Statement: Contemporary corporate and institutional healthcare plans in the United States work against free market forces and subsidize poor health in America.
Hypothesis: Large risk pools associated with corporations and institutions remove the financial consequences of risky behaviors that lead to poor health, higher healthcare demand, and higher healthcare cost.
Free Market Healthcare Facts:
- Less demand for healthcare will lower healthcare costs.
- Living healthier lifestyles and reducing behavioral health risks will lower healthcare costs.
- Healthy and responsible Americans can buy health insurance at a lower rate than large risks pools (this is the exception rather than the norm).
- Purchasers are more frugal when paying for goods or services out of their own wallet.
Observations:
- Twenty-seven percent (27%) of Americans are obese in addition to thirty-six percent (36%) that are overweight, which leaves only thirty-seven percent (37%) that are neither overweight nor obese.
- Small businesses, the self-employed, and individuals normally pay more for health insurance than larger risk pools, in part because they must bear the free market forces on an individual basis. These free market forces reflect personal health risks and personal financial risks. When two persons have the same health risks, the person with a poor credit history will pay more than the person with a better credit rating. When two people have the same credit rating, the person with better health (lower health risk) pays less.
- Corporate and institutional employees pay the same rate for health insurance, regardless of the risks associated with their lifestyles choices, current health condition or credit rating.
- When health expenses are managed by a third party, the system is more likely to be abused or mismanaged.
- U.S. healthcare spending as a portion of the GDP is almost four times greater in 2009 than 1969.
Proposal to Restore the Free Market: U.S. corporations and institutions are urged to stop subsidizing behavior health risks. Health insurance costs of individual employees should be rated according individual risk. Corporation should make statistics on the spectrum of employee healthcare costs visible to officers and shareholders, and to make personal healthcare cost benefits visible to employees in comparison to overall employee trends. Corporations and institutions should hold employees financially accountable for their health performance/costs, rather than subsidizing unhealthy behaviors of irresponsible employees. This proposal may be implemented in with various methods. The goal is to ensure employees bear the burden of their behavioral health risks. This will create more personal responsibility in living a healthy life style and thereby reduce healthcare costs.
God Save the U.S.A.
References and Recommended Reading:
CDC Behavioral Risk Factor Surveillance System
National Health Insurance—A Brief History of Reform Efforts in the U.S.
The Pharmaceutical Industry in Figures
National Health Expenditure Projections 2008-2018
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