Group Health Insurance is Bad For America

healthcare reformMy Comments: Followers of this blog know my reasons for wanting to keep the PPACA in place, mindful of the need for a lot of modifications. What you may not know was about 40 years ago I cut my teeth in the insurance world selling individual health insurance policies.

My market was staff and faculty at the University of Florida where there was a one price, one plan fit all program. Those younger than average were paying the same as those in their sixties, thus subsidizing the old folks. I was able to provide equal or better coverage at far less money for those in my target market.

The health care industry, in all its forms, represents about almost 1/5th of our entire Gross National Product. Before the PPACA, the annual increase in health insurance premiums was about 7% per year, meaning before long, unless checked, it would choke us. You can argue that the PPACA should be abolished, but not before you come up with a meaningful alternative.

By Rick Lindquist February 3, 2015

(Editor’s note: This blog has been republished here with permission from Zane Benefits. This is part three of an ongoing series. You can check out the original, in its entirety, here.)

When you drive to work today, look around at the people, cars, and buildings you pass by. Between one-sixth and one-fifth of the people you pass on their way to work, representing 17.5 percent of our gross domestic product, work producing a product or service nobody really wants to buy—health care, or more accurately sickness care, since what most Americans call healthcare has very little to do with health.

Despite the fact that the United States spends two-and-a-half to three times per person what other developed nations spend on healthcare, the United States is the unhealthiest developed nation on earth. There are many reasons proposed for why this is so.

For example, 95 percent of the pharmaceutical prescriptions filled each year in the United States are for drugs you are expected to take for the rest of your life—because drug companies find it much more profitable to create customers for life by producing maintenance drugs that treat the symptoms of diseases versus drugs that cure diseases.

Medical providers from the individual doctor to the largest hospital are paid for their procedures and time spent versus their outcomes or health of their patients. However, the major reason that the U.S. health care industry costs so much is because the employers who pay for most U.S. health care do not have a financial stake in the long-term health of their employees.

Employees used to stay with one company for 25 years or more. Today, the average employee is projected to change jobs more than 10 times over his or her 45-year working life. Most of the major illnesses on which you can spend $1 today to save $100 tomorrow (like heart disease from obesity or cancer from poor nutrition) will not show up until an employee is long gone or retired, at which time the $100 cost is picked up by another employer or by taxpayers through Medicare.

As medical costs have escalated, employers have, in effect, told their medical providers to pay for only those expenses related to keeping or getting the insured back to work—and this does not include paying for the prevention of a disease that will not manifest itself during the expected tenure of the employee with the company.

Despite a new federal mandate in PPACA that employers must cover preventive care, the federal definition of preventive care includes tests like mammograms and prostate exams that merely screen for diseases rather than help prevent them.

Significant weight reduction, nutritional advice, vitamins, minerals, smoking cessation, and hundreds of other wellness-related treatments are excluded from most group and most individual health insurance plans. Although at least with individual health insurance plans you can choose to apply the savings to your wellness care.

In summary, rising health care costs, driven mostly by group health insurance, punish our nation on multiple fronts:
1. For you and your family, rising healthcare costs means less money in your pockets and forces hard choices about balancing your children’s education, food, rent, and needed care.
2. For your company, rising healthcare costs make it more expensive to add new employees and reduces budgets available for marketing, customer service, and product development.
3. For the government, rising healthcare costs lead to reduced funding on other priorities such as infrastructure, education, and security.

What’s the solution?
You should switch to individual health insurance because its good for America. With an individual plan, it empowers Americans to manage their own healthcare and it makes American businesses more competitive.