Following up my earlier post on health care and the Supreme Court's decision, and the very interesting comments of a friend on Facebook (Note: both a Facebook friend and a real friend. At the same time, even!)
The individual mandate--the requirement that everybody get health insurance somehow--is a solution to one part of the US public's health care dilemma. That is, the health care costs of the most unhealthy are borne unevenly by those who have health insurance. In the pre-Obamacare era, people with pre-existing conditions, people with really bad health, people who were old, etc. had a really hard time getting affordable health insurance. So a lot of them went without, basically because they couldn't afford it.
In a fair world, maybe not being able to get health insurance would mean that you wouldn't get sick. Of course, that's not what happens--your proclivity get sick makes you less likely to be able to afford health insurance. So what happens? You get sick, but can't afford treatment, so you get sicker and sicker until you have to go to the emergency room. And they don't turn you away, so you get treated there, at the emergency room, which happens to be the most expensive place to get treated for just about anything. And the hospital has to cover those costs, so what do they do? They charge everybody else a little bit extra, through those other peoples' insurance.
So what happens? The insurance gets more expensive over time, and as it gets more expensive, more people can't afford it, so they go off insurance, so they start waiting and going to the emergency room... It becomes a spiral.
Okay. So what's the solution? Well, the individual mandate is one solution.
But there's actually another problem, which goes like this:
Everybody is always trying to make a buck--put their kids through college, put a new roof on the house, put gas in the Explorer, whatever. So the doctor recommends that you get more treatments, diagnostics, office visits, vitamin injections, MRIs, whatever. But he doesn't charge you or me. He charges our insurance company. And they then spread out the cost and pass it back to you in me, more or less evenly. Basically, most doctors get paid for doing piecework. More office visits, more exams, more x-rays, the more they make. And basically, insurance companies don't care, because they can pass the cost back to consumers.
The solution to this might be greater competition in the health insurance market. This is where the HIX comes in. HIX is the new three letter acronym for "Health Insurance Exchange." This is one of the things that is required under the new health care law in the US. State governments are required to set up an "insurance exchange," which is supposed to be a clearinghouse for businesses and individuals looking for private insurance. The idea is that individuals will go to this source in order to shop for insurance. And the theory is that by having a single place where people will be able to gather information about insurance, there will be more competition in the market, and health care costs will go down (or at least stop rising).
Will it work? Maybe. I kind of doubt it, but maybe. But it certainly can't be worse than the pre-Obamacare system (which, I should add, is the most expensive in the world). Time will tell, but keep your fingers crossed.
You might think about signing up for an HMO if you have the opportunity. Kaiser Permanente is a good example. Those guys get paid a flat fee for keeping you healthy, so their incentives are to provide you health care as cheaply as possible. Which sounds like a bad thing, but it's not, because the cheapest thing of all is for you never to get sick in the first place. So prevention is key. Also, they like to keep you out of the office, so you can do a lot of stuff with them over the phone, including consulting with doctors and nurses.
1 comment:
There is no evidence that setting up the state insurance exchanges will stop the upward spiral of costs. In fact, after the health care bill was passed in Massachusetts (which used a similar idea of an "exchange"), costs started rising faster than they did in the rest of the country. It wasn't until the state started regulating health care cost increases (a few years after the mandate came into force) that costs started to level off.
Another problem with the system is that there are concerns that this won't really put everyone into the system. Because it will still be cheaper to pay the fine (which is perhaps not even enforceable) than to buy insurance. Which raises questions to the "affordable" part of ACA.
In fact, the "affordable" in the ACA is really a misnomer particularly after the supreme court ruling. The "affordable" in the ACA actually referred to the mandatory expansion of medicare. However, since that's the one part that the supreme court threw out we may as well just call it the "Care Act".
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