the whole idea sounds a little suspicious. And this is assuming that you are in relatively good health with no pre-existing chronic illnesses.

And, really, pray that you don’t have any maladies, chronic or otherwise, because insurance companies like to use a process called underwriting. Underwriting is used to screen applicants and weed out potentially costly clients based on previous medical history. They deny coverage altogether to most and apply special costs to others. Simply being a smoker is enough to raise a monthly premium. This process, coupled with endless loopholes in policies and fine print have created enough insurance company “victims” for Michael Moore to make a movie about it. To wit: it’s a pretty long movie.

These are merely unscrupulous business tactics, however; the real obstacle for graduates is the outrageous cost of the service. Deductibles offered for an annual plan for a single individual by Blue Cross Blue Shield, a major insurance company, range from $300 to $10,000. This is the amount that must be exceeded before the company will pay the expense; the lower it is, the sooner the company will begin coverage. It makes sense, then, that a lower deductible would entail a higher monthly premium. The $10,000 deductible costs around $70 a month while the $300 deductible costs around $322 a month. The $300 deductible, in addition to being low, also covers smaller services such as medication with copayments and has a lower out-of-pocket maximum, while the $10,000 deductible is the out-of-pocket maximum and covers nothing until it has been reached.

Cutting to the heart of the bullshit, what this all means is that you can pick a plan where you pay a lot for a ton of coverage that you won’t use unless you are consistently hospitalized, pay a small amount and may as well not have health insurance at all, or pay an amount in between and get half-assed coverage that still costs you a lot in extra fees.

Of course, graduation means that many seniors will find their financial situation much tighter than a decent health insurance plan requires. Simply put, our generation is going deeper and deeper in debt in order to attend college. A recent study by the National Center for Education Statistics reports that the average student loan debt is $10,000, with the average cost of college increasing at twice the rate of inflation. On top of that, debt levels for graduating seniors with student loans more than doubled in the last decade from $9,250 to $19,200 – an increase of 108% which is 58% after inflation. When you consider that 60% of students took out loans in 2004, you can see the wide-ranging effects of such increases.

Private loans raise even more questions about students’ financial situations. The College Board reports that lenders provided about $14 billion in private loans during the 04-05 academic year, a 734% increase from a decade earlier and a 30% increase from the previous year. Private loans typically carry higher interest rates and less flexible payment options than federal loans. That might have had more impact had I put it six paragraphs back, when you didn’t think banks and universities were trying to rape you in the metaphorical back alley of your over-priced education.

Statistical evidence also calls into question our ability to pay these ever-increasing loans. According to USA Today, late payments on loans by twenty-somethings are at a proportion of 1.6 to the general population’s 1.0. When those loans actually get paid, though, things don’t get much better: 49% of our peers are charging their loans to credit cards, a practice that only increases one type of debt in order decrease another. When the highest growing of group of students in debt are those with $20,000 or more, you can see how these practices only reinforce a system that is using our limited financial capacities to tie us up in an ever-downward spiral of debt. As a generation that watched the baby boomers do the same thing at middle age, (via cars, houses, boats, suburban migration, poor financial decisions, etc.) how are we supposed to feel about being put in that situation when we are in our twenties, before we can actually make any significant financial decisions? When you start at the bottom, where do you go?

III. THE PENDULUM

While the blow to your pocket book is sobering enough, the moral and legal implications of such a system are also astounding.

One issue that is seemingly never discussed is the constitutionality of a rapacious, privatized health care system. What the government is essentially forcing us to do by not having a nationalized health care option is either give all of our money to a private corporation or just go without health care – a practice that could literally kill you. Is it really constitutional to force citizens to choose between supporting an exploitative third-party and going without health care? Is it respectful of our freedoms to basically force us to support groups that drive our peers into debt and prevent many of our fellow citizens from receiving any sort of health care? The modern American health care system has become ground zero for our lack of choice and control over our own lives. When we don’t even have the right to receive medical attention, what do we have?

Of course, that gets at a question that is larger than this already very large article: do we have a right to health care? It’s definitely up to personal interpretation, but it is important that we discuss whether or not the government has the responsibility to ensure medical coverage for its citizens. It’s even more imperative now that our generation is facing the looming prospect of life without health care and without choice. In a world where we have to choose between our health and our finances, it is imperative that we ask if that’s a choice that we should have to make.

In our eyes, the evidence speaks for itself. Medical insurance companies have used government inattention to set up a system that is impossible and exploitative. They have cornered the American people and forced them to weigh their livelihood (and, in turn, their ability to support their lifestyles and/or families) against their health and basic ability to, well, stay alive. It’s a ridiculous notion that we should die because we can’t pay for life.

And, yeah, that’s a moral issue. I mean, how do you feel about vast swaths of our country’s population, possibly including you, dear reader, not being able to receive health care? Anyone who has visited a hospital recently can attest to the ridiculous costs of supplies and overnight stays, the overcrowding, the poor infrastructure, haphazard management and on and on. Bear in mind that these wonderful services are qualities of the same care that is denied to those who can’t pay the ridiculous premiums and service costs of comprehensive health care plans. Isn’t it important that citizens, regardless of market and societal forces that keep them in whatever dire straits they find themselves in, are able to receive medical treatment? If we’re willing to spend billions to kill our so-called enemies, why can’t we be bothered to spend the same to keep our fellow Americans alive?

IV. NOW WHAT?

There really is no way to win, nor any way around playing the game. What are we supposed to do, not have health insurance? It sounds like a good idea for about ten seconds until the thought of a horrible car accident or god forbid, cancer, comes to mind. The price is right, but the risk is high. What makes the situation so tragic is that it is incredibly dangerous to be without insurance. It is less costly to be sure, but the X factor is always looming over your shoulder, threatening you with a freak accident. It certainly isn’t in the best interest of anyone to be without health insurance, but with such high prices options seem to be limited.

So what is a college graduate to do? Get a job! That’s the easy and supposedly natural answer. Certainly, many of us will land jobs that offer plans sufficient to cover our youthful ailments. Unfortunately, health care coverage is quickly becoming a commodity even for the gainfully employed.

When the Minneapolis Public Schools’ teachers re-negotiated their contract earlier this year, for example, their coverage was significantly decreased. As part of negotiations, the teachers agreed to a tiered health care system. The tiers refer to how much people pay for co-pays. For example, at a tier one clinic, the co-pay is $30, while at a tier two clinic it is $55 and $80 at a tier three. “This is essentially to push down costs and encourage people to go to certain clinics,” says Robert Panning-Miller, President of the Minneapolis Federation of Teachers, Local 59.

This is not to say that this is encouraging cheaper care, but to try and help people get the best quality care for the fees that they are paying. “The out of pocket expenses went up, but we were able to keep the overall costs, the premiums, for every individual in the district, from increasing by more than 5.4 percent,” Panning-Miller said. “That’s where the negotiations came in.”

For single coverage the district pays all of the costs. For families, the district pays the amount equal to what they pay for single coverage, plus a negotiated additional amount. The district wanted to cap how much they paid for single coverage, but negotiations resulted in full payment. That also helped family coverage because the district has to pay someone with a family plan at least as much as they pay someone with single coverage.

“Health care is one of those things where what you want to do is minimize the pain —there’s always going to be some,” Panning-Miller said.

“When we sent out requests for proposals, three companies replied saying that if we wanted to keep the same coverage, premiums would be 25-35% more,” Panning-Miller said. It became a question of how many benefits teachers were willing to give up in order to bring premium costs down. “To only increase 5.4% in relation to the patterns is really good. But the reality is that we gave up a lot.”

In reality, these policies end up hurting the people who need it most. If you don’t get sick, you don’t pay co-pays, creating an incentive for avoiding medical treatment and utilization of these much-coveted health care plans. “That is the big philosophical question in health care: how much of the burden should be shared?” Panning-Miller said. “Our costs are higher than most. Some people opt out of the district coverage because they can get cheaper coverage elsewhere.”

Unfortunately, when people go elsewhere for coverage, it makes the pool smaller. If fewer people buy in, individual costs increase and become far less predictable. “People opting out is going to be a problem year to year, though maybe not immediately,” Panning-Miller said.

Compared to other school districts or other businesses, “Our benefits are horrible,” Panning-Miller said. “And the argument is that teachers use health care a lot.”

“The system as it is now is unsustainable,” Panning-Miller said.

In the long-term, change is needed. Oftentimes, issues like health insurance and debt are mentally outsourced by our generation as problems for old people; issues that plague those entering mid-life. Obviously, this is not true. For many of us, it’s only a matter of years, months or even weeks until, like it or not, this problem becomes ours. It’s up to us, then, to encourage debate and force the question when it comes to health care. It’s our duty to force our elected officials and peers alike to present us with a solution to this problem or at least a pronouncement. As it is, we’re getting screwed and no-one is willing to confirm or deny that. So really, honestly think about what you’re going to do about this problem, either personally or politically, because if those hit hardest by this inequity are silent, who will speak for us?