I am Dropping My Health Insurance

After a great deal of thought I have decided to drop my health insurance.

As everyone without health insurance knows, this a very scary position in which to find oneself.  Being in the healthcare field myself, I am well aware that a single day of hospitalization can generate tens of thousands of dollars in bills.  I also know that as a 53 year old self-employed man with hypertension and a history of oral cancer,  once I drop my health insurance, I will never be able to get it again.  I also know that the older I get, the greater the probability of developing an expensive medical condition.

Given this reality, why would I drop my insurance?  The answer is that while I can still technically afford my health insurance,  I can no longer justify the extremely high cost of maintaining health insurance.  My premiums have steadily gone up, so that I am now paying $1,400 per month for a plan that comes with a $6,000 annual deductible.  This means that, I am now paying $18,000 this year, to prevent the health care system from bankrupting me.  No matter the item we purchase, there is a point at which we decide the price exceeds the value of the item and for me health insurance has now reached that point.  This is a single item in my budget and I cannot justify paying that amount of money for an insurance policy.  It is no wonder that so many families are unable to afford health insurance when the cost for it is this high.

I do not blame the insurance companies for this out of control cost of health insurance.  I know that insurance companies are not living in poverty and there is much about the way they do business that totally frustrates me, but neither do I think they are the major cause of unaffordable health insurance.  I believe  the major cause of high health insurance premiums is out of control health care costs and the premiums are rising to cover the ever increasing cost of health care.

Unfortunately, the politicians whole focus is on ways to pay for our health care, rather than answering the question of why is health care so expensive?

Some blame the costs on an aging population, advances in medical technology and too many in the population being uninsured.  While these things may be contributors to cost, I believe they are not the major reason for these runaway costs.  I believe the real culprits are other items.

The reality is we have created a health care system in this country that almost no one can afford.  It started back when employer and government provided health insurance was initiated.  This began the decoupling of health care from market forces and the price of health care started climbing.  This produced a vicious cycle of higher prices trying to be compensated by more subsidies and higher premiums and less control by patients and doctors.  Unfortunately, we have now gotten to the point that patients are no longer the doctor’s customers, but have become mere widgets to be manipulated by the system.  This view of patients will become fully manifest when Obamacare is fully implemented.  When market forces are removed, they are replaced by rules and enforcers of the rules.

A major contributor to sky rocketing health care costs is the escalating mounds of regulation.   The justification for these regulations range from preventing “improper payment”  to creating a perfect health care environment.  I could argue with these justifications, but right or wrong, the need to fulfill these regulations costs our health care system millions upon millions of dollars each year.  As an illustration of the impact of regulations on our health care system, go by a hospital parking lot Monday through Friday and see how many cars are in it.  Now go by the same parking lot on Saturday.  The amount of reduction in cars is an approximation of the cost of regulation to our health care system.   While one could make an argument for a small amount of regulation; we have long surpassed the ridiculous and we are now at a level where the whole system is in danger of collapsing under the weight of the regulatory burden.

Lawyers are a tremendous expense for our health care system.  There is, of course, the direct cost of malpractice judgments.  One can debate the merits of a tort system, but when a plaintiff is paid a judgment, the money for that payment ultimately comes from health insurance premiums.  The even bigger impact of doctors and hospitals being sued over bad outcomes is the cost of doctors ordering lots and lots of expensive tests and spending lots of time documenting, for the purpose of protecting themselves from law suits.  I am sure, some will argue that it is good that the fear of lawyers makes doctors so cautious, but I have to ask, at what cost?

Mandated coverage of all kinds of things is expensive.  The politicians, in their yearning to buy votes by looking compassionate, have passed more and more laws requiring insurance plans to cover various and sundry things.  There are many of these items, but some of the latest items have been mental health care, children to age 26, preventive health care, contraception and soon coming preexisting conditions.  This mandating of coverage may sound wonderful to those getting the benefits, but these mandates come with a huge price tag.  One of the major things is it eliminates an insurance company’s ability to offer an affordable policy because they have been mandated to cover so many things.  This creates a larger pool of people with no insurance at all because all that is available are plans that cover everything and are therefore too expensive for them to purchase.   All of these “wonderful” mandates will do one no good when one cannot afford to buy the insurance in the first place.

There are other factors impacting the cost of health care, but these are some of the major ones.  Whatever the reason for the costs, the reality is that health care in the United States is extremely expensive and health care is something everyone of us is going to have to purchase sooner or later.  What am I going to do?  I am going to be participating in a cost sharing cooperative (Samaritan Ministries).  There are a number of these out there, but their monthly premiums are $350/mo instead of $1,500/mo.  They provide no coverage for day to day medical needs (neither did my high deductible plan)  and take more time on my end, but in my mind not only are these plans markedly cheaper, but they are how health insurance should work.  We will see how it goes.