A Cautionary Tale About Relying Solely on Health Insurance for Your Health

Health insurance is often seen as a safety net, but it’s important to understand its limitations. Here’s a closer look at why relying solely on health insurance for your health care can be problematic and what you can do about it.

Health Insurance vs. Good Health Care

Health insurance companies prioritize profits, which can conflict with providing the best health care. Their primary goal is to maximize profits for their shareholders, often by denying or limiting coverage for necessary treatments. This creates a significant issue: how can patients receive the best possible care when their insurance is designed to minimize payouts?

Health Care as a Right

Unlike material goods, health care is a necessity. Everyone deserves the best possible health care, regardless of their ability to pay. When it comes to health, even minor deviations from the norm can severely impact a person’s quality of life. Imagine a world where only a few can afford a cure for a common illness while others suffer needlessly. This scenario highlights the inequity in our current health care system.

The Free Market and Health Care

In a free market, the price of goods and services is determined by supply and demand. However, health care is not a typical market good. It’s an inelastic necessity, meaning that demand doesn’t decrease as prices increase. This allows pharmaceutical companies to charge exorbitant prices for life-saving medications, leading to medical bankruptcies and unequal access to care. This is why health insurance companies’ business model is fundamentally incompatible with good health care.

Physicians’ Dilemma

Doctors are legally and morally obligated to prioritize their patients’ health, yet they must navigate the constraints imposed by insurance companies. Physicians often have to choose between the best possible treatment and what the patient’s insurance will cover. This can result in suboptimal care and frustration for both doctors and patients.

Real-World Examples

Consider anticoagulants like Apixiban versus Warfarin. Apixiban is more convenient as it doesn’t require regular blood work, unlike Warfarin. However, it is more expensive and may not be covered by insurance. Similarly, for type 2 diabetes, Metformin combined with Ozempic offers superior health outcomes compared to Metformin alone, but the high cost of Ozempic (over $1,000 per month) makes it inaccessible for many.

Insurance Denials and Tactics

Insurance companies often deny coverage for the best, most modern treatments. For instance, GLP-1 agonists like semaglutide are highly effective for type 2 diabetes but are usually only covered under stringent conditions. Even when patients meet these criteria, insurance can revoke coverage if their health improves, leading to a cycle of health deterioration. Insurance may revoke a treatment that was previously approved and worked well.

Other tactics insurance companies use are prior authorizations and denials by technicalities. Prior authorization is when a medical doctor has to justify in writing or via telephone why a patient must have this medicine and why there is no alternative. Denial by technicality is when the physician makes an insignificant clerical error or omission that does not make any real change in a medical document but can cause a claim denial. Such claim denials are often reversible, but they cause a delay in patient care and occasionally require a physician to spend 40 minutes on a phone call justifying the medical necessity. Both situations may put a physician off from prescribing the better medicine because it is too much work and causes a personal waste of time, which may lead to financial loss since another patient may have been seen during the time it took to complete the phone call.

What Can Patients Do?

Patients can explore alternative options when insurance falls short. Purchasing medications from Canadian sources or traveling to countries like Mexico can offer significant savings. While these options still involve out-of-pocket costs, they can be more affordable than U.S. prices.

Conclusion

Relying solely on health insurance for your health care is fraught with challenges. Understanding these limitations can help you navigate the system more effectively. Be proactive, research alternatives, and manage your expectations. Health insurance should be seen as a backup, not the sole solution, for maintaining your health.

For more insights on managing health care costs and alternative solutions, visit our blog and explore our telehealth services.