Rich America, Poor America

STEFANO RIZZO
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The United States is a wealthy country. The per capita income is around 80,000 dollars a year, more than double that of Italy (37,000 dollars), and 30 percent higher than that of Germany and France (53,000 and 46,000 dollars respectively). Americans also spend a lot on medical expenses and healthcare in general: around 18.8 percent of the gross domestic product, almost double the European average, which is 10.9 percent (in Italy it’s 9.5 percent of GDP).

However, despite the country’s wealth, and of course the strong disparities between different income groups, there is a category of people who fare rather poorly when it comes to medical care: the elderly. The “fault” lies in part with the progress of medical science, which has prolonged the average lifespan and allowed more and more people to live relatively healthy lives until an advanced age. In the United States today there are approximately 56 million seniors over the age of 65 (17 percent of the population), and 7 million over the age of 85. All these people are and will increasingly experience inevitable physical deterioration — chronic diseases, dementia, etc. — which require diagnoses, surgical interventions, home care as long as possible, and then hospitalization in special facilities (long-term care, retirement homes).

The growth in health spending in the USA (dark yellow), in high-income countries (light yellow), in middle-high income countries (blue), in low-income countries (fuchsia) (source CNBC)

Here begin the problems that all the money the United States spends on healthcare cannot solve. The American healthcare system is divided into three large blocs: Medicaid, Medicare and private insurance. Medicaid and Medicare were created sixty years ago by Lyndon Johnson as part of that era of reform called the “Great Society”. Medicaid was set up to assist the poor, Medicare to assist the elderly over 65; for everyone else, private insurance companies, which are often reluctant to insure patients with chronic diseases and the elderly. Because the elderly, with all their illnesses, cost a lot. The federal government, which finances and manages Medicaid and Medicare together with the states, does not have enough money. Insurance companies, on the other hand, have no problems: they simply increase premiums, which have reached unattainable figures, not just for the poorest but often also for the middle class (around nine thousand dollars a year for a relatively young person in good health).

The Affordable Care Act (Obamacare, as it came to be called), the law strongly promoted by Obama in 2010, put a stop to the most glaring distortions of the insurance system to some extent, forcing insurance companies to not refuse chronically ill patients or patients with pre-existing conditions. However, to pass the law (which the Republicans have since tried to repeal, without success) Obama had to give up the only provision that could have calmed private insurance prices and reduced their huge profits: the creation of a public insurance system managed by the federal government. In the absence of affordable public health insurance, the problem of how to pay their medical expenses, which affects tens of millions of American citizens on a daily basis during their working lives, and even more afterwards, has remained unsolved. The problem has actually worsened with the retirement of baby boomers (those born between 1945 and the mid-sixties), which is dramatically increasing the number of elderly people.

A demonstration by Health Care for America Now in favor of a universal health care system

In theory, Medicaid should pay for both long-term care and in-home care, but there isn’t enough money. The Inflation Reduction Act, the law promoted by Biden and approved a year ago after endless negotiations, provided an allocation of 150 billion dollars for domestic assistance and community services. However, the provision was removed from the package, along with other interventions that Republicans refused to pass as part of the law. The result has been that individual states that should manage care for poor elderly people do not have the money to do so, and waiting lists are very long. In any case, to be able to benefit from domestic assistance or hospitalization in a state-funded retirement home, the elderly person must not own any assets (not even a home!) and have an income below the poverty threshold. If he has property, he must sell it, and if he has an income he must hand it all over (not only his own but also that of his spouse) to the nursing home, which leaves him an average allowance of fifty dollars a month for personal expenses.

Even for middle or upper-middle-class seniors ($70,000 to $140,000 a year in income), medical expenses can be prohibitive, with or without insurance. Hospitalization in an assisted facility starts from a minimum of $55,000 a year and can reach millions of dollars, while in-home care (for which however there is no staff) exceeds $60,000 a year: enough to eat up savings accumulated during working life, pensions and any insurance in a few years. The result is that the elderly person, once wealthy, falls into a spiral of debt that forces him to sell everything he owns, even his house, and has to rely on the financial help (and not only) of children and spouse, who, in addition to having to provide assistance free of charge, do not even have the hope of inheriting anything upon the death of their relative.

On Lok Senior Health Services, San Francisco, CA, 1970s

Thus, a large part of the wealth accumulated since the post-war period by the legendary American middle class, which is increasingly discontented and politically disoriented for good reason, is going up in smoke. Or rather, it’s not going up in smoke but is being redistributed upwards to the rich and very rich classes who already hold a large part of the country’s wealth (ten percent of the population earns the same as the remaining ninety percent and owns 70 percent of the wealth).

Demographers say the situation is only destined to get worse: by 2050 the population of elderly people over 65 will increase by fifty percent, reaching 86 million, and that over 85 will triple to 19 million. Much more public money would be needed to take care of all these “grand old people” and allow them a dignified old age, but the Republicans, who are against any public spending when they are not governing, are not willing to allocate it. And even for many Democrats, military spending, technological innovation, artificial intelligence, increased industrial production and everything else needed to make the country rich and powerful come first. The elderly come later. In the meantime, just wait and the problem will resolve itself.

Translation by Paul Rosenberg

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Rich America, Poor America ultima modifica: 2023-11-30T18:45:00+01:00 da STEFANO RIZZO
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