the insurance side of health insurance
A lot of people have written that health insurance isn’t really insurance, and that we don’t think of it as insurance. And they’re right! How health insurance works and how we think of it really is quite different from how most other forms of insurance work.
There is one way in which health insurance works like other kinds, though, and it’s important: every customer pays for the tangible benefit of a few. If everyone who had fire insurance actually had a fire, there would be no fire insurance industry. You couldn’t make enough money. Instead, everyone who has insurance pays in, and only a few have a fire, and then part of everyone’s premiums go to the few. Not everyone who has auto insurance has an accident, but everyone who does pays for those who do– because they might end up one of the few.
Heath insurance is a little different. Very few people go for long without getting some kind of compensation for their contributions to health insurance. But, again, most people pay in more than they take back out; if that wasn’t the case, there would be no health insurance industry. Couldn’t be. We pay in, or should, understanding that we may end up paying far more than we will get back out, because in the event of catastrophic illness or injury we need comprehensive coverage. This, incidentally, is what is so utterly criminal and disgusting about the conduct of health insurance companies that seek to ditch patients because they get sick or wiggle out of covering major expenses. That’s what everyone who pays for health insurance is paying for. (It would be constructive if some of those opposed to reform were more upfront about how incredibly poorly behaved many insurance companies and HMOs in this country have been.)
I point this out merely to say that as much as there are benefits to viewing health care in more conventional consumerist terms, particularly when it comes to cost reduction, there are limits to thinking about shopping for health care like you’re shopping for groceries. Part of health care access has to be an actual kind of insurance, payment for catastrophic expenses. That can only come from pooled resources, which doesn’t have an analog in a simple consumerist vision. It may offend some people’s individualist sensibilities, but part of covering health care is and will continue to be sharing expenses for the benefit of a few.