Once again, I’m sucked into the discussion on health care reform. I despise this topic, because so much of what is wrong with our current system could be fixed relatively easily, if Americans could just take an ideologic leap.
Most of us have heard of “pre-existing condition (PEC)” clauses—those rules that allow insurance companies to deny payment for care based on your previous history. There’s a lot of facets to this, and laws vary tremendously (your results may vary). For example, a company may simply refuse to insure you (although some companies don’t have that choice, but they can still price you out), but more commonly insurers will refuse payment on services related to conditions that existed before you enrolled in the policy. You remember (don’t you?) the huge questionnaire you filled out before you got your insurance? And the request for all previous records? This is where you can end up in a heap of trouble.
You see, if you have, for example, type I diabetes, you already know about it and most likely disclosed it. But what if you forgot that you saw a colon specialist ten years ago and had a polyp? Let’s say you develop some rectal bleeding, go for an exam, end up having a colonoscopy where a tumor is found, and have to have surgery. You may also need chemotherapy, etc. If you have a PEC clause, your insurer is going to take a close look at your past and find that colonoscopy, and you’re going to end up responsible for tens of thousands of dollars of bills you weren’t expecting. You thought cancer was bad…
But don’t be too quick to blame the insurance company—it’s really your fault. No, I don’t mean your memory lapse about the damned polyp, I mean your ideology. As an American, you implicitly or explicitly support the current health care system, and the current system demands PEC clauses.
Insurance relies on pooled risk. Lots of people pay in, and hopefully, the payout is lower than the pay-in. This give insurance companies incentive to insure only healthy people, so that they can collect the most money for the least risk. Our system also encourages healthy people not to participate at all—why waste money on insurance if you’re young and healthy? Chances are you won’t need it.
If all the healthy people opt out, and only sick people are left, the level of risk is high, and the insurance company may not be able to make a profit, or even make ends meet. Don’t forget to factor in the fact that many insurance risk pools are small—most Americans under 65 rely on employer-provided plans. If my little practice has one sick person, our insurer may have to raise our premiums so high that we drop our employee benefits.
Medicare is funny though. Just about everyone over 65 participates, healthy or ill. Of course, people over 65 will be, on average, a lot more ill than younger people. Just imagine if we could somehow improve the risk pool for Medicare, you know, like adding all Americans to it. Pre-existing conditions would be irrelevant, since everyone pays, everyone plays, and everyone is covered.
A single-payer system would eliminate the immoral but nearly-unavoidable practice of excluding pre-existing conditions. So what are we waiting for?