Recently, I received a notice from my “not for profit,” locally based health care insurer that my rates are going up $15 a month next year due to “rising health care costs.” This baffled me, since I personally haven’t “cost” my insurance company much of anything in at least a year or two.
I do go to the doctor once a year for a check up, but given that my monthly health insurance premium is nearly double what a “wellness visit” costs off the rack, I’d say they’ve taken enough money from me to cover that tab. My only other health care costs are generic prescription drugs that are not only cheap, they’re not covered under my plan anyway. Oh, and I go to the dentist—but that’s not covered, either.
Being self-employed, I have to pay 100 percent of my insurance premium under an “individual plan.” If you work somewhere that offers health insurance as a benefit, then you only pay a portion of your premium out of your paycheck and the company covers the rest. You and your coworkers as a group participate in your own “group plan.”
The overall health of your company’s “group” determines what each person in the group pays. In other words, you pay the same amount out of your paycheck as the three-pack-a-day smoker in the warehouse or the 300-pound secretary in the cubical next door. In the infinite wisdom of health insurance mathematics, the monetary risk of one sick person is spread out over the premiums paid by each member of the group so that the insurance company always wins. Very Vegas.
Meanwhile there’s me. I don’t have co-workers, sick or healthy. I don’t have an employer picking up a big portion of my health plan premium. I’m not even part of any group. Or am I?
In an effort to simplify things, as far as determining an accurate monthly premium rate for a one-off like myself, all individual plan members such as myself are lumped into a big happy group of our own. The risk of each individual member is spread across the entire group and rates are averaged out. So, my rates are determined by the health of a bunch of people I’ve never even seen, let alone met. And apparently unlike me, they’ve all been using their health insurance a lot, hence the rate increase I’m about to start paying.
Is it me or does this seem unfair? If I’m watching my diet, exercising and not running to the doctor every time I have a sniffle shouldn’t I be rewarded with reduced premiums? My car insurance company thinks so.
Until adding my teenage daughter to my policy a year or so ago, I paid the lowest rates my car insurance company offers. In fact, over the years they’ve not only proactively sent me notices of premium reductions based on my good driving record, but even sent rebate checks every now and then for a percentage of what I’d paid in any given year. And if my daughter maintains a clean driving record and a good report card, her rates will drop as well. How is this any different than health insurance? It’s because I go to the doctor, but don’t have auto accidents—and that’s bullshit.
I actually had a claim on my car insurance for an accident that happened just last year. Between the cost of damages for both my car and the car I hit, I’d say the total bill to my insurer was likely around $25,000—a far cry from the cost of a single doctor’s visit. However, when I received my next car insurance premium statement my annual fee was exactly the same as it was the year before—and the year before that. No increase due to “rising body shop costs.”
Health insurance companies have shell-game explanations of why their brand of coverage is different than auto insurance and how spreading out risk across the entire population of members is good for everyone. I know, because I wrote marketing copy for the insurer in question for nearly a decade. But in all that time I never quite bought in to their logic and business practices. They’ve got people snowed and scared to death of the antidote—Obamacare.
Chuck Crowder is a local writer and man about town. His opinions are his own.