By: Ron E. Peck

One of my favorite sayings is, “a penny wise and a pound foolish.”  Too often, people and organizations are too quick to act on a short-term desire and fail to contemplate the long-term impact.

Consider, as an example, COVID-19 and the vaccines.   When the vaccines were first made available to the public, there was a desire to get as many people vaccinated as quickly as possible.  Unfortunately, many entities in control of general communication disseminated messaging that suggested the vaccine “prevents” people from contracting COVID-19.  While it was true that is seriously reduced the likelihood that you would actually contract the disease, it certainly wasn’t a guarantee.  Furthermore, we didn’t have adequate statistics to show us with certainty how effective the vaccine would be at preventing people from actually contracting COVID-19… not to mention mutations (known and unknown, present and not-yet-developed). 

A false promise was publicly made, giving people a generally untrue belief that the vaccine would prevent them from contracting the disease, giving people a false sense of invincibility.  Now, as breakthrough cases are popping up (mostly due to the Delta variant and its ability to sneak past the vaccine), those who opposed the vaccine are pointing at this as proof that the vaccine doesn’t work at all… that the promises of immunity were lies, and that the vaccines have no value at all; providing ammunition for their anti-vaccination campaign.

If those with the ability to communicate had been more honest, transparent, and accurate, this wouldn’t be an issue.  In truth, the vaccine’s value has always been less about guaranteeing that every vaccinated individual would not contract the disease, and more about reducing the total number of people contracting the disease, slowing the spread, and reducing the likelihood of serious illness or death.  Had the messaging always been that – Yes, if you get vaccinated you may still get sick… but you are less likely to get sick, and much less likely to die – then anti-vaccination advocates wouldn’t have past misrepresentations upon which to hang their hats.

The issue is that in our haste to promote the vaccine and get as many people vaccinated as possible, those who advocated for vaccinations over-promised inaccurate suggestions that eventually were used against them.

As with the vaccines, so too with health insurance and benefit plans.  Years ago, our industry (and employers in general), in their haste to create a system that boxed-out the plan members, created an infrastructure with no patient involvement.  Networks were expanded to include as many providers as possible; reducing or eliminating the need to have patients be selective when searching for care.  Assignment of benefits became the status quo; eliminating the patient from the exchange between payor and payee … meaning the actual consumer has no concept of the actual cost of the care they are purchasing, guaranteeing that they would not care about the cost and thus allow prices to inflate astronomically.  In an effort to “protect” participants from the “business” side of insurance, and broaden options and coverage as much as possible… we ensured that people would be confused and misinformed when it comes to health insurance and health care.

Skip a few decades later, and people mistakenly think their premiums are sucked into a black hole, whose only purpose is to generate profit for some fat cat CEO.  Meanwhile, the insurance companies have magic trees that grow money… Money that has no association or affiliation with the insureds.  Thus, it should be an easy thing to “force” these insurance companies to pay for things like expensive but ineffective medications, and balance bills.

The issue?  Insurance is a fiction.  In most cases, and especially in the case of self-funded plans, benefit plans are the participants, and participants are the plans.  When we demand that the benefit plan pay for something, we are demanding that the participants pay for that thing.  The magic tree that grows money is the participants, and their contributions to the plan.

In our effort to separate participants from the reality of insurance – what it is, how it works, and whose money is used to pay medical bills – we ensured that decades later, the general public would not understand how or why their calls to have “insurance” pay more is, in fact, self-destructive.

Honesty and transparency are best policies.  The time has come to explain in terms everyone can understand what insurance is, and what it is not.  It is a profit making, privatized tax.  Everyone contributes, pools their money, and that pool of money is then used to pay covered expenses.  When the expenses increase, the amount of money we need to pull from the contributors increases.  The only way to reduce how much contributors need to contribute, is to reduce the expenses.  Asking insurance to pay more, in an effort to have those contributors pay less, is a contradiction.  Frankly, we can’t be annoyed when people don’t understand this basic concept if – as is the case here, and in so many other places – we were a penny wise and a pound foolish.