Why mandatory health insurance won’t work

Filet Mignon, Pinot Noir and an MRI

This view of America’s health-care system has led a number of pundits and politicians to advocate mandatory health insurance. Massachusetts has made national headlines because it is about to institute that exact policy.

Other states are sure to follow. In California, Gov. Arnold Schwarzenegger has already announced that health-care reform will be the cornerstone of next year’s agenda. And most expect his plan to mirror the one in Massachusetts.

But mandatory health insurance is a step in the wrong direction.

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7 responses to “Why mandatory health insurance won’t work

  • michael

    I agree that universal coverage in not really the answer. I do not however hear any solutions coming from the your side of the field. Medical sharing is great but does not address the inflated price that those with no insurance pay. Hospitals charge those without insurance many times the price that an insurance company would pay for the same service. What is your solution to this?

  • James Lansberry

    Hi Michael:

    One of the ways we solve part of this problem is negotiating directly with the hospitals and providers. My allergist gives me a discount for paying cash. I’ve heard of getting 10-60% discounts from hospitals just because they get cash and don’t have to bill insurance companies.

    The third party payment system is a big part of the problem–universalizing it will only exacerbate.

    But if a hospital is overcharging–why use that hospital anymore? Find one that gives discounts. There are three hospitals locally and one of them *never* gives discounts. So I don’t go there. Proctor, however, has given good discounts for quick payment so when my wife needed to go to the E/R we went there even though it was further (and she ended up with a $19k bill for an appendectomy–I’ll let you know how big of a discount I get).

    Now if you go to Proctor and they find out they’re getting more business because they give discounts for quick payment–it encourages those discounts and maybe other hospitals, finding out they’re losing that business, will change.

    This doesn’t work all the time, though. The hospital that doesn’t give discounts at all is guaranteed a certain amount of business because the area’s second largest employer (the hospital itself is the largest!) uses them for insurance. So why should they cater to anyone else? If they want my business they’ll have to, but I don’t think it’s the government’s job to make them practice better business.

    I have more thoughts on this, of course–feel free to email me.

    JKL

  • michael

    The biggest problem is that one is oftern trying to figure out the price after the fact. Even at simple clinics the person giving treatment has no idea about price. I sell books, what a change it would be if people came in, picked up what they wanted with no idea on price, and some weeks later I could send a bill. Is the book $2.00 or $20,000.00, I dont know you will get a bill in the mail. The one change I would like to see from the government is that if I pay cash within 30 days I should get the medicaid price (whatever the gov. would pay for the same service).

  • michael

    I would add that I agree with choosing the best provider. There is a new clinic on allen road that charges $35 cash for a visit. In the past most clinics were $95 so I am a huge supporter of the new guys. The new $5.00 meds from walmart are a big help and I use them. Compitition however does not always work, many times a medical provider can charge whatever they choose. I think this is wrong and should be controled. Had your wife needed to be taken by ambulance would you have been in a position to bargain or find the best price? I am not a fan of one pay, I am a fan of allowing everyone to pay the same set price. The bill for your wife should not be any higher or lower than anyone else needing the same procedure. To often it is more like bargaining over the price of a used car after you have purchased it. Insurance companies at least are able to bargain before the need. Why should I be charged several hundred dollars for a shot that medicaid would have paid a few dollars for? I would ask what would medicaid have been charged for your wife to have her $20,000 surgery? I dont want the government to pay, I just want to be able to pay what the government would pay.

  • michael

    Just thought I would add that as to the discounts at Proctor, if I bill you $20.00 for a $2.00 book, but later agree to let you pay $10.00 to settle your bill, did you really get a discount?

  • michael

    One last comment on things like the new $5.00 meds from walmart. Why is it that for years walmart charged far more for those same meds. How is it that they can take something they were selling for $60.00 and now charge $5.00. Medical providers have never been in a positon of fighting over price. There have always been plenty of clinics and doctor offices in the area and they all have charged about the same for a visit $80.00-$100.00. Now someone opens up charging $35.00. Do you think they are loosing money at $35.00? My personal opinion is that all the others have in the past just set the price by inflating it to the tune of an extra $55.00. I never got a discount, but if you were a better bargainer than I you could get it for half price and you still would have been paying to much.

  • James Lansberry

    Michael–

    I’ll get to these in a day or so. Sorry I can’t get to them today, but these are good comments and questions, some of which I have something resembling an answer. :0)

    JKL

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