Insurance Quotes & Advice

The health insurance industry recently brought forth a proposal that favors mandated universal coverage.  Massachusetts is currently the only state at the moment which mandates universal coverage. 

Under the industry proposal, health plans participating in the individual health insurance market would be required to offer coverage to all applicants as part of a universal participation plan in which all individuals are required to maintain health insurance.

Health plans also said that premium support for moderate-income individuals and broad spreading of risk are necessary to promote affordability and maintain premium stability in the individual health insurance market.

The big issue for the industry is the coverage of pre-existing conditions.  By mandating coverage, individuals can’t wait until they get sick before they purchase coverage and passing off the costs to those who are already paying.

However, we still come to the issue of affordability, with so many people living at poverty levels, universal coverage will mean large government subsidies.  As Massachusetts is already finding out, that expense is much more than they thought it would be originally and are struggling to find ways to pay for their program.

Until the issue of rising medical costs is dealt with, a nationwide universal health system is impractical.  With the government facing an increased debt load from the financial crisis, finding the money to fund such an endeavor will likely be a problem.

But with the growing public support for universal coverage, that doesn’t mean the government won’t try it anyway.

A recent research study shows that many Americans are struggling with the cost of healthcare even when they have insurance. 

“On the national level, we’ve seen rates of foregoing care because of costs rise dramatically from 2001-2007. We’ve also seen medical bills and debt rise since 2005,” says Michelle McEvoy Doty, PhD, one of the study’s authors and director of survey research for The Commonwealth Fund.

An important finding is that the underinsured, in some cases, have similar rates of problems as the uninsured. “This indicates that policy makers also need to worry about the content of insurance, not just covering more of the uninsured,” says Dr. Doty.

As the study points out, even in Massachusetts which became the first state in the nation to implement universal health coverage, residents are struggling to meet out of pocket expenses.  However a big source of cash outflow for most states is the cost of uninsured medical care which has seen a significant drop off in Massachusetts.

As the state is quickly finding out though, it’s a lot more expensive than they though it would be.  Some thought this could be the test case for other states or even a national program but the numbers really don’t add up.

The problem isn’t the cost of insurance it’s the cost of medical care in this country.  If you look at other country’s with successful universal healthcare systems in place, the key is their lower per capita medical costs.

You can’t say the government isn’t spending enough because they spent nearly 50% of all medical expenditures in this country last year.  A nearly bankrupt Medicare system is hemorrhaging money at an alarming rate as medical costs continues to outpace inflation. 

Now I’m not sure how they can go about lowering medical costs but I do believe that is what needs to be focused on at least initially.  Could the country implement universal health coverage now?  Probably, but it would be ridiculously expensive and somebody would have to be taxed to pay for it.

While the economy is what most Americans are primarily worried about these days, the looming question about healthcare still remains. The outcome  of next month’ elections may very well determine the course of the nation’s healthcare system for the next decade and beyond.

While each candidate has markedly different proposals on how they would implement healthcare in this country, neither has any solution on the main reason why premiums are rising so fast, namely skyrocketing medical costs.  Their plans mainly center on how they would implement insurance coverage and on ways to pay for them.

With the federal government already spending obscene amounts of money attempting to solve the financial crisis, nearly $2 trillion already, how much will Congress be willing to allocate to healthcare in the next few years.  Something also to consider is that AIG is not the only struggling insurer and that the insurance industry may very well require it’s own bailout package before every thing is said and done.

Only one state in the country, Massachusetts, has made an attempt at installing universal healthcare coverage.  While some believed they may act as a model for other states to follow, Massachusetts is quickly finding out that it is much more expensive than originally thought.

In order to fund their healthcare program, the state has had to raise cigarette taxes as well as turn to the government for federal assistance.  At this point it is still uncertain if the their attempt will have any long term success.

Until something is done to try to control rising medical costs, there is just no way you can reasonably attempt to control rising insurance premiums, it’s impossible, the two go hand in hand.