Archive for the ‘costs’ Category
The economic slowdown has swelled the ranks of people without health insurance. But now it is also threatening millions of people who have insurance but find that the coverage is too limited or that they cannot afford their own share of medical costs.
Many of the 158 million people covered by employer health insurance are struggling to meet medical expenses that are much higher than they used to be — often because of some combination of higher premiums, less extensive coverage, and bigger out-of-pocket deductibles and co-payments.
With medical costs soaring, the coverage many people have may not adequately protect them from the financial shock of an emergency room visit or a major surgery. For some, even routine doctor visits might now take a back seat to basic expenses like food and gasoline.
“It just keeps eating into people’s income,” said James Corbin, a former union official who works for the local utility in Tucson.
Mr. Corbin said that under their employer’s health plan, he and his co-workers are now obliged to pay up to $4,000 of their families’ annual medical bills, on top of about $1,600 a year in premiums. Five years ago, they paid no premiums and were responsible for only about $2,000 of their families’ medical bills.
“That’s a big jump,” Mr. Corbin said. “You’ve just lost a month’s pay.”
Already, many doctors say, the soft economy is making some insured people hesitant to get care they need, reluctant to spend a $50 co-payment for an office visit. Parents “are waiting longer to bring in their children,” said Dr. Richard Lander, a pediatrician in Livingston, N.J. “They say, ‘The kid isn’t that sick; her temperature is only 102.’ ”
The problem of affording health care is most acute for people with no insurance, a group expected to soon exceed 48 million, but those with insurance say they too are feeling the pain.
Since the recession of 2001, the employee’s average cost of an annual health care premium for family coverage has nearly doubled — to $3,300, up from $1,800 — while incomes have come nowhere close to keeping up. Factor in other out-of-pocket medical costs, and the portion of the average American household’s income that goes toward health care has risen about 12 percent, according to the consulting and accounting firm Deloitte, and is now approaching one-fifth of the average household’s spending.
In a recent survey by Deloitte’s health research center, only 7 percent of people said they felt financially prepared for their future health care needs.
Shirley Giarde of Walla Walla, Wash., was not prepared when her husband, Raymond, suddenly developed congestive heart failure last year and needed a pacemaker and defibrillator. Because his job did not provide health benefits, she has covered them both through a policy for the self-employed, which she obtained as the proprietor of a bridal and formal-wear store, the Purple Parasol.
But when Raymond had his medical problems, Ms. Giarde discovered that her insurance would cover only $22,000, leaving them with about $100,000 in unpaid hospital bills.
Dave Strom of South Boston, Va., bought a Smart ForTwo Passion Coupe, which he says is getting 45 miles a gallon.
Soaring gas prices have turned the steady migration by Americans to smaller cars into a stampede.
In what industry analysts are calling a first, about one in five vehicles sold in the United States was a compact or subcompact car during April, based on monthly sales data released Thursday. Almost a decade ago, when sport utility vehicles were at their peak of popularity, only one in every eight vehicles sold was a small car.
The switch to smaller, more fuel-efficient vehicles has been building in recent years, but has accelerated recently with the advent of $3.50-a-gallon gas. At the same time, sales of pickup trucks and large sport utility vehicles have dropped sharply.
In another first, fuel-sipping four-cylinder engines surpassed six-cylinder models in popularity in April.
“It’s easily the most dramatic segment shift I have witnessed in the market in my 31 years here,” said George Pipas, chief sales analyst for the Ford Motor Company.
The trend toward smaller and lighter vehicles with better mileage is a blow to Detroit automakers, which offer fewer such models than Asian carmakers like Toyota and Honda. Moreover, the decline of S.U.V.’s and pickups has curtailed the biggest source of profits for General Motors, Ford and Chrysler.
Once considered an unattractive and cheap alternative to large cars and S.U.V.’s, compacts have become the new star of the showroom at a time when overall industry sales are falling.
Sales of Toyota’s subcompact Yaris increased 46 percent, and Honda’s tiny Fit had a record month. Ford’s compact Focus model jumped 32 percent in April from a year earlier. All those models are rated at more than 30 miles per gallon for highway driving.
Dave Strom of South Boston, Va., recently bought a tiny Smart ForTwo Passion Coupe, made by Daimler, the German automaker.
Mr. Strom also owns a pickup truck, which he uses mainly to haul his boat. When he runs errands, he drives his Smart, which he says is getting 45 miles a gallon.
“I had to smile the other day when I filled my tank for $18 and the guy next to me had a Ford Explorer and the pump was clicking past $80,” said Mr. Strom, a 66-year-old retired manager of a Chevrolet dealership.
Previous spikes in sales of smaller cars were often a result of consumers trading down during tough economic conditions or gas-price increases. When the economy improved or fuel prices dropped again — as they did after the oil-price shocks in the 1970s eased — buyers invariably went back to bigger vehicles.
But with oil prices expected to remain high for years, auto industry executives are seeing a turning point.
BBC and ISPs clash over iPlayer
Posted on: April 9, 2008
A row about who should pay for extra network costs incurred by the iPlayer has broken out between internet service providers (ISPs) and the BBC.
ISPs say the on-demand TV service is putting strain on their networks, which need to be upgraded to cope.
Ashley Highfield, head of future media and technology at the corporation, has said he believes the cost of network upgrades should be carried by ISPs.
Simon Gunter, from ISP Tiscali, said the BBC should contribute to the cost.
He said the BBC did not understand the issues involved.
‘Bit odd’
The popular iPlayer service lets users download or stream programmes to a PC.
In its first three months more than 42m programmes have been accessed via the catch-up TV service.
According to figures from regulator Ofcom it will cost ISPs in the region of £830m to pay for the extra capacity needed to allow for services like the iPlayer.
Mr Gunter is leading the call for the BBC to help pay for the rising costs.
“The question is about whether we invest in extra capacity or go to the consumer and ask them to pay a BBC tax,” he said.
Bandwidth problems
Mr Highfield told the BBC’s Today programme such “inflammatory” comments were not helpful.
“The success of the iPlayer should be of benefit to the whole UK broadband industry, increasing those who want to take up broadband,” he said.
In his BBC blog last week Mr Highfield laid out a 19-point plan of action for ISPs, and warned they should not try to charge content providers.
“Content providers, if they find their content being specifically squeezed, shaped, or capped, could start to indicate on their sites which ISPs their content works best on (and which to avoid).”
In response Mr Gunter said it was a “bit rich that a publicly-funded organisation is telling a commercial body how to run its business”.
“Inflammatory comments about blacklisting ISPs do not help. There seems to be a lack of understanding about how networks are built. Either we are not explaining it properly or it is falling on deaf ears,” he added.
So-called traffic throttling has long been controversial and has been used by ISPs to control those users who eat up bandwidth by downloading huge amounts of material from often illegal file-sharing sites.
But the BBC’s iPlayer service has changed the nature of the problem.
“The iPlayer has come along and made downloading a legal and mass market activity,” said Michael Phillips, from broadband comparison service broadbandchoices.co.uk.
He said he believed ISPs were partly to blame for the bandwidth problems they now face.
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 Inflammatory comments about blacklisting ISPs do not help  Simon Gunter, Tiscali
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“They have priced themselves as cheaply as possible on the assumption that people were just going to use e-mail and do a bit of web surfing,” he said.
ISPs needed to stop using the term ‘unlimited’ to describe their services and make it clear that if people wanted to watch hours of downloaded video content they would have to pay a higher tariff, he added.
He said he believed the BBC needed to compromise.
“There has been talk, for instance, of the BBC bringing their servers into the loop as a way of lowering the backhaul costs,” he said.
But Mr Gunter said he was not convinced this would help.
“I have heard that the BBC is working on building a caching infrastructure so that storage devices can go on an ISP’s network but even if it goes ahead it doesn’t save costs on the backhaul network,” he said.
Gridlock warning
Geoff Bennett, director of product marketing at optical equipment maker Infinera, said he believed the government should broker a deal between the BBC and ISPs.
While allowing BBC content to be ‘cached’ by ISPs might be an instant fix to the problem it may not be the answer as more on-demand, bandwidth heavy applications come online, he said.
“There is a broader issue about the downloading of content and this requires an increase in the pipe where the bottleneck is occurring,” he said.
This would mean upgrades in the so-called backhaul or second mile network, he said.
“The industry has talked a lot about upgrading the last mile network with fibre to the home but the question needs to be asked about whether we should upgrade the second mile. The price of this would be ten times less,” he said.
Some reports, including one from US analyst firm Nemertes Research, have warned of net gridlock as early as 2010 as networks struggle to cope with the amount of data being carried on them.
But the BBC believes that the growth is “manageable”, said Mr Highfield.
“We estimate that currently the iPlayer is having between 3-5% impact on the network,” he said.
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