It seems that everyone has an opinion regarding what should be done to reform our health care system. Most people believe that changes to our current system need to be made, but not quickly and not by politicians. The costs must come down, but not by rationing, government price controls or higher taxes.
Depending on whom you listen to, 85 percent of us have health insurance that we are satisfied with; it just costs too much. The rest includes the folks who are eligible for Medicaid or the State Children’s Health Insurance Program and haven’t enrolled; illegal immigrants; those who can obtain insurance and choose not to; and about 5 million or 6 million people who have no other option. For the people with no other option — a small minority of the nation’s total population of more than 300 million — the president and many in his party are advocating the wholesale takeover of one-sixth of our entire national economy.
The president tells us if we like what we have we can keep it, but the bills floating around D.C. tell a different story. The insurance companies are the bad guys — everybody knows that, right? They just need a little friendly competition from a government-run option. If you fact-check each of the examples of insurance company abuses the president cited in his speech to Congress, you begin to get the idea that Rep. Joe Wilson (R-S.C.) had the right idea.
Then the president trots out insurance statistics from more than 30 years ago to try and prove that Medicare has much lower overhead because it is much more efficient and isn’t paying exorbitant CEO salaries. Medicare spends less on administration because it pays all claims, including the fraudulent ones, and doesn’t manage much of anything. The government runs Medicare so efficiently, it will soon be bankrupt.
Health insurance in New Jersey costs so much in part due to state mandates that require everything under the sun to be covered by the policies you can buy in New Jersey. You can’t buy a policy without all the mandates even if you want to.
Think of it as if the state Legislature were to mandate that your car insurance was required to cover oil changes, tires, fan belts, wiper blades and exhaust systems. We are all being forced to pay higher premiums to cover a host of things that most of us will never need. Amazingly, the politicians create the problem and then blame it on the greedy insurance companies and specialist physicians.
New Jersey’s tort liability system is ranked second to worst in the nation, according to the 2008 study released by the nonpartisan Pacific Research Institute, which specializes in health care policy. New Jersey tort laws are a travesty that adds significantly to health care costs through high malpractice insurance premiums and all those unnecessary tests we hear about due to physicians practicing defensive medicine. Limits on punitive damages would be a good place to start, but don’t hold your breath.
Things will change, but neither the president nor pundits know how or when. Meanwhile, we’re stuck with the employer-based system we’ve got. Recently, the cost of health insurance in New Jersey has been rising more rapidly. New state and federal mandates, the economy and uncertainty over “Obamacare” are among the factors driving up costs.
Employers should explore all options before resorting to dropping coverage. Although more complicated than an HMO or point-of-service plan, high-deductible health plans combined with health reimbursement arrangements and/or health savings accounts can mean significant savings.
These plans cause employees to be more engaged and to begin to understand what health care services really cost. HRA/HSA utilization data can help even smaller employers to create wellness and incentive programs to further reduce costs.
The majority of New Jersey employers have yet to embrace these cost-reducing options, and yet Congress even wants to restrict HSAs. Bias, preconceived notions, misinformation and insufficient ability to accurately predict costs have caused many employers, and their employees, to continue to pay more than necessary.