Why the insurance industry (and others) need to change

Right now we have insurance companies that take our money, and then fight as hard as they can to not give us our money when we need it.  It's not much better than when a gang extorts "protection money" from small business owners in a city.

That's the meat of the situation.  I don't doubt that there are some good people working for those insurance companies.  I don't doubt that sometimes the insurance companies begrudgingly pay for some pretty expensive stuff that the recipients couldn't have otherwise paid for.  But the system is broken.

I hope everyone reading this can agree that the most important concern in the topic of health care is that people who need medical help can get it.  From the poor bystander getting hit by a drunk driver, to the worker that got exposed to too much asbestos, to the child with the faulty heart that needs surgery...  even to the people who made bad choices and need help to get back on the right path (smokers, alcoholics, narcotic addicts, and so on), should have access to help.

We're all humans right?  We either go in the direction of isolation or inclusion.  My opinion is that NOT dividing ourselves into small groups and NOT being at odds with each other is better.

The current system divides who gets health care into three basic groups.  Rich people that can afford it;  Middle tier people who can get the care, but end up worse off financially (perhaps in serious debt);  And poor people who can't even begin to get the health care attention they need.

Why is it like this?  Because some enterprising people figured out they could make tons of money in the context of health care.  It's an industry instead of a service.  It's an industry that feeds greedy people.  I worked for a software subsidiary of a health care company, and I have a distinct memory of a year passing and all of us were wondering what our pay increases would be.  Would it be the weak cost of living increase, or might we all get recognized for the work we had done to improve the web application used for people to sign up and pick options for their health care package.

But we were told that there would be no raises for anyone because the company was doing so badly financially.  No raises at all.  Just a: keep working, and maybe next year.  This occurred the same week or month that the financials were publicly posted for the company, and the high up managers got bonuses in the millions of dollars.  bonuses.  millions of dollars.

What the hell did they get bonuses for?  Running the company so poorly that they didn't have enough money to make the workers (people who actually make the company function) a little happier?  Those self-important jerks don't care about the employees, or about an insurance company helping people get the care they need.  They care about their money.

Granted it's a personal experience, and not valid as proof that all insurance companies' chief-level managers are greedy pieces of crap... but it's one of the big insurance companies... and it does happen.

I'm sorry I went off on that little tangent, but I wanted to point out the biggest problem with privately run insurance companies... with health care being run as a business.  At the head of the whole thing is an apparent group of greedy people that don't have their customers' or employees' best interest at heart.  And why should they change?  They're getting what they want.  The system allows for it.  And no one is stopping them.  Our well-being is a for profit industry right now, and it's not working well for anyone but the super rich executives.

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The problem is compounded by two additional things... though this is still in the realm of my opinion.  The first additional thing is that skilled medical people have to pay huge amounts of money to become skilled medical people.  This is true of any highly skilled industry where the cost of the education is so high that people interested in that education frequently have to take out loans to do it.  My understanding is the doctors come out with the biggest debt, describable with "hundreds of thousands of dollars".  We start off the people who are going to take care of us with a desperate need to pay back money on the order of a house mortgage.  Think about that.

Why are we putting our health care professionals in debt to start with (really... why are we putting any college educated people in debt to start with)?  So, health care ends up needing to cost more so that doctors can pay back the money they borrowed.  If they're lucky, they become successful doctors financially, and they can make decent money at it... but... these are people who are going into the industry of caring for us.  And we are hiking up the prices for our care by putting the care-givers in debt.

It's stupid.

The second thing that adds to the problem of for-profit-insurance-companies is the pharmaceutical industry.  You have a a bunch of people working their butts off to help those in need... to make medicines that can save lives, and improve quality of life... but... they are under the management of more people that are running a for-profit company.  It's another broken industry.  An excellent example is Martin Shkreli.  The man is an awful human being.  This article should work as a reminder, but in case the link is broken or something, you can search the name, and read this quote from the article...

Asked by an audience member at a healthcare summit hosted by Forbes what he'd do differently if he could go back in time to before his highly criticized decision to raise the price of a 62-year-old drug, the Turing CEO replied: "I probably would have raised prices higher, is probably what I should have done. I could have raised it higher and made more profits for our shareholders. Which is my primary duty."

As a person in charge of a medicine that is needed for people to live, this guy should have said his primary duty is to help people.  What he actually said sickens me.  Shkrelli is an awful human being.

So anyway, because the medicine industry is a business, it charges extra money so that profit can be made.  It makes sense from a business perspective, but the extra money comes from the pockets of the insurance folks... and they don't like losing money, so they charge more.

Between the debt the medical folks have, and the nature of business of both the insurance and pharmaceutical industries... we pay a ton of money into a system that isn't designed to help us.  It's designed to help the rich people running it.

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I'm pretty confident that the system is broken, and not doing what it's supposed to do.  But what are the counter arguments?  I doubt I know all the counter arguments, but the one I hear most often is that in our system there's competition which benefits the customers.  There's competition to be the best doctor for example.  Better doctors will get more customers and they can charge more for their service.  Of course they want to be the best doctor they can be in that system.

But there would also be competition between health care providers and even pharma companies right?  The ones with the lowest prices will have more customers.  The ones with the best coverage or the best medicine will do better than the ones without.  The idea is that the free market will make this into a great system.  But that idea doesn't seem to be working.

Medicine prices are still higher than they should be.  Likely this is because the really important medicines seem to be monopolies... until generic brands can start producing it.  And insurance seem to have found a balance where they can over charge us, and no one is willing to drop their prices to compete... rich people don't like losing what they perceive as their rightful profit.  To be clear, that's an impression.  I don't know that for sure.  But rich people need better PR if it's not true that they're selfish jerks.  Sure... point to rich people donating to charity, but they're still rich, and those donations are probably a drop in the bucket just to make themselves feel better and look better publicly.  That's a guess on my part, but again... rich people need better PR if I'm wrong.

Anyway, what I'm saying is that the competition that the big companies face isn't helping us from what I can tell.  Or maybe things would be worse, but the plateau happened in a place where customers are still getting abused.  Either way, we are being abused.

As for doctoral competition making them better, I think that argument is a weak one too.  There are a number of countries with better health care systems than ours, that don't have the competition...

36 Best Healthcare Systems in the World

I think the real answer to that conundrum is that anyone willing to spend nearly a decade learning to be a doctor is doing so because of something other than money.  I have heard too that work weeks for medical professionals are ridiculous on time-demands and stress.  It's a profession that requires incredible dedication while enduring genuine hardship in the form of time, stress, and their own money.

I'd like to take this moment to say to doctors, nurses, and every medical professional that is working hard to help people: Thank you.  Really.  Thank you.

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So what exactly do I recommend?  I just spent time tearing down our current system.  But it's not really helpful for me to just complain about what's not working.  And I've been avoiding the word because it has such a negative stigma for so many people: socialism.  Before anyone shouts and reacts emotionally that socialized medicine is bad... look again at the list of the 36 best healthcare systems in the world.  The U.S. isn't even on it.  For the most powerful nation on the planet, it's ridiculous that regardless of the metrics used, we're not even in the top ten.  It's pathetic.  And the countries that have the healthiest and happiest people for the best prices are using a socialized medical system.

For my next thing I'd like you to think about... we ALREADY HAVE a bunch of systems in our government that count as socialism...

• Education (grade school)
• Police
• Fire Fighters
• Infrastructure (streets, traffic control, etc)
• The Military

Socialism is not about getting rid of the hard working entrepreneur that makes a good amount of money for themselves.  Socialism's fundamental principle is the idea of us looking out for each other.  Our tax money pays for those things I listed (and probably lots more I haven't thought of yet).  Anything we all pay for that we all benefit from counts as socialism.  That's what socialism is.

I'm NOT suggesting we do everything by that means.  But we already have a hybrid system.  I'm just saying that for something like medicine, it makes sense that we use the idea of socialism.  Instead of paying some private company to be there for us when we need medical attention, we pay into the government system with taxes.  No private owner at the top that gets to make millions of dollars every year at the expense of their employees and customers.  So we wouldn't even have to pay more than we are now.

With the change where we don't have to pay a bunch of rich jerks millions of dollars a year only to have their company argue with us when we need the service we payed for, we might even end up paying less... AND if it's a public service where every citizen gets to use it when they need it, there wouldn't ever be the situation where a child might die because they can't afford the needed medical attention.  Going all the way back to the beginning of this essay, my stated goal is a system that helps everyone... not just people who can pay for it.

When I was younger, I had some conservative thoughts, and I even remember making the argument that I didn't want to pay for someone else's medical expenses.  I said I didn't want to be responsible for a system I wasn't even using.  I didn't think it was fair.

But that's "awful human being" territory.  I DO want to help people.  I want us to take care of each other.  I even think it's fair now, because I do benefit from a system where I pay taxes so that everyone can have medical coverage.  I benefit because other human beings will be better off.  We're humans that are part of a gigantic community.  When the individuals are better taken care of, the whole thing is healthier and happier.  I get to be part of a wonderful society instead of a selfish one that only wants to look out for the privileged few..

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As a related note, I think schooling beyond high school should be socialized too.  I think it should all be paid for with tax money.  No more student debt.  No more lenders making money off the people we need to enter our work force.  No more negative balance for kids that are just starting out.  And even the poorest among us should have the option to learn if they want.

It won't diminish the quality of the schools or learning.  It won't make things worse.  People who want a degree will still have to work to earn their grades... they'll still have to work hard to learn.  If they don't, then they won't succeed later.  And they still have to convince the schools that their grades from high school make them worth taking a risk on.

And as a perk, we get access to a whole pool of people that might be brilliant and ready to move their chosen field forward, that we don't have in a system where you can only use it if you have a lot of money or are willing to go into a lot of debt.

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Alright.  I'll end it there.  My closing assertion is that we, the United States of America, should move to socialized medicine and socialized higher education.  Making the change is an enormous task, that many would argue is too costly for us to do.  But the system right now is broken.  It's costly too, and the only people that benefit from it are those rich owners and managers at the top of the businesses.