Health care problem has become a cancer for the current society. It is something that is eating up the hard work of the majority of the people in terms of huge insurance premium, but returning nothing in turn.
Is the problem really a big? or it is just a hype?
Well by looking into the statistic we can immediately say it is one of the biggest problem, especially for a society in an advanced country like US.
Around 60% of the Bankruptcies happen in US because someone got ill in the family, not only this, out of these 60% bankrupt families, 75% had health insurance! That means out of every 100 bankrupt families 45 had been in complete insured state of mind that they are completely protected, same state as you and me now!
It means even though you have proper insurance coverage, there is 45% chance that you will be bankrupt in case if someone in your family gets majorly ill. So better come out of that pseudo comfort zone of yours! where health care problem is only of those people mentioned in newspaper or TV. It can very well happen to you at anytime!
Let us try to analyze why and how the problem started, because to solve any problem we must first get to its roots.
Assume there is a town where people do not buy health insurance as health care cost is not much. Doctors make a little more than average income and they are more concerned about patients health than making money. Moreover since people do not fall sick that much the supply and demand is balanced, which keeps check on the cost.
Now one day Mr Ronald comes to town with a wonderful insurance scheme, which has incentive for both doctors and patients. Mr Ronald tells patients buy my policies and I will take care of most of your cost and you can get even very expensive care for free under my insurance coverage. At the same time Mr Ronald says to doctors, you can ask more to the patients since most of them are covered under insurance schemes, insurance company would pay you how much ever you ask for. Obviously doctors will start to ask for more and insurance companies will start to pay them what they ask for.
Now when a normal person who got sick after a long time and had no idea about the insurance, had a real tough time paying to doctors to get the care he needed, the story of his suffering traveled really fast and obviously generated insecurity and fear among the listeners or readers. Now all the healthy and normal persons out of fear started to rush for insurance from Mr Ronald.
And Mr Ronald, now makes tons of more money than he has to spend out. Since he has successfully made a not so useful product, which was not at all need, a necessity of life of all the people in town, how? by inflating the cost of doctors, by giving doctors good incentive, and generating fear among residents of town that they can not afford health care without his coverage.
Now, not only this, once in the town someone sues a doctor for ignorance and jury awards millions of dollars to the victim of insurance. Wow a perfect opportunity for Mr Ronald, make insurance a necessary evil for even doctors/hospitals too to cover themselves against the emotional wrath of jury! In turn doctors would put the new premium on patients bills. Result, further raise in the health care cost. Which, Mr Ronald puts back on residents of the town in terms of higher premium and prays to have few more such ignorance cases on doctors! Not only this Mr Ronald have now devised other ways to save money by denying needy people, by making them sign certain one sided agreements during purchase of policy!
I am not a good story teller, but I suppose you got some idea on how insurance became necessity of the people. Mr Ronald became necessity provider and started to put one sided contracts. However another town, where Mr Ronald did not visit, is still happy and people are able to afford quality health care without needing the insurance.
Now, let us see the whole system of the first town from top. Everyone in the town, including doctors is paying to Mr Ronald a premium amount – a hard earned money. Mr Ronald keeps it in his safe. A small amount of people (very small % of total population) come and ask Mr Ronald to pay for them, so Mr Ronald takes out a small part from his safe to pay for those people. Now in this whole cycle who is actually working? People are working, Doctors are working, but who is getting rich? – Mr Ronald! who never works. Isn’t it strange?… Well lot of people would argue rich people don’t work, and yes it is true, others work for them.
Now Mr Ronald goes to other towns and ultimately covers the whole country and result! … you know.
Who is really responsible for all this? Well, mainly the residents of the town, of the the country, for being ignorant, for getting enticed by Mr Ronald’s persistent persuasion, for being fearful of their own imagination of bad and for not being united.
What could be the solution? throw Mr Ronald out? impeach him in court for designing such an ill willed system, where he takes away tons of money from hard working people and in turn not returning any real value to them? Well now its too late Mr Ronald is too powerful as he has already worked with lawmakers to protect himself.
So whats the solution? Well, work together! form a cooperative – a non profit cooperative. A system which would take your money not away from you but would reserve it for you, something similar to what I suggested in my last post – Insurance – An Engine to Suck money for no real work.
Or, ask your selected representatives to form and initially fund a public health insurance, to keep check on the premium that Mr Ronald demands.
Since Mr Ronald is taking in approx 100,000 and giving out only 1000 and keeping remaining 99,000 in his pocket, but the public health insurance, eventually, over the time would effectively take only 1000 from the people. So instead of paying $500 a month you would pay only $5 a month in few years for the same quality care. And you would be sure that you are not dependent on Mr Ronald for your health care. This will also make Mr Ronald to come close to 1000 in terms of money taken in from the people, due to healthy competition in market.
Note: I recently read, Obama is actually trying to form public health insurance, which is an excellent idea. However, in long run it may become inefficient, to counter this inefficiency he should in parallel encourage and give incentive to non-profit organization to enter into the health insurance business.
Other thoughts?
Filed under: Health Care Crisis, Healthcare, Obama Health Coverage Plan | Leave a Comment
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