Monthly Archives: August 2016

Health Emergency Fund

images-6Even with good health insurance, a health emergency or a prolonged illness can be a financial disaster. Health insurance deductibles, co-payments, emergency room costs, and other costs of illness can add up in a hurry.

A health savings account (HSA) is one way you can put aside tax-free money for a health emergency. HSAs were established in 2003. If you are covered by a type of insurance known as a high-deductible insurance plan, you can make tax-deductible contributions to an HSA. Your employer may also make tax-deductible contributions.

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“An HSA account is very different from having a general emergency fund account,” says Joseph J. Porco, managing member of the Financial Security Group, LLC, in Newtown, Conn. “An emergency fund is about more than just out-of-pocket medical expenses. If possible, it’s a good idea to have both.”

How Much of an Emergency Fund Do You Need?

For an older adult, a health emergency might result in the need for long-term care, possibly for the rest of the senior’s life. For a young adult supporting a family, a medical emergency might be much more than just the cost of illness. Your health emergency could cause a disability that results in loss of income over an extended period. That means you should save enough to cover all your expenses.

“Most advisers would say you should have enough emergency funds saved to cover your family expenses for three to six months. I would recommend trying to put enough aside to cover all your expenses, not just health expenses, for 6 to 12 months,” says Porco.

How much you need for a health emergency and how much you can actually put into an emergency fund will depend on your family size, your income, your health status, and your age. But your first step is to understand your health insurance situation.

“The best way to start is to sit down with a financial adviser and figure out what your insurance actually covers and what it doesn’t cover. What are your insurance limits? What kind of medical bills might arise that you would be responsible for? Get some expert advice on how best to cover your actual needs,” advises Porco.

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What Insurance May Not Cover

How much insurance companies actually pay for accidents, cancer treatment, or surgery depends on what kind of insurance you have, but there are usually limits. Here are some facts to consider:

  • Cost of illness. Most insurance companies have a cap on how much they will pay for a long-term illness. A recent survey found that 10 percent of people with cancer have hit their lifetime cap and are no longer covered by insurance. Looking forward, however, the new health care reform law will eliminate caps on lifetime insurance by 2014.
  • Emergency room cost. If you have an accident that requires emergency treatment and you end up in an emergency room outside your insurance network, you may not be covered. One study found that HMOs in California denied one out of every six claims for emergency room costs.

Caramel Coloring Is Toxic

The FDA should ban the use of two compounds widely used in food products, including market giants Coke and Pepsi as well as other soft drinks, because they pose a cancer risk, according to a petition filed by a citizen’s group.

But the American Beverage Association denounced the petition, filed Feb. 16, as “nothing more than another attempt to scare consumers” that is not supported by science.

At issue are caramel colorings that contain 2-methylimidazole and 4-methylimidazole.

According to the petition, filed by the Washington-based Center for Science in the Public Interest, both have been found by the National Toxicology Program to cause cancer in animals.

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And last month, California regulators added one of them — 4-methylimidazole — to the list of chemicals “known to the state to cause cancer.” The state said the safe limit for consumption of the chemical is 16 micrograms a day.

However, a recent study suggested that 12 ounces of cola would contain up to 130 micrograms of the substance, according to the petition.

The coloring substances are made by treating sugars with ammonium alone or ammonium and sulfites under high pressure and temperatures; the two compounds are byproducts of the process.

Feeding studies conducted by the National Toxicology Program showed that high doses of the substances led to lung, liver, or thyroid cancer or leukemia in laboratory mice or rats.

The government researchers concluded there was “clear evidence” that 4-methylimidazole caused cancer in mice, although studies in rats were less clear, with significant increases in leukemia in females but no increase in tumor activity in males.

They also concluded that 2-methylimidazole caused cancer in female rats and argued there was “some evidence” the substance caused tumors in male and female mice.

Help Ease Chronic Fatigue

download-11Patients with chronic fatigue syndrome who participated in programs aimed at helping them overcome their symptoms — a combination of exercise and counseling — improved more than those whose treatment was intended to help them adapt to the limitations of the disease, a large randomized trial found.

Mean fatigue scores among patients treated with graded exercise therapy — a tailored program that gradually increases exercise capacity — were 3.2 points lower than scores in patients who received specialist medical care alone, according to Dr. Peter D. White, of Queen Mary University of London, and colleagues.

Furthermore, fatigue scores were lower by 3.4 points among patients receiving cognitive behavioral therapy, in which a therapist works with the patient to understand the disease, alleviate fears about activity, and help overcome obstacles to functioning.

In contrast, among patients who were treated with a program known as adaptive pacing therapy, which emphasizes energy limitations and avoidance of excess activity, scores differed by only 0.7 points the researchers reported online in The Lancet.

In a press briefing describing the study findings, co-investigator Dr. Trudie Chalder, of King’s College London, said, “We monitored safety very carefully, because we wanted to be sure we weren’t causing harm to any patients.”

“The number of serious adverse events was miniscule,” she added.

Another co-investigator, Dr. Michael Sharpe, of the University of Edinburgh, commented that a difficulty in the management of chronic fatigue syndrome has been ambiguity — about the causes and whether these treatments recommended by NICE actually are effective.

“The evidence up to now has suggested benefit, but this study gives pretty clear-cut evidence of safety and efficacy. So I hope that addresses the ambiguity,” Sharpe said during the press briefing.

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However, the investigators conceded that the beneficial effects of these treatments were only moderate, with less than one-third of participants being within normal ranges for fatigue and functioning, and only about 40 percent reporting that their overall health was much better or very much better.

“Our finding that studied treatments were only moderately effective also suggests research into more effective treatments is needed,” they wrote.

In addition, they stated that their finding of efficacy for cognitive behavioral therapy “does not imply that the condition is psychological in nature.”

The importance of cognitive behavioral therapy was further emphasized by Dr. Benjamin H. Natelson, of Albert Einstein College of Medicine in New York.

“This approach of encouragement of activity and discouragement of negative thinking should be a tool in every physician’s armamentarium,” he said.