Wednesday, July 09, 2008

National health care or an open market?

There's so much discussion these days about the problems in the health care industry. Medical insurance (which, btw, my family purchases on our own) can be expensive depending upon the type of coverage you want to have, especially if you have children or medical issues.

Many individuals say they can't afford to purchase medical insurance. Others decide, for various reasons such as age and health, that they don't need such insurance. Still others find it's better for them to just pay for their care at the time they need it, rather than purchase an insurance policy.

But many have decided that the only way to 'solve' the problem of uninsured or 'under-insured' individuals is for the government to take control of the issue. I'm not one of them.

Here's what I don't understand. We purchase homeowner's or renter's insurance on the open market. There are numerous types of policies, multiple carriers and a host of agents willing to write such a policy.

We purchase car insurance on the open market. There are so many options when it comes to car insurance that some companies advertise that they'll do the comparisons for you to help make it easy to decide. You can decide what level of insurance you need, whether or not you need collision coverage for your vehicle (based upon the age and condition of the car) and what your deductible will be.

We purchase life insurance on the open market. We can get as much or as little as we want, whole life or universal life, from companies across the United States.

Why can't medical insurance work the same way?

With car insurance, the competition and various levels of coverage have resulted in an increase in options with lower costs for consumers. Would the same be possible if health insurance were available in the same manner?

We don't let our employers decide our life insurance, our home insurance or our car insurance - why do we so willingly allow them to decide about our health insurance?

I know the answers to these questions, so they're not exactly rhetorical. Congress granted tax deductions to employers for providing the insurance in an effort to increase coverage. That's why employers offer it as a 'benefit.' Plus, with the current structure, it's more cost effective - in some ways - to be part of a larger group, where you can aggregate risk. Medical insurance is also more highly regulated with Medicare/Medicaid reimbursements, etc. So it seems that part of the reasons we have problems in this area is because of the meddling by our Congress, yet some think they can meddle some more to make it right.

If we're really looking for a 'solution' to increase availability of affordable health insurance and, therefore, enable more Americans to purchase such coverage, wouldn't we all be better served by looking at how other types of insurance actually accomplish this goal????

Or are we so stupid that we will, instead, look to government and elected officials who've never worked a day in the insurance industry for a supposed 'solution'?

It is, after all, our decision to make.

7 comments:

Tim Higgins said...

Maggie,

Perhaps the answer here are some additional questions:

1. What has the government ever done at a lower cost than the private sector?

2. What has the government ever done more efficiently than the private sector?

3. What has the government ever done better than the private sector?

The answer of course to each of these questions is nothing, but that doesn't stop us from seeking to make the same mistake. One final question though:

What makes us think that our government can nationalize health care when every government that has previously tried (like that of England and Canada) has failed?

Robin said...

I'm totally against having the government in charge of everyone's health insurance. Yes... it should be made affordable on the open market. Hospitals and health centers need to learn how to run more efficiently, too.

I think that if the government is in charge, it will make health care even more expensive than it already is. It will open the door to more waste and corruption.

Kadim said...

Maggie,

I don't necessarily disagree with your thesis. (I'm definitely not comfortable with universal health care.)

I'm hesitant to compare health insurance to car/renter's/homeowners or life insurance.

Health insurance...isn't. It's not really an insurance at all. It's more like a time-share of our health care system (some people get a better time-share than others.) Everyone ends up using their time share, and unlike car insurance, there really is no cap to payouts (there are only so many car accidents with so much financial damage.) Health care costs have no place to go but up, and the only tool for controlling costs available is to deny coverage (limiting your time in the time-share.)

This is not to say that I don't think that the free market would be a better way of dealing with health care, just that I think that health care is extremely different from property and casualty insurance, and doesn't make for a great comparison.

Maggie Thurber said...

Kadim - I agree that health insurance isn't the same as car or home insurance, but it's not the product I want to examine...it's the marketplace.

Many states mandate that you have car insurance - and they make it a criminal offense if you don't. I certainly don't believe that a person who chooses not to have health insurance should be criminally punished. However, the states who mandate car insurance do not offer it as a product that you can buy - nor do they give it to you for 'free' by using tax dollars to subsidize the product. They rely upon the private sector to offer the product and the private sector has responded with a wide variety of 'products' at a range of prices.

Key to this is that that the state doesn't dictate the type of product. So why couldn't we look at this type of system to supply the product of health insurance? If the system works for car insurance, can we get government out of the system enough to make it work for health insurance as well?

Government has its tentacles in so many aspects of the health system - and that adds to the costs. Would an absence of those government mandates result in a better system? I have to believe so, especially when you consider Tim Higgins' questions above.

That's all I'm saying. If we're going to look at the health care system, I'd rather that we start trying to make it like the other insurance systems rather than give government even more control over it. We KNOW that government has already messed it up enough...

The Rebellious Pastor's Wife said...

I agree with you completely, however, I fear that the idealism we share may not be able to enter reality in this mess. The difference between health insurance and other insurances is that is that a person can choose not to have a car if they can't provide insurance for it. If they can't provide proof that the car is insured before it goes off the lot, the deal falls through. The cost of providing insurance for a car is part of the expenses of owning a car.

The only thing you can tie health insurance to is actually being able to afford to breathe. You can't mandate health insurance for the people who are homeless, poor, or just living hand to mouth. So that brings in the cost of supplementation, and then what do we do? Mandate it for certain incomes?

I do agree with you. It should be an issue resolved in the marketplace. But even with that, because of the nature of health insurance being tied to no concrete commodity (my car, my house, replacing my income when I am gone).

The current state of health insurance has done much to drive the cost of medical care to the point that almost no one can afford it without health insurance, and so therefore, not everyone can access it...or at least good health care. Not that I believe health insurance is a right, but in the current state of things, the market itself has mandated its existence, combined with the fact that any doctor or dentist that chooses to allow someone to make payments now falls under lending laws, and so has chosen to provide the ability to apply for credit, which again alienates the poor and those with messed up finances and increases our debt issues in our economy.

Chuck Greer said...

Tim, my answer to your question 1 is, as you say, nothing. But to 2 and 3, the US Military is one possible answer, we have the best in the world, barnone, but it ain't cheap...aside from this, nothing, by a long shot...

Marikay said...

I think the only solution to our health care problem is to let the market work. Health care is the only thing we do without first asking, "how much does it cost?" Example: your doctor orders an xray and you use whatever Radiology service that is in his office building. Does anybody call around and ask "how much do you charge for a chest xray?"

Twice a year I have to have blood drawn to check hormone levels. When I receive my EOB from the insurance company, it indicates that the charges were over $1,000. Because I have coverage, the lab accepts about $100. If I didn't have insurance, I would be charged the full $1,000. The uninsured are discriminated against by being charged exorbitant prices. When politicians point out that people are losing their homes in order to pay medical bills, it is because they are so overcharged.

I pay over $800 a month for health insurance for a family of 4. If the lab charged me $100 to begin with, it would be cheaper to just pay my health care costs out of pocket and simply purchase catastrophic coverage. Also, if I pay out of pocket, the elaborate web of coding and billing would be eliminated. Ironically, those who are insured pay far less, even though their claims have to be filed and the uninsured are just sent a bill.

My doctor once opened a lab because he's so dissatisfied with how notoriously inaccurate most labs are. He was shut down because he didn't charge enough for Medicare/Medicaid approval. He says the mark-up for lab work is obscene. He refused to charge such high prices.

Lasik eye surgery and cosmetic surgery are perfect examples of how the market works. The prices for these services have steadily come down at the same time as the technology and quality of service have gone up. These services are not covered by insurance. They are completely market driven.

It would also eliminate all the unnecessary tests that people submit to, due to fear of malpractice lawsuits.

I dread what will happen to our health care system if Obama is elected.

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