The Money and Markets section of the Gazette-Times on Aug. 13 reported that stock values of the top four health insurance companies had increased 31 percent this year (S&P 500 companies were up “only” 5 percent). This news is welcome for some but bad for all, a perverse byproduct of an overpriced health-care industry.
We rarely can determine the likely cost of health care services before we receive them. Even if we could estimate price, when we are in crisis, we cannot comparison-shop. We essentially sign blank checks hoping that our insurance plan will cover the costs of care. The likelihood of adequate coverage diminishes each year as health-care costs escalate and insurance plans degenerate.
Furthermore, medical bills from hospitals and pharmacies are grossly inflated, not meant to be real. A neighbor’s hospital bill for his hip replacement last month was more than $50,000 (typical in the U.S. compared to $10,000 under publicly funded care in England or Switzerland). The insurance company followed industry standards by allowing a secretly negotiated “provider discount” of $42,000 and paid about $8,000 to the hospital, leaving the neighbor to pay $176 out-of-pocket.
But many people you may know have no insurance or poor insurance, even under the Affordable Care Act. They face much or all of a fully inflated health-care bill, and they risk their savings, credit ratings, dignity, and even their homes. Medical costs are still the leading trigger of personal bankruptcies. Most of the bankrupted families had health-care insurance they had trusted to protect them.