What's So Great About Private Health Insurance?

[Amskeptic]

What's so great about private health insurance?

The bloody battle in Congress over a 'public option' ignores the insurers' role in creating the nation's healthcare crisis and their efforts to throttle reform.

Michael Hiltzik LA Times
4:31 PM PDT, August 2, 2009

Throughout the heroic struggle in Congress to provide a "public option" in health insurance, one question never seems to get answered: Why are we so intent on protecting the private option?

The "public option," as followers of the debate know, is a government-sponsored health plan that would be available as an alternative to, and in competition with, the for-profit health insurance industry, otherwise known as the private option.

(Congress' own healthcare benefits are a public plan-Colin)

On Friday, the House Committee on Energy and Commerce narrowly passed a reform bill incorporating a public option resembling Medicare. It was a bloody fight among members of Congress, some of whom believe that the public option will give the government unwarranted power over healthcare, and all of whom enjoy government-provided healthcare that's a lot better than what most of us get.

But the battle is just beginning. After the committee vote, House Speaker Nancy Pelosi warned that the health insurance industry will conduct a "shock and awe" campaign to kill the public option when Congress returns from vacation in September and starts debating the measure. We can expect to be overwhelmed with an industry ad campaign worth millions of dollars (remember Harry and Louise?) exhorting us to write our lawmakers to preserve the American way of healthcare.

So it's proper to remind ourselves what that American way entails. For if the insurers have proved anything over the last 15 years as the health crisis has gathered speed like an avalanche roaring downhill, it's that they're part of the problem, not the solution.

The firms take billions of dollars out of the U.S. healthcare wallet as profits, while imposing enormous administrative costs on doctors, hospitals, employers and patients. They've introduced complexity into the system at every level. Your doctor has to fight them to get approval for the treatment he or she thinks is best for you. Your hospital has to fight them for approval for every day you're laid up. Then they have to fight them to get their bills paid, and you do too.

One Wendell Potter reminded a Senate committee in June that health insurance executives had assured Congress in 1993 they would work to secure universal medical coverage and end denials of coverage to people with pre-existing conditions. Then they moved heaven and earth to kill reform.

They've made the same promises now, Potter observed. But they're in an even better position to throttle reform. Mergers and acquisitions have turned the industry into a cartel of huge corporations.

"The industry is bigger, richer and stronger, and it has a much tighter grip on our healthcare system," he said. The last thing they want is a government program set up as their competition.

Potter knows the insurers' ways because he was a top executive in the industry for 20 years. But the hard numbers bear him out. The two largest insurers, WellPoint and UnitedHealth Group, each acquired 11 other insurers between 2000 and 2007. They now control a total of 67 million "covered lives" (that's customers in health insurance-speak).

This consolidation has produced functional monopolies in communities across America. The American Medical Assn. (itself no great fan of reform) found in a 2007 survey that in 76% of the country, defined as its major metropolitan statistical areas, one insurer had a share of 50% or more of the conventional insurance market. This phenomenon gives the companies enormous power to drive up premiums and maximize profits.

Why do we tolerate this? The industry loves to promote surveys indicating that most Americans are "satisfied" with their current health insurance -- 37% are "very satisfied" and 17% "extremely satisfied," according to one such study.

Yet these figures are misleading. Most people are satisfied with their current insurance because most people never have a complex encounter with the health insurance bureaucracy. Medical care generally follows the so-called 80-20 statistical pattern -- 20% of patients consume 80% of care. If your typical encounter is an annual checkup or treatment of the kids' sniffles, or even a serious but routine condition such as a heart attack, your experience is probably satisfactory.

But it's on the margins where the challenges exist. Anyone whose condition is even slightly out of the ordinary knows the sinking feeling of entering health insurance hell -- pre-authorizations, denials, appeals, and days, weeks, even months wasted waiting for resolution.

And that's among people with affordable employer-paid insurance, an ever-shrinking cohort. The percentage of small and medium-sized businesses offering health coverage to employees shriveled to 38% from 67% between 1995 and 2008, according to the National Small Business Assn. Without reform, the number will continue to plummet. Meanwhile, people employed by big companies that offer a health plan are within a layoff notice of losing coverage for themselves or their families, joining America's 46 million uninsured.

Their only alternative right now is the individual market, where insurers scrutinize applicants' medical histories, looking for reasons to turn them down or charge them exorbitant premiums. Have hay fever, asthma, a cholesterol pill prescription? Are you a woman of child-bearing age? You're virtually uninsurable at an affordable cost.

Even if you're accepted, your carrier reserves the right to cancel your policy retroactively if it finds that you left even a tiny condition from years back off your application.

The public option may be your lifeline -- if it's enacted.

Signs of the industry's mobilization against the public option are everywhere. I don't claim clairvoyance for having predicted this development back in March; given the industry's record on reform, a child could have done so.

You've heard of the Blue Dog Democrats, those mostly rural conservatives who blocked a summertime vote on reform legislation on Capitol Hill? According to the Center for Public Integrity, the biggest backer of the Blue Dogs’ political action committee is the healthcare industry, which is on the path to pumping a total of $1.2 million into the PAC's maw in the current 2009-10 election cycle.

The there's the advocacy group called the Campaign for an American Solution, which describes itself as "a grass-roots effort . . . to build support for workable healthcare reform." The organization owns up to being an "initiative" of America’s Health Insurance Plans, or AHIP, the industry's chief lobbying arm. Unless I've missed a radical change in lawn and garden horticulture, you can't get much further from the grass roots than to be a creation of the industry with the biggest stake in the debate.

Despite all this, America's health insurance plans, which helped create our dysfunctional world, are deferred to as though they're a disinterested party. AHIP subtitled one of its policy papers "A Vision for Reform." But are the insurers now, and have they ever been, anything other than a roadblock?

[Sylvester]

Health insurance is such a bad topic for me personally. So far this year I have paid out of pocket $2800, and this is really a quiet year, with the exception of my son having to have surgery in September. All three of my boys have pre-existing conditions, one with asthma, one autistic and one deaf and having one kidney and bladder reflux. My situation really is nothing compared to others we all know, with worse afflictions and needing constant care. Consider yourself very fortunate and blessed if you are not. However in time, you will be, that is a guarantee by illness or by age. Why in the world are there 67 million Americans with NO health insurance? Should we all drop our coverage tomorrow and wreck the industry that is keeping us all down? I wish we could!

I came back to edit this, because it ended with a silly question and answer. Personally I want health care for those 67 million, first and foremost. Then I need help, and answers to my health care needs. I delayed a test for my youngest boy because it was that or the operation this year, I could not do both and in reality, I can's afford the surgery either, but not doing it to me for my son is scarier than the bill. What I fail to see in ANYONE's discussion about health care, on this site and really anywhere else, is how it affects people personally. Is it really only an issue when it becomes YOUR issue? If it is not your issue now, how about the day when it becomes your issue? Then?

[RussellK]

I have a friend with relapsing remitting MS. There are four branded treatments available that slow the progression. The effectiveness of the treatments are as varied as the individuals taking them. The patient and neurologist find the one that works after trial and error. So my friend is on the drug that works for him and his progression is being managed. The company he works for changed insurance carriers and one day a letter arrives from the new carrier addressed to his neurologist and he is cc'd. The letter reads because of peer review and blah blah blah it has been determined that your patient would be more effectively treated by switching to blah blah blah. Fortunately for my friend, his neurologist doesn't like to be told how to do his job so he writes back a letter documenting why the current course is the correct one. But we have to ask what prompts this type of activity. All these drugs are expensive. The only thing I can think of that would prompt an insurance company to write such a letter is rebates. These are not the people you want making decisions for you and if they win this battle we will be screwed for a long long time.

[Manfred]

My mother will need a lung transplant in then next two years. It would be nice to know she was completely covered.

Can you believe her brother, my uncle, likes to call her to debate why we shouldn't have a public health care system?

[static]

Download this interview. It is very interesting. Trust me.

http://www.angiecoiro.com/drupal6/sites ... 3009H2.mp3

[Sylvester]

My mother will need a lung transplant in then next two years. It would be nice to know she was completely covered.

Can you believe her brother, my uncle, likes to call her to debate why we shouldn't have a public health care system?

My mother had that done in 1993, she lived 11 years with the transplant.

[zblair]

What I fail to see in ANYONE's discussion about health care, on this site and really anywhere else, is how it affects people personally. Is it really only an issue when it becomes YOUR issue? If it is not your issue now, how about the day when it becomes your issue? Then?

One of my reasons for going into social work was because of 40 years spent witnessing and trying to advocate for my mother through her cancer-related illnesses and treatment protocols and the injustices she suffered.

Sly, I am sure you would agree that your issues can and are consuming and probably the reason why health problems fail to become an issue for many until they are faced with them is because if they do have them they don't have the bandwidth to advocate for anyone else while they are sorting out their own issues. Plus when you do become an advocate you face constant BS bureaucracy/red tape in trying to achieve the simplest things and the burnout rate is sky high. Modern man against the corporate money machine and the machine has been winning for a long long time.

[hambone]

This is really a reflection of how compassionate our society is.
We've been taken over by robber barons and timber theives since the dawn of the zeppelins, and not much has changed.
Ever see Spartacus? Just saw it last night. Slaves just change costume.

[Ritter]

If'n we're gonna put on the pretense of being a Great Civilization, aught not we care for our citizens? You know, act civilly? It drives me apeshit insane that Americans think we're the be all end all of greatness and yet we shit on our own people. There is no reason that in a country with this much wealth that people should go without health care, adequate food and shelter. None.

[Sylvester]

If'n we're gonna put on the pretense of being a Great Civilization, aught not we care for our citizens? You know, act civilly? It drives me apeshit insane that Americans think we're the be all end all of greatness and yet we shit on our own people. There is no reason that in a country with this much wealth that people should go without health care, adequate food and shelter. None.

Dead on. What kills me is bullshit talk of who is going to pay for it. Shit my drawers, did we not pay for a lot of submarines, planes, billions for defense, and no one asked me if I wanted to. Who paid for that air craft carrier? Who paid South Korea all that money to say bad things about North Korea, and for keeping democracy on that peninsula and let us keep face for the ending of the Korean war? Why can't this country be self sustaining? Why do we pay for Israel to exist when we have hungry people just YARDS away from any of us in a given minute. How can we justify sending money to Egypt when we can't care for our mentally institutionalized citizens, pushing them into the streets or prisons because their families can't care for them? How can I possibly support a system that makes me choose?

[hambone]

Food and medicine come before bombs to any rational thinking loving HUMAN BEING.
Greed, however................................

[Sylvester]

Food and medicine come before bombs to any rational thinking loving HUMAN BEING.
Greed, however................................

True, however this is not enough, at least for me. I have been battling the insurance company for my reasons, now I need a way to participate globally, and recommend others do the same. Now I just have to find the outlet.

[hambone]

Sooner or later we gotta take it to the streets. Why do we take this crap?

[Sylvester]

Those of you who have no health insurance on this site reading this, can any of you tell me why you don't have insurance? I am not on a witch hunt, I just want to know why, and if you are concerned.

I ask this because I am reminded of an airman I supervised years ago in Florida. He was 22, and had an issue when his car insurance went up due to a traffic ticket. His solution was to drop his insurance, because he believed he did not need it because he was a safe driver, and if he continued to be so, he would never need it. Was he right?

[Ritter]

Sooner or later we gotta take it to the streets. Why do we take this crap?

Because we still have too much to lose. If I go to the streets, I voluntarily lose my job, health care, etc. because if I take to the streets, I stay there until I achieve my objective or, more likely the case, I end up in a small cell with three squares a day.

We have been well pacified. We are fat Americans only used to armchair quarterbacking.