How The Economics Of US Health Insurance Work Against Compliance With Preventive Care
Taking Our Medicine - The bad economics of switching health-care plans
By Ray Fisman. Slate.com
September 7, 2007
Payment For Preventive Care A Bad Bet For Health Insurance
The notion that significant improvement in treatment implementation is possible only if the interests of all healthcare stakeholders are aligned has been and continues to be AlignMap’s central and recurrent theme. Taking Our Medicine, the September 7, 2007 entry from The Dismal Science, the ongoing economics column at Slate.com, sounds a resonant leitmotiv.
An excerpt from the article indicates its basic premise - that the economic nature of the US health insurance system militates against funding of preventive care, which, in turn, negatively influences compliance with this important segment of treatment by insured patients.
In the long-simmering argument over what’s wrong with American health care, recent polls show that many people blame our market-based system of private health insurance. Private insurance companies are faulted for, among other things, failing to do enough to prevent disease. They have no incentive to do so, argue advocates for reform, ranging from Michael Moore in Sicko to some of the current presidential candidates. And yet if preventive measures today result in savings on treatment tomorrow, then what’s good medicine should also be good business.
Diabetes management is a case in point. If they get help early on in managing blood-sugar levels, diabetics can stave off later medical complications that may result in expensive hospital stays. Yet many of these preventive measures aren’t covered or encouraged by insurers. Instead, patients are forced to haggle over reimbursement for insulin pumps, and most are rationed only four test strips per day to monitor their blood sugar (sometimes enough, but often not). If better access to insulin pumps and blood-sugar monitoring will save money in the long run, why are insurers so miserly with their diabetes customers?
A recent study (not yet published) by researchers from Case Western Reserve and Carnegie Mellon University1 explains that the culprit in poor diabetes management—and the lack of preventive care in general—may be the very high rate at which Americans switch among insurance plans. It takes about a decade for insurers to recoup their investment in early diabetes treatment, and by then odds are that their customer has moved on to another health plan. Alas, a lot of this turnover may be built in to the way Americans get health insurance. And it’s the doing not of individual patients so much as their employers, who are always on the lookout to switch plans for lower-cost coverage.
The essay goes on to explicate the specifics of the employer-based health insurance system and suggest solutions to the problems of frequent switching between programs.
The situation described in this article is an excellent example of the systemic factors that must be brought into alignment if compliance is to be enhanced on a large scale.
This brief and clearly written examination of the implications of a health insurance system in which insurers cannot count on benefiting from long term coverage of the same individuals is well worth reading and can be found at Taking Our Medicine.
Footnotes
- A preliminary copy of the referenced study is available at Employer-Based Insurance Markets and Investments in Health [back]
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