What if you had supermarket insurance and 20% was the most you would pay for any item you bought? Would you be as choosy about what you buy as you are now? Would you care as much about price? If you didn’t care as much about price, would the supermarket have an incentive to keep prices down?
Today, most people still expect their employer to pay for their insurance. They see it as an “extra” benefit. In reality, in a state like Colorado the policy will cost the employer more than 2x what a similar individual/family health insurance plan will cost, just because they aren’t underwritten. I would rather have a bigger salary and go shop for my own health insurance with the extra money.
Employer sponsored health insurance plans usually have low copays and low deductibles. And a lot of people still prefer to stay away from plans that don’t have copays or have a high deductible. They think that “insured” means “free”. I recently read that it costs a health insurance company $35 – $50 to process a $25 claim. That’s just wasteful.
Don’t get me wrong, it’s very important to have health insurance. However, it should be designed as an actual “insurance” product so people don’t see it as getting free benefits. Having higher deductible plans, like health savings accounts (HSAs) are a start. People with these type of plans have more of an incentive to shop the market for a better deal.
If more people get these type of health insurance plans and start shopping for their healthcare like they shop for groceries, the prices will soon get a lot more competitive and customer service will get a lot better.