As policymakers, pundits and the public consider the path to universal health care coverage in the US, it is helpful to remind ourselves of the key reasons that commercial health insurance cannot and will never meet our health care needs.
Because, as a rule, commercial health insurers put profits before people:
- Commercial health insurers are generally unwilling or unable to disclose their benefits or deliver value for people with costly and complex conditions; rather, they tend to deter people with complex and costly conditions from enrolling or, if they are enrolled, from seeking care and remaining in their health plans.
- To generate profits, they tend to market to people who are healthy and will not need a lot of health care services; and, they do not distinguish themselves from other health plans based on the care they cover for people with the greatest care needs, making it impossible for people with costly conditions to choose a health plan that meets their needs.
- They limit people’s choice of doctors and hospitals through inadequate networks that restrict access to care, including centers of excellence and top specialists in order to discourage people with costly conditions from enrolling.
- They generally do not disclose what treatments they will cover or people’s out-of-pocket costs for particular treatments before they decide whether to enroll in their plan or, if they are enrolled, before they receive treatments.
- They charge high copays and deductibles, which keep people from getting costly care. They ration care based on people’s ability and willingness to pay, penalizing people in the poorest health and with the lowest incomes.
- Commercial health insurers cannot offer reliable coverage and they undermine continuity of care. They are constantly changing the doctors and hospitals you can use, and they cannot guarantee that they will offer you coverage from one year to the next.
- To generate profits, they change their networks all the time, placing little or no value on continuity of care. You cannot count on them to provide continuous coverage from doctors you know and trust or from doctors and hospitals outside your community. And, you can’t trust the health plan’s provider directory.
- From one year to the next, they can raise their premiums and deductibles significantly, forcing their members who cannot afford the increased costs to find new coverage.
- When they are not making money in a community, they pull out altogether, forcing their members to find new coverage. Humana and Anthem pulled out of state health exchanges. (Anthem in Maine, Virginia, Missouri, Ohio, Nevada ACA plans.)
- Commercial health insurers may delay and deny care arbitrarily and keep their protocols and data proprietary, unwilling to be publicly accountable regarding their value to consumers.
- To generate profits, they treat data as proprietary that would allow researchers to report whether they deliver high value cancer, stroke or heart care. Outside researchers and rating agencies generally cannot access the needed data or, if they can, cannot report on what they learn with respect to a particular health plan or on the comparative value of these plans when it comes to costly services. Try googling “best health insurance for people with diabetes.”
- They may hire medical directors to oversee treatment decisions who do not understand the conditions or the treatments for which they are denying care, with little risk anyone will know.
- They may deny coverage for ER visits, based on patients’ diagnosis, expecting patients to know when they really need emergency care and deterring them from getting needed emergency care.
- They have a financial incentive to delay or deny care without fear of harming their brand image since consumers cannot compare their value in a meaningful way and they are unlikely to be held to account for these practices. Moreover, they have a financial disincentive to deliver high value cancer, stroke or heart care or to cover costly drugs to treat complex conditions or too many people with those conditions would enroll, jeopardizing their profits.
- Commercial health insurers are generally unwilling or unable to drive system change that promotes overall value to our health care system.
- They are unwilling or unable to control high hospital rates. Rather, they shift costs to people who go to the ER unnecessarily by charging them the full cost of their visit rather than penalize hospitals for not having a cost-effective triage system for people who go to the ER. Medicare, in sharp contrast, penalizes hospitals with high readmission rates to incentivize them to discharge patients appropriately, rather than penalize patients who are readmitted.
- They are unwilling or unable to control rising drug costs. It can be financially rewarding for health insurers to make profits off of higher-priced drugs (formulary with brand-name drugs and not generic alternative) or to charge their members a higher copay than their actual cost for the drug.
- They are unwilling to share their data and innovations that give them a competitive edge, be it on the value of a medical device, drug or treatment or any other care-related item. For example, it is hard to identify a health plan that alerts the general public to a particular treatment that causes their patients harm or provides unique benefits.
- Commercial health insurers engage in fraudulent practices.
- To increase their revenues, they may misrepresent the health status of their members, overcharging the government.
- The federal government has made tens of billions of overpayments to them. Here is one GAO report.
- They may engage in enrollment fraud, enrolling people who do not want to be enrolled in their plans to generate more revenue.
- Commercial health insurers are unwilling or unable to rein in ever-increasing health care costs. Rather, they drive up costs through the time, money and personnel they require for billing and other insurance-related activities.
- Commercial health plans have far higher administrative costs than Medicare and pay significantly higher provider rates. Hospitals in most communities have more power than commercial insurers, keeping commercial insurers in many markets from reining in provider rates.
- The cost of commercial health insurance is so high that it puts many smaller businesses at risk and eats deeply into employee wages.
- Medicare is more cost-effective than commercial health insurance.
- Neither states nor the federal government have the resources to effectively oversee commercial health insurers and hold them accountable for their inappropriate or illegal activities.
- Unlike commercial firms that create products whose systemic defects are fixed and can be detected, if not immediately, over the long term, commercial health insurers create products that are constantly changing–doctors, hospitals, protocols for approving and denying care, costs, etc.–and make covert decisions that are constantly changing–medical necessity and billing, etc. As a result, arbitrary denials and delays of care can easily go undetected.
- All but a handful of states, if any, have the will, skill and resources to ensure that commercial health insurers are complying with their legal obligations and meeting the needs of consumers. And, the federal government does not oversee commercial health insurers outside of government programs.
- Even with the will, skill and resources needed, health plan data is proprietary, so even independent researchers are hard pressed to report on the failings of particular health plans.
- Except in the most egregious situations which come to public light, it is near impossible to develop measures to evaluate whether health plans are delivering on their obligations to consumers and not delaying or denying needed care, let alone delivering value or committing fraud.
Improving and expanding Medicare to everyone is the best way to ensure all Americans have access to good, affordable care. If you support Medicare for all, please let Congress know. Sign this petition.