Friday, October 18, 2013

Reflections On The Insurance Wars

I remember when I was 19 and spent my first Fourth of July away from our traditional family routine. Normally we'd stay at home, watch the "Twilight Zone" marathon on TV, barbecue, and let off fireworks in the alley behind our house or in the back yard. I don't think I ever left the house for a single Fourth of July in all the years leading up to 1993.

Needless to say, I thought everyone did what we did for the holiday. So imagine my shock when I was in my friend's car, driving to a spot to watch a fireworks display... and I saw rows and rows of people out on their front lawns, watching fireworks in the sky from nearby locations. It really blew my mind to realize that all these years the rest of the city participated in something that I had no clue about, due to the insular nature of my annual celebrations with the family.

So it is with health insurance. I've always known that people buy health insurance, but because I always got my insurance through my job I never really put two-and-two together: in a strange way, I kind of assumed that everyone got health insurance through their job, and that when you lost your job your only recourse was to pay into COBRA (which was never an alternative for someone such as myself, who has never been rich and could not see myself paying $200 to extend my benefits when I needed that money to survive if my search for a new job took longer than expected). Thanks to my solipsism, I never realized until recently how many people pay for health insurance outside of their profession.

This made me realize that, although I've been insured over the years through various employers, I actually belong in the demographic of people who have never had their own health plans. When I was unemployed for nearly two years, I didn't have any health insurance. My son was covered by Medi-Cal (back when we lived in California) and my wife had benefits through her job, but I had nothing. Zilch. Nada. If I'd had any of the maladies I am experiencing now (diabetes, sleep apnea) during that time, how screwed would I be?

There was once a time when I didn't pay car insurance either. Why? Because I didn't have a car... or a license. I didn't take my driver test until I was 19 (a lot happened to me that year) and even then I didn't own a car that worked until I was in my mid-twenties. So paying car insurance was something I never thought about. Now I take it for granted, but for a time it was a new world and things were different back then.

Living in the Midwest now, I pay about a third of what I used to pay in California. Of course, I have never owned or leased a new car, and I have a better driving record here than back home, but even when I was at my safest in the Golden State the lowest I ever paid for insurance was probably double what I pay now, which is less than $50 a month. I can definitely live with that. I am not a rich man, but I think even if I were homeless and living out of my car, paying $50 a month to insure my vehicle is a deal.

Of course, the new Affordable Care Act is not car insurance: for example, you can get away with being a scofflaw and not paying for car insurance (albeit for a limited time, and with much paranoia whenever you get behind the wheel) but apparently you get penalized for not paying into the health care system. However, I lived for a great deal of time in Los Angeles without a car, and therefore I didn't need to pay for insurance during that time. I can't see how I can do the same with health insurance-- it would be impossible, to say the least. Unless you're a zombie (and these days so many people aspire to be) it is a useless solution.

So I'm glad to pay into the mandate system, but I don't have to because my employer has me covered and their plan is not changing. It is nice to know, however, that if I lost my job I could now play Big Spender like all my richer-than-thou friends and actually buy my own plan if need be, and that it may be cheaper than paying into COBRA. I could even decide to go rogue and buy outside my job coverage, if I so desired. This is a luxury I never allowed myself nor thought possible. And when I say 'luxury' I mean it as it stands: some people have never had any health insurance ever, and trips to the ER were their version of affordable care.

I mean, the bottom line is this: we all know that ALL insurance is a big scam. But if I have to pay for insurance, at least it should cover me in case I get sick.

One last thing: recently I was trying to renew my car insurance but ran into some red tape because I had never filled out an exclusion form for my wife on my truck. She never drives it anyway, but the agent insisted I needed to fill it out in order to renew. He kept e-mailing it to me but I never received it. I found out on the last day of the month (and also the last day of my policy) that they were sending it to my old e-mail address. So I printed it, had her sign it, then sent it via e-mail to my agent, but on the first of the next month I called the agency and my policy had not been renewed.

Not wanting to drive even one day without being insured, I immediately found another agency and received a policy that was only a few dollars more than my last policy (and given that I had a speeding ticket last year, it made sense that my new policy would be slightly more expensive). Of course, this resulted in endless appeals from other insurers who wanted my business over the following three days. I appreciated the concern, but that's the price of doing business: you can only give your money to one company.

A week later, I received a letter from my old insurer. They had renewed my policy after all, and had my insurance card and everything ready to go. I had to politely decline because I didn't need two policies for the same truck, but it was amusing to me that they wanted my business that badly... and maybe they will get it, if they can beat the cost I'm paying right now.

I predict that this is how it will be one day with Obamacare: lots of competition, plenty of insurers vying for your business, falling over each other just to sign you up. This is not a bad thing-- you just have to give it time to work, something that government shutdowns and partisan politics will not permit.



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