Friday, September 14, 2007

20/20 Takes On Health Insurance

I really like John Stossel's reports on 20/20. They're always pretty interesting, and he usually makes a lot of sense. Earlier this year, he did a report on education, stating how when there's competition, services are better... for example, in other countries when schools compete for children to attend, whether public or private. I know for a fact that the private sector can educate children more effectively, because for the same cost that the public school educates a child, Kindercare provides full-day Kindergartens at most of their centers, and will throw in breakfast, lunch, and snacks.

For his health care segment, I was not surprised that he did a good job as well. He first pointed out that it's not good to be without health care. He brought out a lady that left her job, was on temporary insurance, and then found out that she had cancer. After her temporary insurance ran out, she was left with paying for everything out of pocket. While nobody in our family has cancer, thank God, we did deal with losing our health insurance when my husband lost his job earlier this year. Just our luck, we ended up with two fevers at 103 or greater and one case of severe dehydration in an underweight infant, and ended up with 3 emergency room trips. We now have health insurance so all is taken care of again.

For several years now, I've found most private health insurance offered by employers to be way overpriced. I turned down health insurance while working at Kindercare because it would have cost half my paycheck. Health insurance at my husband's last job would have cost $700 a month out of our pockets, and that was after his job kicked in enough money to fully cover my husband.

Why is that? I can shop around and find high deductible policies that cover my entire family for around $200-$300 a month. Why do employers offer the low-deductible policies and charge their employees an arm and a leg for it? During most years I wouldn't even use $8400 in services, which is what the insurance policy offered by my husband's prior employer would have cost him every year. I don't even think that we'll reach a total of $8400 in health insurance costs this year, and that includes 3 emergency room visits and several well-baby checkups.

Health insurance costs a lot because people use it for everything. He brought up a good point... what if there was grocery insurance? People would be buying steaks instead of hamburger. The same thing is true with any time someone else is paying for services... I receive WIC, and although I always buy the cheapest milk and eggs that are at the grocery store, I buy my preferred brand of tuna fish and don't really look at the price. If someone else is paying for it, you are less likely to shop around.

Why do we include the smallest things in our health insurance coverage? If everyone paid for their own well visits and checkups, it would lower health insurance costs. Similarly, people should pay out of pocket for things like birth control and viagra. These are things that a lot of people will buy, but if you have to pay for them out of pocket you're going to shop around. You're also going to think twice about whether you really need something or not. When we were without health insurance this summer, for example, we really thought long and hard about whether we were going to take our kids in. I waited each time until I thought that there was nothing that I could do at home, and they really needed to be seen or they might die. While I don't think that people should wait until they think that they are on the verge of death before they see a doctor, sometimes if you just have the sniffles, you really don't need to be seen.

Britain, France, Canada and Cuba are looked at by Michael Moore and others as examples because they have free health care, but because it is free to all, it is substandard. People have to wait for months to see a specialist, even for life-threatening conditions. Emergency room waits are longer than ours here, if you can believe it. The wealthy and well-connected might be able to get better care, as Michael Moore was able to in his movie, but ordinary people are going to hospitals where they try to save money by washing the sheets every other day... one suggestion to save money was to flip the sheets over and reuse them. Gross!

At the end of his report, John Stossel talked about clinics popping up in grocery stores and pharmacies, where you pay cash and see a nurse practitioner. I wish I would have known about those months ago. My daughter wouldn't have had to suffer temporary hearing loss and spend over a month with an ear infection because we couldn't afford a doctor. We could have saved 2 emergency room trips, I'm sure, because we could have taken in my children when they had fevers and gotten a prescription for antibiotics. Probably not when my son was dehydrated because he needed an IV, but the other two trips could have been saved. Since we live in a major metropolitan area, I'm sure there must be one of those within driving distance of us.

I think that clinics are a great idea. Just as it would be preferable if routine doctor's visits were something ordinarily paid for out of pocket. Competition would reduce prices. It would save doctors offices money as well, because they wouldn't have to pay so many staffers to haggle with insurance companies. Of course, you're always going to have people with medicaid, but wouldn't it be better if instead of having a $700 a month health insurance premium, you had a $300 a month health insurance premium and covered routine doctor's visits, viagra, birth control, and other small items out of pocket? Do you really spend $400 a month on all those things? Maybe some people would have to because they get sick a lot, but if everybody did it, doctors would lower prices to try to draw customers.

HSAs are a good idea, in theory. My husband's job last year had a really nice HSA program where you were given a debit card and could pay for health costs with that. It allowed you to roll over money that you had if you didn't use it all in one year. When my husband worked for the state, however, their HSA program really bit. You would lose all your money at the end of the year if you didn't use it, and you had to fill out a form and mail it in if you had a health expenditure, and they would reimburse you. We decided to opt out of that one because in most years we don't really get sick that much, and having to go through the whole headache of reimbursement wasn't worth it.

This is just my opinion, but why couldn't we have a hybrid type health care system? Allow for private insurance (private clinics are illegal in Canada). The government could offer coverage for major medical expenses to every family making... say... under $100K a year, or those that lose health insurance because of a preexisting condition... with a catch. The government's health plan would only cover major, life-threatening medical expenses, like cancer. Of course, we know that in countries with government health care, the line to be seen is long, so anybody with enough means to afford private insurance would probably want to pay for that, because they wouldn't have to wait as long to be seen.

It would be preferable if more companies would offer higher deductible plans that cost the employers less per month. Then people would have to spend the first couple of thousand dollars out of pocket, but they would make better choices and shop around. They would save a lot of money in the long run, because $700 per month after your employer's contribution for health insurance is ridiculous.

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