I watched the President’s speech last night, and so I have health care on my mind. One important issue he touched on was insurance security. I’ve heard statistics bandied about that 80% of people are happy with their own insurers. What I haven’t seen is a break down of what segment of those people have actually had to rely on their insurer for coverage of something serious.
The scam, when it’s perpetrated, works something like this: the insurer collects premiums from the “insured” for a good long time. Then, when it’s time to pay up on the policy, the insurer either looks for loopholes in its policy not to cover the particular service or it digs into health insurance applications to find a pre-existing condition — whether related to the current health problem or not — and deny coverage on that basis. In either case, the insurance you were paying for is illusory. Another ploy is to keep demanding more and different paperwork until something gets missed, run out the clock for the “proper” submission of a claim, and then deny coverage on that basis.
A market doesn’t work when the benefits being sold are illusory — the consumer doesn’t know up front, before he or she gets sick, that one insurer is charging $400 per month for insurance that won’t actually pay for any big ticket items while the other is charging $500 per month for insurance that does. The second one is obviously the better value, but the consumer won’t know that until he or she is already sick and it’s too late to bargain for insurance.
One approach, it seems to me, would help in this regard is to require insurers to offer a basket of basic health insurance for a flat price in such a way that potential consumers could make an apples-to-apples comparison where it’s clear what is covered and what is not. They would have to offer this product to all comers or, at the least, they would have – say – 90 days to terminate contracts based on pre-existing conditions. This would combat abuses related to rescinding contracts only after the insured gets sick.
Here is an NPR report on recission: http://www.npr.org/templates/story/story.php?storyId=105680875&ft=1&f=1001
Well said. I have a fundamental problem with private companies (or public entities) that go out of their way not to provide a service that a customer has been paying for.
I ask people, what if someone went into Best Buy and put a plasma TV on lay-away and dutifully paid your monthly payments? Then, when you came to collect your TV, they told you, “Oh, well, we don’t really sell TVs to left-handed people. So what we’re going to do is go ahead and keep your money, and not give you the TV.”
Everyone would be up in arms, no? So how is it ok for insurance companies to do this? Perhaps I’m oversimplifying, but I just don’t get how this is a legal practice. Seems inherently dishonest.
Yes, insurance should work as advertised,and benefits should be reasonably predictable. Benefits shouldn’t be a de facto high level one-sided game of service vs profit. One’s premiums should predict one’s benefits.
There’s kind of an applied pragmatism here that struck me last night listing and watching Obama’s address.Obama doesn’t mandate a public option as long as the result of lower premiums is reached by some other way.But he sees public option as the most direct,honest way of establishing predictable benefits vis a vis premiums paid.. The Conservative Republicans en masse on the other hand warn that any public option will kill the reform bill as far as they are concerned.
Here is a perfect example of pragmatism( results) vs ideology ( belief in a invariable truth) with benefits not defined till the company insurance adjustors have ruled.
I also think so much of the profit comes from people like my mother(90 yrs old) who is just too old and weary to fight back.Paying what is asked gets the wolves off her back,and everything is hard to understand.
I think 80 percent of people are happy with their health insurance because they have not needed it. 80 percent of people could do better by not having insurance and paying cash, if they got their employer to give them the cash they paid for health insurance as well.
That is how the system is designed, MOST people don’t NEED big health care all the time, so most people won’t be told “NO”. Saying that MOST people are happy with insurance doesn’t tell me anything.
Evidence: http://blog.greeninsuranceservices.com/a-simple-approach-to-california-health-insurance/bid/8461/The-80-20-Rule-applies-to-California-Health-Care