Money & Medicine

Health Care and Public Policy

 

Time for a soap-boxy post. 

 

Aside from being something I’m wrestling with this week on a personal level, it’s clear:  Those who create public policy surrounding health care have completely missed the point.  There could be any number of reasons why they’ve done so.  Personally, I think it happens to be that they have simply neglected to examine what the ACTUAL cost of health care is – they are too busy bickering about ideology and are completely willing to just look at the monthly premiums offered by health insurance companies and say “Of course that’s affordable!”  They neglect to factor things in like co-pays, or prescription cost, or any number of other things that add to the out of pocket expenses in addition to premium cost. 

 

Here’s the general gist:  My partner is slated to lose his job at the end of the year.  He’s been given adequate notice and overall they’ve been incredibly fair, so no complaints there.  What that does mean is we will lose his (absolutely fabulous) insurance.  SO, we have to find our own.

 There are a number of other parts of the financial situation that complicate things – I work part-time, which means my share of the premiums through my company plans are more than if I were to work full-time.  My company’s options are - to put it nicely – crap.  I’m a grad student – I’m broke.  But between the two of us, we (thankfully, because it would be really hard otherwise) make too much money to qualify for any subsidized plan through the state (assuming he gets another job in a similar range which, while not impossible, will take time and doing).  

 

Overall we’ve got a clear idea of how much health care we use and need.  Since my partner’s current insurance is unbelievably good, we’ve been pretty spoiled.  By “spoiled” I mean “gone to the doctor when needed” (annual physicals and 2 additional visits to treat my sprained ankle; tooth cleaning once; and mental health visits to treat our learning disabilities).  So we’re pretty much low-users of the policy, overall. 

Keeping all of those variables the same – doctors visits, prescription coverage, and even adding in vision care (because I’m blind as a bat), we’ve crunched the numbers and it’s simply ridiculous – and not worth the money! (Provided, of course, that nothing catastrophic happens but if it does all bets are off, anyway…)

 

Here’s where public policy gets it so very, very, VERY wrong. 

 

I’ve evaluated a number of plans for per-month cost, after adding up premiums, co-pays, deductibles, etc.  The cheapest INSURED option – the cheapest “individual + one” plan, among all, even those offered by the state – comes out to cost us, out of pocket, a mind-numbing  $6,101.16 per year, or $508.43 per month.   Which also is way, way, under the $8,000 “out-of-pocket” limit on this particular plan, because (naturally) the monthly premium doesn’t count. There are a few other options that are approximately $650 per month in costs after all is said and done. 

 

That’s the cheapest “most affordable” option.  I have a LOT more than a lot of people and I’m not trying to plead poverty, but on what planet is 50% of my net take-home pay – affordable? That’s working 2 weeks of my part-time job JUST to afford health care.  Wha?!

 

What’s really ironic is that, in crunching the numbers and using the same variables, that if we were to self-pay for *everything* (using the self-pay rates I’m used to dealing with all of those years I was without health insurance) AND pay the full extent of the tax penalty for BOTH of us next year, we would wind up with only, out of pocket, $468.83 per month in expenses.  BUT WITHOUT the tax penalty, we would pay only $290.83 per month in health care costs – for everything.

 

Because here’s what’s really sick – I added up the cost of EVERYTHING my partner and I would normally use in medical expenses throughout the year.  Estimated, of course, but not lowballed. 

 

On our own, without insurance at all, we would spend $3,490 in medical care in a year. 

The CHEAPEST premium we have available to us, through the state, would cost us $5,745.96 per year. 

 

We lose over $2,300 a year just in the act of buying insurance – and that’s before a SINGLE CO-PAY OR DEDUCTIBLE.

 

I understand what Massachusetts was trying to do here.  To make insurance “affordable” to all, widen the risk pool through mandated participation to include those who would normally not carry insurance because they don’t need it (healthy, young, trust fund, whatever).

 

But the initial premise is inherently flawed.  Health insurance companies exist to make a profit, NOT to provide health care.  All “widening the risk pool” has done is allow them to charge the same insane rates to everyone and make even MORE of a killing, because the vast vast majority of those who don’t need it won’t even come close to using even the value of their premium in health care costs!!  All widening the risk pool does is guarantee the insurance company a fatter bottom line.

 

So I don’t understand is why, after all of this common-sense number crunching, the idea of a universal, single-payer health care system is so inherently frightening to so many people. 

 

You want to talk about widening the risk pool?!  THAT’S how you widen the risk pool – everybody’s in.  Everybody pays taxes (and thank god we’re still a progressive system, although my professor argues it’s getting more regressive every year), and everyone chips in.  Not everyone will need massive levels of care. Most people won’t even use what they have.  But it will be there when you need it. 

 

IF you still insist insurance companies can have a piece of the pie (and they will, because there is always risk and that’s what insurance does, it mitigates risk), then there is no reason I can see at the moment that a single-payer system can’t work in tandem with catastrophic health insurance policies that cover massive expenses as a result of accidents or something.

 

Oh, wait.  We already have something like that.  It’s called accident insurance, and it’s nowhere near as costly as health insurance.  So it seems like the risks are calculated and mitigated, according to market forces. 

 

It’s time for me to stop ranting.  I think I will bring this up in class and ask my finance professor’s opinion.  I’m not saying that as a lame tie-in, either – I am genuinely about curious what he has to say about this situation.