The Expanded Principles of Health Care and Health Insurance

Principles of Health Insurance and Health Care

1. Health Care and Health Insurance are two separate items. They should never be used as synonyms.
For years – actually since PPOs and HMOs became the norm for health insurance coverage, health care and the high costs of it have been blamed on the high cost of health insurance. When in reality lumping doctor visits (doctor visits) in with coverage for catastrophic illness coverage (health insurance) has been the culprit. Over the past several over 60% of the medical claims filed have been under $1000.00 and nearly 40% of those claims have been for costs under $200.00. When you consider that the cost of a monthly premium averages over $3600.00 a year and most people only go to the doctor five times a year, ($1000.00 average.) you can see that the high cost of health care is joined at the hip with paying for simple procedures and doctor visits. Health care (doctor visits) should not be a part of health insurance. (Catastrophic illness coverage)

2. Health Insurance is insurance and insurance is meant to protect you financially in the event of a catastrophic loss.
Closely connected to Principle #1 is the issue of health insurance. Only about 7% of people ever have to go into the hospital for an overnight stay. The average cost of a hospitalization is roughly $25,000.00 (Now bear in mind that this is the amount billed not the amount paid.) The average amount paid in a hospitalization by the insurance company is roughly 1/3 of that amount or $7500.00. Simple mathematics can be done to come up with the cost for catastrophic care spread over a risk group. Health insurance companies could cover catastrophic medical bills for slightly over $100.00 per month in premium per person. Health insurance has been damaged and decimated by attaching it – politically – to health care. In order for health insurance and health care to be saved they must be treated as separate entities. Health insurance must be extracted from the health care equation and treated as pure insurance – as a policy to cover for financial catastrophic loss.

3. Personal responsibility is the first natural law of health care.
It should be mentioned that one of our primary natural laws is, “Ownership begets stewardship.” Since the HMOs and PPOs cam into prominence over 40 years ago we have all learned (been taught) as consumers of “health care” that we have no responsibility in our care. The number one reason for this is that we do not pay for our health care, our employer does. It is critical for the user of health insurance and health care to have some “skin in the game.” Let’s face it if you are not paying for your doctor visits or your health insurance or your hospital stays you are more willing to stand by and do nothing about making sure you are getting the most for your money. If, on the other hand, you are paying $100 for a doctor visit you are probably going to be more anxious to question the doctor more thoroughly. Research shows that the self-employed, those who do pay for their health care not only visit the doctor less and spend less on health care, but as a group they are healthier.

4. Personal freedom of choice in doctors, treatment and care are the primary and most important factors in health care.
This goes hand in hand with personal responsibility. Most people who are in group, or employer sponsored, health plans are completely unaware that they have signed away their rights to see ANY doctor. Moreover they are completely oblivious to the fact if they are diagnosed with ANYTHING that they have signed away their rights to get all options for treatment. Contractually, they have agreed to accept as treatment ONLY those treatments their health insurance company wants to pay for. This is called managed care. (Type “managed care” into Google and see what you get.) There is a reason that there is a list of doctors for both HMOs and PPOs. The doctors on these lists agree contractually to only prescribe the treatments that the health insurance agrees to pay for, and they agree to be the lowest bidder. (I don’t know about you but when I need open heart surgery, I don’t want my ticker being worked on by the lowest bidder.) All patients should have the option to choose their doctors hospitals and treatments.

5. Fair and free competition among insurers, doctors and hospitals insures the best care and pricing possible.
Some people call it transparency. I call it necessary. You should be able to compare doctors and hospitals and insurance companies based on price and performance. Right now managed care health insurance companies don’t want you to know what a doctor visit really costs, because they have spent years convincing us that we must have health insurance to go to the doctor. Nothing could be further from the truth. Not paying for doctor visit through your insurance company would save as much as 40% on your health insurance costs. However, for all of this to work pricing and experience must be made available to patients.

6. Insurance – all insurance – was created to be a self-policing free market business and should remain as such.
Any guesses on any one entity which is most responsible for the high costs of health insurance. I your guess was government you would be right. Government intrusion into health care coverage and plans has added things into health plans to include some people with illnesses that all of us must pay for. This also allows health insurance companies under the guise of “managed care” to exclude certain things legally under their umbrellas of coverage. The constitution allows for contracts to be freely created between individual and or corporations. Constitutionally the ONLY direction that government should exert is legal execution of those contracts. In other words as it regards health insurance you should be able to sign an insurance policy that covers any treatment or surgery up to monetary limits and have that paid as the contract dictates, if that is not paid then the government should step in to adjudicate that matter. Free market economics should allow you to choose your coverage, limits and pricing. Companies that don’t do what they say should be driven out of business by customers refusing to do business with them.


7. Health Care and Health Insurance are privileges not entitlements.
Nothing screams socialism like entitlements. Employers and health insurance companies and our own apathy and laziness have made us all slaves. We are slaves to complacency. We are salves to employers for our health insurance because of things like pre-existing conditions. But mostly we are slaves to entitlements. If you are reliant on someone else for any of your basic needs that is an entitlement. Entitlements make people lazy and apathetic. Motivated and food stamp recipient are rarely used in the same sentence, but complaining and welfare recipient go hand in hand. Employers who rely on health insurance from their employer are looking at that health insurance as an entitlement. There is no motivation to look at what they can do keep costs low or receive the best treatment. The motivation is to get as much from the “freebie” or to “manipulate the system.” Health insurance must be moved from employers sponsored health care to individual policies to get rid of the entitlement mentality.