Medical catastrophes are not stories about health insurance

When it comes to opinions about health care, there are two kinds of Americans. No, I do not mean Republicans and Democrats. There are (1) people who have actually experienced a medical catastrophe, and (2) people who have not yet experienced a medical catastrophe. (But don’t worry – you and your loved ones are not immortal. You will learn what it means to be vulnerable eventually.) I used to be a government economist, and I can tell you… the policy wonks have no idea when it comes to the myriad problems with health care. This reality is why so many people of all political persuasions hate the “establishment.”

By my reckoning, I have now experienced four medical catastrophes. A family member miraculously survived an aortic aneurysm, something that is damn near universally fatal. A family member survived a horrific car accident that involved being cut from a car with the Jaws of Life and required a month-long stay in the ICU. I gave birth to a critically ill child. And, as followers of this blog know, my husband recently accidentally swallowed a metal needle from a grill brush that worked its way through his entire digestive tract, requiring a week-long hospitalization.

Needless to say, I have learned a heck of a lot more than I ever wanted to learn about how health care and long-term care works in this country over the last ten years. I’ve navigated the nuances of government programs in several states. Our household has been covered by the best private insurance that money can buy and by Obamacare plans. I can tell you that private insurance is a hell of a lot better than what was offered under Obamacare. Honestly, I think Obamacare is deeply immoral and far-from-progressive policy.

A little digression on Obamacare

For the couple of years that we had an Obamacare plan in Kentucky (because there were no good private options available to self-employed individuals), it was an absolute nightmare. I had to get our daughter’s kindergarten vaccinations at a public university hospital because literally no pediatrician in our city would accept Obamacare. None. I called every single one. It was the first question their secretaries asked when they picked up the phone, even before asking your name or the age of your child. “Do you have Obamacare? We do not accept it. You will have to pay for your appointment in cash, up-front.” The hospital knew that it had a captive group of customers too, which is why a 15-minute appointment with a nurse practitioner at the children’s hospital there cost twice as much as the permissible amount for a doctor’s visit under Obamacare. They essentially got to bill twice for services, knowing that customers would end up having to pay the gap. They could go nowhere else for care because their insurance cards were radioactive.

Staying under Obamacare, we would have been forced to pay over $1,000 a month to a nonprofit that had only been in the insurance business for a couple years because every big insurer had been driven out of the state. We might as well have been uninsured from a financial perspective. That’s not quality health care, but we counted as “insured” for government statistical purposes, which is all that mattered to the program’s proponents. They continue to congratulate themselves for doing this to people. They radically transformed your life!

And that was without a catastrophic event, which would have cost us tens of thousands of dollars even under Obamacare. We could have handled that expense, but I know most American households would have been sent over the edge. The notion that Obamacare is saving normal households from health care-driven bankruptcy is an outright lie, and people like Bernie Sanders are correct to point that out. And really all you need to do to understand that is to get a simple quote.

You know why the level of uninsured is increasing now that the Trump administration has removed the tax penalty for not carrying insurance? Because Obamacare was always bullshit as far as coverage goes and young people now have the freedom to choose to be uninsured rather than being fleeced for coverage that they do not perceive a real need for. I’m not saying being uninsured is a good idea, but it is undeniable that they are doing what they think a rational economic actor should do under the circumstances.

The Affordable Care Act was nothing but a giant Medicaid expansion. If you are on Medicaid and were marginally qualified before in terms of means testing, you love the ACA. If you actually purchased coverage on an exchange, which is quite different from Medicaid, it is pure unadulterated hell to deal with. And chances are you are choosing not to see a doctor when you actually need care because it costs so much to do.

The whole logic of Obamacare was to end the practice of people going to the emergency room for standard health care. Guess what? If you go to the ER a decade into the Obamacare era, you still have a three-hour wait to get into a room. Be sure to tell them you have difficulty breathing and are in excruciating pain. It’s about the only thing that will help you see a doctor within five hours. If you don’t do that, you will be waiting behind sixty families who really only need antibiotics that have already learned how to game the system. I watched my husband sit for several hours with a needle lodged in his throat while doctors saw a parade of people who were there before us with colds and the like. The ER is still where a lot of people are getting care, even with a litany of subsidized programs.

Hospitals charge immense amounts for phantom care

But anyway, the point is to talk about why looking at health care from an insurer’s perspective is useless. Changing who the bills go to will not cure the system. In fact, having taxpayers absorb everything will probably make it much worse. Much like allowing college students to borrow virtually unlimited amounts of money from the federal government at subsidized interest rates jacked up the cost of college astronomically.

I am thoroughly convinced that Democrats have absolutely no idea what insurance of any kind is. I mean, they can’t explain how it functions as a financial instrument. They talk about it as if it’s a newspaper subscription instead of a risk pool that redistributes costs. There is an episode of the comedy show Superstore that offers an excellent parody of this mentality. The episode where the annoyingly idealistic and naive Jonah creates an employee health care fund for the store, only to discover that half the employees routinely milk the system and the risk associated with their health costs could not be reasonably divided among the employees even if they were all rich. I highly recommend hunting it down so you can appreciate exactly how stupid Obamacare is. And how Medicare for All is even worse. It is hilarious either one has made it past the thought experiment stage.

If you have ever had a loved one in the hospital, you understand that most hospitals are financial predators masquerading as charities. When my husband was in the hospital recently – to be monitored, which means he saw a doctor for five minutes a day, and even then we had to explain to the latest doctor on call what was going on – the hospital charged us … no kidding, here…. $1,000 per hour for the hospital stay. It was the most expensive daytime television our family had ever watched. To be monitored overnight for the first hospital he was at resulted in a bill for $24,000. The hospital did absolutely nothing to improve his situation during that time (in fact, they arguably made it worse). Over twenty thousand dollars to lay in a bed.

When our daughter was in the NICU after being born, the hospital charged us around $30 for every package of baby wipes she required. Each day, we watched the nurses open a package of baby wipes every time she needed to be changed, and then toss the package and remaining wipes in the trash afterwards. They were the same way with packages of gauze, and many other things. If we had known that we would be paying $30 a pop for something you could get for $1 at Walmart, we would have seen the whole episode differently. The charges from specialists were nothing compared to the overall cost of being hospitalized, which in the end was well over $1.5 million.

I have a friend who is in perfect health – perhaps too perfect health, because she injured her knee as a marathoner and had to have some ligaments fixed. For OUTPATIENT surgery, she was charged $75,000. She was in and out of the hospital in three hours, with a $75,000 bill. Did she get the world’s best knee surgery because she lives in the United States instead of Mexico? I doubt it. This is why medical tourism exists.

Now you can say, hey, at least you guys had insurance, so you aren’t eating the actual cost of those procedures. That is missing the point. The point is that the procedures are not actually worth that much money. The hospitals and pharmaceutical companies are gouging prices the same way colleges and universities are now gouging prices on tuition. Baby Boomers paid next to nothing for college and now an undergraduate degree alone costs a quarter of a million dollars – and arguably the product has decreased in practical value in the meantime. The only thing that changed was the perception of how much families should be willing to sacrifice financially for something that is pretty basic.

The federal government rewards hospitals and health care providers for antisocial behavior. They reward them with a tax exemption under the federal tax code. They reward them with grants and line-item appropriations. They reward them with bundled fees for entitlement programs. You go bankrupt, but these “nonprofits” get subsidized. They get subsidized so much that hospital administrators can buy all the hookers and blow they want for three lifetimes.

The problem is not private health insurance. The fact that private health insurers can turn any profits for their shareholders in this policy environment is insane. We live in an era where insurers are opting not to do business in regions altogether, and presidential candidates think they are Rockefellers.

If you want to fix health care, you need to start with the actual institutions that are providing care. Not the people who are pooling risk using financial technology that dates back to Ancient Greece and hasn’t changed one iota.

And for what it is worth, this same financially predatory behavior is being imitated by dentists nationwide too. You go see a dentist now and you are going to come away with a treatment plan that costs as much as a yacht even if your teeth are fine. If you are poor, you can go to some medieval joint in a strip mall where the patients can’t take out a home equity line of credit for Instagram-worthy smiles. Hospitals have gotten away with it for so long, they are joining in the great health care bubble.

2 thoughts on “Medical catastrophes are not stories about health insurance

  1. I’m grateful for the good health I’ve enjoyed so far. I’ve had a couple of injuries, but nothing catastrophic like your examples. I’ve been lucky. But I’m rolling the dice again later today. I’m having my right shoulder reconstructed in about seven hours. (Result of a bicycle accident.)
    We’ll figure out who pays what later.

    Liked by 1 person

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