Is health care "free" if insurance pays for it? A response to Rand Rover

Great Debates
1

In this thread, Rand Rover says the following:

. . . mainly in response (I think) to my comment that if my grandmother were to go home from the hospital she’d have to pay out-of-pocket for drugs that her insurance pays for when she’s an inpatient, and that the choice to go home and not be racking up bills for inpatient care will actually mean that she has to pay much more per day, while costing the system less.

I have a few points to make in response to Rand Rover:

[ul]
[li]First, this is stupid from a business standpoint. Staying in the hospital costs money. The system should encourage people who are able to go home. Making returning home a financial burden on the consumer means they are much more likely to stay in the hospital longer, thus costing the insurance company more money (yet making money for the hospital . . . I’m sure that in some cases those two entities work at cross-purposes).[/li]
[li]Second, she is getting nothing for free, and frankly I find the fact that you’re ascribing those words to my perspective indicative of nothing more than your own personal bias about government funded anything. The complaint is about bizarre-seeming restrictions about what her insurance is and is not willing to cover. When my insurance (well, I don’t have any, but if I did) pays for drugs or medical care, I’m not getting it for free, I have paid for that care. That’s what my premiums are. And the whole reason why insurance works, for the rich and the poor, is that some people pay more than the ultimate cost of their medical care so that others can receive more than they put into it. People who get out more than they put in are not getting something for ‘free,’ they’re buying into a system that allows for people of all financial walks of life to afford expensive treatment. [/ul][/li]
So, I’m not upset that my grandmother isn’t getting something for free. What I am upset about is that in this particular instance the system seems set up to encourage her to spend more money for care that she doesn’t need, by transferring the cost of a portion of that care directly to the patient if she chooses to go home.

You seem to have twisted it into an argument I wasn’t making, about . . . I don’t know what about. That I think she should get to do whatever she wants or something, because that’s what’s fair?

Nothing in this world is free; it all costs someone something, even if it’s just time, or energy, or other intangibles. My post was not in any way an argument for totally socialized medicine, though you maybe want to treat it that way, but even that is not ‘free’, and putting that word into other people’s mouths dirties the debate. Socialized medicine is paid for through taxes, which is a cost that may or may not be worth it, but no one is arguing for ‘free’ anything.

2

My apologies for messing up the list tags. If a mod wants to fix it, I wouldn’t hold it against them! :slight_smile:

3

Insurance is just a way to spread the costs. In this case the word “free” means that you are taking more out of the system then you put into it.

If you put in $1,000/year and take out $1,200 you’ve gotten $200 worth of services you didn’t pay for.

If you put in $1,000/year and you take out $800, you’ve lost $200 worth of services.

The “peace of mind” of knowing you would’ve been covered, had you needed it, is what the $200 of unused services is “charged to”

Actuaries are used by insurance to come up with formulas so that no one takes out too much more than they put in and vice versa.

If you stay in the hospital when you don’t need to you are overpaying. These overpayments are applied to people who actually need to stay but haven’t put in a full amount yet, or to pay off profits and salaries and other administrative costs.

It sounds shady but it’s just the way it is.

I think the OP main gripe is with the defintion of “free” rather than any other thing

4

This is a strange way to define “free.” As you acknowledge in the rest of your post, you are paying for the cost of risk spreading.

5

I wonder if RR considers winnings from a casino “free.” Insurance is somewhat of a gamble, made attractive because of the spreading of risk. When someone pays into Medicare or any other insurance policy, it is with the realization that they might get little back (either from dying quickly or being healthy,) or perhaps a lot back.

I can just see RR going up to the grieving widow of the young man and telling her about how she got “free” money from his life insurance.

6

By “free” in that post I meant “without cost to the person receiving the services,” (i.e., your grandma). Does this clear everything up?

Hope your grandma gets better, by the way.

7

I suppose we have to assume your grandmother never worked, paid for insurance at work, never bought a health insurance policy and never paid premiums.

8

But it’s not without cost. Paying premiums is the fee for particular services.

Let’s say I get insurance, and start paying $400 a month for coverage. Two months down the road I have to go to the hospital and the bills end up totaling $10,000. I did not receive $9,600 dollars worth of free care. I paid for my care per the terms of my contract with the insurance company. What it costs them is immaterial. They agreed to pay my bills at the fee of $400 a month. I might have gotten a good deal, but I’ve still payed for it.
And, incidentally, thanks for the warm thoughts. I didn’t take your original comment in any negative way in that regard, I just felt like this point was worth of further discussion somewhere other than MPSIMS.

9

No health care is free. It uses resources, people and buildings. The question is which is the most humane and efficient way of delivering it. Our system is one of the worst. It has the greatest waste, largest cost and gives relatively poor care. It does not cover many citizens and poorly covers many more. Almost every citizen has paid taxes for their adult lives. They have had deductions from their checks . They have paid. Claiming they demand free health care is retarded.
If you don’t get coverage at work, you have to buy your own. It is extremely expensive and the coverage sucks. Plus you get the sport of fighting with your carrier who has an interest in making profit off you. They will make money by continually raising rates, cutting coverage, and denying coverage that they are contracted to pay for.
Our system is flat out broken, unsustainable and morally and ethically wrong.