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« Happy Birthday, Sparky | Main | Hu's On First? » November 26, 2002Health Care ProblemsI switched jobs today (sadly, still in the car industry), and I'll be eligible for health benefits in three months. As part of my employment package, I received a copy of the health plan, and it's easy to see one reason health care costs are so out of control. This plan only allows you to visit a limited list of doctors, all of whom have no doubt been vetted regarding the price plan. A routine doctor visit requires a $20 co-pay, then the plan pays all of the next $100. So, what do you bet is the going rate for a doctor's visit on this plan, but $120? After all, there's no reason for me to be cost conscious until the fee goes above $120, so the doctors can maximize their profits without risk of losing customers. And this pattern tends to repeat itself throughout the plan, joining a co-pay to a 100% coverage to a certain limit. I don't pretend to be an expert on health care, but I am familiar enough with basic economics to know that this system isn't going to help keep costs down. If my out of pocket costs are reasonably low, which they are in this system, there's very little incentive for me to not use the system to the limits of what the insurance company will pay. Which will continue to drive the costs of health insurance upwards, because the price pressure isn't designed properly to keep costs down. I don't think that redesigning medical insurance coverage to make the costs of health care evident to consumers would be sufficient to fully resolve the health care problems we face, but allowing the market to help determine health care costs would certainly be a good step towards alleviating the problem. Posted at November 26, 2002 08:38 PM
Comment policyI apologize for only allowing authenticated commenters, but comment spam overwhelms the site if I don't use those measures to prevent it. I reserve the right to delete any comment, although generally comments will only be deleted due to use of profanity or personal attacks on people. I have no objection to vigorous argument, but when name-calling begins, I'm putting a stop to it. In the immortal words of Eugene Levy, "People, people, let's stop this before somebody says something untrue!" If you want to call people names, I recommend you get your own blog. Trackback PingsTrackBack URL for this entry: CommentsIt shouldn't be that hard for them to derive a sliding scale for doctor's visits that charges you more for over say 6 per year. Or something like that. Posted by: natasha at November 27, 2002 09:41 AM I think it would be easy enough for them to completely revise coverage to make it highly cost conscious. The best way I've yet heard is to give people an 'allowance.' Say I've got $2000 free and clear to spend on health care this year, then the next $1000 I spend will have to come out of my pocket. That's a huge enticement for me to spend my money carefully. Granted, this isn't going to work for all people, but for relatively healthy people like me, it's a great system that increases cost consciousness and should help apply some downward pressure and market competition to the industry. Posted by: Andrew Olmsted at November 27, 2002 09:47 AM I assume you have a upper limit on what you pay as well? Otherwise, it isn't really insurance. Not that paying for scheduled medical exams is technically 'insurance' either. Posted by: Enrak at November 27, 2002 10:28 AM For a routine visit, I pay the first $20, they pay the next $100, then they pay 80% of whatever comes next. There is an annual and lifetime limit on their total outlay. Posted by: Andrew Olmsted at November 27, 2002 10:48 AM Post a commentThanks for signing in, . Now you can comment. (sign out) (If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.) |
