They’ve Got You Covered (You Hope)

 

In a vintage Monty Python sketch, a customer complains to his insurance agent about his claim not being paid. Upon review, the agent makes a startling discovery: “Ah! Here’s the problem. You selected the ‘never-pay’ policy, which works out quite nicely as long as you never make a claim.”

Although the sketch wasn’t referring to health insurance, its punch line is no laughing matter to countless Americans who find that their health insurance policies fail to live up to what was promised. A recent Los Angeles Times investigative story described heart-wrenching stories of families who worked hard, played by the rules and paid their premiums on time, yet when a major illness affected a loved one, their insurance carrier combed over their contract for a reason to cancel their coverage.

While the definition of insurance is to pool risk, health insurance companies, according to California Lieutenant Governor John Garamendi, “are in the business of avoiding risk.” In other words, the business model of insurance companies is to accept only the applicants least at risk for major medical expenses. This adverse selection leaves the least wealthy and least healthy members to rely on overburdened government programs and charity care.   

The majority of Americans are lucky enough to be covered by employment based insurance, but for many, this luck is running out. As businesses strive to remain competitive in a cut-throat global economy, the number of American corporations offering employee health coverage, according to research conducted by the Kaiser Family Foundation, has dropped from 69% in 1999 to only 60% today. More and more working adults are finding that expectations of decent health coverage are a fleeting promise.

The consensus of our society has completed step one: we’ve admitted that there’s a problem.

Future posts will explore possible solutions to the health care dilemma that, as Purple America recommends for all troubling societal challenges, will be rational.

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