Wednesday, April 7, 2010

Insurance Reform

I wanted to put down a few thoughts about health insurance. Since we, as a nation, are on the cusp of doing away with the genre as we know it I figured I may as well.

Health insurance...... well, any insurance I guess.... is just a form of commercialized gambling. You bet the insurance company your premium dollars that you’re going to get sick, or have an accident and they, in turn, call and raise all, or some agreed to portion, of your expenses. It’s as simple as that. But it’s like most gambling...... the odds are stacked in their favor. They have this great big pool of customers and a pile of statistics that they call actuarial tables. They know going in what the odds are, and how likely you or your children are to get sick or to have an accident. And so that’s how it goes: you and I.... we.... the customers get the peace of mind and protection of the insurance companies and they, in their turn, get a profit..... that is..... they take in more than they pay out and pocket the difference. But in order for the system to work, they need to know going in who we are, so they can look us up in the table. The bigger the pool of customers the less important this is, but still. In order to figure out how much to charge for their service they need to know us. What our habits are, what our lifestyle is, family history etc, etc. If we make our living jumping motor cycles they may want to charge us more...... or if we chain smoke. It seems only fair since in those two cases we’re more likely to need medical care.

But in recent years our perception of insurance has changed somehow. Seems to me that before, we used insurance as something to cover expense brought about by illness or accident. Now we use it to cover the cost of normal wear and tear. When I was a kid you went to the doctor if you were sick and didn’t get better, or if you had a maiming accident that required stitches or the setting of a bone. We’ve grown much softer now, and perhaps our lives are better because of it. But still the insurance companies have been able to make a decent living. And that’s as it should be. This is, after all, America. Land of the Free, and Home of the Brave. But lately the insurance companies have come under fire. Well, not lately actually, people have been calling them heartless bastards for as long as I can remember. The complaints seem to be mainly about increasing premiums, cancellation of policies and denial of coverage because of a pre-existing condition.

I’m gonna go out on a limb here and take a position supporting health insurance companies in general, but before you send me nasty messages filled with horror stories about relatives let me explain.

As a layman, the health care industry, which the insurance industry is a part, seems horribly complex to me. It’s made up of hospitals, doctors, insurance companies, medical device manufacturers, pharmaceutical companies, the government and then us. And everyone in there’s trying to make a buck and that’s okay. I don’t mind. Everyone has the right to make a living and companies have to make a profit in order for that to happen. But we don’t care about that. All we care about is getting the service we pay for and being treated fairly.

Toward increasing premiums: You expect for things to get more expensive over time just due to the increase in the cost of living. You buy a gallon of milk at the grocery and you expect that a year from now it’ll cost more. You buy the exact same car you bought 5 years ago equipped the same way and you know it’s gonna cost more. Health insurance is the same way, only on steroids. You can’t buy the same health care like the gallon of milk or car that you bought 5 years ago. The product improves over time and we have, and want to buy the new and improved version whether or not we recognize that it’s changed. Health care providers (doctors and nurses) are sworn to give us the best care they know how. Sometimes it also turns out to be the most expensive. Used to be there was the x-ray. Then came ultra sound, the CAT scan and the PET scan and now MRI technology. There are constantly improving treatments, and new pharmaceuticals that continually increase the cost of health care beyond cost of living increases. We just have to accept that if the cost of living goes up by 5% over some time period, the cost of health care is likely going to go up more than that.

One of the things that have been proposed as a no cost way to lower insurance premiums is to make it possible for groups of associated people to band together in order to better bargain with insurance companies. Say the National Association of Widget Washers has a meeting, they agree, and it becomes possible for all of them to buy insurance from one company. Nation wide it turns out there are quite a few widget washers, but they generally work in small groups so it’s been hard for them to get good prices on insurance. Now, as a group, they can finally negotiate a good rate on their insurance.

Also discussed as a no cost way to decrease insurance premiums is the removal of the restrictions that shelter insurance companies from interstate competition. This would provide the insurance companies with a larger pool of customers over which to spread expenses, and force them into price competition with hundreds of other companies that might be operating in a more efficient manner. Price competition is where the consumer benefits. We or our representatives would then be free to buy our insurance from a much longer list of suppliers. This would increase the number of products available and make them less expensive.

Another issue needing consideration is how insurance companies negotiate with health care providers. Because larger insurance companies can provide more customers to the big health care providers they can obviously get a better deal. That’s good for some people, but not so good for others. If you work for a large company and have your insurance through Mega Plan it’s good for you, but if you work for a small company and get your coverage through So So Healthcare they aren’t going to be able to get the great deal and you’re going to have to pay more. If you’re self employed and buy insurance form Around the Corner Insurance you have no one to negotiate for you at all. And if you’re uninsured, why, you’re making up the difference for every discount that was given up the tree. In recognition of this some health care providers have taken to giving discounts to the uninsured. Cold comfort I suppose, but at least a recognition that the heaviest burden and highest cost falls on them with the least ability to bear it.

My point here is that we can fix the health insurance and health care industries without huge costs to the average consumer. And, if we...... the people..... choose we can put in place a system to help care for those who can not care for themselves. But we can NOT give away that which belongs to our children and theirs.

Our government was founded and built by people who believed that the happiness of the people could best be provided by limiting the size of government. They believed in self reliance and free markets. Today we have a huge government apparatus which produces nothing and yet employs more people than any private company. The purpose of the government used to be to provide for the common defense, insure domestic tranquility, and secure the blessings of liberty.... but it has since turned to the taking of wealth from one group of citizens and giving it to some other group. Our politicians (I will not call them leaders) have, in general, gone mad with power, seeing their jobs as not doing the will of the people, but merely the retention of their jobs. This they have done, insuring their re-election in perpetuity by selectively gifting the wealth they have taken from others on their constituents. And we, for our part have been equally irresponsible in taking this redistributed wealth without mind to where it came from or of our actual need. We have all looked on the federal treasury as if it were a bottomless well of money and favors. This now must stop. Our politicians, on our behalf, have stolen from our fellow citizens and the federal treasury, and with a nod and a wink they have allowed their fellows to likewise steal from us. Until now when we find that our fellows have nothing left to steal. WE have nothing left to steal. But so driven are these men and women that we have set at the controls of the nation, so set in their ways that they now turn their attention to the treasure that should belong to our children and our children's children. This now must stop.

The health care debate is only the head of the nail, the lens that brings the picture into focus. These may be the last months in which we have the chance to choose. Will we allow ourselves to be harnessed and yoked as one huge team of oxen, fed and led to water at the will of the drover, or will we have the liberty that we were promised, and be free as the wild horses on the western plains?

But that’s just what an average guy thinks.

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