To the Senators, House Members, aides, and policy analysts working on health care:
Dear distinguished Madams and Sirs,
As we discuss ways to ensure that Americans find humane, civilized, and rational access to healthcare, we must come face to face with one critical failure, a failure that may be at the heart of participatory choice and consumer models for healthcare altogether. To be simple about it, asking people to choose the financial health coverage that they will need in the future, and asking them to bet on the amount of money they will need to spend on health, has failed up to now, presently fails, and will always fail to result in adequate coverage or the existence of a classical free market in care.
This means that any and all “market” choices about health care are doomed. In fact, they are self-evident folly that can only come from an effort to misdirect attention or devalue language.
These are huge claims — the sorts of claims that belong to cranks and idealists. I hope to persuade you that they’re justified.
I. The insurance model
Insurance as it began in Lloyd’s Coffee Shop was a group of merchants betting one another that their ships would not sink. Twenty merchants would agree that the chances of the twenty-first’s ship sinking were so low that they would pay for the cargo, if it went down, provided the twenty-first paid a sum to the group. They were, essentially, purchasing risk instruments, in today’s language. They did this precisely because they felt that they were dealing with acts of God and criminality — storms and pirates — that were outside of human reason. There was a very small risk that a storm would claim a cargo, but there was nothing anyone could do to stop it. Therefore, people would bet on the small chance, make money, and, the people who suffered the loss could be recouped.
Health insurance does not work the same way, and yet market arguments in favor of it are the same. We know that every woman over 30 should go to the doctor for breast and gynecological maintenance checkups. We know that every man over 50 should go to the doctor once a year for prostate and colon health, as well as checks on cholesterol. We know that most children should go to the doctor twice a year to the age of thirteen, at least, to ensure that there are no emerging diseases. In other words, the need for a physician is not a rare act of God, but a routine maintenance cost of inhabiting a body. Therefore, no one should be buying insurance (a risk instrument), and calling what we get from Blue Aetna United Humana “insurance” is a linguistic perversion.
Further, every person will have massive medical physician intervention at end of life. Time is the omnipotent coward; it never fights, but it always wins. We have such a certainty of our end of life costs that we take away the word “insurance” for “care” (Medicare) and move from any semblance of purchasing toward an entitlement.
Therefore, we begin with the problem that the very name “health insurance” implies purchasing a risk instrument against a random event, and what the public knows about the thing itself, purchasing a shield against regular but unpredictable costs of being alive, represents a lie. Part of our battle, as reformers of health care, is to explain to the world that it hasn’t bought insurance in the first place, that insurance is the wrong word.
We were always buying cost mitigation. We were paying agents to negotiate with merchants and haggle over prices and charge us for this skill/power. It’s a strange thing to pay for: a middle man to argue with middle men representing providers who are being billed by middle men, while every last person in the chain piously claims “the market” is setting prices and “costs” are driving “reductions in coverage.” (Coverage? Think about the word for a moment, and you’ll grow angry.)
II. Unlike insurance, private “health insurance” does not recoup costs to clients.
The original insurance existed to replace losses. Those Puritans at Lloyds got the value of their cargo back. Even today, one can insure transit of goods and be sure, if they are lost, the full monetary value will be repaid. Pay your car insurance at a high enough level, and it will pay to replace your car if it is stolen.
Health insurance does no such thing. It claims, from its first word, to never repay customers for their expenses, but, rather, to “cover” some percentage of costs, if the insurance agency feels that the costs are apt. If the insurance agency feels that the charges are not proper, or are too high, the costs do not go away; rather, the customer gets stuck with them.
Health care is no eleemosynary transaction (my Henry Fielding word), where prices are listed on a menu board. If you have severe pain above your right hip, in a few inches, warm to the touch, then you will have an appendectomy, and you will discover afterward that the anesthesiologist billed you, and the hospital billed you, and the surgeon billed you, and the internist billed you, and neither you nor they will have any knowledge of whether it is appropriate. After all, you could not have said no, retroactively.
Far from life insurance, which promises to pay a cash value if the customer dies a year after getting it or seventy years after getting it, health “insurance” promises to pay 60%, 70%, 80%, or 90% of “covered costs” after a deductible of $5,000, $7,500, $10,000, and premiums that are never paid off to term.
Private health insurance, even good private health insurance, is less like insurance that the feudal patronage system. Feudal peasants would pay for protection from invaders and robbers, but never simply become citizens, and, in return, were to give thanks for reduced damage to their farms when the lord’s knights showed up and trampled the fields. Just so is today’s insured patient, who pays for a penumbra of protection against “catastrophic” medical events and for reductions in costs that nevertheless leave them devastated. Are the reductions “worth it?” Well, that depends. If you pay $7,200/year in premiums, and the insurance demands $7,500 in deductible before paying 70% of covered costs, the savings it offers have to be in the “catastrophic” category before the customer gets back to the risk threshhold.
III. The young invulnerables and the middle aged invulnerables
Private insurance is status quo in the public mind, both linguistically and in the market — something it celebrates with yearly premium increases and shocking lack of complaint about prescription drug prices that it is supposedly absorbing. It looks like a scam, but it feels like a misery. For the extremely wealthy, it is alright, presumably, but any American living less than two paychecks from the street (which is fewer than 20% of us), any who don’t own their own houses free and clear, any with credit ratings that can be infected with the plague of collections, private insurance is simply a mental space of dread.
A. The Young Invulnerables
In 2011, we learned the phrase “young invulnerables.” They were the ruin of ACA.
They were the 19-27 year old males who are healthy. They make the least and therefore can afford premiums the least, and they cannot imagine ever being old, ever having prostatitis, ever having atherosclerosis, ever having an injury that can’t be dealt with outside of the ER. They’re the young women who get their birth control from the county health extension, if they get any, and they ignore a lot of “weird stuff” because nobody has time or money to deal with it, and they read on Goop that they just need to detoxify their karmas.
They are healthy, and they won’t enroll. That’s why there had to be the mandate.
Curiously, once the ACA was in place, the young invulnerables didn’t turn out to be the problem. The people who provided political energy against the ACA weren’t the young. Young, fit, poor people weren’t standing around with the second wave of the TEA Party in 2014 complaining about getting a chance at health insurance. The young may not have enrolled, but they didn’t hate the ACA. By 2015, anyway, the young seem to have been coming along pretty well. The poor, white young were coming along and enrolling by the end of Obama’s years, and poor Black, young people were faster than them. No. The energy against the mandate came from fat, white, middle aged men.
B. The Middle Aged Invulnerables
The current litigants against the ACA in Texas seem pretty insincere. When I talk about middle aged invulnerables, I’m not talking about them. Sure: there are white Fox News victims who refuse health insurance because the ACA exists, but they’re . . . static. They’re the “concerned parents” who move into a district just to find a Judy Blume book in the library to complain about the “filth” there. They’re professional plaintiffs. Ignore the people wanting to be seen and heard on this issue and listen to the people who think that they’re “not political,” who are “normal.” That’s where you’ll find the problem.
B1. Digression
I was born to be dead. I was cross-eyed, club footed, and I had a closed pulmonic valve in my heart. I was the runt of the litter: sad, calm, sweet, and leaving. However, five hospitalizations for pneumonia before the age of five, two strabysmus surgeries before the age of four, pediatric massage on the foot, and open heart surgery at the age of seven kept me alive.
Every day of my life, I have had to think about my body. Sick is normal. For twenty years after the heart surgery, every day involved constant monitoring for cardiac arrhythmias and performing vagal maneuvers to stop them (unpleasant things, by design). These days, I take fourteen pills a day as maintenance medication, and none are psychiatric. [“Well there’s your problem.”] Simply put, I consider it customary, normal. “Healthy” and “normal” is being vigilant and hyperaware. [I saw, on True Detective, a character put his finger to his throat to check his pulse, and I thought, “How weird! Can’t you just feel your heart beat or listen for the clicking of the artificial valve?” As I say, this is normal for me.]
I will never have a credit rating, because I will never be clear on medical bills. That, too, is normal.
B2. Digression to minor premise: What’s normal?
For me, normal is going to the doctor. Normal is sick. Normal is learning medicine, investigating drugs. This is just a necessary and normal part of life. Because it’s normal, I think everyone feels the same way.
I began, in my 30’s, to meet people who had gotten sick — men who had heart attacks, women who had breast lumps or cervical abnormalities, both who got hypothyroid — and they freaked out. I didn’t understand them. Why were they insisting that the whole world stop and pay attention? Why were they expecting to get disability for hypothyroidism? Didn’t they know the difference between sick and sickly? (You can’t help the first, but heaven help you if you’re the second.)
The reason was that they had been healthy. . . normal. They had been able to live without any awareness of the blood and weepy goo and gristle and bone that moved them around, laid them down, and kept them between. They had lived their lives at 98.6 F, 72 bpm, 120/70, and now mortality had stuck its pale head through the trapdoor.
C. “I don’t have a doctor”
In my 40’s and 50’s, I began to meet more “normal” people than the university hothouses. Farmers, business owners, merchants — mostly men — told me, “I don’t have a doctor. I should get one.” I would ask, “Where do you go to get blood drawn?” “I don’t have a primary doctor,” they’d answer.
I met single women who would say that same thing. I even met women with children who said it. (They told me that they had a gynecologist that they saw. . . well. . . they really should set up an appointment again, but they’ve definitely got one.)
These grown ups would go to a “doc-in-a-box” ambulatory care facility when they had sinus infections, sprains, and bronchitis, but they had zero health care. They do not know who in town offers primary care, do not know family medicine from internal medicine from osteo-, and they don’t want to. They don’t want to go.
D. The real resistance to the ACA
Who is not subscribing? Our biggest problem is not the 19 year old. Our biggest problem is the middle aged immortal. We have a massive group comprising probably all the “normal” people that does not want to think about the doctor. This group does not wish to buy insurance, if it doesn’t have it, because that comes down to mortality, to being sick, to needing care.
They also don’t want to participate in a scam.
IV. The problem with markets
If we ask the people to choose insurance, they won’t.
First, we are asking them to spend money that they will “bet” they won’t need to spend. They will always make this bet because of both the young and middle aged invulnerables. The young believe that they will never get hurt and that aging diseases don’t apply. The middle aged don’t want to think about the cholesterol in their arteries any more than they want to think about their carbon footprint: both thoughts trail guilt and powerlessness. They further don’t want to start to think about “the doctor,” because that means admitting the creeping petty pace of time. Further, if they don’t have a “sickness,” they’re “not sick,” and if they’re “not sick,” they will bet that this year will be the same as last year — no “sickness.” (The rains have come every year, so they will come again, and there will never be a drought or flood. Very small sets of data lead to very large conclusions and very human inductive reasoning.)
Second, they won’t spend the money they don’t have, and they don’t have it. Health insurance companies are not pricing their policies on costs. If they were, we would see greater variety in premiums and premium increases. In a free market, insurance providers would compete with one another, the way car insurance companies do, to cut down their administrative costs, to reduce freebies, to tailor advertising, and we would see rates compete. Instead we see the classic behavior of collusion and oligopoly. Given the fact that there isn’t a real oligopoly, something else is happening, but the thing isn’t a free market. It seems that insurance companies are pricing toward a maximum price increase and maximum deductible before regulators step in or companies prefer to be self-insured. This behavior is easily felt by every employee, even if HR officers made glad tidings, and employees, the self-employed, and the gig economy folks truly hate the very idea of health insurance.
Third, they believe that insurance, and everything associated with the word, is prey. Individuals obey rules, even crazy ones, but if they think that the rules are unfair or that other players in the game are cheating, they’ll cheat their tails off. “Insurance” as a concept has already set up a “rigged” system in the minds of the “not sick” middle aged immortals.
V. Conclusion: If you offer a choice to buy a “governmental insurance plan,” you’ve lost the battle. If you offer an “insurance exchange,” you’ve given the private insurers a chance to fight you and win. Your only choice is to offer a new program that sounds like a new program.
Lester Holt was trying to make news with his “raise your hand in you would outlaw YOUR private insurance” question, and, Senator Harris, your parsing of his question didn’t help, even though it was right. That’s a game they want to play. They want to act as if we’re going to “take away freedom.” The best idea is to simply ignore private insurance, if you’d like. Let it exist for “boobs and bums” (I mean the people buying it, not the body parts covered).
Tell people they can do whatever they want with their overpriced, underperforming, Wall Street investment vehicles. Let them pour money into Humana’s banking investments, or United Health Care’s purchase of CVS, if they want, but mandate complete coverage (ALL paid) for a fee that can be paid monthly, like a premium, or all at once on income tax. Beat the stuffing out of any employer who, upon cutting the premiums they were paying to private insurance, doesn’t turn that over directly to salary/pay to the workers. Make sure that doctors that want to turn up their noses at the poor people get slammed, and slammed HARD for doing it.
The simple truth is that “free market” and health care haven’t ever truly been on the same plane since the 17th century, and it was a disaster, then. When we read Daniel Defoe’s Journal of the Plague Year, we hear about doctors getting paid slightly more than the men who carried the dead, paid by the city. Those darned socialists.
Thank you for your consideration.