Insured vs. Uninsurable?
February 25, 2008 | General
Here are some interesting stats: of the so-called 47,000,000 uninsured in the US (and I truly believe that is a bit exaggerated, but we will use those figures), please understand that uninsured does not mean uninsurable. Also, let’s please assume that those figures relate to citizens and legal residents…. Here is what I have found over the last 16 years as a high risk and hard to place specialist:
- one third of the uninsured who call me - or who I call - tell me they think someone one should pay for it. Can they get it? YES. Can they qualify for it through decent health? YES. Can they afford it? YES. Do they believe they should pay for it? NO
- one-third have the erroneous belief that since they haven’t seen sick or needed it, insurance is a waste of money and they will get it “when they need it.” I ask them if they believe they can wait till they have a car accident to get auto insurance? They usually say “that’s not the same.” Yes, it IS the same. Insurance is about covering you for a risk that hasn’t happened, not one that already has. Otherwise, no one would ever buy homeowners insurance, car insurance, travel insurance, life insurance… it’s insurance
- one-third have truly fallen through the cracks. They tend to earn a low level of income and have many health issues and their employers do not provide group coverage. Or they earn a decent income but not enough to cover the $1800 in medications they take every month for that unusual diagnosis that no one expects (MS, Parkinson’s, Alzheimer’s, rheumatoid arthritis, etc).
OK - so one-third of that 47,000,000 is about 15-16,000,000 and those people simply can’t get health coverage. So instead of being 20% of the US population, the truly uninsurable comprise about 7%.
Let’s be pro-active here: how many of these people got sick because they:
(1) didn’t watch their weight and are now over-weight, which statistically leads to high blood pressure, elevated cholesterol and triglycerides, elevated sugar (weight and sugar are at an epidemic level with those under the age of 30, due predominantly to the consumption of processed and junk foods and sitting in front of TVs and video games and not getting and real exercise), and degenerative disk disease? In the world of auto insurance, we would call this self-inflicted injury.
(2) left a job in one state and moved to another, didn’t continue their insurance and take it with them because they assumed they would get another job right away that would offer coverage? This is one big assumption to make with one’s health! Murphy’s Law says that in the uninsured interim, something catastrophic happened and now there is a health coverage issue
(3) forgot to make a payment, deliberately let their policy lapse or cancelled one plan before they had another one approved, and then couldn’t get approved? Once you have cancelled a policy, if there have been any new medical conditions, you generally cannot get it back.
(4) lost their job and couldn’t afford COBRA, or there was no COBRA and they couldn’t afford HIPAA? Granted, COBRA isn’t cheap - but many employees do not understand that the COBRA rate is dollar-for-dollar what the employer was paying for that employee’s insurance and I know no one ever told their employer they thought he or she was paying too much for their health insurance! (Guess it depends on who pays for it….) All other things being equal, group health insurance has the most expensive premium per person. On average, the employee has maybe 25% of the total withheld from his paycheck, but the employer is paying the rest. And very very few employers pay for the employees’ family members, so if you find one who does, you know he is paying a pretty penny and should kiss the ground he walks on for being willing to do so.
Currently, 33 states have high risk pools, whereby if you apply for coverage and get declined by two or more carriers, the high risk pool must take you. This is not cheap - it can run from $400 to over $800 per month depending on the state. Generally, and for obvious reasons, this is a form of high risk coverage - otherwise, those people on it wouldn’t be taking it.
In states that do not have high risk pools (and in some that do), we have a form of Medicaid, based on gross income. These income levels are low, and if someone who is on Medicaid applies for and is awarded social security disability, they will usually lose their Medicaid as they now have more income than the Medicaid guidelines allow. This is truly a problem.
So, now we can break down that 7%, totaling 15,665,000 into maybe three more groups: those who had it and got rid of it (i.e., lack of knowledge), those who had it and it was taken away (i.e., lost job, etc), and those who - over time - did it to themselves. Gaining weight, drinking too much, not exercising….. these are not behaviors thrust upon us by the government: they are things we do to ourselves. And ultimately they are things for which we pay.
No amount of money can buy insurance if one’s health has been seriously impaired through behaviors that could have been avoided (other than through a group plan - and even those can have one year waits on preexisting conditions). And, many of those behaviors could have been and still can, in many cases, be reversed. Losing weight is the best thing to do for one’s health. A person weighing 250 lbs at 5′8″, they are carrying nearly 100 lbs of extra pressure on their vital organs - this is what the carriers are concerned about, this is why the health carriers will not cover these people. They may not [yet] have a blood pressure or cholesterol issue, but statistically they will. But they can avoid it. There are many things we can do to prevent illnesses and injuries, and health insurance companies just don’t want to be baby-sitters for those who could have prevented their own medical issues. Not a warm and fuzzy thing to read, but true.
So, what are we really looking at? Maybe 15-16,000,000 people without coverage with less than one-half of those people uninsured through no fault of their own…. so maybe 5,000,000 who are truly in crisis at any given time. Not having insurance does not mean one will die without coverage - it means that there is a risk if their health worsens and they cannot afford necessary attention. I am often asked by someone if they are just supposed to die? And of course, I have to ask the obvious question: Is anyone terminal now? The first thing to do is try to take care of yourself - better diet, more exercise, fresh air, vitamins/supplements…. and really, be willing to pay for the inexpensive health care called maintenance: pap smears, mammograms, prostate, blood pressure and cholesterol checks, etc. This is the small stuff. Be willing to invest in yourself.
Need medications? Check out Canadian mail order. Short on cash? Negotiate with a doctor - the average doctor gets maybe seventy cents on the dollar when paid by an insurance carrier - ask for the self pay fee schedule. I have seen doctors lower their rates by half for cash-paying patients. Many places in AZ, like Bashas, offer low-cost clinics for many routine tests - check them out on the web. Find out what is available. There are also many pharmaceutical companies that will virtually give away medications to people with low incomes. Call the manufacturer of the medications you take and ask what kind of assistance programs they offer.
Maybe you are one of those who have simply said, “Nah, don’t need it, don’t want it, don’t want to pay for it.” That is your choice. Maybe you are one of those who would do anything to have it and have never been able to afford it - check out what are called limited liability plans, find a high risk specialist, find out what your employer is doing about a group plan, see if your local government has any assistance plans you might qualify for, call your Dept of Insurance to see if they know of any, write your Congressional representatives, talk to your doctor about less expensive medications or treatments and what you can do to help yourself…. Check out low-cost clinics and ask for recommendations. Also, not all insurance carriers are the same; some allow more negative medical history than others when it comes to what they will accept. As a broker with over 124 products, I am amazed at what some carriers will take and what others won’t. If you can get coverage, even if not for all your preexisting conditions, take a higher deductible to keep your premiums down (you can always negotiate the payment of a deductible with the hospital).
Remember: just like uninsured and uninsurable are two different things, so are health care and health insurance. You are responsible for your care, first and foremost; the doctors intervene when things go wrong, but that is not health insurance - which is what helps you pay for the health care. While hospitals and doctors don’t work for free, they can negotiate. Ask - always ask. If you ask and they say No, well, now you know. But if you don’t ask, then they may as well have said No…. but they might not.
Health care should never be an option - but it is always a choice. And it starts with the consumer - be aware, be pro-active, take care of yourself, try to improve your health, check out your options…. and there are options.
June - Arizona Life Lines
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Comment by John February 27, 2008
The current system can NOT be a solution.
Some facts:
1) It does not exist anywhere in the world.
2) No other developed country spends as much as we spend in US. We spend about $7000/- per capita compared to $4-5000/- in other developed countries OR we spend 16% of our GDP compared to 8-11% elsewhere. Yet a third of our population are either uninsured or under-insured whereas everyone is covered in every other developed country.
3) Any healthcare system must involve patients and doctors ONLY; why a third party in the name of health plans required in YOUR health decisions?
4) Health insurance industry in US is very complex and grossly inefficient. The data and the IT systems they have are nothing but junk; they can not be salvaged.
5) You really do not have a choice of doctors. Your doctor may be in your healthplan’s network one day and the next day he/she is not. They themselves may not even know. Half-way through your treatment, you are forced to change the doctor.
Do you need any more reason to scrap the current system?
Comment by Carolyn February 27, 2008
Re: John’s comment - doctors in a true PPO must sign calendar year agreements - they cannot be in the network one day and gone the next. That would apply to Fee For Service Plans, such as Medicare offers. We have the best health care system in the country - but we also have less active people and more overweight people in the US than any other country, statistical fact, sadly. We spend more on health care here than anywhere because we can - better medical attention, better pharmaceuticals, etc - so of course they cost more.
People come to the US for medical care because they have something here and nowhere else: CHOICE.
Comment by John February 27, 2008
Wow! ‘We have the best healthcare system’??? Amazing. Then why healthcare remains one of the major campaign issues now. And why no other country is even thinking of following our system.
Re Carolyn’s comment on doctors, the data maintained by healthplans especially provider data is JUNK. Even today, we don’t have something called unique-provider-ID implemented by the healthplans; Dr. Carolyn can be written in dozens of different ways. When you call the healthplan, they would say that your doctor is in network and when the claim goes he/she is NOT. Even if everything is ok, what happens if your doctor goes out of network in January in the middle of your treatment. Is it called CHOICE?
Comment by Jim February 29, 2008
Regarding comments on our large number of overweight people, I think our WORK CULTURE is the main culprit; we can not blame entirely on the individuals. With my work experience in Europe, I can tell you that they work about 1600 hrs a year compared to 2000 hrs here. In fact, millions of people here work 50-60 hour weeks. And, many of us end up going to fast foods regularly for lunch on week days; in France, they take an hour for lunch.
We talk so much about our productivity. Yes, we do have higher productivity, but it comes with a price in the form of over weight and poor health.
Comment by Jack March 3, 2008
Wake-up America!! Shut down the current healthcare system. It simply can not survive.
Here is the fact. A family of 4 will need to spend over $52,400 a year in 2017. This is the projected national healthcare expense. I am not saying this. This is according to US Dept of Health & Human Services. You can check it out at http://www.cms.hhs.gov/NationalHealthExpendData/Downloads/proj2007.pdf
According to them, $4.277 trillion is required in 2017 for the population of 326.5 million. Can a family of 4 afford $52,400/- a year on healthcare? Absolutely it is not going to happen. Let us not waste time in trying to analyze or fix the system. It is simply not fixable. Shut it down ASAP.
Jack
Comment by Bill March 3, 2008
Completely shocked! Who will foot the bill of $52,400 per family of four every year on healthcare alone? I think there is nothing to even discuss about the current system.
Doctors hate health insurance companies.
People hate health insurance companies.
Employers hate health insurance companies.
Then why do we still keep them in business? Put the ‘out of business’ sign in front of health insurance companies immediately.
Comment by Nathan March 3, 2008
Health insurance companies exist only in US. That’s why we only have a healthcare crisis here in US and not others in other developed countries.
Do we need any more reason to get rid of health insurance companies?
Comment by John March 5, 2008
Have lived in the U.S.A for the past 30 years(Scottish), here is my 2cents worth.
The number of people employed by middle to large corporations to administer all these health plans is mind boggling, all the paper work and time to explain them is unproductive, companies are there to produce and make a profit, we don’t expect to buy house insurance or car insurance thru companies.
I was umemployed for almost 19months COBRA cost $891 a month, who can afford that, could’nt get insurance as my wife had a pre-existing condition.
Presently working at a great place, buts its small so the benefits are’nt
great, my wife had to go the emergency room with a broken wrist, this
ended up costing me just under $1000, a friend who works for a large corporation and pays less in insurance had a large hospital bill for his wife, his cost was nothing.
I have talked to quite a few Americans, well educated, and it is amazing how frightened they are of “Socialized Medicine”, also lived and worked in what was West Germany and they had a much better health care system then the U.K, nobody writes about them, just about
waiting lists in the U.K.
The system does’nt work its costly, lets try something better
Comment by Jack March 6, 2008
Health insurance companies in US are the most inefficient in the world. They still survive because they thrive on ‘COMPLEXITY and CONTROL’ of the whole healthcare system.
I have lived and worked in UK, Asia and now in US for over 20 years with a good part of it for health plans . With my exposure to different cultures, here is a much better option.
1) Employers spend tens of thousands of dollars on every employee (& dependents) today. Let them direct 50% (or so)of that money to employee’s Health Savings Account; and the rest to ‘Federal Catastrophic pool’.
2) Limited number of ‘Catastrophic procedures’ (like cancer treatment) will be covered by this ‘Federal Catastrophic pool’ with some copays.
3) Individuals will pay the doctors directly from their HSAs for all other procedures. There is no question of claim forms, out-of-network issues, deductibles, out-of-pocket maximums, etc. It is just like what we do in case of auto-insurance or home insurance.
4) What about low-income people: Catastrophic pool will cover them as well. For all other services, introduce a process something like food-stamps, we may call it ‘medical-stamps’.
Why it will work:
1) Patients and doctors are the only folks involved in making medical decisions; not too many cooks to spoil the broth.
2) Admin costs will be very minimal; 100s of billions in savings.
3) Individuals make payments and so comes responsibility; also encourages a healthy living (diet & exercise). Also, it does not give room for ‘defensive medicine’ where doctors resort to unnecessary tests for fear of law suits; 100s of billions in savings.
4) Does not involve ‘too many cooks’; so less law suits and lower ‘liability insurance’ for doctors.
5) Simplified process; people know up front what they will pay and no surprise bills.
6) Total choice of doctors/hospitals; no need to check if the doctor is in-network or not.
7) More importantly, no more psychological stress due the non-transparent and complex system.
From my experience, I can say for sure that the money what we spend today is absolutely enough.
Jack
Comment by Carolyn March 10, 2008
Our healthcare is basically good in the US - maybe not the best, but the medical professionals here often have a vested interest in receiving “commissions” on the prescriptions they write. I know this for a fact, I worked as a pharmaceutical rep for seven years until two years ago. Many of my physician clients fianced their Mercedes and cruises by prescribing medications that weren’t always, by their own admission, necessary but they knew the client wouldn’t make necessary dietary changes so went ahead and prescribed medications instead. They admitted they didn’t even give the patient a choice! That is atrocious and why I finally left the industry. it is a fact that the more medications aynone takes, the more they will continue to require. it is a vicious and generally unending cycle.
The US is the most over-medicated country in the US. People in this country average three times the amount of medications that people in other countries do. This is likewise atrocious. The insurance carriers do not like it as they know doctors are often prescribing for the wrong reasons and saying “Your insurance company will cover it.” Like, they don’t care wh pays for it, they will prescribe it….
As for not buying home insurance and car insruance through insurance carriers, those are the ONLY places to get it. You may go through a broker or agent, but all ‘insurance’ is provided by insurance companies.
Let’s overhaul the system by starting with the outrageous profit-making machines…. and it isn’t the insurance industry. They are considered “profitable” is they make 4% ! No individual who is self-employed would stay self-employed for 4% ! The pharmaceutical companies have a larger lobby in Washington than the tobacco or firearms lobbies…. and when they tell you that they like to get their R & D costs back and that is why the cost of meds is so high - BULL. If you ask for and read the fiancial statement for any pharmaceutical company, 80% of their ‘overhead’ is for advertising. Advertising! NOT research and developement.
Instead of attacking the insurance companies, with their 4% profit (we are talking health iinsurance, not life - life is very profitable and should not be confused with health insurance), let’s go after the root cause: increase in malpractice insurance, increase in medication cost (I know for a fact that what usually costs you $4 a tablet at the pharmacy leaves the factory for less than 25 cents…..) and, face it, when hospitals are forced to take care of people who are not even in this country legally to start with, knowing they will never get paid, who pays? WE do - so of course the hositals’ costs are going to go up, too!
Healthcare has always been a hot topic in political races - but realize, NOTHING is ever done abut it. Not by any candidate. But they know that - aside from those truly in need - the ignorant, poor and/or milking-the-system types will vote for anyone who says they are going to provide healthcare for everyone. Come on, who is going to pay for it?! WE are - not the government. If the government pays for it, where do they get the money from - from US, from higher taxes!
Think this through, it isn’t free: but it does take away freedom of choice. That is one thing we have, in our country, and it is one thing that it seems the voters will let the government take away from us - freedom of choice.
Once you lose freedom of choice - what’s left?
Comment by Gerry March 10, 2008
When I got my timing belt of my car replaced last week, I did not call my auto-insurance company to see whether my auto-mechanic is in their network or how much my insurance would cover. I called a few mechanics and went with one and paid right away; no more paper work. The mechanic wants my business in the future and so tried his best to keep me happy. I had all the CHOICES in the world.
Auto-insurance is there only for any unexpected accidents. That’s why, the premium is so low. Imagine an auto-insurance system covering every possible expenses including oil-change, tire/battery replacement, other maintenance, etc., there would have been tons of money wasted or misused.
Why not we make healthcare exactly like auto-insurance. Let us have health-insurance only for ‘catastrophic’ coverage and pay directly for all routine services from HSAs. In this case, tons of wastage can be avoided; doctors would prescribe only as necessary, because they want to really ‘treat’ the patients as they want to keep the patients happy.
It would reduce tons of money wasted in administrative expenses, law-suits, etc.
Comment by Fred March 10, 2008
Folks! Act now!!
Let us all understand one thing. Even if the current healthcare system is good, it simply can not survive. Someone wrote in this blog about projected expense of over $13,000 per person per year by 2017. I could not believe it at first. When I checked Health & Human Services Dept website, it is absolutely true.
Surely, more than 90% of the population can not afford this amount. A huge freight train is coming at you…very fast. Act right now. We say college is not affordable even when you go to college only for 4-6 years. Whereas this healthcare expense is for your entire life.
You can not get rid of doctors because they are the ones who provide the service; and patients receive the service. It means, health insurance companies (and allied) are the only ones who should/will become extinct.
Let us have a purely consumer driven healthcare system and not health insurance company driven one.
Comment by Jack March 12, 2008
Healthcare system: Where is the MONEY?
According to US Dept of Health & Human Services http://www.cms.hhs.gov/NationalHealthExpendData/Downloads/proj2007.pdf ), our projected healthcare expenses would be $4.277 TRILLION in 2017 compared to $2.105 trillion in 2006….if the current system continues.
It means, a family of 4 will need to spend $52,400 - in 2017 on healthcare alone. Please wait….actual expense will always be more than projected amounts. AND, more and more people will become uninsured and under-insured. Where is the money?
Simply, the current system is not financially viable. Let us not waste our time analyzing and trying to put band-aids here and there. We must shut down the current system ASAP and come out with a simpler system where medical decisions are made by doctors and patients ONLY.
Comment by John June 16, 2008
This is a great post. It’s amazing how people think they should be able to something for free. Health insurance quotes and premiums have to be paid by someone. And many people think someone else should pay it and not themselves. Health insurance quotes aren’t cheap, but it’s not something I’m willing to go without because the reality is, if you’re hopitalized and don’t have insurance, you will recieve far worse treatment than someone who is insured. The hospitals see the uninsured patient as a financial burden.
Comment by mike June 18, 2008
Nothing can be free. But people don’t understand the fundamental problem in healthcare.
‘Consumers’ should be the ‘buyers’ whether they pay the doctors/hospitals directly or buy insurance. Today, the cost for hospitals/doctors services is ‘unknown’; why don’t they publish their rates online so that people can compare & shop. If this option is available, I will buy insurance only for what I need…just for emergency/catastrophic coverage and for all the rest I will pay directly. This will cost only a fraction of premium I pay in the current system.
Bottom line is we don’t need insurance for every service.
It means, by forcing the doctors/hospitals (by law) to publish their rates you can expect the healthcare cost drop significantly.