According to the Centers for Medicare and Medicaid Services, nearly 100 percent of large firms offer health insurance to their employees.8 Although much more likely to offer retiree health benefits than small firms, the percentage of large firms offering these benefits fell from 66 percent in 1988 to 34 percent in 2002.9 This follows the impact of global labor trends like outsourcing on the general cost of labor.
Patient satisfaction is generally lower than traditional plans and has often been viewed as a temporary solution to a system whose crisis is larger than such types of care can solve.
COBRA and Mandatory Continuation
Another problem with employer-paid health insurance is that terminated employees find themselves without insurance coverage, and if they acquired medical problems during their employment, an insurance company is likely not to issue them a personal plan because they are too high a risk.
This problem has led to government legislation that provides a way for people to continue coverage. Congress passed the Consolidated Omnibus Budget Reconciliation Act (COBRA) health benefit provisions in 1986. The law provides for continuation of group health coverage that otherwise might be terminated.10 This continuation period is 18 months, after which time a guaranteed conversion plan must be offered by the insurance company. However, these rates will be higher than market rates for healthy individuals in a comparable age group. Thus, people who need health care the most are less able to afford private insurance.
Health Savings Accounts
Another recent development has been a high-deductible insurance plan coupled with a tax-exempt health savings account. This was made possible by legislation passed in 2003 as an incentive to reduce overuse of medical care by having consumers directly pay for routine medical treatment and having insurance policies cover only major medical costs, for example those over $5,000. Consumers can deposit money into health savings account and deduct that amount from income they have to pay on income taxes. They can invest the money in the account, and if they do not use it, this account can grow. The cost of major medical insurance premiums plus the amount required to fund the deductible portion is generally less than premiums for total health coverage. These plans encourage more personal responsibility in health care than employer- or government-provided health insurance.
Health Insurance 2006 Census in the United States
According to the 2006 United States Census Bureau figures, approximately 85 percent of Americans have health insurance. Approximately 60 percent obtain health insurance through their place of employment or as individuals, and various government agencies provide health insurance to over 29 percent of Americans.11. In 2005, 46.6 million Americans (15.9 percent) were without health insurance for at least part of the year.12 One-third of these are people who are eligible for public health insurance programs but have not signed up for them. People living in the western and southern United States are more likely to be uninsured.13
The Future of Health Insurance
Health insurance is still a new and changing form of insurance. Two centuries ago, no one imagined the revolutionary advances in medicine and technology that would provide today's wide array of options for repairing injuries, curing diseases, and prolonging life. At the beginning of the twentieth century, only a few of the medical possibilities that exist today were available. Various forms of insurance, both private and social, were developed and seemed reasonable, but no one could have predicted the exponential increase in medical advances and expenses that followed, partly as a result of the increased money available for medical research and hospital purchase of medical technology. These plans also failed to account for human nature-how these plans would lead to increased consumer use and abuse.
The twentieth century provides lessons and boundaries for the future of health insurance. People want to be as healthy as possible, and if possible, they want other people to pay the cost. However, both the private plans that pushed payments onto employers and the socialist plans that expected governments to pay failed to continue to deliver the medical care that people wanted. After a century of experience, there are no major countries without some mixture of personal responsibility and social safety net. In countries where social insurance leads to rationing of medical care, those who can afford it seek to go outside the system and procure extra care that fits more with their expectations. In countries where not everyone can afford insurance, there is some effort to create social welfare programs to help those who would not otherwise get medical care. The wealthier the nation, the more this is possible. Because human beings have a social conscience, they want to see those in need cared for as much as reasonable.
Health savings accounts combined with high-deductible insurance are a new innovation that puts more responsibility for routine medical care on the consumer, while still providing protection against large, unforeseen medical expenses. These innovations might be part of the solution to the health crises that exist in many countries. However, unless issues of monopoly, conflict of interest, checks on power, and unnecessary government mandates in the medical sector are addressed, prices of health insurance will not be generally affordable for all individuals in a post-industrial society.
- ↑ Paul Starr, The Social Transformation of American Medicine: The Rise of a Sovereign Profession and the Making of a Vast Industry, pp. 237-239.
- ↑ Richard M. Ebling, National Health Insurance and the Welfare State, Part II. Freedom Daily, February 1994. Retrieved April 12, 2007.
- ↑ Ibid.
- ↑ John Goodman, "Five Myths of Socialized Medicine," Cato's Letter, Winter 2005. This newsletter does not explain the possible overuse of medical procedures based on social forces operating in the U.S. health care system.
- ↑ The History of Health Insurance in the United States. Retrieved January 26, 2007.
- ↑ Paul Starr, The Social Transformation of American Medicine: The Rise of a Sovereign Profession and the Making of a Vast Industry, p. 240.
- ↑ See California Insurance Code Section 106 (defining disability insurance). Retrieved April 12, 2007. In 2001, the California Legislature added subdivision (b), which defines "health insurance" as "an individual or group disability insurance policy that provides coverage for hospital, medical, or surgical benefits."
- ↑ //www.cms.hhs.gov/TheChartSeries/downloads/private_ins_chap4_p.pdf Centers for Medicare and Medicaid Services. Retrieved April 12, 2007.
- ↑ Ibid.
- ↑ FAQs About COBRA Continuation Health Coverage. U.S. Department of Labor. Retrieved February 1, 2007.
- ↑ Income, Poverty, and Health Insurance Coverage in the United States: 2005. U.S. Census Bureau. Issued August 2006. Retrieved April 12, 2007.
- ↑ Ibid.
- ↑ Ibid.
- Bodenheimer, Thomas S., and Kevin Grumbach. Understanding Health Policy. McGraw-Hill Medical, 2004. ISBN 0071423117
- Boni, John A., et. al. The Health Insurance Primer. HIAA Insurance Education, 2000. ISBN 1879143496
- Gratzer, David. The Cure: How Capitalism Can Save American Health Care. Encounter Books, 2006. ISBN 1594031533
- Starr, Paul. The Social Transformation of American Medicine. Basic Books, 1984. ISBN 0465079350
- Webster, Charles. National Health Service: A Political History. Oxford University Press, 2002. ISBN 019925110X
- Social security
- Social welfare
All links retrieved December 12, 2017.
- Burger, E. J., Jr., M. G. Field, and J. L. Twigg. From assurance to insurance in Russian health care: the problematic transition. American Journal of Public Health, 1998.
- Erlen, John. History of American Health Insurance.
- The Health Insurance Research Center. Frequently-asked Questions about Health Insurance.