Here, here UW! Living in the liberal hellhole of Massachusetts (and having marketed individual major medical products
in the other New England states)I’m always quick to correct my Massachusetts clients and friends when they speak of health insurance. I always advise them that they have “prepaid healthcare delivery systems”. No underwriting = No insurance.
Health insurance has gotten out of hand because people have gotten out of hand. Going to the doctor when you know you have a cold! How stupid is that!!! Going to the doctor for every GD thing! It’s riduculous and even being an insurance agent, I hear my co-workers all the time saying, went to the doctor for this , that. Stupid! We need to be told every month how much this premium is – probably $2000 each family!
While these economists’ thoughts are interesting, it seems to me they are comparing apples to oranges here. Health insurance most certainly IS insurance and IS NOT cash flow management for known expenses. Cars don’t get warts, nor are they at risk for the health consequences certain types of warts can pose if left untreated. A failing headlight bulb will not cause the car to get cancer or stop running — it will just subject the car’s owner to the risk of a traffic ticket if he doesn’t replace the bulb. Sure, the cost of an annual check-up could be called a “known cost,” but what’s not known is what might happen as a result of that physician visit. Example: The patient complains of chest pains and difficulty breathing. The physician will refer that patient for appropriate follow up diagnosis and treatment. Beyond diagnosis and initial treatment may be several repeat office visits with the primary physician. Health insurers have to anticipate, and reserve against, such outcomes. Annual check-ups are considered preventive care. Insurers are banking on the hope that encouraging (paying for) regular treatment and early intervention/diagnosis will keep long-term health care costs down.
Anne Nonymous thank you for so perfectly making the authors case. Auto insurance could pay for preventative measures i.e. replcing brakes before an accident but it doesn’t. That is not the purpose of insurance but a responsibility of owning a car. Health insurance has become an entitlement program expected to cover any bodily ailment from cancer to hairplugs. The line between an insurable risk and an annoying expense has increasingly become blurred which contributes directly to the overall cost.
Oh Anne Oying (I mean Nonymous). There’s two things I wish people paid for directly. First, is their taxes. Instead of having it come out of their paycheck by their employer. And second is, health insurance. They’d be riots in the streets. Believe me!
When’s the last time you called your doctor and asked him how much a procedure cost? You take your car to the garage you want to know how much a gallon of gas is to the cost of a tuneup!
Anne, Have you heard of heart transplants, liver transplants, etc.? Yes, those annual exams that everyone should get are just like a tune up for your car. You take it in and if the mechanic finds a problem, your car will be back for further service. Same as going to the doctor. Granted, it is more expensive and a higher priority to get to the doctor and be taken care of but these types of visits are those that are known. Don’t get me wrong, I sell and service health insurance policies for my clients, and there needs to be some reform. However, the debate needs to be open and honest about the true cost of things prior to making changes to our system. Using the car analogy, lets start our country off with Chevy Aveo, see how it works for us and go from there. You wouldn’t start your kid off driving a stretch limo would you?
Health care is a right. Having health insurance is not a right. Somewhere in the middle we have to find a way to reduce the cost of health care which is not the same as reducing the cost of health insurance.
It really is. You have the fixed cost maintenance issues (annual check ups) and then the catostrophic issues. It is why Accident Policies are so cheap vs health insurance. I guess the HMO’s didn’t bring the costs down like everyone thought. I love the HSA/HRA option. A great way to give the employee some skin in the game of ‘what they use’ . Someone may not wish to dip into their deductible so easily.
I disagree with the idea that most people dont really know what it costs. While most dont know the actual premiums, most people that are educated know that an employer who offers health insurance is the more competitive employer because they are not willing to pay for it themselves. People who have multiple offers are now drilling down and asking how much is my out of pocket before signing on the dotted line. The same is not true for Govt workers.
*Sigh* Thank goodnees my wife works for a NJ School District. 100% paid for with $5 co-pay in network and $20 out of network. Now those people have NO CLUE what it costs and are taking the tax payers for a ride. I am glad I get something for my high taxes.
Wow! Thank you all for your feedback. I was wondering if people were reading the comments on this article. Apparently you are!
I’m still not convinced that a person should be insured/maintained in the same manner as chattel property. You are correct that many Americans have no clue what health care really costs and how much they’re really paying for it. I suspect, however, that anyone who doesn’t know how much tax was withheld from their pay checks probably isn’t filing tax returns . . . :). Anyway, the cost of health care IS out of control. Insurance companies, employers, and state/local governments have all tried at least something to curb it — but here we are anyway.
Do you all think that, if we were to go with the idea of an indemnity-like health insurance product as a minimum mandated coverage, that such a program could actually reach the goal to “cover” all insureds in the US? If so, will Americans support something that pays benefits like an auto policy does (i.e. the car/person analogy)?
If this “health-indemnity” product has to accept everybody (no pre-existing condition exclusions) but only pays for services that are not “due to wear and tear” or “are routine maintenance items” I wonder how much coverage it would afford to older, or frail, or at-risk persons. I also wonder whether the premium would be affordable when considered alongside the increased out-of-pocket costs for noncovered stuff (wart removal, replacement of worn-out parts [yes I am fully aware of organ transplant availability :)] etc.? Would transplants be left uncovered as “due to normal wear and tear?” Would we need a national risk pool in addition to the mandated health plan to cover the biggies like transplants and cancer?
I know some of my examples are a bit extreme . . . I just wonder what minimum mandatory health policies would cover and how much it would cost individual policyholders? Any thoughts out there?
Thanks.
A big shift in the last generation: health insurance equals health care.
I have been telling people that using the word “insurance” related to health care has become inaccurate. You buy auto insurance to cover the chance that you might have a claim; there is no “chance of a claim” with health insurance, it’s going to be used.
Realize that as more people loose jobs, this plays into Obama’s plan to sell his Federal takeover plan (Obamacare).
His “Shovel Ready Jobs” that should have months ago started have never materialized and he really doesn’t want them to. The more jobs lost, the more uninsured to “buy into” his notion of Obamacare.
Note 2% or less of the “Cash for clunkers” has yet to be paid to dealerships. Maybe it will show up in 2010 to convenienty coincide Obama’s re-election run.
Its all about Federal control of a huge sum of money. Big tax “changes” are a large portion of this plan which breaks his campaign promise of only those making over $250,000 to now affecting instead directly and indirectly every wage earner in America – YOU.
Get this done before re-election time, and before anyone understands the impact, accuse the American public and those in opposition of being partisan or prejudice,…that is the modus operandi!
Go 09/12/09 March at the Capital! Hopefully the partisan media will show the real story, and not just a select few wackos off in a side street.
May God have mercy on our country. May those who are in opposition not remain complacent!
This guy must have been a great carpenter in a prior life. He certainly knows how to hit the nail on the head, and drive a true nail. It really is time we called a spade a spade and cleared up the ‘insurance’ confusion.
I agree that health insurance is not really health insurance for the reasons mentioned in the article. One additional reason that comes to mind is health insurance companies use their size and influence to reduce health care costs. They use this influence to contract with drug companies, doctors and hospitals, etc. for reduced pricing if you want to be included in their network. In this respect they create their own operating margins.
Property and casualty insurance companies do not do this. For example if you have hail damage to your roof you pick your own roofer to do the repairs. You don’t go to the roofer that the P&C company chooses for you.
Also a typical health insurer will not examine you before taking you as an insured. Almost every P&C company I know wants to inspect your house when they insure it.
I fail to see the relevance of pointing out the difference between health and auto insurance. Each line of insurance is different. D & O is quite different from boiler & machinery, etc. Workers’ compensation may be more analagous to health insurance or disability insurance than it is to property insurance although it’s a P & C line.
However, since the analogy has been made between auto and health insurance, a more rigorous comparison will show that there are more similarities than this simplistic article states. Most auto policies give premium discounts for safety features such as anti-lock brakes. Health insurance policies covering routine preventive care is similar. The major costs in health insurance are not the preventive check-ups and screenings, which are typically more than covered by the premiums charged, but the serious and catastrophic injuries and illnesses. Coverage for preventive care is like a premium discount in auto insurance–it helps prevent more serious accidents/illnesses.
All: Are those of you who support the “health-indemnity” type product talking about a return to the old-fashioned policies that stated the covered expenses, had an annual deductible and coinsurance and a lifetime benefit limit, and paid any doctor or hospital you went to up to the benefit limits? Would this mean doing away with the “in-network/out-of-network” strategy that most insurers have in place today?
I’m trying to get an understanding of what Ty and others think real health insurance should look like.
My experience with this “old” type of policy was that the patient had significant upfront payment obligations, was obligated to pay “the rest” of the medical bill if the insurer didn’t pay 100%, and seriously ill people sometimes maxed out the lifetime benefit limit (while still living).
POLICIES USED TO BE SIMPLER—ANNUAL DEDUCTIBLE AND MAXIMUM BENEFIT. WE NEED THE INSURED TO MORE ACTIVELY PARTICIPATE IN THE PRICING OF HIS OR HER MEDICAL SERVICES. WE ALSO NEED TO HAVE INDIVIDUAL HEALTH POLICIES UNDERWRITTEN MEDICALLY THE SAME AS GROUP POLICIES—JUST CUZ YOU WORK FOR SONY DOESN’T MEAN YOU ARE A BETTER RISK THAN IF YOU WORK FOR JOE’S BARBER SHOP. EVERYONE EITHER SHOULD BE MEDICALLY UNDERWRITTEN, OR NO HEALTH QUESTIONS. NICKLE-DIME HEALTH MAINTENANCE SHOULD BE THE INSURED’S RESPONSIBILITY, BUT HE SHOULD GET A “DIVIDEND” FOR PROVING TO THE INSURANCE COMPANY THAT HE GOT IT DONE. ALSO, ONLY CITIZENS SHOULD RECEIVE HEALTH CARE. NONCITIZENS SHOULD BE TURNED AWAY UNLESS THEY PAY.
I’m so tired of the governement is always wrong philospy. It’s been used for the last 30 years to the point that we our infracture is failling apart because it was built during the 40’s and 50′, our schools are over crowded and many of them unsafe. We got government out of the regulation business and we get the sub-prime mess and the AIG debacle.
The government is us. It provides us with police protection, fire service, public schools, national defense, infracture projects (such as the dams and levees on our river), unemployment benefits and a safety net for people who fall on hard times. What do you want to eliminate and what private company will take it over for less cost and benefit? We tried to privatize some our military operations in Iraq with Black Hawk and look what happened.
Larry,
some of us are not citizens but pay all the taxes etc that citizens do but without all the benefits that citizens get. We live here legally and are part of the global exchange of knowledge and appreciation of other cultures.
But sometimes it just seems crazy that you guys get so incensed about something as basic as health care – of course a civilized, democratic (small d)society such as yours should be able to provide this without going bankrupt – the smallest European countries seem to be able to manage, contrary to some previous posts, a wait of 2 years to get a basic procedure done is not normal.
No answers but hopefully another perspective, it is going to be tough especially in this particular point in the financial cycle. I plan on being here for the long haul, so in for a penny in for a pound, or rather in for a dime in for a dollar!
You are so wrong in this statement “JUST CUZ YOU WORK FOR SONY DOESN’T MEAN YOU ARE A BETTER RISK THAN IF YOU WORK FOR JOE’S BARBER SHOP”
A guy that paves roads for a living, he is going to have more health related problems in the future then someone that sits at a desk all day (e.g skin cancer, lung cancer from inhaling all the exaust from vechiles passing by, etc etc). No health questions would be a disater. Why should I pay the same amount as someone who is in worse health them myself (or pre exsiting conditions?)
Before you can determine what Health Care should look like or what changes should be made to the system we need to get a handle on costs; i.e. put a leach on trial attorneys. We need penalties for attorneys that bring frivolous, baseless lawsuits and Loser Pay rules. And, there has to be teeth added to signed disclosure statements, etc. Lawsuits and arbitration are are wreaking havoc not only to Health Care but every aspect of our economy.
Anne,
did you say INSURANCE COMPANIES are trying to curb the high cost of health care?? Are you drinking the kool aide?? The only thing they seem to be curbing is patient care and physician payments. Meanwhile, check the WSJ to see the latest double digit increases in health plan executive bonuses.
million…. with all this money we could have healed the world but instead we play with it like a house of cards. Will we wake up? Ask yourself this big question. IN LOVE WITH THE INSURANCE INDUSTRY? . THINK ABOUT IT LIKE THIS. DO WE REALLY WANT THE INSURANCE COMPANIES RUNNING OUR WORLD . I SAY NO WAY……I HAVE MORE FAITH IN OUR GOVERNMENT THAN THE INSURANCE COMPANIES.
I believe one of the commenters in this dialogue made the point that health insurance and health care aren’t the same thing. I agree with that point of view.
Health insurance is one way to fund a person’s health care when it is needed. Individuals and companies have other options, in addition to/instead of private insurance that they can use to pay for health care. These options include self-funding, cost-sharing, health savings programs, etc. Self-pay is also an option, although not a popular one.
Any of these payment sources are going to take steps to keep the cost of the care they choose to pay for as low (affordable) as possible.
It seems to me that the cost of health care in the U.S. is the primary issue to address. How individuals and companies pay for their health care is another major issue. The other main issue is how to match the demand for health care with the supply of health care available. The unanswered question is this: Who has the ultimate obligation to pay for each person’s health care?
So, which problem should U.S. Government step in and “fix”? Funding source? Price of services? Access to services?
Sorry Professor – Too much time in the class room and no case management experience. Most property and casualty risks that are underwritten have known risks to loss that are clearly illustrated over an extended period. Most competent underwriters price the coverage to cover the expected expense from these expected losses resulting from known exposures.
P&C carriers could learn from health carriers by using preventive care in their policies. How many home and auto policies could have been prevented had the insured done proper maintenance to their home or auto. I had a water damage claim on a home called in this morning that could have been prevented had the insured calked the flashing around her fireplace chimney. An auto claim was called in last week because the insured’s brake shoes were worn out. Both of these examples could have been avoided with preventive maintenance.
Health carriers encourage insureds to get an annual exam to prevent a minor problem from becoming a major and expensive problem. True, the medical profession makes money from the preventive care. However, it probably saves health carriers money in the long run.
P&C carriers give discounts for alarm systems. Should they give discounts for proof of proper maintenance or surcharges for lack of proper maintenance. Unfortunately this may be too difficult to manange with P&C but, it is not with health insurance.
I can agree that “Theoretically all auto accidents could have been avoided”. However, we don’t insure for just human error. Theft, vandalism and weather damage to autos is a very significant portion of our losses. This varies from year to year with the crime and weather patterns. With uninsured motorist losses we are insuring for ‘human error’ but, not our insured’s error.
I agree with health insurance carriers paying for preventive care. Even the HSA plans I market include prescription drugs – gives an incentive to make sure you’re taking your medicine. I think HSA plans should be allowed to pay for one physical exam a year – as preventive care. As an alternative, the carriers could also a premium discount to those insureds that have a regular physical exam and pay for it themselves.
Think about it, if no one had health insurance, the pharmaceutical industry would either go out of business or drastically lower their prices. Who pays for the billions in advertising?
I think the reason they starting covering routine Dr’s visits is because they want to create value in their product and attract new customers. BTW, a lot of ins policies dont cover a lot of routine expenses.
Im 42 and ive virtually never used my health insurance, so dont tell me its not insurance. Im healthy, I have to be forced to go to the doctor, and my ins company actually makes a ton of money off of me.
I have no routine expenses for them to pay for – Maybe a few, but they are not covered.
The health insurance should cover only unexpected serious illness or injury and be paid for by Government.
the client should be responsible for routine physicals, colds and such.
If desired one can buy extra coverage for premium coverage and faster care
One person said, this is irrelevant, it’s not! Insurance is a one type of solution to the financial problem of risk. But if we don’t properly classify a problem, we’re not going to use the right solution!
On people that said it isn’t, wake up! Real health insurance would look like other insurances. It would cover only unexpected adverse events and it would have a relatively high deductible per incident ($250, $500, or $1,000 depending on how much you want to pay.)
While some auto/home plans offer limited benefits for specific repair/maintenance items, you are essentially on your own. That means, you work actively to control those costs.
An oil change today is $25-40. How much do you think and oil change would cost if for the last 60 years, your employer had been paying your all-encompassing auto needs policy, and then they pay the oil change place?
First, an oil change would cost $200 for anyone without coverage, (your insurer only pays $80 for theirs, great deal eh?) Second, nobody would get just an oil change, everything that can be changed out, flushed, worn, or replaced in under 5 min. (per item) would be upsold onto every order… BECAUSE IT’S FREE! I mean, at least I don’t write a check for it, or if I do it’s a token amount.
What the author is really afraid to say is the effects of this distorted reality. Replace this junk system we have now w/ real insurance, paid for by individuals! Then, you have to mandate coverage, just like auto and home insurance (mandated by the note holder, or whoever else stands to lose thousands in one catastrophic event.)
This would make insurance affordable, that’s all it takes! But instead, we continue to embrace a failed anti-market process. Seperating the payer from the beneficiary isn’t market economics it’s letting the 5-yr old drive! How would your household budget look if your teen had a CC w/ virtually no limit, but you paid the bill. Oh, and you can’t look at or question the charges, you just
have to shut up and pay.
BTW, why is it that doctors almost never go out of business? Does every one of them happen to be excellent businessmen… I bet not.
Once you have insurance covering risk, then you can set up a variety of seperate mechanisms for managing typical repair/maintenance.
If you would separate these two important but very different components of health care, you would finally create a free market in health care and that would dramatically lower costs. You would also eliminate the huge penalty premiums created by the industry’s overzealous obsession with the risk of adverse selection.
There’s no magic in this, “health insurance” is $12,000 a year of wages per family that is instead being re-routed to a private corporation, who decides how to spend that money for you. They’ve done a terrible job handling your money, because you let them! But this inefficient anti-market hasn’t bankrupted the greatest economy in the history of the world yet… so let’s give it some time, I think they can.
If you graph the percentage of people on one access, 0 to %100%, and the percentage of health care costs on the other, 0 to 100% and then compare the curve for the USA to other countries where they do not have health “insurance” as we know it in the US, then you will notice little difference in the curves. ~85% of the costs are on ~15% people in the US as well as the other countries. The relationship is based on epidemiology and genetics. And the relationship is known and is stable over time.
If you are in favor of a re-distribution from the sick to the healthcare system, then do it the way it is done in the USA. Especially if you don’t challenge the providers when they charge 2.5 times as much in the USA as they do on the average in the OECD countries. We prefer well-paid providers and their “insurance” companies to those impoverished by disease and their genetic endowment.
Here, here UW! Living in the liberal hellhole of Massachusetts (and having marketed individual major medical products
in the other New England states)I’m always quick to correct my Massachusetts clients and friends when they speak of health insurance. I always advise them that they have “prepaid healthcare delivery systems”. No underwriting = No insurance.
It’s almost like I wrote this article!
Health insurance has gotten out of hand because people have gotten out of hand. Going to the doctor when you know you have a cold! How stupid is that!!! Going to the doctor for every GD thing! It’s riduculous and even being an insurance agent, I hear my co-workers all the time saying, went to the doctor for this , that. Stupid! We need to be told every month how much this premium is – probably $2000 each family!
Correct were you a student of Dr, Vaughn?
While these economists’ thoughts are interesting, it seems to me they are comparing apples to oranges here. Health insurance most certainly IS insurance and IS NOT cash flow management for known expenses. Cars don’t get warts, nor are they at risk for the health consequences certain types of warts can pose if left untreated. A failing headlight bulb will not cause the car to get cancer or stop running — it will just subject the car’s owner to the risk of a traffic ticket if he doesn’t replace the bulb. Sure, the cost of an annual check-up could be called a “known cost,” but what’s not known is what might happen as a result of that physician visit. Example: The patient complains of chest pains and difficulty breathing. The physician will refer that patient for appropriate follow up diagnosis and treatment. Beyond diagnosis and initial treatment may be several repeat office visits with the primary physician. Health insurers have to anticipate, and reserve against, such outcomes. Annual check-ups are considered preventive care. Insurers are banking on the hope that encouraging (paying for) regular treatment and early intervention/diagnosis will keep long-term health care costs down.
Anne Nonymous thank you for so perfectly making the authors case. Auto insurance could pay for preventative measures i.e. replcing brakes before an accident but it doesn’t. That is not the purpose of insurance but a responsibility of owning a car. Health insurance has become an entitlement program expected to cover any bodily ailment from cancer to hairplugs. The line between an insurable risk and an annoying expense has increasingly become blurred which contributes directly to the overall cost.
Oh Anne Oying (I mean Nonymous). There’s two things I wish people paid for directly. First, is their taxes. Instead of having it come out of their paycheck by their employer. And second is, health insurance. They’d be riots in the streets. Believe me!
When’s the last time you called your doctor and asked him how much a procedure cost? You take your car to the garage you want to know how much a gallon of gas is to the cost of a tuneup!
This article is right on. I rest my weary back.
What’s a hair plug? I can add that to my maintenance list!
Yes, Anne, you completely got this author wrong. There is much truth and wisdom in this article.
Anne, Have you heard of heart transplants, liver transplants, etc.? Yes, those annual exams that everyone should get are just like a tune up for your car. You take it in and if the mechanic finds a problem, your car will be back for further service. Same as going to the doctor. Granted, it is more expensive and a higher priority to get to the doctor and be taken care of but these types of visits are those that are known. Don’t get me wrong, I sell and service health insurance policies for my clients, and there needs to be some reform. However, the debate needs to be open and honest about the true cost of things prior to making changes to our system. Using the car analogy, lets start our country off with Chevy Aveo, see how it works for us and go from there. You wouldn’t start your kid off driving a stretch limo would you?
Health care is a right. Having health insurance is not a right. Somewhere in the middle we have to find a way to reduce the cost of health care which is not the same as reducing the cost of health insurance.
Hairplug: see Al Gore/Joe biden
It really is. You have the fixed cost maintenance issues (annual check ups) and then the catostrophic issues. It is why Accident Policies are so cheap vs health insurance. I guess the HMO’s didn’t bring the costs down like everyone thought. I love the HSA/HRA option. A great way to give the employee some skin in the game of ‘what they use’ . Someone may not wish to dip into their deductible so easily.
I disagree with the idea that most people dont really know what it costs. While most dont know the actual premiums, most people that are educated know that an employer who offers health insurance is the more competitive employer because they are not willing to pay for it themselves. People who have multiple offers are now drilling down and asking how much is my out of pocket before signing on the dotted line. The same is not true for Govt workers.
*Sigh* Thank goodnees my wife works for a NJ School District. 100% paid for with $5 co-pay in network and $20 out of network. Now those people have NO CLUE what it costs and are taking the tax payers for a ride. I am glad I get something for my high taxes.
Wow! Thank you all for your feedback. I was wondering if people were reading the comments on this article. Apparently you are!
I’m still not convinced that a person should be insured/maintained in the same manner as chattel property. You are correct that many Americans have no clue what health care really costs and how much they’re really paying for it. I suspect, however, that anyone who doesn’t know how much tax was withheld from their pay checks probably isn’t filing tax returns . . . :). Anyway, the cost of health care IS out of control. Insurance companies, employers, and state/local governments have all tried at least something to curb it — but here we are anyway.
Do you all think that, if we were to go with the idea of an indemnity-like health insurance product as a minimum mandated coverage, that such a program could actually reach the goal to “cover” all insureds in the US? If so, will Americans support something that pays benefits like an auto policy does (i.e. the car/person analogy)?
If this “health-indemnity” product has to accept everybody (no pre-existing condition exclusions) but only pays for services that are not “due to wear and tear” or “are routine maintenance items” I wonder how much coverage it would afford to older, or frail, or at-risk persons. I also wonder whether the premium would be affordable when considered alongside the increased out-of-pocket costs for noncovered stuff (wart removal, replacement of worn-out parts [yes I am fully aware of organ transplant availability :)] etc.? Would transplants be left uncovered as “due to normal wear and tear?” Would we need a national risk pool in addition to the mandated health plan to cover the biggies like transplants and cancer?
I know some of my examples are a bit extreme . . . I just wonder what minimum mandatory health policies would cover and how much it would cost individual policyholders? Any thoughts out there?
Thanks.
Sure, it’s called personal financial responsibility
A big shift in the last generation: health insurance equals health care.
I have been telling people that using the word “insurance” related to health care has become inaccurate. You buy auto insurance to cover the chance that you might have a claim; there is no “chance of a claim” with health insurance, it’s going to be used.
Realize that as more people loose jobs, this plays into Obama’s plan to sell his Federal takeover plan (Obamacare).
His “Shovel Ready Jobs” that should have months ago started have never materialized and he really doesn’t want them to. The more jobs lost, the more uninsured to “buy into” his notion of Obamacare.
Note 2% or less of the “Cash for clunkers” has yet to be paid to dealerships. Maybe it will show up in 2010 to convenienty coincide Obama’s re-election run.
Its all about Federal control of a huge sum of money. Big tax “changes” are a large portion of this plan which breaks his campaign promise of only those making over $250,000 to now affecting instead directly and indirectly every wage earner in America – YOU.
Get this done before re-election time, and before anyone understands the impact, accuse the American public and those in opposition of being partisan or prejudice,…that is the modus operandi!
Go 09/12/09 March at the Capital! Hopefully the partisan media will show the real story, and not just a select few wackos off in a side street.
May God have mercy on our country. May those who are in opposition not remain complacent!
This guy must have been a great carpenter in a prior life. He certainly knows how to hit the nail on the head, and drive a true nail. It really is time we called a spade a spade and cleared up the ‘insurance’ confusion.
I agree that health insurance is not really health insurance for the reasons mentioned in the article. One additional reason that comes to mind is health insurance companies use their size and influence to reduce health care costs. They use this influence to contract with drug companies, doctors and hospitals, etc. for reduced pricing if you want to be included in their network. In this respect they create their own operating margins.
Property and casualty insurance companies do not do this. For example if you have hail damage to your roof you pick your own roofer to do the repairs. You don’t go to the roofer that the P&C company chooses for you.
Also a typical health insurer will not examine you before taking you as an insured. Almost every P&C company I know wants to inspect your house when they insure it.
I fail to see the relevance of pointing out the difference between health and auto insurance. Each line of insurance is different. D & O is quite different from boiler & machinery, etc. Workers’ compensation may be more analagous to health insurance or disability insurance than it is to property insurance although it’s a P & C line.
However, since the analogy has been made between auto and health insurance, a more rigorous comparison will show that there are more similarities than this simplistic article states. Most auto policies give premium discounts for safety features such as anti-lock brakes. Health insurance policies covering routine preventive care is similar. The major costs in health insurance are not the preventive check-ups and screenings, which are typically more than covered by the premiums charged, but the serious and catastrophic injuries and illnesses. Coverage for preventive care is like a premium discount in auto insurance–it helps prevent more serious accidents/illnesses.
All: Are those of you who support the “health-indemnity” type product talking about a return to the old-fashioned policies that stated the covered expenses, had an annual deductible and coinsurance and a lifetime benefit limit, and paid any doctor or hospital you went to up to the benefit limits? Would this mean doing away with the “in-network/out-of-network” strategy that most insurers have in place today?
I’m trying to get an understanding of what Ty and others think real health insurance should look like.
My experience with this “old” type of policy was that the patient had significant upfront payment obligations, was obligated to pay “the rest” of the medical bill if the insurer didn’t pay 100%, and seriously ill people sometimes maxed out the lifetime benefit limit (while still living).
Am I getting close?
Thanks.
POLICIES USED TO BE SIMPLER—ANNUAL DEDUCTIBLE AND MAXIMUM BENEFIT. WE NEED THE INSURED TO MORE ACTIVELY PARTICIPATE IN THE PRICING OF HIS OR HER MEDICAL SERVICES. WE ALSO NEED TO HAVE INDIVIDUAL HEALTH POLICIES UNDERWRITTEN MEDICALLY THE SAME AS GROUP POLICIES—JUST CUZ YOU WORK FOR SONY DOESN’T MEAN YOU ARE A BETTER RISK THAN IF YOU WORK FOR JOE’S BARBER SHOP. EVERYONE EITHER SHOULD BE MEDICALLY UNDERWRITTEN, OR NO HEALTH QUESTIONS. NICKLE-DIME HEALTH MAINTENANCE SHOULD BE THE INSURED’S RESPONSIBILITY, BUT HE SHOULD GET A “DIVIDEND” FOR PROVING TO THE INSURANCE COMPANY THAT HE GOT IT DONE. ALSO, ONLY CITIZENS SHOULD RECEIVE HEALTH CARE. NONCITIZENS SHOULD BE TURNED AWAY UNLESS THEY PAY.
I’m so tired of the governement is always wrong philospy. It’s been used for the last 30 years to the point that we our infracture is failling apart because it was built during the 40’s and 50′, our schools are over crowded and many of them unsafe. We got government out of the regulation business and we get the sub-prime mess and the AIG debacle.
The government is us. It provides us with police protection, fire service, public schools, national defense, infracture projects (such as the dams and levees on our river), unemployment benefits and a safety net for people who fall on hard times. What do you want to eliminate and what private company will take it over for less cost and benefit? We tried to privatize some our military operations in Iraq with Black Hawk and look what happened.
“Go 09/12/09 March at the Capital! Hopefully the partisan media will show the real story, and not just a select few wackos off in a side street.”
yes, let’s use 9/11 and the memory of those fallen for a blatant political event… that’s a brilliant idea. disgusting.
Larry,
some of us are not citizens but pay all the taxes etc that citizens do but without all the benefits that citizens get. We live here legally and are part of the global exchange of knowledge and appreciation of other cultures.
But sometimes it just seems crazy that you guys get so incensed about something as basic as health care – of course a civilized, democratic (small d)society such as yours should be able to provide this without going bankrupt – the smallest European countries seem to be able to manage, contrary to some previous posts, a wait of 2 years to get a basic procedure done is not normal.
No answers but hopefully another perspective, it is going to be tough especially in this particular point in the financial cycle. I plan on being here for the long haul, so in for a penny in for a pound, or rather in for a dime in for a dollar!
You are so wrong in this statement “JUST CUZ YOU WORK FOR SONY DOESN’T MEAN YOU ARE A BETTER RISK THAN IF YOU WORK FOR JOE’S BARBER SHOP”
A guy that paves roads for a living, he is going to have more health related problems in the future then someone that sits at a desk all day (e.g skin cancer, lung cancer from inhaling all the exaust from vechiles passing by, etc etc). No health questions would be a disater. Why should I pay the same amount as someone who is in worse health them myself (or pre exsiting conditions?)
Before you can determine what Health Care should look like or what changes should be made to the system we need to get a handle on costs; i.e. put a leach on trial attorneys. We need penalties for attorneys that bring frivolous, baseless lawsuits and Loser Pay rules. And, there has to be teeth added to signed disclosure statements, etc. Lawsuits and arbitration are are wreaking havoc not only to Health Care but every aspect of our economy.
You’re scary . . . and not very well read. All of you facts and figures are wrong. Stop watching Bill O’Rielly and READ.
Anne,
did you say INSURANCE COMPANIES are trying to curb the high cost of health care?? Are you drinking the kool aide?? The only thing they seem to be curbing is patient care and physician payments. Meanwhile, check the WSJ to see the latest double digit increases in health plan executive bonuses.
million…. with all this money we could have healed the world but instead we play with it like a house of cards. Will we wake up? Ask yourself this big question. IN LOVE WITH THE INSURANCE INDUSTRY? . THINK ABOUT IT LIKE THIS. DO WE REALLY WANT THE INSURANCE COMPANIES RUNNING OUR WORLD . I SAY NO WAY……I HAVE MORE FAITH IN OUR GOVERNMENT THAN THE INSURANCE COMPANIES.
Great analogy between auto insurance and health insurance. I don’t know how health insurance carriers make money selling this type of coverage?
Chloe, and All:
I believe one of the commenters in this dialogue made the point that health insurance and health care aren’t the same thing. I agree with that point of view.
Health insurance is one way to fund a person’s health care when it is needed. Individuals and companies have other options, in addition to/instead of private insurance that they can use to pay for health care. These options include self-funding, cost-sharing, health savings programs, etc. Self-pay is also an option, although not a popular one.
Any of these payment sources are going to take steps to keep the cost of the care they choose to pay for as low (affordable) as possible.
It seems to me that the cost of health care in the U.S. is the primary issue to address. How individuals and companies pay for their health care is another major issue. The other main issue is how to match the demand for health care with the supply of health care available. The unanswered question is this: Who has the ultimate obligation to pay for each person’s health care?
So, which problem should U.S. Government step in and “fix”? Funding source? Price of services? Access to services?
Any thoughts out there?
Sorry Professor – Too much time in the class room and no case management experience. Most property and casualty risks that are underwritten have known risks to loss that are clearly illustrated over an extended period. Most competent underwriters price the coverage to cover the expected expense from these expected losses resulting from known exposures.
P&C carriers could learn from health carriers by using preventive care in their policies. How many home and auto policies could have been prevented had the insured done proper maintenance to their home or auto. I had a water damage claim on a home called in this morning that could have been prevented had the insured calked the flashing around her fireplace chimney. An auto claim was called in last week because the insured’s brake shoes were worn out. Both of these examples could have been avoided with preventive maintenance.
Health carriers encourage insureds to get an annual exam to prevent a minor problem from becoming a major and expensive problem. True, the medical profession makes money from the preventive care. However, it probably saves health carriers money in the long run.
P&C carriers give discounts for alarm systems. Should they give discounts for proof of proper maintenance or surcharges for lack of proper maintenance. Unfortunately this may be too difficult to manange with P&C but, it is not with health insurance.
Prior comment! I meant to say how many auto and home policy losses could have been prevented with preventive care to the autos and homes.
Theoretically all auto accidents could have been avoided, we insure for human error.
I can agree that “Theoretically all auto accidents could have been avoided”. However, we don’t insure for just human error. Theft, vandalism and weather damage to autos is a very significant portion of our losses. This varies from year to year with the crime and weather patterns. With uninsured motorist losses we are insuring for ‘human error’ but, not our insured’s error.
I agree with health insurance carriers paying for preventive care. Even the HSA plans I market include prescription drugs – gives an incentive to make sure you’re taking your medicine. I think HSA plans should be allowed to pay for one physical exam a year – as preventive care. As an alternative, the carriers could also a premium discount to those insureds that have a regular physical exam and pay for it themselves.
Think about it, if no one had health insurance, the pharmaceutical industry would either go out of business or drastically lower their prices. Who pays for the billions in advertising?
I think the reason they starting covering routine Dr’s visits is because they want to create value in their product and attract new customers. BTW, a lot of ins policies dont cover a lot of routine expenses.
Im 42 and ive virtually never used my health insurance, so dont tell me its not insurance. Im healthy, I have to be forced to go to the doctor, and my ins company actually makes a ton of money off of me.
I have no routine expenses for them to pay for – Maybe a few, but they are not covered.
It IS INSURANCE, and im a good risk.
The other thing to consider is that if you have predictable costs that you know someone will have, then at least you can price for those!
But there is still an element of insurance to it.
The real costs are involved in unforeseen events. This is a fact.
If Geico offered to pay for 4 oil changes a year, and this were legal, then they could easily do it, just price for it.
The conversation is irrelevant!
The health insurance should cover only unexpected serious illness or injury and be paid for by Government.
the client should be responsible for routine physicals, colds and such.
If desired one can buy extra coverage for premium coverage and faster care
One person said, this is irrelevant, it’s not! Insurance is a one type of solution to the financial problem of risk. But if we don’t properly classify a problem, we’re not going to use the right solution!
On people that said it isn’t, wake up! Real health insurance would look like other insurances. It would cover only unexpected adverse events and it would have a relatively high deductible per incident ($250, $500, or $1,000 depending on how much you want to pay.)
While some auto/home plans offer limited benefits for specific repair/maintenance items, you are essentially on your own. That means, you work actively to control those costs.
An oil change today is $25-40. How much do you think and oil change would cost if for the last 60 years, your employer had been paying your all-encompassing auto needs policy, and then they pay the oil change place?
First, an oil change would cost $200 for anyone without coverage, (your insurer only pays $80 for theirs, great deal eh?) Second, nobody would get just an oil change, everything that can be changed out, flushed, worn, or replaced in under 5 min. (per item) would be upsold onto every order… BECAUSE IT’S FREE! I mean, at least I don’t write a check for it, or if I do it’s a token amount.
What the author is really afraid to say is the effects of this distorted reality. Replace this junk system we have now w/ real insurance, paid for by individuals! Then, you have to mandate coverage, just like auto and home insurance (mandated by the note holder, or whoever else stands to lose thousands in one catastrophic event.)
This would make insurance affordable, that’s all it takes! But instead, we continue to embrace a failed anti-market process. Seperating the payer from the beneficiary isn’t market economics it’s letting the 5-yr old drive! How would your household budget look if your teen had a CC w/ virtually no limit, but you paid the bill. Oh, and you can’t look at or question the charges, you just
have to shut up and pay.
BTW, why is it that doctors almost never go out of business? Does every one of them happen to be excellent businessmen… I bet not.
Once you have insurance covering risk, then you can set up a variety of seperate mechanisms for managing typical repair/maintenance.
If you would separate these two important but very different components of health care, you would finally create a free market in health care and that would dramatically lower costs. You would also eliminate the huge penalty premiums created by the industry’s overzealous obsession with the risk of adverse selection.
There’s no magic in this, “health insurance” is $12,000 a year of wages per family that is instead being re-routed to a private corporation, who decides how to spend that money for you. They’ve done a terrible job handling your money, because you let them! But this inefficient anti-market hasn’t bankrupted the greatest economy in the history of the world yet… so let’s give it some time, I think they can.
If you graph the percentage of people on one access, 0 to %100%, and the percentage of health care costs on the other, 0 to 100% and then compare the curve for the USA to other countries where they do not have health “insurance” as we know it in the US, then you will notice little difference in the curves. ~85% of the costs are on ~15% people in the US as well as the other countries. The relationship is based on epidemiology and genetics. And the relationship is known and is stable over time.
If you are in favor of a re-distribution from the sick to the healthcare system, then do it the way it is done in the USA. Especially if you don’t challenge the providers when they charge 2.5 times as much in the USA as they do on the average in the OECD countries. We prefer well-paid providers and their “insurance” companies to those impoverished by disease and their genetic endowment.