A Tangled Web: The Cruelty of For-Profit Health Insurance "Five sites for open source healthcare" by opensourceway is licensed with CC BY-SA 2.0. To view a copy of this license, visit https://creativecommons.org/licenses/by-sa/2.0/

A Tangled Web: The Cruelty of For-Profit Health Insurance

The coronavirus pandemic has exposed the weaknesses and dysfunction plaguing multiple realms of American politics: the lack of a social safety net, no guaranteed paid sick leave for workers, and, most notably, the patchiness and unreliability of health insurance coverage. Recently, the New York Times published a report illustrating wildly different prices of the same COVID-19 test at an Austin, Texas emergency room. Within the last two years, NPR’s Bill of the Month series has exposed the exorbitant costs of surprise medical bills and the cloudiness behind the reasoning (most of these bills are forgiven or significantly reduced after NPR has begun an investigation). While it is respectable to question the reasoning behind the opaqueness of medical billing and extortion-level pricing, such outlets—whether intentionally or not—have a tendency to gloss over one glaring factor: this is how the system is supposed to operate.  

The biggest myth Americans have concerning for-profit health insurance is that it provides health care. Doctors, nurses, technicians, physician assistants, and pharmacists are the people who provide this service. Health insurance provides access. It is the middleman who opens or closes the gate to a treatment, test, or doctor’s appointment. When arguing against a single-payer health care system that would essentially eliminate this middleman, politicians and policy wonks state the variety of health care plans give Americans “choice,” praising capitalism and market efficiency as a means of solving this intractable issue. This freedom is more or less nonexistent since the vast majority of Americans receive health insurance through their employer. Even when one could choose a plan through these means, one is usually forced to choose between a handful of options, and wading through those options can be daunting given the jargon and fine print. This confusion extends to people who currently have a plan, with a 2013 study indicating most Americans cannot correctly summarize the cost-sharing details of their health insurance.  

These complex aspects of insurance plans, however, are a feature, not a bug. Unlike car insurance or homeowner’s insurance, people need health care to survive, and health insurance  companies exploit this in a variety ways in an effort to squeeze more pennies from consumers: coding certain health care providers as “in-network” and “out-of-network”; using terminology and acronyms (e.g., coinsurance, health maintenance organization (HMO), preferred provider  organization (PPO), health savings account (HSA), high deductible health plan (HDHP), exclusive provider organization (EPO) plan, point-of-service plan, out-of-pocket maximum, cost sharing reduction) to obfuscate coverage; and “metal level” tiers to highlight a plan’s so-called prestige. The excitement from these seemingly enticing plans fades once one realizes the hospital  down the street is out-of-network and the closest in-network hospital is a half-hour drive away; or the hospital one went to is in-network but the doctor performing the emergency surgery is out of-network, forcing one to negotiate a large hospital bill, which depending on the flexibility and generosity of the hospital and insurer may or may not be forgiven; or one’s insurance arbitrarily decides to not cover a certain lifesaving treatment, forcing one to crowdfund the treatment via GoFundMe (one-third of the website’s campaigns center on paying medical bills). 

These facets also present a cruelty unique to the United States. The presence of labor unions has plummeted since the 1980s, making the workplace an ever-more precarious environment for disempowered workers. Human resources departments have largely absorbed the place of unions, who, instead of representing workers’ interests and safety, protect the company and management. Given this scenario, employees are lucky to have a voice when it comes to the quality and distribution of health insurance and other benefits. In spite of creating a façade of supporting  employee well-being, HR is quick to silence any whisper of organizing and remind workers they could be dismissed at will and with no warning. Since insurance is primarily tied to employment, Americans are more apt to stay at an unfulfilling job and remain silent about an abusive boss or colleague. Such a trap may also extend to one’s personal life: if one receives insurance through their spouse, one may think twice before deciding to end a marriage. A twenty-sixth birthday can be a death sentence for young people with Type 1 diabetes.  

Exacerbating the issue is the fact that these insurance plans treat health as if it were static: open enrollment only happens once a year for most individuals, and if one’s health declines after this  period ends, they may be left physically and financially vulnerable for months to come if they opted for a more affordable plan. This does not just apply to middle-age or older folks; young, healthy adults and children are susceptible to misfortune. Catastrophic accidents happen even if one lives a low-risk lifestyle. Several common yet debilitating diseases such as epilepsy and Crohn’s develop regardless if one exercises and eats right. Most cancers arise due to chance and genetics, and cancers with overall excellent prognoses still require biopsies, surgeries, therapies,  and follow-up visits, which accrue costs over time. For women, trans men, and nonbinary folks, pregnancy can translate to hefty bills, especially if there are complications (and if there are no complications, it can be difficult to ascertain how much giving birth will cost ahead of time). Since the health care system is laissez-faire, the responsibility falls squarely on the consumer; if an individual receives a surprise bill, it is their problem since they should have done the research before receiving treatment at such-and-such hospital, or they should have negotiated a lower price while “shopping” for a doctor. The tangled web of bureaucracy and uncertainty of what these services may cost—even if one has “good” insurance—prevents many from seeing a doctor at the first sign of alarm. This already had a devastating effect before the pandemic, but has since created a maelstrom due to mass unemployment. COVID-19 has further exposed racial and class divides, with Latinx, Indigenous, and Black communities having hospitalization rates 4 to 5 times higher than white communities. For African Americans, the statistics are the bleakest: mortality rates are 1.5 to 2.3 times higher than other racial groups. In the nation’s capital, the mortality rate is 6 times higher compared to whites. A for-profit health care system that forces one to rely on employment and wealth as a means of receiving care only amplifies inequality in a  country with a lengthy history of racism and union-busting.  

Despite the fact this opaqueness is the leading cause of personal bankruptcy, these health insurance companies are allowed to operate with virtual impunity because it is nearly impossible to hold them accountable. Citizens in democratic countries with single-payer health care systems, such as Canada and the United Kingdom, can indirectly vote out health ministers by voting for an opposing political party. Citizens cannot oust a CEO. What is jarring about U.S. health care is it is enmeshed within government, providing a pipeline between Washington, D.C. and the for-profit health care industry. Politicians and presidential cabinet secretaries on both sides of the aisle are eager to cater to these corporations, with many having formerly worked in the industry (e.g., Senator Rick Scott from Florida is the former CEO of Columbia/HCA, a for-profit operator of hospitals; current Secretary of Health and Human Services, Alex Azar, is the former president of the U.S. division of Eli Lilly, a major pharmaceutical company most known for its manufacturing of multiple forms of insulin) or making a beeline once a new administration steps in (e.g., since 2018, President Obama’s Secretary of Health and Human Services, Sylvia Mathews Burwell, has served on the boards of GuideWell Mutual Holding Corporation and Florida Blue, an arm of the Blue Cross Blue Shield Association). In April of last year, health care lobbyists rubbed elbows with congressional staff, hosting aides at a posh spa in exchange for hearing discussions aimed at defeating progressive health care legislation.  

Some moderate Democrats and Republicans propose hybrid systems, allowing for a mixture of public and private insurance. While such programs may work in other countries with universal health care systems, it is natural to remain skeptical if it could work in the United States given the health care industry’s greed, corruption, and discrimination. The most popular proposal backed by Bernie Sanders, Alexandria Ocasio-Cortez, and other progressives is Medicare for All. While a misnomer since a large chunk of the government-run Medicare is privatized, Medicare for All would provide health services—surgeries, appointments, treatments, dental care, et cetera —free at the point of care, regardless of one’s age, employment status, and ability to pay. This  single-payer proposal is similar to health care programs in the Canadian provinces and United  Kingdom, two countries whose health care systems rank above the United States in performance. While these provincial systems and the National Health Service are by no means perfect, they send a clear message: health care is a necessity and one’s job status and bank account are not a measure of one’s worthiness to receive care. In spite of conservative-leaning politicians and think tanks promising the market’s ability to solve the system’s woes, America continues to underperform. If the United States wants to improve the health and well-being of its citizens, the first step is to stamp out the greed and profiting off of misery. In a discipline which swears to do no harm, people must come first.