This is really helpful to read and insightful. It should be mandatory reading. In fact, It's time for a podcast. Maybe you should actually get into politics. Yes, it is possible to make a difference, with slightly higher probabilities than the Steelers winning a super bowl.
Buzz I really enjoyed #1 and #2 of your cogent analysis.
I think you are benefiting, in part, from having worked for government care, current care, and now a version of concierge care. Look forward to #3.
I am still in Private Practice (non owned) Cardiology, so if I had price clarity I could do something.
Also thanks for explaining that in particular Medicaid is not insurance and does not cover expenses so it remains in part a Charity at least for those outside government pay systems.
As a former reporter who covered the health insurance busness--from the invention of PPOs on--I have always been frustrated at the complete ignorance of what actual insurance is and is not. Thanks for agreat summary.
Health insurance stopped being insurance when it became a tax favored employee benefit. A benefit is something that people want to use while insurance is something that one does not want to use. For example, one does not want to get into an accident to use their auto insurance.
A major issue is that when goods and services are not paid for by the consumer, the consumer does not understand the value of such. Understandably, we are not in a position to make cost based decisions in emergencies. Most of medical care is not provided on an emergency basis.
The big health "insurance" companies have pushed care toward institutions while penalizing lower cost office based procedures and the consumers did not care since they were not paying the bills.
I've been without health insurance ever since Obama told me my plan was junk and he would save me from my own stupidity. The cost went up 4x and required me to earn $80,000 a year just to cover the cost of insurance for my wife and I. For 9 years now we pay cash for our healthcare. Providers are happy to give us a 50% discount when we pay cash because they don't have to deal with insurance companies. They double their list price for insurance companies so they can then give them the 40% discount insurance companies demand to be in their network. And of course, no one in government lives with the ACA plan.
I am so impressed that you continue to keep up with all of this while dealing with your own personal life.
I appreciate you so very much.
As for insurance and healthcare, it is a very sad predicament web
find ourselves in now.
I remember sensing the pride that my father had when I was a child in being able to have Blue Cross and Blue Shield insurance through his job to cover his family’s health care needs.
At the time it was the very best and a true benefit offered by his employer.
He would be heartbroken to see the world in the shambles that it is in now in regards to health care and the tragedy of insurance.
I am so grateful for you and I always will be.
Thank you for continuing to stay in touch with all of those who look to you for information in guidance.
I am looking forward to your final installment, Buzz.
There are times when my medical friends tell me they should have gone into dentistry or veterinary schools.
In many parts of the U.S. it is more difficult to be accepted at a school with an accredited veterinary major than it is to be accepted into a med school.
Humans or horses? Go figure.
My own nearly 79 year old body and brain receive first class care using Medicare plus coverage from a United Health Care.
Within the past few months I have had two head CT scans and an MRI to see if there were any brain issues after I fell flat on my forehead because I was wearing transitional lens glasses and made the mistake of looking downward at the stairs leading into my garage.
Fortunately, all those imaging costs were paid by Medicare and my backup insurance.
In fact, since I retired after selling my software development company in 2006, I have never paid for a CT, a PET or an MRI. But I now have proof that I have a working brain.
Of course, my monthly Social in-Security check is reduced by about $600 and my payments for the private insurance chew up another $400.
My dad was an account for a large mid western oil distributor. Even before I had graduated from high school, he told me Social Security was a Ponzi scheme made legal by the Federal government.
Hopefully you'll not suggest such a scheme in your final essay dealing with health care.
your premise is a straw man: "the central concept is to prepare for a potentially catastrophic financial loss by paying manageable amounts of money in advance into a pooled risk fund."
instead, "Sharing, or pooling, of risk is the central concept of the business of insurance" without any requirement for being limited to potentially catastrophic loss.
it's true that health insurance doesn't insure health, but instead the costs associated with maintaining the best health possible.
the central concept of insurance is to pay covered expenses by paying manageable amounts of money in advance into a pooled risk fund. catastrophic care insurance is no more insurance than is insurance for routine care.
why are you using this approach? what does delegitimizing non-catastrophic care accomplish in your reasoning?
germany's 'sickness fund' is accurately called by the germans "Gesetzliche Krankenkasse", with krankenkasse meaning health insurance. it seems similar to our medicare trust fund, regionalized.
we've had a global experiment in multiple systems, with metrics which include cost, outcomes, patient and provider satisfaction, etc.
some form of universal "whatever you want to call it" sure seems to be optimal.
"the central concept of insurance is to pay covered expenses by paying manageable amounts of money in advance into a pooled risk fund."
No - not 𝗮 pooled risk fund - 𝘃𝗮𝗿𝗶𝗼𝘂𝘀 pooled risk funds. If a 30 year old man, his 60 year old father and his 90 year old grandfather all walk into a life insurance office and each asks to buy a $1million 1 year term life insurance policy; then the insurance company isn't going to charge each of them the the same amount for their policies with the same payouts because son/father/grandfather each belong to a 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁 𝗿𝗶𝘀𝗸 𝗽𝗼𝗼𝗹𝘀. Insurance isn't a system where competent and successful get together to help out the incompetent and unsuccessful - that would be welfare (if government run) or charity (if privately run). With actual insurance, actuarians statistically calculate the expected payout to various identifiable groups (risk pools) and then calculate the premiums so each group is self funding. People who buy actual insurance pay the amount that they are statistically likely to pay anyway plus the costs of the insurer's overheads plus any profit margin that the insurer receives.
"they could choose to bring their prices down for the rest"
And therein lies the flaw in this thinking. Will. Never. Happen. Maybe they will toss a few pennies away...at first. Then they push prices back up and over where they are soon enough. Fail.
Many other possible solutions, Doc.
Like destroying the allopathic medical system alltogether. It is a monstrosity. Allopathic, "evidence-based medicine was the chosen killing machine of Nazi Germany. Has been the chosen killing and maiming machine of the pandemic - obstructing breathing of patients with respiratory ailments, with worthless and germ-filled petri dish cloth coverings over mouths, pushing phony PCR tests meant to detect dinosaur DNA fragments in fossils as evidence of infection, injecting unsafe and ineffective experimental biotechnology into the arms of healthy people who have less risk of severe illness and death from infectious disease than from severe adverser outcomes from the biotech, declaring natural immunity a "new age belief system", the entire quackery of pandemic medical interventions exposed much.
Accompanied by performing genital mutilations of children, ratting out patients to authorities for government-declared wrongthink about gun rights, LBGTQABCDEFG, BLM social policy (gun violence and racism declared health emergencies to be combated by medical professionals. Pushing pills that cure all ills for decades on unsuspecting and trusting patients - gotta get to that conference in Hawaii for the top pill-pushing MD's!!
Rockefeller petrochemical-based medicine is the bane of the the past century. It's time to put a stake in the heart of the dangerous and deadly practices that allopathic medicine quacks practice. And it's unjustifiably expensive. Complementary and alternative medicine practitioners are the future (and past) of true health care and medicine. Homeopathy, naturopathy, holistic, ayurveda, traditional Chinese medicine, herbalists, etc, practice REAL health care and healing.
Insurance to pay mercenaries for Big Pharma and eugenicists is just a way to spread the loot; like Nazi's picking over the property of the deported and gold fillings of the corpses swept out of ovens. Sorry/not sorry to be a buzzkill. The smelling rot of what is allopathy is now too great to ignore.
Have a nice read about the last time that type of medicine was employed for mass murder:
Useless Eaters: Disability as Genocidal Marker in Nazi Germany
Universal health care actually makes more sense at the state level as all of the money necessary to fund a Medicare for All (M4A) program is being spent on health care currently in states like Vermont and Massachusetts. So Bernie Sanders and Elizabeth Warren did a huge disservice by running for president promoting M4A instead of providing leadership in their respective states to craft a M4A program. And just remember—DeSantis barely won the governorship in 2018 because a Bernie Sanders acolyte won 34% of the primary vote running on M4A and beat Gwen Graham who would have beat DeSantis in the general election.
I have pondered whether enterprising states could successfully run some alternative models (ie Massachusetts' try at universal health care) like what I am proposing, or a single-payer system, but I worry that it's hard with the constrictions of federal medicare and medicaid programs. Maybe too hard.
Ted Kennedy worked with Romney to get waivers and whatnot for Medicaid in 2005.
The key would be transferring state employees and college professors and doctors and hospitals employees into the M4A program first and then for the next 5 years add other groups to the program with Medicaid and the few uninsured being the last group to add to the program. So start out with the groups that have the highest reimbursement rates and keep their premiums and copays the same except call them taxes. And then just have CSR payments like the ACA to reduce the tax burden for lower income people. Massachusetts runs a state health care program and yet their state employees aren’t in that program…it makes no sense!
So M4A advocates argue it will be less expensive and so all of the money necessary to fund the program is already sloshing around in Massachusetts as we speak because it has a very low uninsured rate.
Actual insurance is based on probability; but people also refer to insurance metaphorically as in: "I wanted insurance that I would have plenty of money in retirement; so I started robbing banks."
Everyone wants to be healthy and live; while the inescapable reality is that everyone must sicken and die. No medical system can ever achieve what people actually want; so people will never be satisfied. Will some multi million dollar additional treatment give me a 1% better chance of being cured? Then I want that treatment no matter how many millions it costs and if I can shift as much of the cost as possible away from myself; then I want it even more.
Thank you for this clear explanation. I’ve especially been wondering how the religious-based plans work, since they advertise heavily but don’t explain that they’re essentially covering currently-healthy people. Odd that they actually are insurance, but can only exist by promising that they aren’t insurance. Makes perfect sense in our system. Now, can someone come up with a business plan that covers those of us that do have pre-existing conditions?
Our experience with a healthshare started out good, but over time they were unable to pay reasonable reimbursement in a reasonable amount of time. The concept was great; the mission was admirable; the execution was extremely poor.
But not all healthshares are necessarily the same. I'm pleased to hear that Zion worked out for the author.
I wonder if we had that same health share (there are only a handful of them out there). After the third board upheaval and a price hike to nearly BCBS levels, it seemed like we should stop testing our luck of never needing them!
Interesting however Ontario Canada used to require citizens to pay for their government health insurance directly. Their premiums were a function of system costs and their income. The higher the income the more they paid. Ha ha. Politicians in the 80s thought it would be great if citizens didn't have to pay but rather employers. So no citizen pays but the employers do and govt covers catastrophic costs. The system is beginning to freeze. Waiting lines are increasing for the most basic services. The current government is touting the idea of allowing private healthcare.
America’s health insurance for those ages 18-64 is essentially funded by a VAT with the revenue controlled by state governments and major employers in the respective states. So whenever one buys a product or a service in America one is paying for someone else’s health care expenses. So health care costs are a line item on businesses budget with the GM CEO once complaining that they were a health insurance company that sold cars.
I am pointing to that Canadian province because of two things: the actual cost of what is being paid is not known by the user of the service and the government will work hard to obfuscate what the true cost is. Medicare's complexity is a feature and not a bug.
A feature of the American system is having some free market forces that help determine prices…so then Medicare can just pay something like 20% less than private health insurance and Medicaid can pay 50% less and it is up to doctors and hospitals to make it work. Primary care doctors that accept Medicaid either have to limit their number patients on Medicaid or they have to see a lot every day which means spending less time with each patient.
Insurers negotiate prices based on Medicare reimbursement rates so it is circular.
Drug prices in the US are supposed to cover R&D costs and European healthcare negotiate prices as a discount of US prices. US pharma withholds those drugs for a few years and then runs the clock on the lower reimbursement rates of socialized systems.
This is really helpful to read and insightful. It should be mandatory reading. In fact, It's time for a podcast. Maybe you should actually get into politics. Yes, it is possible to make a difference, with slightly higher probabilities than the Steelers winning a super bowl.
Buzz I really enjoyed #1 and #2 of your cogent analysis.
I think you are benefiting, in part, from having worked for government care, current care, and now a version of concierge care. Look forward to #3.
I am still in Private Practice (non owned) Cardiology, so if I had price clarity I could do something.
Also thanks for explaining that in particular Medicaid is not insurance and does not cover expenses so it remains in part a Charity at least for those outside government pay systems.
JAM
As a former reporter who covered the health insurance busness--from the invention of PPOs on--I have always been frustrated at the complete ignorance of what actual insurance is and is not. Thanks for agreat summary.
Health insurance stopped being insurance when it became a tax favored employee benefit. A benefit is something that people want to use while insurance is something that one does not want to use. For example, one does not want to get into an accident to use their auto insurance.
A major issue is that when goods and services are not paid for by the consumer, the consumer does not understand the value of such. Understandably, we are not in a position to make cost based decisions in emergencies. Most of medical care is not provided on an emergency basis.
The big health "insurance" companies have pushed care toward institutions while penalizing lower cost office based procedures and the consumers did not care since they were not paying the bills.
As a former life, health and disability agent I can say ObamaCare is junk and medicine itself isn't much better.
I've been without health insurance ever since Obama told me my plan was junk and he would save me from my own stupidity. The cost went up 4x and required me to earn $80,000 a year just to cover the cost of insurance for my wife and I. For 9 years now we pay cash for our healthcare. Providers are happy to give us a 50% discount when we pay cash because they don't have to deal with insurance companies. They double their list price for insurance companies so they can then give them the 40% discount insurance companies demand to be in their network. And of course, no one in government lives with the ACA plan.
Dear Buzz,
I am so impressed that you continue to keep up with all of this while dealing with your own personal life.
I appreciate you so very much.
As for insurance and healthcare, it is a very sad predicament web
find ourselves in now.
I remember sensing the pride that my father had when I was a child in being able to have Blue Cross and Blue Shield insurance through his job to cover his family’s health care needs.
At the time it was the very best and a true benefit offered by his employer.
He would be heartbroken to see the world in the shambles that it is in now in regards to health care and the tragedy of insurance.
I am so grateful for you and I always will be.
Thank you for continuing to stay in touch with all of those who look to you for information in guidance.
Your friend,
Mary Ellen.
I am looking forward to your final installment, Buzz.
There are times when my medical friends tell me they should have gone into dentistry or veterinary schools.
In many parts of the U.S. it is more difficult to be accepted at a school with an accredited veterinary major than it is to be accepted into a med school.
Humans or horses? Go figure.
My own nearly 79 year old body and brain receive first class care using Medicare plus coverage from a United Health Care.
Within the past few months I have had two head CT scans and an MRI to see if there were any brain issues after I fell flat on my forehead because I was wearing transitional lens glasses and made the mistake of looking downward at the stairs leading into my garage.
Fortunately, all those imaging costs were paid by Medicare and my backup insurance.
In fact, since I retired after selling my software development company in 2006, I have never paid for a CT, a PET or an MRI. But I now have proof that I have a working brain.
Of course, my monthly Social in-Security check is reduced by about $600 and my payments for the private insurance chew up another $400.
My dad was an account for a large mid western oil distributor. Even before I had graduated from high school, he told me Social Security was a Ponzi scheme made legal by the Federal government.
Hopefully you'll not suggest such a scheme in your final essay dealing with health care.
your premise is a straw man: "the central concept is to prepare for a potentially catastrophic financial loss by paying manageable amounts of money in advance into a pooled risk fund."
instead, "Sharing, or pooling, of risk is the central concept of the business of insurance" without any requirement for being limited to potentially catastrophic loss.
it's true that health insurance doesn't insure health, but instead the costs associated with maintaining the best health possible.
the central concept of insurance is to pay covered expenses by paying manageable amounts of money in advance into a pooled risk fund. catastrophic care insurance is no more insurance than is insurance for routine care.
why are you using this approach? what does delegitimizing non-catastrophic care accomplish in your reasoning?
germany's 'sickness fund' is accurately called by the germans "Gesetzliche Krankenkasse", with krankenkasse meaning health insurance. it seems similar to our medicare trust fund, regionalized.
we've had a global experiment in multiple systems, with metrics which include cost, outcomes, patient and provider satisfaction, etc.
some form of universal "whatever you want to call it" sure seems to be optimal.
"the central concept of insurance is to pay covered expenses by paying manageable amounts of money in advance into a pooled risk fund."
No - not 𝗮 pooled risk fund - 𝘃𝗮𝗿𝗶𝗼𝘂𝘀 pooled risk funds. If a 30 year old man, his 60 year old father and his 90 year old grandfather all walk into a life insurance office and each asks to buy a $1million 1 year term life insurance policy; then the insurance company isn't going to charge each of them the the same amount for their policies with the same payouts because son/father/grandfather each belong to a 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁 𝗿𝗶𝘀𝗸 𝗽𝗼𝗼𝗹𝘀. Insurance isn't a system where competent and successful get together to help out the incompetent and unsuccessful - that would be welfare (if government run) or charity (if privately run). With actual insurance, actuarians statistically calculate the expected payout to various identifiable groups (risk pools) and then calculate the premiums so each group is self funding. People who buy actual insurance pay the amount that they are statistically likely to pay anyway plus the costs of the insurer's overheads plus any profit margin that the insurer receives.
"they could choose to bring their prices down for the rest"
And therein lies the flaw in this thinking. Will. Never. Happen. Maybe they will toss a few pennies away...at first. Then they push prices back up and over where they are soon enough. Fail.
Many other possible solutions, Doc.
Like destroying the allopathic medical system alltogether. It is a monstrosity. Allopathic, "evidence-based medicine was the chosen killing machine of Nazi Germany. Has been the chosen killing and maiming machine of the pandemic - obstructing breathing of patients with respiratory ailments, with worthless and germ-filled petri dish cloth coverings over mouths, pushing phony PCR tests meant to detect dinosaur DNA fragments in fossils as evidence of infection, injecting unsafe and ineffective experimental biotechnology into the arms of healthy people who have less risk of severe illness and death from infectious disease than from severe adverser outcomes from the biotech, declaring natural immunity a "new age belief system", the entire quackery of pandemic medical interventions exposed much.
Accompanied by performing genital mutilations of children, ratting out patients to authorities for government-declared wrongthink about gun rights, LBGTQABCDEFG, BLM social policy (gun violence and racism declared health emergencies to be combated by medical professionals. Pushing pills that cure all ills for decades on unsuspecting and trusting patients - gotta get to that conference in Hawaii for the top pill-pushing MD's!!
Rockefeller petrochemical-based medicine is the bane of the the past century. It's time to put a stake in the heart of the dangerous and deadly practices that allopathic medicine quacks practice. And it's unjustifiably expensive. Complementary and alternative medicine practitioners are the future (and past) of true health care and medicine. Homeopathy, naturopathy, holistic, ayurveda, traditional Chinese medicine, herbalists, etc, practice REAL health care and healing.
Insurance to pay mercenaries for Big Pharma and eugenicists is just a way to spread the loot; like Nazi's picking over the property of the deported and gold fillings of the corpses swept out of ovens. Sorry/not sorry to be a buzzkill. The smelling rot of what is allopathy is now too great to ignore.
Have a nice read about the last time that type of medicine was employed for mass murder:
Useless Eaters: Disability as Genocidal Marker in Nazi Germany
Catholic Culture, 2002
https://www.catholicculture.org/culture/library/view.cfm?recnum=7019
The Nuremberg Trials: The Doctors Trial
https://famous-trials.com/nuremberg/1903-doctortrial
1940 Germany = 2020 USA. The profession did it, is doing it again. Dangerous. Murderous. Untrustworthy. Burn it down.
Universal health care actually makes more sense at the state level as all of the money necessary to fund a Medicare for All (M4A) program is being spent on health care currently in states like Vermont and Massachusetts. So Bernie Sanders and Elizabeth Warren did a huge disservice by running for president promoting M4A instead of providing leadership in their respective states to craft a M4A program. And just remember—DeSantis barely won the governorship in 2018 because a Bernie Sanders acolyte won 34% of the primary vote running on M4A and beat Gwen Graham who would have beat DeSantis in the general election.
I have pondered whether enterprising states could successfully run some alternative models (ie Massachusetts' try at universal health care) like what I am proposing, or a single-payer system, but I worry that it's hard with the constrictions of federal medicare and medicaid programs. Maybe too hard.
Ted Kennedy worked with Romney to get waivers and whatnot for Medicaid in 2005.
The key would be transferring state employees and college professors and doctors and hospitals employees into the M4A program first and then for the next 5 years add other groups to the program with Medicaid and the few uninsured being the last group to add to the program. So start out with the groups that have the highest reimbursement rates and keep their premiums and copays the same except call them taxes. And then just have CSR payments like the ACA to reduce the tax burden for lower income people. Massachusetts runs a state health care program and yet their state employees aren’t in that program…it makes no sense!
So M4A advocates argue it will be less expensive and so all of the money necessary to fund the program is already sloshing around in Massachusetts as we speak because it has a very low uninsured rate.
Actual insurance is based on probability; but people also refer to insurance metaphorically as in: "I wanted insurance that I would have plenty of money in retirement; so I started robbing banks."
Everyone wants to be healthy and live; while the inescapable reality is that everyone must sicken and die. No medical system can ever achieve what people actually want; so people will never be satisfied. Will some multi million dollar additional treatment give me a 1% better chance of being cured? Then I want that treatment no matter how many millions it costs and if I can shift as much of the cost as possible away from myself; then I want it even more.
Thank you for this clear explanation. I’ve especially been wondering how the religious-based plans work, since they advertise heavily but don’t explain that they’re essentially covering currently-healthy people. Odd that they actually are insurance, but can only exist by promising that they aren’t insurance. Makes perfect sense in our system. Now, can someone come up with a business plan that covers those of us that do have pre-existing conditions?
Our experience with a healthshare started out good, but over time they were unable to pay reasonable reimbursement in a reasonable amount of time. The concept was great; the mission was admirable; the execution was extremely poor.
But not all healthshares are necessarily the same. I'm pleased to hear that Zion worked out for the author.
I wonder if we had that same health share (there are only a handful of them out there). After the third board upheaval and a price hike to nearly BCBS levels, it seemed like we should stop testing our luck of never needing them!
Interesting however Ontario Canada used to require citizens to pay for their government health insurance directly. Their premiums were a function of system costs and their income. The higher the income the more they paid. Ha ha. Politicians in the 80s thought it would be great if citizens didn't have to pay but rather employers. So no citizen pays but the employers do and govt covers catastrophic costs. The system is beginning to freeze. Waiting lines are increasing for the most basic services. The current government is touting the idea of allowing private healthcare.
America’s health insurance for those ages 18-64 is essentially funded by a VAT with the revenue controlled by state governments and major employers in the respective states. So whenever one buys a product or a service in America one is paying for someone else’s health care expenses. So health care costs are a line item on businesses budget with the GM CEO once complaining that they were a health insurance company that sold cars.
I am pointing to that Canadian province because of two things: the actual cost of what is being paid is not known by the user of the service and the government will work hard to obfuscate what the true cost is. Medicare's complexity is a feature and not a bug.
A feature of the American system is having some free market forces that help determine prices…so then Medicare can just pay something like 20% less than private health insurance and Medicaid can pay 50% less and it is up to doctors and hospitals to make it work. Primary care doctors that accept Medicaid either have to limit their number patients on Medicaid or they have to see a lot every day which means spending less time with each patient.
Insurers negotiate prices based on Medicare reimbursement rates so it is circular.
Drug prices in the US are supposed to cover R&D costs and European healthcare negotiate prices as a discount of US prices. US pharma withholds those drugs for a few years and then runs the clock on the lower reimbursement rates of socialized systems.
All fun and games.