Did you know that when you receive medical services—whether a doctor’s visit or a prescription fill— if you have insurance, your bill is lower than if you don’t have insurance?  It’s not just that you personally pay less, but what you and the insurance company pay together is less than what the person who carries no insurance gets billed.  Why is that?

Insurance companies have carved out a comfortable niche for themselves, adding a layer of artificial value to the process of getting medical care by effectively squeezing doctors and druggists for lower prices.  Meanwhile, the price which they displace is borne up by patients who pay without insurance.  Whether in “protection money” to the insurer or in higher prices at the clinic, every patient gets to pay added costs.

That’s not the real reason why I hate medical insurance, though…

A bigger fish to die

I am considering the possibility that a larger problem in health insurance is that health insurance products are simply bad products.  Please correct me if I’m wrong about this…

What makes them bad products?  Unlike other types of insurance, health insurance coverage is hit or miss.  Here’s what I mean:

People buy insurance because, rather than suffer the risk of paying for a catastrophe, they prefer to make small, manageable premium payments.  But health insurance often doesn’t work that way.  Say the catastrophe occurs: one day you take a trip through your windshield and become intimately acquainted with the surface of the highway, and your face likes the asphalt so much, it decides to become a permanent resident.  Maybe your accident was not so severe, and the doctors can get their work done on you in a week, but what if it was a bad one, and the next week is spent just trying to find all your teeth?  And the hip bone’s connected to the steering-wheel bone?  And the police cordon off the accident site so that Wes Craven can shoot his next film there?

And what if your insurance is up for renewal just a week later?  The insurer is not going to renew your coverage, at least at the same price as before.  And once your coverage is dropped, you get to pay for the next two months of surgery by yourself!  Other types of insurance pay off if you’re covered when disaster strikes, but health insurance pays off if you’re covered at the time of the service you’re receiving.  That’s particularly a problem since health insurance products only last a year before re-evaluation!

For another illustration, imagine that you had good coverage when you were initially exposed to Agent Orange, but that coverage expired years ago and only now are you facing the medical cancer treatment.  You’re paying out of your own pocket, buddy.

So what does it cover?

Most accidents are shortly resolved: you break an arm, and you get it set.  Chances are, you’ll even still have coverage 6–8 weeks later when your cast is to be removed, so if you want, you can pay someone with a medical degree to do something a carpenter is more qualified to do (and you’ll get to sit in a waiting room for 45 mins—that’s something the carpenter won’t offer).

However, these accidents are not a good reason to buy health insurance.  These accidents aren’t going to ruin your finances.  It’s the danger of long-term health problems that should inspire us to buy health insurance, but health insurance is likely to leave us high and dry for such matters.  And if those matters require more than a year of treatment, they certainly will leave us high and dry.

It’s not that the insurers are bad or unethical people.  It’s only that they’re just as stupid as the people buying their products: neither party seems to understand that medical insurance is not a good purchase.

Some readers might be thinking: “Thank goodness for government health care reform.  That’ll solve this problem.”  If that’s what you’re thinking, please leave a comment to that effect, and I’ll address both sides of that issue in a separate post.  (Also, shoot yourself in the head because that’ll impose a lot less expense on the taxpayers than the future health care costs for all the times that you will put your finger in the light socket, eat poisonous berries, and drink anti-freeze “because it’s a cool colour.”)

P.S.  For those following along, I finally just paid cash for those drugs I wanted, circumventing the insurer entirely.  Had to get fixed.

By the way, that final, nasty comment about shooting yourself was written earlier this week, before I got the drugs.  I don’t have the urge to go back and edit this post, but I probably would have written something more crowd pleasing if I had taken up the task just today.