Tuesday, April 20, 2010

Health insurance rant

I was feeling pretty good about our health insurance premium going up only 12% this year until I checked the fine print. Beginning in July, our co-insurance maximum rises significantly, plus we’ll be on the hook for 50% of the cost of all our CT, MRI and PET scans once deductibles are satisfied (it was previously 20%). If those real costs had been calculated into our premium and assuming my personal need for complex imaging does not abate, we're looking at the equivalent of about a 40% jump in our insurance costs.

I know, I know: Cry me a river. When it comes to rising premiums and diminishing benefits, all of us in the private market are kayaking through whitewater without a paddle. We can hear what sounds like the roar of a waterfall straight ahead.

My family and I are the sort of healthcare consumers that everyone should hate—not that we’d take it personally. I am, in particular, a healthcare glutton. My choices and those of my doctors help to drive up the overall cost of medicine. Unfortunately, cancer treatment doesn’t come cheaply, and in the time we’ve been on the private market, Allie has also had two major eye surgeries and Ellen two lumbar diskectomies. In those eight-plus years, Regence has picked up about $116,000 of our expenses. Our share has been about the same: We’ve spent roughly $45,000 on premiums and another $72,000 for out-of-pocket costs. For every two dollars’ worth of healthcare that the Ogles consume, we pay for only one.

Thanks, friends, for picking up that other buck. I hope to return the favor some day.

Because we have a high-deductible plan—$7500/year per family member—we have some skin in the game. As my family will tell you, I believe in using healthcare prudently. We don’t run to the doctor with every ache and pain. When you're healthy, consumer psychology assures that a high-deductible policy works to the advantage of both buyer and supplier. The protocols for cancer care are notoriously variable, however, so a distressingly high percentage of the decisions about my care are made in the absence of convincing clinical evidence. Do I want radiation therapy? Ah, sure. How about interferon? Heck, why not? What about plastic surgery for that metastasis removed from your face? Well, maybe later. Oh, and let’s forgo plain-vanilla CT this time and see what PET/CT shows us instead. So far, Regence has stood back and said, let ‘er rip.

This sort of intensive care takes us far beyond those sissy $20 co-pays. For each decision, thousands of healthcare dollars swing in the balance. Those dollars are mine, partly, and as I’ve explained above, they’re also yours. Most people in my shoes wouldn’t hesitate to go for the Cadillac care I’ve received. I have freedom of choice and access to state-of-the-art drugs and technology. If I lived in Canada or the U.K. or Singapore, many of my healthcare decisions would be made for me, and a lot less money would be spent. Would that be a good thing or a bad thing? I’m inclined to believe it would be a mixed bag. By pooling risk, insurance is a great concept. It’s what civilized societies do. But in an environment of insatiable demand and increasingly sophisticated technology, it’s aiming us toward economic ruin.

I see nothing on the horizon that incentivizes people to consume less. The profligacy of my care doesn’t help matters, but I feel as much a victim as a beneficiary. I’ve had others tell me not to worry about the costs. But I do. I hate feeding the beast because of its obscene inefficiencies, its callous and impersonal treatment of patients, and its blatant manipulation of our primal fears of illness, injury and death. I hate helping to perpetuate a business model that recent healthcare legislation has done nothing significant to reform. But make no mistake: I’m among the 20% of patients who generate 80% of costs. I’m why your premiums are spiraling out of control.

So what’s the answer? I’m not sure, but here’s what I know for sure: I’m thankful to have insurance, despite paying a premium that’s gone up 300% in eight years. Some uninsured people with cancer go bankrupt while others who are insured get dropped by their carrier. If Obamacare does nothing else, it at least stops that onerous practice. On balance, I’ve done little to minimize my medical expenses. I'm a typical cancer patient in that regard. So far, I’ve mostly gone with the flow. Most distressing to me is the fact that the price of healthcare has no relation to its value. Providers get as much as they can. They’re paid through a tangle of insurance-company agreements and billing schedules that change from patient to patient. They game the system, and lots of people get rich off it. If you don’t know what something costs, you can’t know if it costs too much.

I don’t hate the people who run health insurance companies. I’ve always been treated courteously when I’ve had to call to ask questions. But if we don’t come to terms with where this system is taking us, it will suck out what life remains in our economy and leave everyone as cynical as I am about how wise healthcare decisions are supposed to be made. And then you'll have to read more rants like this one.


Anonymous said...

I sure haven’t put as much thought into healthcare reform as I should. And like a great many people who are employed and enjoy the fact that we are “covered” I grew quite tired of hearing about reform every day. Working in the medical industry I have also dealt with the effects of rising costs on several levels. I still see no solution.

The slide show is a nice addition. You should give lessons in blogging.

Anonymous said...

You call your piece a rant, Peter, but I find it fair-minded and objective. Of all the issues it brings to the table, I'll mention just one.

In any country, the finite supply of health care is necessarily apportioned in some fashion among those who need or want to use it. The question that any wealthy society eventually faces is how to ration, er, apportion, that care rationally, efficiently and--because it's our health we're talking about--humanely. To my thinking, those three attributes of good apportionment of health care should tend to rise or fall together.

Under the recent reforms, they actually will rise: from a D+ to a C-. What an opportunity missed.


Anonymous said...

As a member of the board of directors of a non-profit, we had to make a very painful decision related to health care premiums of our few employees. We sucked it up and are paying exorbitant premiums for not great coverage. Painful because we are on the edge of financial survival but we need our good employees. They can't afford to pay any more of the premiums on their meager salaries. If we lose them then we may as well shut the doors, call it a day and sell the place. Somehow we have to "find" the money. It is a shame that providing basic health care insurance becomes a survival decision for small businesses and non-profits. It is a shame that prospective employees make job decisions on whether or not an employer can offer health care insurance. I agree that nothing is being done to address the inefficiencies of the system, the lack of transparency in how health care costs are set, and the tangled bureaucracy that is now a major part of every health care decision. Continue ranting...I'll help.