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Private insurers are the biggest obstacle to guaranteed affordable health care

Written by Diane Archer

Although not all the Democratic presidential candidates support Medicare for All, most understand that giving people the choice of Medicare but allowing them to keep their private health insurance will not guarantee health care to all or make health care affordable. Only Medicare for All guarantees everyone affordable health care from the private doctors and hospitals they choose to use. Private health insurers are the biggest obstacle to guaranteed affordable health care.

Over at New York magazine, Josh Barro does not appear to appreciate that the problem with private insurers goes beyond the fact that they are for-profit and do not rein in provider rates or prescription drug prices. It’s that their business interests are at odds with the need of Americans for guaranteed affordable health care. 

Barro mistakenly believes that if we simply reined in provider rates through federal rate-setting, we could make health care affordable. Unfortunately, high provider rates are only one way that private insurers do not meet our needs. Insurers jeopardize our health care in a number of other ways.

Private health insurers drive up administrative costs to the tune of as much as $503 billion a year. These administrative costs contribute to both high provider rates and high premiums. With Medicare for All, these administrative costs largely disappear, and we generate enormous administrative savings.

Yet a third problem with for-profit private insurers is that they are in the business of avoiding risk. To survive financially, private insurers must compete to avoid people with costly conditions. Consequently, our commercial health care system is designed to fail the people who most rely on it.

Commercial health insurers cannot compete to meet the needs of people with complex conditions. If they did, they would attract too many people in poor health, their premiums would soar, and everyone who was healthy would flock to their competitors. They would go out of business. So, instead, they do their best to avoid enrolling people with costly conditions and to delay and deny care to their enrollees with complex conditions. 

A fourth problem with commercial health insurers is that they treat their data as proprietary. Most of their data is not available for public scrutiny. So, we cannot measure and report their performance, nor can we drive system improvements.

The fact that insurers do not appear to “manage care” in ways that serve the public good is a fifth problem. For example, wittingly or unwittingly they colluded with pharmaceutical companies to fill millions of opioid prescriptions. Even if unwittingly, the fact that they covered millions of opioid prescriptions without questioning people’s need for opioids vividly illustrates that they do not manage care appropriately or effectively.

Thankfully, virtually all Democratic presidential candidates seem to appreciate that for-profit insurers are at the heart of the problem with our health care system. Federal rate-setting alone cannot guarantee access to good affordable health care for all Americans. You need Medicare for All in order for the federal government to bring down exorbitant and irrational hospital and doctor rates, lower administrative costs, eliminate cost-sharing and give people access to the doctors and hospitals they want to use when and where they need to use them. 

If you support Medicare for all, please let Congress know. Sign this petition.

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  • Great article! As a physician I deal with pushback from insurance companies every day. Patient’s formulary changes and they can no longer afford the medication they’re taking, peer reviews needed after insurance denies a test a patient needs. Medicare for all would eliminate most of that and reduce the overhead costs of private insurance and let providers return to being providers of healthcare for our patients not bill collectors for private insurance. #NIM4A

  • Great article! As a physician I see patients every day who can’t afford their healthcare. Patient’s formulary changes and they have to switch medications, I have to do peer reviews after insurance denies tests, taking away from time spent in direct patient care. Medicare For All would eliminate some of these issues and let providers make decisions focusing on direct patient care instead of acting as bill collectors for private insurance companies. #NIM4A

  • Que!stion: Say a doctor’s office charges $300 for a visit. Medicare pays only $96, with United healthcare paying only an additional $12. Does the doctor’s office then claim the remaining unpaid balance as a loss on his income taxes? I am sick and tired of UnitedHealth, and others, charging a monthly premium almost twice the monthly premium as that of Medicare Part B and paying only pennies to the doctor. What a shameful, greedy country we are!

  • A friend went in for a mammogram and presented her high deductible insurance card. Using her insurance, the mammogram place charged @$300 of which the insurance company pays @$80 and she has to pay the other $220. Then she asked what it would cost if she didn’t use her insurance. Answer – $95. You do the math – It’s costing her way more to use her insurance. The numbers probably vary depending on your insurance and where you get you mammograms but it certainly pays to at least ask. Maybe the mammogram place justifies charges more because of all the insurance company paperwork but come on folks, they should at least tell her (and you) the various options.

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