Is Being Insured A Good Thing?

By Author: Norris Rios
Total Articles: 572
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Looking at the title of this article again, it seems a little strange. Surely it goes without saying that having a company insure your health is a good thing? How can it not be good? Surely people who are insured have better health and live longer? One of the more interesting things about the so-called scientific method is that everyone knows how it is supposed to work. You have to start with a hypothesis. In this case, it would be: people with health plans enjoy better health. You then devise an experiment involving a statistically significant number of people. One group, drawn randomly from the population have health plans. The other group (the control group) do not have health plans. Researchers then monitor their health for, say, ten years. Data is collected and analyzed. Results are published in a peer reviewed journal. Human knowledge is increased. Except, the US has been running this experiment for decades. Millions of people across the age range and with differing levels of health are uninsured. Millions more pay for private coverage. The remainder have plans provided by their employers. The data over the years shows ...
... that uninsured people have a lower life expectancy. In fact, the poor on average die seven years earlier than the rich. By a coincidence, many of those without insurance are poor. Now that is bad news for this research. There are many factors contributing to death. They are directly related to the social class and lifestyles of the individuals involved. In this, lack of access to medical care is not a major contributing factor. Put another way: there has never been any research to answer the question posed in the title to this article.

We need to consider two contradictory statements: when they fall sick, the poor go to an emergency room and, if they are lucky, receive treatment that keeps them alive; when they are insured, the rich receive care that gives them better health. Except the international statistics show the US has higher mortality rates than most of the other developed countries. To help you understand, we need a comparison with Europe where there is a completely socialized healthcare service and better life expectancy. Both at a European and individual state level, there are panels of experts who decide what treatments and which drugs represent good value for money. States will only pay for treatment proven effective and safe, and will not pay drug companies the retail price they claim. Instead, the states will only pay for approved drugs at prices agreed in negotiations. In the US, insurance companies happily pay for a battery of medical tests and procedures even though there is no evidence any of this work is effective. This adds to the irony. Sometimes the rich die young even though they have received multiple treatments. This is because their expensive treatments are ineffective.

So long as the healthcare service industry remains profit driven, doctors have a direct financial incentive to perform endless tests and multiple procedures to justify big bills. There is no national body to approve treatments and then monitor their safety and effectiveness. Health insurance companies could challenge the medical profession to justify what they do and the prices they charge. But, for the most part, health insurance companies pay up without question. What is clear that until and until there are controls over medical costs, the premiums on individual health plans will continue to rise. Worse, there is no evidence to show that those who do pay these high premiums live any longer than the uninsured.