I’m not an insurance agent, I’m not a politician, I’m not a doctor or anything even close. I’m a mid-thirties married mom of four who, more frequently than not, has a hard time just finding the time to slap on makeup and anything sexier than a pair of sweats. But I do have my opinions, and I try my best to base them on good information, and one of the things I’ve been delving into really intensely lately is this whole health insurance thing.
I have had some experience with health insurance before, both as a patient and as a medical biller. I have been through the gauntlet in both ways, fighting for important things, either for myself or for others. Although health insurance companies aren’t, as some would want you to believe, the devil incarnate, they aren’t lily-white, either. Much of the bad image they have comes from them watching their bottom line (money), which we don’t fault “normal” companies for—but for some reason, health insurers are expected to be more altruistic, I guess, since their province is sacred, at least to us: our health. Our bodies. Our quality of life.
There are a ton of things that health insurance providers don’t want you to know about, and they almost all revolve around a central tenet: Insurance companies make money by NOT paying for health care.
“What?” you say. “But, isn’t that what they’re there for in the first place, to pay for my care?”
Well, yes and no. To understand it a bit better, here’s a little crash-course in insurance in general, to help underscore the point.
Insurance is basically a company that takes money from people and stuffs it away in the event that something bad happens to that person in the future. If you buy auto insurance, those premiums you pay will eventually be worth it if/when you get into a fender-bender. But if you never do, that money is never refunded to you.
Same principle with health insurance: premium money is pooled and doled out as needed. Some people might hardly ever need to dip their toe in that pool, whereas some people have to plunge in and stay there till their toes turn pruney, poor things. Insurance companies average out the hardy versus the sickly by covering bare minimums, by pinching pennies, by sidling away from expensive or experimental treatments, by cancelling or denying coverage.
Why?
They make a lot less profit than you’d think. That’s right, health insurance companies average about 3% profit, which is really not that good when compared to other industries. Toy stores, movie theaters, and even other insurance companies, such as life, auto and property insurers have way higher profit margins than they do. Heck, the cream of the crop is the drug companies: they make a whopping 16.8% profit, one of the highest in the world, even ahead of casinos and cigarette companies. About 86% of health premiums actually do go to actual care, the remainder to operating expenses and wellness coverage, leaving only 3 cents per dollar for re-investment and growth. Not much. That’s one major reason why they hang on to their money, and they don’t want you to know how bad-off they are, because image is so very important.
What’s the solution? I personally think it’s rather stupid to be so secretive, and I think it’s just mean to use underhanded techniques to try to improve their bottom line. I think it would be a lot more effective for them to make a profit (which is fair) by cleaning up their administration. Seriously, how many claims advisors are needed? Get on the phone with these people for a simple matter and you’ll age a year and grow at least ten gray hairs just waiting, as you’re batted from one to another. Also, they could save by addressing issue number two.
They pay for a lot of stuff that’s unnecessary, and it’s their fault. And ours. If you set foot in a hospital for more than ten minutes, they’ll hook you up to a dozen tubes and draw as much fluid as you can give them without shriveling up into a raisin, they’ll scan every part until you feel you’re glowing with radiation…all for a broken toe. Why? You will ask that question, much less calmly, when they hand you the bill, and it runs longer than the federal budget, full of all kinds of things you have no idea what they are or what they’re for. The answer is always the same: “Policy.” Whose policy? Does my insuranc really pay for all that crap? Why? The answer lies in the hospital’s fear of litigation and insurance claims denial. They are trying to cover every base, even if it’s moronic. They don’t want to get sued, and they don’t want to not get paid. It’s a Catch-22. If they under-examine, they could get sued for malpractice if they miss something crucial.
Lawsuits, baby, lawsuits. The bread and butter of lawyers, the bane of doctors and insurers. Society is far too litigious…but that’s another article altogether. If the doctors make a diagnosis, they want it backed up by as much proof as they can, so they can justify it to the insurance company, to make them pay. If they over-examine, they’re just as likely to have the claim denied or under-paid, but they still can turn around and bill the patient…the one who didn’t need, want, or ask for the MRI for the sore throat in the first place. Insurance companies wonder why people burn through their minimum coverage so quickly? All they have to do is look in their own back yards. The solution? A serious look at all the overkill that goes on in medical billing and mandatory testing. That’d bring the bottom line down fast.
They pay doctors better for recommending “Best Care” measures…Even if they’re not the best care for you. This one is crazy, and seems the polar opposite of number 2, but it’s true. Everyone’s been to the doctor and felt like they were not being listened to. I had an experience like that, and it really made me mad, because it involved my daughter. She had been complaining of stomach pain, which I dismissed at first based on her having eaten way too much garbage while at a sleepover the night before. When she started spiking a fever and vomiting and complaining of pain in the lower right quadrant of her tummy, I called the doctor. He dismissed it, too, told me to give her something for the fever and it’d pass. When the fever got higher I took her to the emergency room, and they, too, told me it was gastroenteritis. When I asked about appendicitis they waved it off. “She’s a kid, and we don’t look for appendicitis until it’s a last resort.” Now, I know that kids can get stomachaches; I also know that moms can overreact, and that the solution for every sore tummy isn’t a laparoscopic exam. This was different, though. “Best care” for this problem was to let it be, let nature take its course.
The ONE time when I would’ve wanted some major testing, they refused. I knew something was wrong, but no one listened to me—until her appendix burst, there in the hospital. While my baby writhed in agony and turned bright purple, they all sprang into motion and whisked her away to have it out; she spent two weeks in the hospital on antibiotics, because the peritoneum was full of gunk from her appendix. If they hadn’t been so concerned with receiving more money for giving “best care” she might not have had to go through that, and the bill would’ve been a lot smaller. The solution? Somewhere in between standard care and intuitive care is needed. It’s hard to legislate or codify this kind of thing, though, so there’s little hope for anything even close to that in the near future.
So there you have it, my top three things health insurance companies don’t want you to know, all of them tied up in how they want to spend our premium dollars to improve their profits. It’s like someone with a condemned house sniffing in superiority at my cobwebs in the corners.
Seems like they need a good spring cleaning, to me.