I see it with dental. I don't have dental insurance. It's amazing when one makes a financial decision. Example a root canal plus a crown with "50% chance of success" (translation...we don't know if it will save the tooth or not) would've cost about $2000. An extraction cost $400.
People with dental insurance go for the crown-root canal, sometimes with a deductable coming close to the price of an extraction. People without dental insurance will more likely say "get that gold mine out of my mouth".
It's like that with anything that's insured. The desire of the medical profession to make profits has no check if the patient has no financial stake in keeping prices down.
That's why we shouldn't be forced into these crazy policies that cover everything. It'll cause medical costs and availability to spin hopelessly out of control.
Anecdotal....when I had the hospital stay from hell with pneumonia almost four years ago, there were Medicare patients using it as free room and board when they could come up with believable diseases....lovely roomates. (sarcasm)
Your observations about dental care are very relevant.
Dental insurance is a small test laboratory for looking at what ails the larger medical sector. There are some differences:
* A significant amount of dental care is not life threatening
* Dental care is generally a lot less expensive than significant medical care
* Bankruptcy causing dental catastrophes are rare
* Dental insurance has a much shorter history than medical insurance
* Dental insurance usually has a rather low payout limit.
That said, there are similarities that are very important. Like medical care, dental insurance became an employment benefit. Unlike medical care, dental insurance reached this status far more recently. Twenty years ago, I would just go to the dentist and pay my bills.
Now, I feel like its prudent to have dental insurance. I noticed that dentists raised their rates somewhere between 50 and 100% after dental insurance became common. The reason they did this was that the dental plans had to offer a discount from the “list rate.” Worse, dentists who signed on with dental insurance companies (and most of them felt they had to) had to sign contracts where they would agree not to make side deals with the uninsured.
In effect, dental insurance created “pricing clubs” in a matter of a few years. There were fewer direct negotiations with the uninsured than with hospitals, because even though the uninsured were being overcharged, they could usually pay the inflated rates.
Unlike medical insurance, most dental plans are capped (pun, sorry) at around $1200 per insured. So, in effect, dental plans are mostly a combination of pre-payment for the cleanings you are going to have, with a payout cap that might cover a filling or two. They embody two of the features of what is currently called medical insurance: prepayment for expected care (which really isn’t insurance), and a pricing club.
What they don’t give is catastrophic coverage.