Restructure the Health Insurance business to more closely resemble the property, theft and casualty insurance business. Health insurance should be for the big stuff, not our runny noses and annual physicals. It should be like car insurance. Each policy would be customized for the individual or family purchasing it. We get to choose how big our deductible will be, how much co-insurance there will be, how much we're willing spend out of pocket, etc. Our premiums will reflect the choices we have made.
We do not expect our auto insurance company to pay for our gas, or our repair bills. We expect them to cover us if we’re in an accident. And only then, if the damage is great. It’s usually cheaper to pay for the lesser damages yourself, without involving the insurance company, because reporting it drives our rates up. Why then do we expect health insurance companies to pay for our ordinary, routine medical expenses? And why are we surprised when our premiums keep going up?
Up until the 80s, when HMOs sprang up and seduced us with the $5 co-pay, we paid for our own regular doctor's visits. Health insurance was for catastrophic medical issues - NOT your annual GYN checkup. . I'd been paying around $35 for an office call. For a single working mother of 1, this was affordable, but barely. A $5 co-pay with an HMO was too good to pass up. I didn't see a downside My primary care doc was even in the network! This sounded good and I signed up, like millions of others over the next few years. Traditional health insurance had to change or die, so they had to go with their own networks and ridiculously low co-pays. Once they did that, they separated the product (health care) from the consumer (us). When the consumer is no longer constrained (by price, OTBE), he will consume as much as he can. Increased consumption (demand) = higher prices.
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