Medical Tuesday Blog
Health Insurance Is Frequently The Worse Gluttony
The pharmaceutical houses have been hiking the charges of common cheap medications rather astronomically. As physicians we have noted this for the past year or more. Recently there has been a huge falderal when epinephrine injectors for asthma and serious allergic reactions were finally notice by the public after they had increased their price more than 10-fold over the past several years.
The debate was rather vicious until the CEO of the industry placed it in perspective. We’re charging insurance companies. Not patients.
Are patients now being sidelined in the practice of medicine? Who do they think we work for?
The insurance industry responded that they have a number of programs to reduce the cost when patients pay. After asking all kinds of questions which really are confidential—like how much do you earn—they strike a deal. In the process they harvest a lot of private information from patients which should remain confidential, for their next deal.
Insurance companies are the ones that disrupt the doctor patient relationship. This whole process can be sidelined by obtaining the appropriate insurance plan that places the patient in charge. See the end note below.
The pharmaceutical industry can be kept in line by following the principles of free enterprise. If price of the epinephrine injectors went from $25 to $500, the sale of their product would drop to zero items. No business, including the pharmaceutical business, will remain in business without any sales. Without the interference with health insurance, the price will remain in line with what we can afford. A very simple equation, don’t you think? However, insurance companies have painted themselves as protecting the consumer (patients) from the high cost of medicine. Patients no longer understand basic economics—the law of supply and demand—so they are hoodwinked in thinking that prices are arbitrary. With health insurance, they are. With patients paying the pharmacy directly, the prices are based on supply and demand. If the demand for epinephrine injectors goes up, the prices go up; then when the supply of epinephrine exceeds what the market can sell, the prices go down.
Insurance should only be for catastrophic medical expense. Your deductible should be equal to your average yearly basic health care costs. Figure out what your basic costs are for a couple of doctor visits per year, your yearly lab tests, maybe an x-ray or two or an ECG. Your medications have become cheaper thanks to Walmart and the discount pharmacies. About 400 different medications are now $4 a month or $10 for three month’s supply. My yearly cost for five medications in my family is about $300 a year. If yours are higher, ask your doctor to prescribe a generic if available. The proprietary costs of my medications in the same category would be about $1500 instead of $300. If all these basic costs come to $2,000 a year, then buy a health insurance plan with a deductible $500 higher or $2500. Your health insurance should then just kick in when you have one of the few things that are expensive: hospitalizations, surgery, cancer, heart attacks, strokes, major trauma, and maybe a few others. Your health insurance premium should then be about $12,000 a year cheaper. Doesn’t that make sense?
Saving $12,000 for a $2500 liability in health care? You can’t make money faster than that outside of healthcare.
Medical Gluttony thrives in Government and Health Insurance Programs.
It Disappears with Appropriate Deductibles and Co-payments on Every Service.
This makes high deductible health insurance and total healthcare relatively cheap.