The United States spends the most in the world on healthcare. But when compared to ten modern countries (including Australia, Canada, Germany, France, New Zealand, the United Kingdom, etc), the U.S. is dead last in quality.
Comparing the U.S to a list of 100 countries, the U.S. is 37th - only a little above Cuba. Why are we getting only average results for such huge amounts of money?
It boils down to how and where your money is spent. About 90 percent of the healthcare dollar goes to hospitals and clinics. Hospitals are hugely expensive but have somehow remained out of the media spotlight as compared to medicines--even as executives skim millions in compensation while cutting staff and services. Yet, there is evidence that the right medicine, taken the right way, keeps people out of the hospital. Better coverage for medicines could save billions of dollars a year in hospital stays, but insurance companies still skimp in that area.
One problem is that if “insurance companies” don’t spend your premiums on your care, they get to keep it. They don’t have to lower your costs, cover more, or return any money. It’s easy to see why that doesn’t benefit you.
In general terms, here are a few things that will help fix that conflict of interest:
Most states prohibit automobile insurers from steering (forcing) you use a particular repair shop. The states did that in to protect consumers from inferior work. They also recognized that networks of repair shops were cost based structures that tended to be monopolistic, sometimes owned by the insurance company, and unresponsive to consumers.
The states passed rules allowing you to choose the right shop and parts for your car. After that change, the quality of the system improved overall, because people gravitated to the better shops.
Health insurance companies say their networks improve quality, yet they will often exclude
providers with better quality scores. Most people in the U.S. are forced to use networks of
“repair shops” (doctors, etc.) chosen or owned by the insurance company - or else pay more.
As you can see, it really is cost based.
Networks didn’t work for cars. The current evidence indicates they aren’t working for people,
either. Otherwise, the U.S would certainly rank higher by now. By allowing customers to choose,
better repair shops rise to the top.
If you’re forced into a network, it simply means your car can get better body work than you can
The fix: Health insurance companies should be prevented from steering, which means you would have the freedom to choose
There are plenty of issues with costs, but insurance practices make those worse. Members get one rate while non-members get a different rate. Patients without insurance often pay the highest rates of all.
This is organized cost shifting. It may also be a form of predatory pricing because non-network competitors, members, and providers, are placed at a financial disadvantage to the monopoly. Healthcare becomes unaffordable.
Politicians once faced similar issues with their radio and tv advertising. To fix that problem, they wrote rules to ensure that each candidate gets the best available rates on the ads being purchased. One candidate cannot be favored over another in pricing for the same product. There is no reason similar rules can’t be applied to healthcare.
In another simple scenario, insurance companies may have ‘rebates’ or ‘pricing spreads’ built into the system. These differences are kept by the insurance company. In Ohio alone, one company running a state sponsored plan pocketed 224 MILLION in one year in taxpayer dollars. These practices mean:
your money isn’t being returned to you in the form of better coverage, higher quality, lower taxes, or reduced premiums, but is instead pocketed by someone else
2. the next item or service is likely going to be priced higher than it should have been in order to try to make up the difference
You can see how this forces prices upward at a faster rate than normal. If everyone charged and paid fairly, that would quickly level out the total costs, saving untold billions of dollars. Did you notice that the U.S. Congress fixed their pricing and access problems, but not yours?
The fix: Like political advertising, whatever the best price is (selling or buying), that price should be the same for everyone
Insurance companies often put rules in place that may un-duly restrict access to treatments. Sometimes called ‘prior authorizations’ or step therapy they are designed from a financial perspective, ‘clinical’ language is used to try to justify them. This may cause you and your doctor to jump through hoops before you can get back to where you needed to be in the first place.
By the time you work your way through the steps, denials or ‘appeals’, and assuming you are successful, your condition may have worsened. That probably costs you more.
Insurance companies say these rules prevent bad medicine. There are other mechanisms to address that. These are simply financially based delays, that cost more money in multiple ways, including the cost of the appeals process itself.
The fix: What’s covered (and what’s not) should be left to independent medical experts, not insurance companies.
Currently your car has better access to care than you do, and at a quality and price that you can choose. For humans, that choice has largely been taken away. In other words, your price keeps going up, but you don’t get any better care.
Maybe it’s because our healthcare system is built around rebates, not results.