According to a recent study by the Kaiser Family Foundation and Health Research and Educational Trust, premiums for employer-sponsored health insurance rose an average of 6.1% in 2007. Now this was less than the 7.7% increase in 2006, unfortunately both are still higher than the increase in the average workers' wages (3.7%) and the overall inflation rate (2.6%).
This is almost appalling that we continue to allow this to happen. Insurance companies are big business and answer to stock holders first and foremost. Even in NC where BCBS is supposed to be a public company, they are allowed to retain their earnings. So if premiums continue to rise at the current level of 3 to 1 with inflation and 2 to 1 compared to wage increases the average person will no longer be able to afford health insurance in their life time.
Now one problem is the issue of entitlement that is plaguing our society. The founders of our great country were in no way implying that the pursuit of happiness and freedom included entitlement to the best healthcare available and free of charge. What happened to paying what was fair and in turn making an honest wage? Unfortunately there are too many people that expect to have the best care and not have to pay a dime and then there are those on the other side of the fence that got into healthcare (including insurance) looking to make all the money in the world.
So back to entitlement, could this be the downfall of the current system? I believe it will be. In the days before the HMO's in the early 80's, insurance fraud was rampant because of too little checks and balances. Healthcare providers would charge whatever they wanted to charge and the insurance company would pay it. Also people utilized the healthcare because it was available and often times necessary. So insurance pulled the reins, pulled back on what they would pay and healthcare providers started complaining. They said technology costs and we need to keep making more money too.
Technology does cost and the cost of the new technology is being passed on to the patient. But how often do we know about? If the insurance company decides they are not going to pay for a service then the person has to pay for that service. I wonder how many of us would drive across town to a physician that charged only $70 a visit as opposed to the one across the street that charged $150 a visit that was no better than the one across town? How about an MRI that cost $845 vs $1000 at a center in another town?
Transparency in healthcare billing is not new, but very few offices practice such a thing. When we opened our office three years ago we had a therapist with many years of practice ask if we considered doing the unthinkable; being tranparent with our costs/billing. I had never really thought about it because no other place I worked had done such a thing. To be honest the thought of "transparency" in which we opened up for all to see what we charged was not only foreign, but scary as well.
After three years, I can honestly say it was one of the best things we could have done. We still have people that do not want to pay. Those are the same people that will try to get a $.99 hot dog for free and will take advantage of any situation. And then we have people with the best of intentions on paying, but for one reason or another just can't make ends meet when it comes time to pay. But overall, if you come into our office after every visit we tell you what you are getting charged for, provide you with a receipt of those services and then instruct you to watch for your explanation of benefits (EOB) or explanation of payments (EOP) from your insurance company to make sure they match up. You will also generally get a rough estimate of what it will cost you if you have a co-insurance rather than a co-payment. And no one has ever complained about us taking this additional couple of minutes at the end of the treatment session. What this does, is it allows our clients to realize upfront if they can afford our services. If not, we can look at options to still get them the care they need and it gives us a place to start.
If every healthcare provider started to do this, much like any other industry, those truly outstanding facilities and providers would still be able to make money and charge at a higher rate because their value would be seen and clients would have no problems paying. It would also help to either drive out or at least force those other facilities not to do as well financially for providing lousy service or treatments. It would also force some friendly competition and keep costs lower on a whole because others would see what they were charging. Much like gas stations, they will generally keep their prices within a few cents of each other if not exactly the same and everyone usually benefits.
To put it in perspective think about the last time you had a hamburger at a restaurant. Chances are if you went specifically to that restaurant looking for that hamburger it was either because of price or taste or both. If you could consistently get a good hamburger at a fair price chances are you would go to that place again. At least you could make a choice based on either price or feeling that you got from that burger. But suppose the menu had no prices. Suppose you ate the hamburger and then were presented a bill afterward. You were hungry and needed to eat, so if the bill was for the price you were used to paying you would have no problems. What if you had never eaten a hamburger out before though. Say you had alwasy eaten hamburgers at home and knew how much you paid at the store, but did not know what to expect the price to be at the restaurant. Now say you were presented with a bill for $600 for that hamburger. You already ate, so now you owe the $600. This could become even more complicated if this was the only restaurant in town and all the grocery stores were closed. If you knew the hamburger was going to cost you $600 you probably would not have eaten it and you would have either made the choice to go hungry or try something else. At least you could make the choice.
Such is not the case in most instances with healthcare services. When was the last time you walked in and a price list was mounted on the wall for the procedures? Even a mechanic will give you an estimate. I believe there needs to be transparency in healthcare costs and billing procedures and only then can consumers make educated decisions about the services they seek and the services they decide to receive. Think large hospitals and healthcare providers can't do this? If the Hilton Hotel chain can price things in their mini-bar differently across the world, then even the largest hospital can do the same. And they already are, they just are telling you what they charge.
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