Here's a clear explanation of the ridiculous loop that people with chronic illnesses can get caught in under our current healthcare situation.
Basically, if you're so ill that you can't make enough money to support yourself, then you become eligible for disability payments from Social Security, and Medicare (eventually) and finally get the care you need. Then, you get well enough (thanks to the expensive care and medication paid for by Medicare) to support yourself, at which time you become ineligible for Medicare. But your job doesn't provide health insurance benefits that will give you the care you need, and you can't afford to pay out-of-pocket, so you get ill again, go on social security and Medicare, and then once again become eligible to receive the treatments you need...
Anyone who wants to reduce the number of people on Social Security disability would do well to support a single-payer health care system. In that way, people would get the treatments they needed from the beginning, and those whose chronic conditions are treatable would never need to rely on disability payments.
Showing posts with label healthcare. Show all posts
Showing posts with label healthcare. Show all posts
Saturday, November 01, 2008
Thursday, September 20, 2007
In Which I Climb onto My Soapbox Once Again
I am a two issue voter: healthcare and marriage equality. There are other things I care about, definitely, but these are my two hot button issues because they impact me directly in very tangible ways.
Anyhow, I learned that the senate will soon vote on the renewal of the State Children's Health Insurance Program, which, if it passes, President Bush threatens to veto. There is no good reason to veto this legislation!
Children need health insurance coverage, this program covers them and has proven quite successful. It saves us all money when children receive adequate preventive care and are treated for small illnesses before they balloon into big ones. But more importantly, children deserve to be healthy, no matter what family they are born into. Is my son somehow more deserving of healthcare than another boy, born on exactly the same day, whose parents are unable to afford any health insurance? I don't think so! This program is a good way to get health coverage on those children whose parents cannot (for whatever reason) provide them with health insurance.
For more information on this, see the Families USA Children's health campaign webpage. They urge you to write your representative and senators.
Amazingly, both of my senators voted for the legislation in August. My representative, however, did not, so I shot off the following message to him. Feel free to borrow from it to write your own message if you'd like.
Anyhow, I learned that the senate will soon vote on the renewal of the State Children's Health Insurance Program, which, if it passes, President Bush threatens to veto. There is no good reason to veto this legislation!
Children need health insurance coverage, this program covers them and has proven quite successful. It saves us all money when children receive adequate preventive care and are treated for small illnesses before they balloon into big ones. But more importantly, children deserve to be healthy, no matter what family they are born into. Is my son somehow more deserving of healthcare than another boy, born on exactly the same day, whose parents are unable to afford any health insurance? I don't think so! This program is a good way to get health coverage on those children whose parents cannot (for whatever reason) provide them with health insurance.
For more information on this, see the Families USA Children's health campaign webpage. They urge you to write your representative and senators.
Amazingly, both of my senators voted for the legislation in August. My representative, however, did not, so I shot off the following message to him. Feel free to borrow from it to write your own message if you'd like.
Dear Congressman [his name]:
I noticed with interest that one of the headlines on your web page today was "HEALTHY MINDS NEED HEALTHY BODIES." I agree that healthy minds need healthy bodies, which is why I am particularly bewildered by your vote against the reauthorization of the State Children's Health Insurance Program in August.
Children who are covered by health insurance are more likely to receive preventive care and more likely to receive appropriate healthcare treatments before a small problem turns into a big one. Children with health insurance coverage are more likely to have the healthy bodies that you and I both agree are integral to their well-being.
The SCHIP program provides health insurance coverage to children who need it. Ideally, it would be nice if all parents could provide insurance without government assistance but the reality is that not all parents can, and this program protects children from getting into precarious healthcare situations that are beyond their control. I urge you to support the SCHIP legislation and to prevent it from being undermined or vetoed.
Sincerely,
[me]
Sunday, February 11, 2007
More on Healthcare
One of my favorite blogs is Shakespeare's Sister. It's the only political blog I read regularly, and I like it because Shakespeare's Sister (a.k.a. Melissa McEwan) and her co-contributors are smart, funny, and not afraid to say what they think. Sometimes they say things in a way that is a bit coarse, shall we say, but I'm not offended by coarse language. Despite the coarse language, it's a feminist- and GLBT-positive and safe space, where people are safe to speak their minds (at least, it was, before the recent troll infestation). I generally agree with most of what they say on the issues and Melissa's very clear prose has helped me strengthen my own positions on many issues.
I was very happy for Melissa when she got the John Edwards campaign blogging gig, and I had a somewhat sleepless night after I heard that her job might be on the line due to some self-proclaimed Catholic church spokesman's claims of bigotry against the church in her writings. I'm not really sure where he got that idea from (aside from perhaps a very dark and poopy place) because while I'm sure Melissa has criticized certain policies of the Catholic church, disagreement does not equal bigotry. In any case, Melissa was not fired and that made me happy (although the negative publicity surrounding this issue is the source of these recent trolls).
Her foray into political blogging made me decide to take the time to look into John Edwards' platform, and I was excited to see what his healthcare proposal would entail. (As my regular readers know, I am a proponent of universal healthcare and this is a very important issue to me.) Edwards proposes to require employers to provide or help pay for health insurance for their employees, encourage employers with tax credits and expand existing government programs, create regional health insurance pools, give the indigent prepaid tax refunds to pay for their premiums, and once the infrastructure is in place, require all Americans to have health insurance.
Realistically, a single-payer system is not an option in this country, because there are too many lobbyists for the health insurance companies. I thought that his proposal was actually very clever, because it left health insurance companies in the game, while forcing them to become more efficient if they expect to compete with government-sponsored plans.
I don't like the fact that health insurance would still be tied to your employer, because of the privacy issues I have mentioned before, but I think this proposal is a step in the right direction. I admit that my heart has been stricken with "Obamania", as they call it on The Daily Show, (my vote was one of many in his landslide Senate victory) but Edwards is winning my mind over with his healthcare plan.
I was very happy for Melissa when she got the John Edwards campaign blogging gig, and I had a somewhat sleepless night after I heard that her job might be on the line due to some self-proclaimed Catholic church spokesman's claims of bigotry against the church in her writings. I'm not really sure where he got that idea from (aside from perhaps a very dark and poopy place) because while I'm sure Melissa has criticized certain policies of the Catholic church, disagreement does not equal bigotry. In any case, Melissa was not fired and that made me happy (although the negative publicity surrounding this issue is the source of these recent trolls).
Her foray into political blogging made me decide to take the time to look into John Edwards' platform, and I was excited to see what his healthcare proposal would entail. (As my regular readers know, I am a proponent of universal healthcare and this is a very important issue to me.) Edwards proposes to require employers to provide or help pay for health insurance for their employees, encourage employers with tax credits and expand existing government programs, create regional health insurance pools, give the indigent prepaid tax refunds to pay for their premiums, and once the infrastructure is in place, require all Americans to have health insurance.
Realistically, a single-payer system is not an option in this country, because there are too many lobbyists for the health insurance companies. I thought that his proposal was actually very clever, because it left health insurance companies in the game, while forcing them to become more efficient if they expect to compete with government-sponsored plans.
I don't like the fact that health insurance would still be tied to your employer, because of the privacy issues I have mentioned before, but I think this proposal is a step in the right direction. I admit that my heart has been stricken with "Obamania", as they call it on The Daily Show, (my vote was one of many in his landslide Senate victory) but Edwards is winning my mind over with his healthcare plan.
Thursday, June 08, 2006
Health Insurance and Privacy
Earlier this week, I went to a meeting about my company's health insurance plan for the upcoming fiscal year. I learned a lot about how they operate the health insurance. My company actually self-insures, meaning that they keep the health insurance premiums that they collect and pay for the health insurance claims themselves. As a backup, they buy reinsurance just in case the claims exceed the collected premiums. They contract with a large health insurance company to administer the plan.
They were proud that last year, the premiums revenue exceeded the claims. The main cost of the claims was due to prescription drugs, although it was lower this year than in the past years because they stressed to people to buy generics. Still, due to the skyrocketing drug costs, the new plan has higher drug co-pays. They aim for a 70%-30% health insurance/consumer cost share on the drugs, and with the increased cost of drugs, they have to raise the co-pay. Otherwise, the plan is the same as last year, with the premium going up by a very modest 1.35%.
My company offers a lot of health and lifestyle improvement classes, such as smoking cessation and weight loss classes, and now I understand why. It's because when people stop doing things that are bad for their health, the company doesn't have to spend as much on health insurance claims. It's not that they're doing it out of the kindness of their hearts; they're trying to decrease the bottom line. At least since they are self-insuring instead of handing the premium revenue over to a private company, the extra premium revenue from our improved health isn't going to line somebody's pockets. Instead, it's the reason that our insurance premium is going up by 1.35% when for other companies it's going up by 7% or more.
Personally, I think that it's none of my company's business what I do with my health. The company should not be concerned about whether I smoke or eat too many cheeseburgers, because the only thing that they should care about is how well I can do my job, a job that neither requires an extensive lung capacity nor being on my feet. But my company is concerned with these matters, because they are taking me on both as an employee and as a health insurance dependent.
People should be hired because they are the best candidate for the job. We have laws that protect against discrimination against people due to race, gender, religion, etc., because those should not be factors in the search for the best candidate for a job. Likewise, people's potential cost to the company in health insurance claims should not be a factor either. But because the cost of my health insurance premium alone (not to mention the claims I might generate as a high-risk employee) is nearly 20% of my compensation (and an even bigger percentage for employees with lower pay), it is a big factor. There have been cases of obese people and smokers being passed over for jobs and pay raises, precisely because of the potential extra cost of funding their health insurance. There's even an infamous Wal-Mart company memo recommending practices to discourage unhealthy job applicants, to reduce company health care costs.
As you no doubt know, I am a formerly obese person, having lost 68 lbs through hard work and perseverance. Because of this, I am not particularly sympathetic to overweight people's claims that they cannot lose weight. The laws of physics are infallible: if you eat fewer calories than you expend, you will lose weight. I do, however, understand the psychological impediments that make overweight people feel as if it is hopeless, and the physiological conditions that make weight loss very difficult. (Perhaps I will write a blog entry about this at some point.)
Whether or not people can or cannot lose weight, their weight should not be a factor in hiring decisions. Unfortunately, it is a factor in hiring decisions, and it will remain a factor as long as companies stay in the business of offering health insurance benefits to their employees.
We could easily eliminate this factor while retaining insurance benefits by implementing a single-payer health insurance system. I have already presented the Pareto optimality argument for a single-payer system, and I think that the right to privacy concerning our health is another good reason. Oh sure, the gubmint isn't really that in to our right to privacy these days, but I would rather George W. Bush know all about my family's history of colon cancer than have my potential employer reject my job application because of my family's health history.
They were proud that last year, the premiums revenue exceeded the claims. The main cost of the claims was due to prescription drugs, although it was lower this year than in the past years because they stressed to people to buy generics. Still, due to the skyrocketing drug costs, the new plan has higher drug co-pays. They aim for a 70%-30% health insurance/consumer cost share on the drugs, and with the increased cost of drugs, they have to raise the co-pay. Otherwise, the plan is the same as last year, with the premium going up by a very modest 1.35%.
My company offers a lot of health and lifestyle improvement classes, such as smoking cessation and weight loss classes, and now I understand why. It's because when people stop doing things that are bad for their health, the company doesn't have to spend as much on health insurance claims. It's not that they're doing it out of the kindness of their hearts; they're trying to decrease the bottom line. At least since they are self-insuring instead of handing the premium revenue over to a private company, the extra premium revenue from our improved health isn't going to line somebody's pockets. Instead, it's the reason that our insurance premium is going up by 1.35% when for other companies it's going up by 7% or more.
Personally, I think that it's none of my company's business what I do with my health. The company should not be concerned about whether I smoke or eat too many cheeseburgers, because the only thing that they should care about is how well I can do my job, a job that neither requires an extensive lung capacity nor being on my feet. But my company is concerned with these matters, because they are taking me on both as an employee and as a health insurance dependent.
People should be hired because they are the best candidate for the job. We have laws that protect against discrimination against people due to race, gender, religion, etc., because those should not be factors in the search for the best candidate for a job. Likewise, people's potential cost to the company in health insurance claims should not be a factor either. But because the cost of my health insurance premium alone (not to mention the claims I might generate as a high-risk employee) is nearly 20% of my compensation (and an even bigger percentage for employees with lower pay), it is a big factor. There have been cases of obese people and smokers being passed over for jobs and pay raises, precisely because of the potential extra cost of funding their health insurance. There's even an infamous Wal-Mart company memo recommending practices to discourage unhealthy job applicants, to reduce company health care costs.
As you no doubt know, I am a formerly obese person, having lost 68 lbs through hard work and perseverance. Because of this, I am not particularly sympathetic to overweight people's claims that they cannot lose weight. The laws of physics are infallible: if you eat fewer calories than you expend, you will lose weight. I do, however, understand the psychological impediments that make overweight people feel as if it is hopeless, and the physiological conditions that make weight loss very difficult. (Perhaps I will write a blog entry about this at some point.)
Whether or not people can or cannot lose weight, their weight should not be a factor in hiring decisions. Unfortunately, it is a factor in hiring decisions, and it will remain a factor as long as companies stay in the business of offering health insurance benefits to their employees.
We could easily eliminate this factor while retaining insurance benefits by implementing a single-payer health insurance system. I have already presented the Pareto optimality argument for a single-payer system, and I think that the right to privacy concerning our health is another good reason. Oh sure, the gubmint isn't really that in to our right to privacy these days, but I would rather George W. Bush know all about my family's history of colon cancer than have my potential employer reject my job application because of my family's health history.
Monday, March 20, 2006
Pareto-Optimal Healthcare
There are some things in life that don't mix: oil and water, Hatfields and McCoys, Pepsi and milk, my mother and my father, and profit and healthcare.
While the first pairs on my list are universally known to be incompatible, the last one may come as a shock to you. After all, don't we, citizens of the United States, land o' capitalism, have access to the best healthcare in the world?
Yes, yes we do! We have the best healthcare that money can buy. And therein lies the problem. Healthcare is expensive, and those who need it the most can generally least afford it.
Remember last week when I was talking about Pareto optimization, or trying to find the best solution to a problem with multiple conflicting objectives? The problem of healthcare in a capitalistic scenario is a Pareto optimization problem, with many complicated and conflicting objectives that can be boiled down to two main objectives: 1, minimize cost, and 2, maximize public health.
There are many different solutions to this problem, each with varying degrees of practicality. Of course we could choose a solution in which no money is spent but everyone is ill, or we could go to the opposite extreme and eradicate every single germ. The best solution lies somewhere in between.
If we say that minimizing ill-health is equivalent to maximizing health, then we could use the same graph as before, substituting "Ill-Health" for "Effort" on the y-axis. Once again we have a continuum of optimal solutions, and the final solution is based on the values of those who make the decision.
The problem is that the values of those who make the decision are skewed toward minimizing costs instead of minimizing ill-health. Today's healthcare landscape is run by corporations, with the objective of maximizing profit taking higher priority than maximizing public health.
In a for-profit insurance model, the underwriter agrees to insure a number of people for a certain rate per person. (Rates for different people might be different, depending on age, status, health history, and what they want covered.) The money collected from each individual goes into a pool that is used to pay the claims of the policyholders and the expenses of the underwriter. Any money left over is profit.
This is why if you try to apply for an individual health insurance policy, you are screened so carefully and (assuming you are approved) the cost is so high. The insurance company wants to make sure that you are a good investment; that statistically speaking, you are within a certain limit of acceptable risk. They hope that you pay your premium regularly and that you never make a claim.
Group policies, such as policies provided by employers, often accept anyone without any conditions on their prior health history. Insurers make money on these policies because they have a guaranteed pool size over which any risks can be amortized, and they charge more per head than they would charge a person whose health risks had been screened.
There is a law that requires that health insurance companies offer policies to anyone who has been previously covered for a period of two years or more. The loophole in that piece of legislation is that the cost of the premium is not regulated. The sickly sister of a friend of mine was approaching the birthday at which she would no longer be covered by her parents' health insurance policy. Sure, she could have health insurance, but only if she could afford a monthly premium of $2700!
Tragically, the requirements for obtaining health insurance, namely good health and the means to pay for it, preclude from obtaining health insurance those who by definition need it the most: the ill who cannot afford treatment. But even people who have access to health insurance are often denied the coverage they need.
True story #1: A mentally ill man with full health coverage is told that he must travel one hundred miles round trip to visit an in-network psychiatrist, despite the dozens of available psychiatrists in a ten-mile radius. If he chooses to see a local psychiatrist, he must pay for the appointment himself, at a cost of $200 or more.
True story #2: A five-year-old girl is in the hospital this past November through February because her transplanted liver is failing and she needs a new liver. The family of the five-year-old girl has comprehensive health care coverage with a yearly limit of $2 million. The plan year is the calendar year. The re-insurer (the people who insure the insurance company) decides that because the bills for the November and December hospitalization were not received until January, they counted for 2006 instead of 2005, and by mid-February, the family has exhausted the $2 million annual limit.
The behavioral profile illustrated by these true stories makes sense under the charters by which corporations operate, that the short-term bottom line takes first priority. It doesn't make sense under the charters of common sense or decency, however.
In the first case, the insurance company was trying to save themselves a buck now, but neglected to consider their later losses when the mentally ill man (who was incapable of driving 100 miles round trip on a weekly basis, and could not afford the cost of seeing a local doctor) stopped receiving psychiatric care and brought harm to himself or another of their clients. (Actually, the man's family appealed the decision to their state's regulatory agency, and it was reversed.)
In the second case, the insurance company was trying to get out of its obligations by bending its rules and looking for any possible violation of the rules by the little girl's family. This is a tactic used by the mentally ill man's insurance company too, and I anticipate that should they be forced to reverse their decision, the girl's family will have a hard time getting them to honor their obligations.
The problem is that with all the focus on profit, the insurance companies have forgotten about what they're really insuring: people. If I lose my house in a mudslide, it's traumatic, it's scary, it's unfortunate, but it's just things. If I get really sick, on the other hand, it's my life that could be lost if the money to pay for the care that I need doesn't come through.
I'm a numbers junkie (I was counting sheep by 17's last night!) but I know where the realm of numbers leaves off and the realm of real people takes priority. The well-being of my fellow human beings is a whole lot more important than the dividends I get to record on Schedule D of my 1040 form. But of course the dividends can be a big temptation for some folks, which makes it all the more important to remove the for-profit aspect from the equation.
What is the solution to this problem? Well, there is no single solution to this problem, as I have already indicated. I just think we need to move along the curve of Pareto solutions away from maximizing profits and towards maximizing public health. I think that doctors and nurses perform a valuable service to our society, and should be remunerated handsomely. I think that hospitals should be run efficiently and the managers of the hospitals should be sufficiently rewarded for their work. But they should operate clinics and hospitals under the concept that the care of patients is the foremost priority, and I strongly believe that all hospitals and clinics should be run as not-for-profit organizations.
I think that similarly, health insurance companies should be not-for-profit organizations, to eliminate any temptation to stiff real life human beings in exchange for a fatter bottom line. I would support a national health insurance program; for example, expanding Medicare/Medicaid to include premium-paying workers.
I know I've lost some people to the rhetoric against government programs by now, but quite honestly, if working people paid premiums to the government instead of to a private insurance company, there would be no change except that the premium would go down.
We already pay our money into a pool. (In fact, we pay twice: once for the indigent and elderly [Medicare tax] and once for ourselves.) My employer and I pay more than $900/month to a large health insurance company. Jeff and I don't use anywhere near that much in coverage every month. The money goes into a pool that pays for my colleague's asthma medication, or the neighbor kid's strep throat, or prenatal checkups for a woman I've never met. It also goes to pay the salaries of the insurance company's employees, but a big chunk of it goes for corporate overhead, such as shareholders' dividends, advertising, and nine-figure bonuses for the CEO, for example, overhead that would be eliminated from a government plan.
Some reports say that a single-payer Medicare system could be supported on a 9% payroll tax: 2% coming from the employee's pay, and 7% coming from the employer. If that were the case, my employer and I would be paying about half of what we're paying now for health insurance. Sounds like a deal to me!
People rail against the inefficiency of government (myself included), but Medicare is actually the most efficient health insurance company in the United States. Less than a nickel of every dollar is spent on overhead. In contrast, the best private insurance companies spend roughly twelve cents per dollar on overhead. According to some reports, my insurance company spends more than a quarter of every dollar on overhead! Wouldn't it be nice if that money went to saving lives instead of fighting against legitimate claims by mentally ill men or critically ill children?
I hate taxes too. I can count my money with the best of 'em. But I don't think that paying for the well-being of my fellow citizens is such a bad thing. (As we've seen, I'm already doing it when I pay my private health insurance premium.) The thing I don't understand is how we in this country can place such a high priority on the unborn (e.g. South Dakota's recent anti-abortion laws and my own state's proposed constitutional amendment) and such a low priority on the already born!
A man who is near and dear to the hearts of most Americans once said, "Therefore, whatever you want men to do to you, do also to them, for this is the Law and the Prophets." (Matthew 7:12, ESV) (This is not to say that the Golden Rule is unique to Christianity.) It bewilders me that so few people actually heed his words. If I were ill, I would like for others to help me get over my illness and get back on my feet. It's only fair that if I want others to do this for me, I should contribute my part in doing this for them. Let's take care of each other like we're supposed to!
There is a lot more to say about Pareto-optimal healthcare, but I had to Pareto-optimize this post for length, substance, and time spent researching and writing, so this is all I have to say for now. There are many interesting articles out there on the topic. Two comprehensive articles that I found were
http://www.bostonreview.net/BR30.6/geyman.html
and
http://www.pnhp.org/facts/why_the_us_needs_a_single_payer_health_system.php
and I encourage you to read them both.
While the first pairs on my list are universally known to be incompatible, the last one may come as a shock to you. After all, don't we, citizens of the United States, land o' capitalism, have access to the best healthcare in the world?
Yes, yes we do! We have the best healthcare that money can buy. And therein lies the problem. Healthcare is expensive, and those who need it the most can generally least afford it.
Remember last week when I was talking about Pareto optimization, or trying to find the best solution to a problem with multiple conflicting objectives? The problem of healthcare in a capitalistic scenario is a Pareto optimization problem, with many complicated and conflicting objectives that can be boiled down to two main objectives: 1, minimize cost, and 2, maximize public health.
There are many different solutions to this problem, each with varying degrees of practicality. Of course we could choose a solution in which no money is spent but everyone is ill, or we could go to the opposite extreme and eradicate every single germ. The best solution lies somewhere in between.
If we say that minimizing ill-health is equivalent to maximizing health, then we could use the same graph as before, substituting "Ill-Health" for "Effort" on the y-axis. Once again we have a continuum of optimal solutions, and the final solution is based on the values of those who make the decision.
The problem is that the values of those who make the decision are skewed toward minimizing costs instead of minimizing ill-health. Today's healthcare landscape is run by corporations, with the objective of maximizing profit taking higher priority than maximizing public health.
In a for-profit insurance model, the underwriter agrees to insure a number of people for a certain rate per person. (Rates for different people might be different, depending on age, status, health history, and what they want covered.) The money collected from each individual goes into a pool that is used to pay the claims of the policyholders and the expenses of the underwriter. Any money left over is profit.
This is why if you try to apply for an individual health insurance policy, you are screened so carefully and (assuming you are approved) the cost is so high. The insurance company wants to make sure that you are a good investment; that statistically speaking, you are within a certain limit of acceptable risk. They hope that you pay your premium regularly and that you never make a claim.
Group policies, such as policies provided by employers, often accept anyone without any conditions on their prior health history. Insurers make money on these policies because they have a guaranteed pool size over which any risks can be amortized, and they charge more per head than they would charge a person whose health risks had been screened.
There is a law that requires that health insurance companies offer policies to anyone who has been previously covered for a period of two years or more. The loophole in that piece of legislation is that the cost of the premium is not regulated. The sickly sister of a friend of mine was approaching the birthday at which she would no longer be covered by her parents' health insurance policy. Sure, she could have health insurance, but only if she could afford a monthly premium of $2700!
Tragically, the requirements for obtaining health insurance, namely good health and the means to pay for it, preclude from obtaining health insurance those who by definition need it the most: the ill who cannot afford treatment. But even people who have access to health insurance are often denied the coverage they need.
True story #1: A mentally ill man with full health coverage is told that he must travel one hundred miles round trip to visit an in-network psychiatrist, despite the dozens of available psychiatrists in a ten-mile radius. If he chooses to see a local psychiatrist, he must pay for the appointment himself, at a cost of $200 or more.
True story #2: A five-year-old girl is in the hospital this past November through February because her transplanted liver is failing and she needs a new liver. The family of the five-year-old girl has comprehensive health care coverage with a yearly limit of $2 million. The plan year is the calendar year. The re-insurer (the people who insure the insurance company) decides that because the bills for the November and December hospitalization were not received until January, they counted for 2006 instead of 2005, and by mid-February, the family has exhausted the $2 million annual limit.
The behavioral profile illustrated by these true stories makes sense under the charters by which corporations operate, that the short-term bottom line takes first priority. It doesn't make sense under the charters of common sense or decency, however.
In the first case, the insurance company was trying to save themselves a buck now, but neglected to consider their later losses when the mentally ill man (who was incapable of driving 100 miles round trip on a weekly basis, and could not afford the cost of seeing a local doctor) stopped receiving psychiatric care and brought harm to himself or another of their clients. (Actually, the man's family appealed the decision to their state's regulatory agency, and it was reversed.)
In the second case, the insurance company was trying to get out of its obligations by bending its rules and looking for any possible violation of the rules by the little girl's family. This is a tactic used by the mentally ill man's insurance company too, and I anticipate that should they be forced to reverse their decision, the girl's family will have a hard time getting them to honor their obligations.
The problem is that with all the focus on profit, the insurance companies have forgotten about what they're really insuring: people. If I lose my house in a mudslide, it's traumatic, it's scary, it's unfortunate, but it's just things. If I get really sick, on the other hand, it's my life that could be lost if the money to pay for the care that I need doesn't come through.
I'm a numbers junkie (I was counting sheep by 17's last night!) but I know where the realm of numbers leaves off and the realm of real people takes priority. The well-being of my fellow human beings is a whole lot more important than the dividends I get to record on Schedule D of my 1040 form. But of course the dividends can be a big temptation for some folks, which makes it all the more important to remove the for-profit aspect from the equation.
What is the solution to this problem? Well, there is no single solution to this problem, as I have already indicated. I just think we need to move along the curve of Pareto solutions away from maximizing profits and towards maximizing public health. I think that doctors and nurses perform a valuable service to our society, and should be remunerated handsomely. I think that hospitals should be run efficiently and the managers of the hospitals should be sufficiently rewarded for their work. But they should operate clinics and hospitals under the concept that the care of patients is the foremost priority, and I strongly believe that all hospitals and clinics should be run as not-for-profit organizations.
I think that similarly, health insurance companies should be not-for-profit organizations, to eliminate any temptation to stiff real life human beings in exchange for a fatter bottom line. I would support a national health insurance program; for example, expanding Medicare/Medicaid to include premium-paying workers.
I know I've lost some people to the rhetoric against government programs by now, but quite honestly, if working people paid premiums to the government instead of to a private insurance company, there would be no change except that the premium would go down.
We already pay our money into a pool. (In fact, we pay twice: once for the indigent and elderly [Medicare tax] and once for ourselves.) My employer and I pay more than $900/month to a large health insurance company. Jeff and I don't use anywhere near that much in coverage every month. The money goes into a pool that pays for my colleague's asthma medication, or the neighbor kid's strep throat, or prenatal checkups for a woman I've never met. It also goes to pay the salaries of the insurance company's employees, but a big chunk of it goes for corporate overhead, such as shareholders' dividends, advertising, and nine-figure bonuses for the CEO, for example, overhead that would be eliminated from a government plan.
Some reports say that a single-payer Medicare system could be supported on a 9% payroll tax: 2% coming from the employee's pay, and 7% coming from the employer. If that were the case, my employer and I would be paying about half of what we're paying now for health insurance. Sounds like a deal to me!
People rail against the inefficiency of government (myself included), but Medicare is actually the most efficient health insurance company in the United States. Less than a nickel of every dollar is spent on overhead. In contrast, the best private insurance companies spend roughly twelve cents per dollar on overhead. According to some reports, my insurance company spends more than a quarter of every dollar on overhead! Wouldn't it be nice if that money went to saving lives instead of fighting against legitimate claims by mentally ill men or critically ill children?
I hate taxes too. I can count my money with the best of 'em. But I don't think that paying for the well-being of my fellow citizens is such a bad thing. (As we've seen, I'm already doing it when I pay my private health insurance premium.) The thing I don't understand is how we in this country can place such a high priority on the unborn (e.g. South Dakota's recent anti-abortion laws and my own state's proposed constitutional amendment) and such a low priority on the already born!
A man who is near and dear to the hearts of most Americans once said, "Therefore, whatever you want men to do to you, do also to them, for this is the Law and the Prophets." (Matthew 7:12, ESV) (This is not to say that the Golden Rule is unique to Christianity.) It bewilders me that so few people actually heed his words. If I were ill, I would like for others to help me get over my illness and get back on my feet. It's only fair that if I want others to do this for me, I should contribute my part in doing this for them. Let's take care of each other like we're supposed to!
There is a lot more to say about Pareto-optimal healthcare, but I had to Pareto-optimize this post for length, substance, and time spent researching and writing, so this is all I have to say for now. There are many interesting articles out there on the topic. Two comprehensive articles that I found were
http://www.bostonreview.net/BR30.6/geyman.html
and
http://www.pnhp.org/facts/why_the_us_needs_a_single_payer_health_system.php
and I encourage you to read them both.
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