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The Real Reason for the Health Insurance Mess

Jun 13, 2008
Why does health insurance cost so much in America? Obviously there are a variety of factors contributing to the ever escalating cost of insuring the average American. The first and foremost is the nature of the system. Health insurance companies, like all business entities, consider the bottom line first. Corporations are, above all, responsible to earn profits for their stockholders. If they can increase profits by raising prices, then they are obligated to do so. This is the nature of our system of capitalism.

While most Americans enjoy and appreciate our capitalist system, many believe that some things do not belong in that game. The most advanced countries have eliminated health-care from their list of entrepreneurial avenues. And whether or not you concur, or disagree, there is no doubt that profit is a contributing factor to the rising cost of health care.

The lack of uniformity is another contributor. Every state has its own set of rules. Every state has its own licensing regulations. In addition rates vary by the area in which you live and the geographic areas in which you wish to be covered.

The absence of preventative medical treatment is also a factor. Consider how many serious ailments might have been averted had they been discovered in the earliest phases. An increased availability of less expensive diagnostic and preventative treatments, could greatly reduce health care costs in America.

The continuously rising costs of health care in itself has led to the increase of health insurance premiums. New treatments, new discoveries, new tools and new regulations have all caused our basic health care ticket to rise dramatically, forcing insurers to increase rates accordingly.

Fraud, litigation, a degrading environment, improper diet, lifestyle choices, and stress are all factors leading to an increase in health care conditions and the rising costs.

We seem to be in an endless circle. The more effective and expensive a treatment, the more people will default on their payments, forcing an increase in the costs for those who are able to pay. As the costs of treatment increases, so does the cost to the insurer and thus the insurance premium. As insurance premiums increase, fewer people are able to afford coverage, resulting in more people defaulting on their medical payments, again leading to further increases in treatment and coverage, and so on and so on and so on.

While it's easy to exclusively blame the insurance carriers, it would be wrong, for they're just playing their part in the game. They're no worse than the officers of any successful corporation. No worse than the oil companies. It's the nature of the business, not the individual, that has them profiting from suffering. The agents, the general agents, the carriers, the re-insurers are all just doing their part, keeping the ball rolling. If the ball seems to be flat, don't blame those keeping it in play, repair the hole, or get a new ball.
About the Author
Jeff Wild is an independent health insurance agent and a representative of some of the highest rated insurers in the United States. His Web Site, Simple Health Coverage was created to educate, inform and connect you, the consumers with the best carriers, policies agents and choices in your geographic area.
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