I’m not exactly sure what constitutes the middle class these days, but after about a year of presidential campaign speeches, it’s apparent that this group is under siege and that likely combatants are the top 1 percent, corporate greed, pharmaceutical companies, the Republicans, the Democrats, Wall Street “fat cats,” Chinese manufacturers, Cayman Island bankers, undocumented immigrants, and gluten.
I was beginning to think that maybe gluten was to blame because it seems to be at the root of most of our other ills. However, I now believe that the silent assassin of the middle class is health care. Health care is the great American job creator — how could it possibly be to blame?
Analysis of government census data shows that the median household income in the U.S. grew by $3,424 between 2007 and 2014. This represented a 6.8 percent increase. But, according to the 2015 Milliman Medical Index, the average health care expenditures for a family of four in the U.S. increased by $8,715 (60.1 percent) over the same period.
Put another way, health care costs increased by $2.54 for every $1 of pay increase for the average American family of four between 2007 and 2014.
This increase in costs is often hidden like a sniper on a rooftop. Taxes were increased through the Affordable Care Act. Wages have been compressed as employers absorbed health benefit rate increases. Employees have absorbed per paycheck health benefit increases and significant increases in average deductibles.
The political campaigns are full of promises for the middle class, but none are adequately addressing the financial threat created by the continued increase in health care costs. Put on your body armor, wear your helmet, and be ready for another four years of financial casualties no matter who wins or loses the election. Maybe we’ll all do better in the 2020 presidential campaign?