Posted on 06/26/2004 4:35:43 PM PDT by Remember_Salamis
Why Can’t We Buy Health Insurance Online?
...as seen in the Arizona Tribune
Americans purchased about $95 billion in goods and services over the Internet in 2003. This dynamism added significantly to entrepreneurship and our economy’s overall health and vitality. One important sector that could use a healthy dose of nationwide competition is health insurance. We can buy just about everything else online; maybe it’s time that health coverage was added to the list.
A basic law of economics is that competition is good for innovation, quality, and price. It’s high time consumers had the opportunity to get the best health coverage at the best deal possible. If health insurance could be purchased online, from anywhere in the country, costs would come down and more people would be insured.
You might say that’s such a concept would probably take an act of Congress. You would be right.
Right now, some states erect barriers to affordable health insurance by passing laws that force consumers to buy insurance plans that cost too much, and often contain benefits we don’t want or need.
Since 1980, state legislatures and the federal government have passed more than 1,000 laws that require consumers to pay for such benefits in their insurance policies. Large businesses and labor unions are exempt from these "mandated benefits" because they can selfinsure under a law called ERISA. That means individuals who buy their own policies and small employers end up paying the price for these politically popular but very expensive mandates.
The situation is intolerable in some states. Families who buy their own health insurance in New Jersey, for example, are forced to pay anywhere from $3,000 to $17,000 per month — that’s right, per month — for a health insurance policy with a $500 deductible.
Nobody has this kind of money, so what do people do? They usually go without insurance. When they are sick, they go to the emergency room where hospitals often overcharge them.
But if consumers could buy health insurance over the Internet in any state they wouldn’t have to go without. New Jersey residents could purchase insurance for themselves or their families in Pennsylvania, New Mexico, or Alabama. Using the Internet, we can tear down the barriers to expensive red tape and regulation and open the door to affordable health insurance for millions of Americans.
People would be able to shop the entire country for health insurance plans that fit their particular needs. They wouldn’t have to pay for benefits they didn’t need or want. Costs would come down, and more people could afford insurance — all without a big government takeover of the health care system and the large tax increase that would be needed to fund such a scheme.
Congressman John Shaddegg, R-Ariz., has a bill that would allow us to purchase health insurance online; it’s called the CHOICE Act. "CHOICE" stands for Creating Healthier Options In Health Insurance Through Choice And Efficiency.
Under the CHOICE bill, consumers would be able to use the Internet or physically go to another state and buy a health insurance policy. The policy they buy would contain the benefits from the state where the consumer purchased the policy.
Putting the power of the Internet to work in order to solve one of our nation’s most pressing problems is the rationale driving this bill. Every member of Congress should get on board. If we can purchase almost every other product or service over the Internet, there is no reason why the one item we count on for our health security shouldn’t be on the list.
Karen Kerrigan is chairman of the Small Business Survival Committee, a trade association based in Washington, D.C. representing over 70,000 member small businesses.
To view the Arizona Tribune endorsement of the Health Care Choice Act, please visit: www.aztrib.com/Ar03701
This is an issue with me.
I basically can't get health isurance. I have no medical problems (if I did, I'd be willing to exclude them), but they won't even talk to me as an individual.
I've looked at health insurance offerings on-line, but I've never purchased them.
The problem I see, is that many of the policies are hard to understand what it is that you get. It's hard to compare them. Some of them appeared to be worthless policies, that excluded everything that could possibly happen to you. And it's also hard to compare them.
I think that there is a need for state departments of insurance to review policies. I also think that the state should force policies into certain molds so that they can be compared. Certain things should not be allowed to be excluded, etc.
How you do balance simplifying insurance without preventing innovation or stifling competition is hard to answer. It's further complicated by the fact that state deparment of insurance executives are dependent on the insurance industry for their next job. Thus giving the insurance companies excessive pull.
However, None of that prevents buying on-line.
Try it sometime.
Well, actually I did go as far as requesting a policy which arrived the next week in the mail, I just never signed it and paid for it.
Quotesmith gives instant quotes, I'm just not sure how quickly the transaction closes once you sign up.
Our employer just announced with a 5 day warning that our deductible was going from $0 to $500. Last year I equested our union to keep our benefits at the same rate. I was laughed out of the room as their response was "what if they offer us something better and we've locked in on the old policy?" Just let me say, I told you so and I told you why it was important to make the benefits binding. Egads.....
Danny, I agree with your comments, but what you suggested about forcing comparability is the law in NJ, insurance companies fled the state when the law was enacted. If such a law is pasted nationally, insurance companies will exit en masse the health insurance industry, again forcing the US taxpayer to pick up the bill, and another route to HillaryCare or some equivalently horrible socialized system.
Why did they leave? Was there something really stupid about the way NJ did it? Or did the insurance companies just not want to compete, and left for greener shores with more confused customers?
I'll tell you the thing I really hate about insurance, especially health insurance. They make everybody else's costs go up.
So many plans negotiate rates on a % below normal that doctors and hospitals raise their rates to everyone else so that they can discount them to the insurance companies. I think that ought to be illegal. In fact, I'm not so sure it is not already in violation of some of the anti-trust laws.
My wife had surgery, The bill was something like $10,000, but the insurance company had negotiated a rate of $5,000. That means if we had decided to self-insure, we would have got stuck with a rate that was twice as high than if we had insurance. That is just WRONG!!!
Yeah this is fishy. If there's a problem with state laws, the answer is changing the state laws, not passing federal laws to "trump" them.
It's bad enough that state governments no longer have representation in Congress, we don't need to accelerate our headlong rush into federal totalitarianism.
My opinion, no group under 150 lives should self-insure. Gambling with your health and your financial security at the same time is unsound.
As for your second point, the new statewide plan in Maine is being a test bed to insure all working people and their families in the state with some form of coverage. Solving that problem is above my pay grade so to speak.
I agree that nobody should go without health insurance. But I think it's a crime that they have to pay twice as much as the rest of us if they do.
"but they won't even talk to me as an individual."
You can get health insurance through Blue Cross/Blue Shield
check it out
http://www.bluecross.com
You might want to revise this to "You can TRY to get health insurance through Blue Cross/Blue Shield".
If you're over 40 and have pre-existing health conditions, good luck. Your only option will be to go with their must insure policy, at 2 to 3 times the standard rate. And that only applies if you've got COBRA coverage from a former employer.
One major problem with the concept of health insurance is that there is no clear and reasonable metric for the level of care that should be provided. If I purchase collision insurance for my car with a $250 deductable, then in the event my car is involved in a collision my insurance company will pay be either what it costs to get the car into condition comparable to what it was prior to the collision, less $250, or buy the car from me for about what it would have been worth, pre-collision, less $250. The cost to the insurance company of either of these actions is reasonably-accurately quantifiable.
Health insurance, however, is another matter entirely. There are many people who cannot possibly be gotten to a state of 'perfect' health, but could be gotten into a better state if they receive $500,000,000 worth of care than if they receive $500. How much should the insurance company spend?
And who makes that decision? A doctor, or an insurance clerk?
But my previous post was just about the inequality or rats. Insurance companies should pay the same amount for the same doctor and procedure as everyone else pays.
That would raise my cost since I have group insurance, and it would lower the poor guy who doesn't have insurance. It would reduce costs overall by making insurance billing simpler.
Should Sam's Club pay the same prices for merchandise as Mom & Dad's Local Market?
There are some legitimate reasons for price discrepancies between what insurers pay and what individuals pay, though there are many dubious ones as well. A bigger problem is that insurance is only a small part of what most 'health insurance' companies really do.
To use a rough analogy, would it be reasonable for someone to buy "oil change insurance" for an automobile? To be sure, some people do buy automotive service plans which include oil changes, but would anyone call such a plan "insurance"? Insurance is based upon the notion of protecting people from unexpected events. By contrast, many if not most of the payouts by "health insurance" companies are for things which are entirely expected.
If some employees need medicines that cost $50-$250/month, an employer that helps cover such costs may boost employee satisfaction by doing so. The notion that such a thing is "insurance", however, is ludicrous. If an HMO can act like Sam's Club and use quantity discounts to save more on medicines that it spends distributing them, that's fine. But that doesn't mean it's "insurance".
Well Harry said "he didn't have any health problems"...that said he shouldn't have a problem...
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.