Employee Benefits

No room for debate; I’ve made up my mind, don’t confuse me with facts.

I recently got into a Twitter “debate” regarding M4A. When I started explaining how insurance works and how the real cost problem is not insurance, but how we use health care and it’s price, I was called a shill for insurance companies (I have no financial or other interest in any insurance company).

There was no room for debate or discussion, the other party was anti everything except M4A. The Tweeter echoed every word of political rhetoric uttered on the subject. No facts, no concerns, no possible consequences mattered. He was convinced anything involving profit was bad.

I suggested he read the health care discussions on my blog. “I don’t have to, was the reply, “I know you are a shill for insurance companies.”

But here’s the thing, insurance companies don’t drive up health care costs. Insurance is not health care. Insurance premiums are not health care.

Eliminating health insurers in favor of a federal bureaucracy won’t lower the cost of health care or raise the quality. The non-medical spending by health insurers equals less than 5-6% of national spending on health. Plus all of that cannot be eliminated no matter what system we have. Nearly two-thirds of Americans do not have coverage that uses insurance (including the uninsured).

Ask any large employer if it struggles with health care costs. They certainly do and have for years. And, they have lead the way trying to find innovative ways to manage these costs …. all without insurance involved.

So, if you believe the health care problem is the result of insurance company profits or their CEOs pay, you do not understand the issue or you have effectively been propagandized.

Sometimes spending less, including on administration, is not all positive. Every system has its challenges. The promise being made (and readily accepted by many) for free, unfettered access to health care of all types is a promise that cannot be fulfilled.

In fact, a report by the Commonwealth Fund found it was the most cost-effective in the world. 

But what these comparisons also show is that the NHS lags behind the very best in terms of outcomes, such as cancer survival. 

Why is this? Nigel Edwards, the widely respected chief executive of the Nuffield Trust think tank, says we may be getting the NHS on the “cheap” – compared with other leading European countries, we spend less as a proportion of GDP (a measure of the size of the economy). 

His point? By spending more, we would have better buildings and quicker access to technology and treatments, which would improve care and make it more efficient. Source:BBC.com

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5 replies »

  1. Another issue is that people do not understand the term “insurance”. Do you not have to pay a deductible for each car accident? Isn’t the purpose of insurance to prevent financial ruin after a car accident or death in the case of life insurance. Health insurance is not a gym membership fee that you can use as much as you want. It is about cost sharing like all insurance is and until people understand that, they will never get it and believe what they want to hear. Vote for me and I will give everything FREE.

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  2. Dick, I’m sure you know by now that you can’t win debates using logic and facts when the other party is ideologically opposed to your argument. Look how often we see this when you bring up social security especially when the subject is “NO COLA THIS YEAR”. The same people crying the same tune even after they are taken by the hand and directed to where facts can be found that prove them wrong.
    People believe what they want to believe and social media reinforces their ideas. I have to say that I admire your fortitude; I’d have given up a long time ago.

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  3. Dick, it was a revelation to me when you stated: “Nearly two-thirds of Americans do not have coverage that uses insurance (including the uninsured).” It reminded me that more than half of all individuals covered under a government-sponsored program (Medicare, Medicaid, Public Exchange, etc.) are covered through a, gasp, insurance policy purchased with taxpayer dollars. Do the government administrators know that they are funding the CEO’s pay package, and contributing to income inequality and wealth inequality? Someone must be forcing their hand, holding a gun to their head, to make this a reality. And, horror of horrors, the percentage of Americans actually insured through these programs is increasing, increasing, increasing!!!!!

    Let’s go to the tape – a mostly liberal think tank and general supporter of the Obama Administration’s version of Health Reform if the Henry J, Kaiser Foundation:

    See: https://www.kff.org/other/state-indicator/total-population/?CurrentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D (2017 data)

    Employer sponsored plans: 49% of Americans ~ 161MM Americans
    Non-Group (individual insurance policies, probably including the public exchange under Health Reform) – 7% – 23MM
    Medicaid (including dual-eligibles with Medicare, and CHIP) – 21% – 69MM
    Medicare (including Medicare Advantage) – 14% – 46MM
    Other Public – 1% – 3MM
    Uninsured – 9% – 27MM

    So, those data probably need a little more breakdown – using other Kaiser survey /reports regarding government and private sector data to determine which are self-insured include: :

    98MM of the 161MM in employers sponsored plans are self insured (61% estimate based on another Kaiser survey – http://files.kff.org/attachment/Report-Employer-Health-Benefits-Annual-Survey-2018)

    0 of the 23MM in non-group (yes, the Obama Administration’s health reform added people to the insurance roles),

    20MM of the 69MM in Medicaid are in self insured coverage, while 49MM are in the Managed Care Market (the federal/state governments outsource most Medicaid participants to insurers) based on another Kaiser survey – https://www.kff.org/other/state-indicator/total-medicaid-mco-enrollment/?currentTimeframe=0&selectedRows=%7B%22states%22:%7B%22all%22:%7B%7D%7D%7D&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D

    26MM of the 46MM are in traditional, uninsured Medicare – the other 20MM are in Medicare Advantage options according to another Kaiser survey – https://www.kff.org/medicare/issue-brief/a-dozen-facts-about-medicare-advantage/

    So, my guesstimate of the number of individuals who have coverage that is self insured is slightly less than yours – 144MM out of 328 MM Americans where 301MM have some sort of health coverage.

    Interestingly, of course, the majority of Medicare beneficiaries are self-insured – and last I heard, the only Medicare trust fund (that’s Part A, so called hospital insurance, which has no actual insurance policies) was going to be eroded by 2026.

    Think about M4A – they are proposing a methodology which is increasingly rejected by the federal and state governments in favor of various forms of managed care and contracting with insurance companies to shift the risk to the private sector.

    Remember, Bernie proposes that you can go to any doctor, any hospital, any time, with no point of purchase cost sharing – all will be paid by revenues collected elsewhere (and from Bernie’s perspective, as he buys your vote) from others.

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