Factoring The Latest Healthcare Equation
Thursday, February 10, 2005SUSIE GHARIB: The government recently released its latest look at health care costs. They show the pace of spending growth has slowed for the first time in years. But as our home economist Brett Graff explains, you need to take a closer look at those numbers, to realize that we`re still coughing up a lot of cash for health care.
BRETT GRAFF, NIGHTLY BUSINESS REPORT CORRESPONDENT: Getting healthy might be easier if it weren`t so expensive. The government`s most recent annual report on health expenditures is for 2003. Health care spending growth that year decelerated for the first time in seven years. But read on and you quickly realize we still paid 7.7 percent more for health care than in 2002, bringing the total to $1.7 trillion. While the rate of growth is down, the reality is, our health costs are still climbing, a lot. Private health insurance, co- pays, deductibles and payments for service not covered by insurance came to almost $913 billion, more than half of national expenditures. Medicare and Medicaid paid the bulk of the remaining costs. Medicare spent nearly $283 billion and Medicaid almost $270 billion. On a per capita basis, health spending increased to $5,670 in 2003 or 15.3 percent of gross domestic product, outpacing overall economic growth by nearly 3 percentage points and our health insurance premiums also continued to climb, up 9.3 percent without out of pocket spending up 7.6 percent. And the trend toward higher premiums appears to be continuing into 2005. Take this letter from one of the major insurance companies to a non- smoking, healthy family of three, their monthly premium for PPO coverage is going up more than $100 a month to over $666. That`s with no illnesses. The family considers that expensive. Industry watchers consider them lucky. But don`t think we`re only paying big for our own health care. We`re also paying for the growing number of people without medical insurance.
DR. ROBERT OLLER, CEO, CLINICAL OPERATIONS, NOVA SOUTHEASTERN UNIVERSITY: What we`re looking at as individuals that are paying for insurance or have insurance is that they are paying for services that were provided from the institutions that needed to raise their premiums in order to take care of these individuals who do not have insurance and they are cost shifting those costs onto other insurance carriers and other individual groups in order to pay their bills.
GRAFF: Add into the overall spending equation new medical technologies, MRI`s and CAT scans Dr. Oller says are being demanded more by the public when perhaps a more traditional x-ray would be just as appropriate. Because the tests are costly and the machines expensive, that, he says, also ultimately impacts our increased out of pocket and insurance costs. So where can we expect to see health care costs go to in the coming years? The government projects that they`ll climb to 18.4 percent of GDP by 2013. How does that translate to the rest of us? It means on a per capita basis, health spending will jump to $11,000, double the amount of the government`s 2003 annual report. Brett Graff, NIGHTLY BUSINESS REPORT, home economist.
Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
02/10/05: Commentary: Accentuating The Positives In Healthcare
SUSIE GHARIB: Throughout the program tonight, we`ve been looking at different aspects of healthcare and how rising costs are causing problems for our healthcare system. But tonight`s commentator says it`s time we take a step back from the problems and look at the positives. Here`s Todd Buchholz, author of "Bringing the Jobs Home."
TODD BUCHHOLZ, AUTHOR, "BRINGING THE JOBS HOME": Jack Benny in his famous routine is confronted by a thief. Your money or your life, demands the crook. Benny pauses and pauses, and pauses again. Well, insists the robber. I`m thinking, replies Benny. And we should be thinking about America`s healthcare system, which steals a lot of money from all of us. You often hear politicians and economists complain that healthcare used to take up 5 percent of our economy, but now it chews up 15 percent, and it`s growing every minute. But guess what? We`re living longer and better. We`re getting something for our money -- life. Go back in history, World War II. The minimum requirements for the army were: a height of five feet; a weight of 100 pounds and the soldier must have 12 of his original 32 teeth. Today, Americans seem obsessed by teeth whiteners, not by whether they can actually chew their lunch. Through investments in technology and drugs, scientists have added six years to the average life span just since 1960. In 1900, the average toddler could expect to live to only 47. Now things could be better. We are not spending healthcare dollars as prudently as possible. Insurance programs and Medicare should give people more incentives to shop around and should prod doctors and hospitals to improve service and control prices. We need reform. But let`s stop portraying the healthcare system as a thief who demands our money and gives us nothing in return. I`m Todd Buchholz.
Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
02/10/05: "Paul Kangas' Stocks In The News"
PAUL KANGAS: Wall Street`s blue chips rebounded today thanks to a drop of 13,000 in new weekly jobless benefit claims when a rise was expected. Also helping, better than expected earnings and a two for one stock split from Aetna. At mid-day, the Dow was up 50 points, but the NASDAQ was down two. Good earnings reports kept the blue chips rising this afternoon while the NASDAQ market languished.
So the Dow Industrial average came in with a gain of 85 1/2 points at 10,749.61, but the NASDAQ Index was only up 1/2 point at 2053.10. Standard & Poor`s 500 up 5 points at 1197.01. Treasuries were weak across the board. The 10-year note slid 27/32 to 101 8/32, lifting the yield to 4.09 percent.
For the second straight session, topping the active list today on 19.4 million shares was Hewlett-Packard (HPQ) coming down a nickel after gaining $1.39 yesterday.
Then Pfizer (PFE), which didn`t change on the day.
Sprint FON Group (FON) down $0.42.
Tyco International (TYC) lost $0.21. The company did squash speculation that its CEO Ed Breen would step down and move over to Hewlett- Packard, said that`s not going to happen.
American International Group (AIG) up $3.28 after reporting excellent earnings yesterday. It was fifth in volume.
ExxonMobil (XOM) up $0.80. Oil prices on the rise today.
Then a new issue, Prestige Brands (PBH) which markets personal care products, 28 million shares offered to the public at 16, opened at 17 1/2, the high of the day 18 and then it backed down a bit.
Texas Instruments (TXN) down $0.28.
And then another new issue, Syniverse Holdings (SVR), this is a telecom services company, 17.6 million shares offered at 16, opened there. The high of the day, $16.38 and then it returned to its offering price at the close.
Lucent Technologies (LU) lost a penny and that was tenth in volume.
Aetna (AET), the star of the day on the blue chips, up $5.35, traded as high as $135. Fourth quarter operating earnings $1.82, up from $132 last year, $0.02 above the Street estimate. Revenues up 13 percent. The company has declared a two for one stock split and its boosting its 2005 earnings estimate from $8.40 to $8.75 to $8.90, also plans to boost its rather small annual dividend to $0.04 to $0.08.
Sara Lee (SLE) up $0.95. The company`s named Brenda Barnes as the new CEO and also it plans restructuring by spinning off some of the units like Hanes underwear and Chock Full of Nuts coffee.
Loews (LTR), this is the insurance and oil and gas conglomerate, not the home improvement firm. Good earnings though, fourth quarter, $2.41, up from $1.79 last year, $0.86 above the Wall Street estimate.
Alcon Incorporated (ACL), which is into eye care products, up $7.80. Fourth quarter earnings sharply higher, $0.60 versus $0.43 last year, $0.07 better than the Street was expecting. Standard & Poor`s repeated a "buy" recommendation.
And Boyd Gaming (BYD) up $5.61. Higher earnings there, fourth quarter, $0.45, up from $0.19 a year ago. Revenues soared 75 percent. CIBC World Markets brokerage upgraded it to "outperform."
Winn-Dixie Stores (WIN), major loser, down $1.25 or almost 36 percent. A fourth quarter loss of $2.84 a share, must bigger than the $0.57 loss last year. Sales dropped by .3 percent. Standard & Poor`s downgraded it from "hold" to "sell."
And then Krispy Kreme Doughnuts (KKD) losing almost 16 percent of its value. Company`s going to take a monthly fee or $400,000 to Kroll, Zalfo and Cooper, a firm specializing in corporate turn-arounds.
Topping the active list on NASDAQ, NASDAQ 100 (QQQQ) up $0.04.
Google (GOOG) down $3.60.
eBay (EBAY) was up $2.23 although after the close, the company said that it`s reaffirming its 2005 earnings and revenues estimate, but they`re below the Street estimates.
Microsoft (MSFT) a penny loss.
Intel (INTC) $0.20 gain there, fifth in dollar volume.
Apple Computer (AAPL) down $0.38.
Cisco Systems (CSCO) dropped a nickel.
Yahoo! (YHOO) off $0.15.
Dell (DELL) closed up $0.58, but as you heard after the close, dropped about $1 from there.
Then LM Ericsson (ERICY) down $2.56. Fourth quarter earnings were just below the Wall Street consensus and margins were disappointing.
And finally a huge gainer, Altair Nanotechnologies (ALTI). The company developed a more powerful and long-lasting quick charging battery. The stock up 130 percent almost.
Those are the stocks in the news tonight.
