Our Unhealthy Addiction to Health Insurance

Whenever I give a talk about health care, I ask the audience, “What is the worst addiction problem we have in the United States?”

The answers are typically the same and all are good guesses—alcohol, tobacco, opiates, and sugar are most frequently cited. I agree these are all terrible addictions that need to be addressed but, in my opinion, the worst addiction in America right now is to health insurance.

The Numbers

That answer usually draws a stunned or shocked silence from the audience but the numbers bear it out. The chart below shows the staggering costs Americans spent on healthcare in 2017. Please remember, these figures are in billions of dollars, so $2,961 spent on “personal health care” represents $2.9 trillion(!).

What is most shocking about these numbers is not just the high spend but the lack of value delivered in return. As a primary care physician who has practiced within the insurance-based system and now outside of it, I can tell you Americans are paying Porsche prices for Yugo performance.

The typical American experience in seeking healthcare is not good. There are often long waiting times for appointments (usually which could have been cleared up in an email or phone call), brief interactions with an actual doctor, high co-pays and deductibles, long waits at the office, a crushing amount of paperwork, and a stunning lack of communication. Does this fit into a description of “Porsche value”—especially when one gets the mysterious, indecipherable bill for services weeks later?

Health Insurance Isn’t Really Insurance

The main mistake that we have succumbed to as a society is that we have deviated from the original intent of health insurance. The true purpose of health insurance was to protect people against financial ruin in the event of an unexpected, major occurrence—just like car insurance, life insurance, and homeowner’s insurance. But things got murky when people were indoctrinated into the belief that good health insurance should “cover everything” because “everything in health care is expensive.”

The irony is that because of this mistake, the “insurance” has become more expensive to the point it is unaffordable to many, and even those that can afford the premiums struggle to put money aside to cover the huge deductibles and coinsurance as shown in this recent article from Bloomberg.

The system got messed up when health insurance stopped being a form of insurance and instead became a default payment system. The dialogue below is an actual discussion I had this past year with a patient about lab tests.

Me: “Those lab tests will be 20 dollars cash through our pricing.”

Patient: “What will it be if I bill through insurance?”

Me: “We can send it to a hospital who will bill insurance but if you are on a high deductible plan I have no idea what your out of pocket will be, but I can guarantee it will be more than 20 dollars.”

Patient: “Ok, well let’s use insurance.”

Me: “You do understand part of the reason insurance is so expensive is because we use it as a payment model rather than insurance?”

Patient: “Well I pay a lot for my insurance so I want to use it.”

Me: *HEAD EXPLODES*

(FYI, the labs ended up being around $400 through insurance due to deductible.)

Addiction

The definition of addiction is “a psychological and physical inability to stop consuming a chemical, drug, activity, or substance, even though it is causing psychological and physical harm.”

It’s discussions like these that make me assert that we are addicted to health insurance. This patient simply could not imagine not using their insurance for a simple procedure and, in so doing, drove up the prices unnecessarily for everyone. By doing this, we as a society, have let this addiction consume us, our paychecks, and our savings for our children and grandchildren. And we keep doing it because our brains tell us there is no other way.

The chart below illustrates the spiraling costs of our health insurance as payment system addiction:

One of the health insurance benefits experts I work with is correct when he says “Today’s claim is tomorrow’s premium, copay or deductible.”

Unfortunately, the hardest part of treating addiction to any substance or belief is that denial is a major part of the disease. In order to fully treat addiction successfully, the addict has to accept that they are an addict and want to get better. Once that happens you just have to ask for help and there are resources available.

Recovery

This country needs help as 20 percent of our GDP is on health insurance and the costs of care. It is up to us as a society to fix this as we are all patients and deserve better. We deserve high-quality care when we are suffering from an insurable event and should be protected from financial ruin in such cases. We also deserve transparent pricing and quality assurance.

Above all, we deserve a system with a working payment system and to stop using insurance beyond its intended purpose. Simply stated, we must break our unhealthy addiction to health insurance. I am starting a support group called USHIAA—United States Health Insurance Addicts Anonymous (ironically HIAA is already being used by you guessed it….Health Insurers Association of America).

As the founding member, I am willing to admit that I too am a health insurance addict, but am now in recovery. The process of recovery has not been easy, but it has been the most rewarding process of my life. This group is established to help you through this process so please join me so we can let the healing begin.

This article is reprinted with permission from Gold Direct Care.