Media portrayals of the “current” state of the US healthcare system rely on outdated information, sensationalism, fear-tactics, vagueness, and circumstantial evidence. The information dispensed in this manner can even have a substantive impact on policy initiatives in congress, further exacerbating the misunderstood nature of challenges in our healthcare and benefits climate. Fortunately, current and significantly more reliable data is available.
The healthcare market has cycled in and out of growth phases over the last 25 years – an indication of a market that neither bleeds (as did the airline industry in that period) nor exhaustively extorts (as in the case of pharmaceutical companies). At present the industry is expanding and maturing to meet new, unique market demands.
In these first several years of PPACA implementation, both profits and risks for insurance companies have increased. The paradigm is similar for employers – offering more attractive or flexible benefits make for a more compelling environment in which to recruit talent. But at what cost? The key for consumers, employers, and news personnel is to be mindful of the shifting nature of our healthcare system, and to seek out the most current and balanced information available.
Employers should work in tandem with their insurance advisers to better understand the big picture of healthcare reform and the how it relates to their business. After this critical step, employers must then find effective ways to communicate the costs and benefits available to their employees – and help them make informed decisions. Businesses can no longer wait and see what happens, reacting to healthcare changes instead of anticipating them. Proactive and educated decision-making must be promoted at all levels to develop and sustain workplaces and societies that live well.
Health insurance is expensive because healthcare is expensive. A reasonable assertion – though only partially true. Another major contributing factor to the burdensome costs of most health insurance coverages is that the coverage provided doesn’t match the needs of the insured. If the coverage is insufficient, then out of pocket expenses can make the overall costs unwieldy. By the same token, excessive coverage for healthier individuals inflates health insurance rates beyond their necessary bounds. In addition to all of this exists a massive amount of confusion, misdirection, and red tape.
The cornerstone of healthcare cost and quality reform is transparency. It’s a paradigm shift that those in power – government, health insurers, and providers – would like to avoid at any cost. The current system is built upon the foundation of confusing and unclear delivery of goods and services. Insurers negotiate deals with providers to set prices for services and then administer that design through an overly complicated billing/coding system to facilitate payment. It sounds convenient, but in reality, the system makes large sums of money for its architects and managers at the cost of the American healthcare consumer.
Widespread internet access and a preponderance of resources therein have improved the ability of the average consumer to comparison shop service providers in their area. The next step is providing consumers with access to information on quality and cost in advance of treatment so they can determine overall value. An excellent example is Lasik eye surgery. The surgery isn’t covered by insurance and the cost is disclosed upfront and paid for directly by the consumer. Ten years ago, Lasik cost $5000 per eye. Today, it costs $500 per eye and quality has improved dramatically.
Legislators, health insurance companies and providers often claim that healthcare is complicated and making cost and quality information available to consumers will only confuse them. This is fallacious and duplicitous. While healthcare products and services are quite nuanced, assessing their cost and quality is a core component of providing them. Uneducated consumers, by definition, will suffer suboptimal care. Transparent and consumer-centric healthcare is the way forward. To learn more, ask us.