Floyd Fitzgibbons
for U.S. Congress
As an insurance agent I have listened to all types of proposed solutions to the medical care problems in our country for long enough. Without exception, every proposed solution is inherently flawed for one reason or another. I am going to advance a real solution that is fair and realistic.
THE CIRCUMSTANCES
In the first place, let’s examine some truths which are beyond dispute. Under current conditions of civilization, people are free to choose what types of health habits to live by. Some choose to get regular physical checkups. Some brag that they never go to the doctor. Some choose unhealthy eating habits. Some adhere to rigid dietary restrictions. Some exercise regularly - others do not. It's the principle of free agency.
Then there are the conditions of mortality. Some are born with birth defects. Most are born appearing completely healthy. Disease strikes some early. For others it comes later in life - or not at all. Some participate voluntarily in risky activities. Some are more cautious. Serious accidents happen to some people - fortunately not very often.
Now what are our rights? If we intentionally make bad choices do we have the right to be sheltered from the consequences? What would it do to our individual character if we were? Would we ever have incentive to be responsible? Do we have the right to have food if we are physically able and refuse to work? How about clothing? Or housing? How about medical care?
HOW DID WE GET IN THIS MESS?
We have medical care problems in our country. Why? Some say there are too many citizens who have no health insurance. Some say that we should not be providing free medical care to illegal aliens. Some say the pharmaceutical companies charge too much for drugs. Some blame the lawyers; for others, it’s the insurance companies charging too much.
About 30 years ago, health insurance companies devised a plan to reduce expenses by agreeing with certain doctors to accept a set fee for each type of visit and procedure. The second component was to offer a reduced premium to businesses if they would enroll most or all of their employees in what would be named “group” health insurance. Employers bought into the plan because it tied employees to them and at the same time reduced costs for them in purchasing health insurance coverage for their employees. When doctors saw their patients leaving and going to the doctors who accepted their health insurance, more doctors caved in to the plan until now almost every doctor does. In this arrangement the health insurance companies gain the upper hand by dictating such low reimbursement levels for doctors that doctors are pressured into seeing more patients for less time in order to make ends meet. The patient gets the short end of that deal.
Many employees have come to expect that a good job comes with health insurance. They gladly give control of their medical care to their employer in what they mistakenly think is free insurance (because the employer pays for it). Then they complain if they have to pay more than $20 in a co-pay for a doctor visit or a $500 deductible for a hospital stay.
While employers feel pressure to purchase health insurance for employees in order to attract employees, they also want to reduce costs. It is the nature of business to keep overhead low. So it becomes a balancing act between attracting and keeping employees with a good benefit plan while trying to remain profitable against competition. Health insurance companies also compete - against each other. So in order to reduce premiums they go back to the doctors and tried to negotiate even lower reimbursement costs. Or they try to lower their overhead costs by reducing staff which causes service to suffer (ever been on hold for two hours trying to speak to someone in the insurance company’s claim department?).
Because the basic premise of how we currently obtain medical care is flawed, no one in this crazy equation can be happy. And when people start to cry “foul” government is more than willing to come to the rescue . . . and take control! Once government starts dictating the rules under the force of law, it's their way or the highway - and in many cases there will be no highway!
Thus, most presidential candidates encourage some form of “universal” medical care. Besides being un-Constitutional, nationalizing it will result in loss of choice, higher costs or taxes, rationed care, delays in receiving treatment, government mandates – in short less freedom. So, before we take a step in the direction from which there is virtually no return, let's take a hard look at the real problem and the real solution.
THE SOLUTION
We are told that 45 million people in our country are uninsured - or have not purchased health insurance. Assuming 45 million is an accurate number, how many of those could buy insurance but won’t? Currently if they get sick or injured they get treated at a hospital emergency room at the expense of you and I. What's fair about that? Then there are those who would like to buy health insurance but can't either because they cannot afford it or they are declined for individual coverage because of their health conditions.
So what is the solution? True insurance. Generally what we have now is not true insurance. You can't buy a life insurance policy on someone after they've died. Yet we expect to purchase health insurance after we've got health problems.
If your medical coverage comes through a group plan purchased by your employer, comparatively speaking very little underwriting or actuarial work went into determining how much premium to charge you in particular. That's because insurance companies by government mandate are forced to cover people who are already burdened with expensive health conditions. As such, the consideration is not so much to underwrite people individually but to have them subsidize the expenses of the entire pool of insureds. Insurance companies are not in business to lose money so they charge sufficient money to cover their claims expenses, overhead, and profit for the next 12 months or so. The masses of people simply trade dollars with the insurance company. We need to put the “insurance” back in health insurance.
Let's look at the way life insurance is bought and sold. An individual decides to take responsibility and makes plans to address the financial consequences of his/her eventual certain death. Remember death is certain - bad health is not, and yet we seem to have more trouble “insuring” health than life! Then he determines how much he wants the insurance company to pay out at the time of his death (let’s say $2,000,000 for example). He then finds out the premium/cost. Most whole life insurance policies have a premium that remains the same throughout the individual’s entire life. He will then have to answer many questions about his past and current health conditions, allow medical records to be reviewed and likely submit to blood, urine and other diagnostic tests. Once this is done and accepted by the insurance company the life insurance policy is issued. As long as he pays the premiums the insurance company is obligated to pay his beneficiary(s) $2 million dollars at his death whether it comes in six months or 60 years.
If we did a similar thing with health insurance the issues we’re now having in our country would largely go away. Responsible people would purchase a true health insurance policy on themselves and immediate family members. They would purchase it while still healthy and the earlier in life they bought it the lower the monthly insurance premiums would be. They would purchase a policy with a lifetime limit of their choosing – one, two, three, or more million dollars for example. Whatever limit they chose would be the most the insurance company would have to pay out during their lifetime. They could go to any doctor they wanted. As long as they made their premium payments, the policy would remain in force. This is called “guaranteed renewable/non-cancellable.” When they incurred costs for medical care, the insurance company would pay the claims out of the remaining limit of their insurance policy. Further, the policy could be a combined Health/Life policy – paying any unused benefit to the insured’s beneficiaries at death.
As a side note - dental and vision care fall into the category of not being insurance risks. Expecting an insurance company to pay for dental care or purchase a new pair of eyeglasses every year is just begging for higher costs. Such things are not true insurance – they are generally expected costs, not costs of chance. It is to trade dollars with insurance companies – and believe me insurance companies are not going to lose that game.
In order to insure children born with birth defects or diseases and not penalize parents of such children with increased premium costs through no fault of their own, the first of two requirements would regulate insurance companies. Remember, since there is no Constitutional authority for the Federal government to be involved in insurance, the states or individuals retain these powers. There are already Departments of Insurance regulating insurance companies in each state. The first is that insurance companies would have to insure all children of insured parents without a premium surcharge or underwriting. It would be an automatic open enrollment period when children are born. Since such births are random and rare, the actuaries would have to take such factors into consideration.
Can we do this overnight? For those that are fairly healthy the answer is an undeniable yes! I'm 51 years old and purchased an individual health savings account type policy last year for a monthly premium of $185.
For those who are not healthy accommodations will need to be made until the mess is cleared up. A second regulation permitted by the Department of Insurance in each state would require each health insurance company operating in their state to insure unhealthy people with a surcharge on premium (life insurance companies do the same thing already). A similar mechanism (assigned risk) is in place in each state mandating automobile insurance and workers compensation insurance. Those who cannot find coverage through the normal marketplace, can purchase it through the assigned risk pool. Each health insurance company would insure high risk individuals through a fair and equitable assignment or distribution to each company.
EVERYONE WINS!
By making health insurance truly insurance again we can keep the federal government out of it, give individuals the freedom to choose their own doctor and how much medical care they want to receive, take control of medical care away from employers and allow doctors to spend quality time with their patients. Everyone wins!
DISCLAIMER
The reality is - this real solution is not likely to be put into practice. A large number (majority?) of the citizens of this country have been trained to avoid taking individual responsibility and will ride the backs of others until both the rider and the ridden fall.
It is a true principle which is the motivating drive behind almost all human action - it is that all of us act based on the things we desire to obtain - the reward. If the reward of wise and prudent behavior is taken from those who are and given to those who are foolish and wasteful, the wise and prudent soon lose their motivation and reward ceases to exist for either. This is what happens in Socialism. Those who strive for excellence and hard work are cheated of their reward and those who tend towards mediocrity and idleness are temporarily rewarded for such behavior until the former cease to work only to see the fruits of their labors given to others. That is what is gravely wrong with any form of “Universal” health care or federal control of health insurance. Instead of placing men on equal grounds as it purports, it puts men on “unequal grounds” because the laborer is robbed of the reward he/she deserves. This not only doesn’t inspire people to prosper, it is a de-motivating scheme. Such socialism is more suited to a society like the old Soviet Union, which dictated and controlled nearly every aspect of its citizen’s lives. This is bondage. We claim America is a free country. Let’s act like it. This is liberty!
Floyd Fitzgibbons, CIC
Certified Insurance Counselor
President/Fitzgibbons & Associates
8301 Fawn Brook Ct., Las Vegas, NV 89149
Phone (702) 655-5160; fax (702) 873-4673
http://www.fitzgibbon.biz/
fitz111@cox.net
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment