By Wayne Persky |
RSS Feed Traditionally, insurance companies have been viewed as a way for individuals to prevent financial ruin, due to an unanticipated property loss, or an unforeseen liability issue, or an unexpectedly large medical bill. But in the healthcare field, for many patients, insurance companies have become the elephant in the room; with the power to dictate whether the outcome of a medical treatment will be life, or death, in some cases. A growing body of evidence suggests that insurance companies wield far too much control over healthcare decisions, often to the detriment of patients. From delaying necessary treatments, to denying coverage, the question arises, “Should insurance companies be controlling our healthcare?”
Insurance company practices reveal an attitude of bad faith.
A critical issue at the forefront of this debate is the phenomenon of bad faith insurance practices. Research published on sokolovelaw.com sheds light on how some insurance companies engage in bad faith tactics, such as denying valid claims, delaying payments, or offering unreasonably low settlements (Sokolove Law Team, 2023, August 17).1 These practices not only harm patients financially but also impede their access to timely and necessary medical care. When profit margins take precedence over patient well-being, the very essence of healthcare is compromised.
Prior authorization requirement delays needed treatments.
One of the most pervasive ways insurance companies exert control is through prior authorization requirements. A report by the American Medical Association (AMA) highlights how the red tape associated with prior authorization can significantly delay patient care (Robeznieks, 2018, March 30).2 Physicians are often forced to navigate a labyrinth of bureaucratic hurdles, seeking approval for treatments or medications deemed essential for their patients' health. Such delays can have serious consequences, exacerbating health conditions, and compromising patient outcomes.
Why has this happened?
The evolution of health insurance from a protector of patients to a profit-seeking enterprise is explored in an article on stanmed.stanford.edu (Rosenthal, 2017, May 19).3 Originally conceived to limit the financial risks of illness, insurance has increasingly become a tool for maximizing profits. This shift in focus has led to practices that prioritize cost-cutting measures over patient needs. As insurance companies strive to boost their bottom line, patients find themselves caught in a system that prioritizes financial gain over their well-being.
Hospitals and clinics must negotiate insurance reimbursement rates.
And these annually renegotiated rates obviously affect patient care, because if an agreement can't be reached, then the hospital or clinic is classified as "out-of-that insurance company's network". When a hospital, clinic, or doctor is "out of network", the cost of healthcare for a patient is almost always significantly higher. Consequently, a patient in this situation either pays much more for their healthcare, or their choice of doctors, hospitals, or clinics is restricted.
And another possible negative aspect of these negotiations is that if a hospital or clinic agrees to reimbursement rates that are inadequate for their needs, it can negatively affect their quality of care. But in either case, it's the patient who suffers the greatest loss.
And another possible negative aspect of these negotiations is that if a hospital or clinic agrees to reimbursement rates that are inadequate for their needs, it can negatively affect their quality of care. But in either case, it's the patient who suffers the greatest loss.
As insurance companies continue to usurp more control over our healthcare, the quality of our healthcare continues to decline.
The detrimental impact of insurance barriers on patient care is vividly illustrated in an opinion article on usnews.com (Pollack, 2023, August 8).4 From delayed treatments to outright denials of coverage, patients face numerous obstacles when navigating the healthcare system. Obstacles that have no place in healthcare settings, have become rather commonplace. Insurance company policies, driven by profit motives, create barriers that hinder access to timely and appropriate care. As a result, patients are left to contend with the consequences, both physical and financial, of inadequate (and overpriced) healthcare coverage.
Patients are suffering, and some are dying, because of insurance rules.
A New York Times article poignantly portrays the human toll of insurance company control over healthcare in a recent article (Hamby, 2024, April 7).5 Individuals faced with exorbitant medical bills and bureaucratic hurdles underscores the stark reality of a system in crisis. Prior authorization requirements, in particular, are singled out as a major source of frustration for patients and healthcare providers alike. The arbitrary nature of these requirements often stands in the way of patients receiving the care they desperately need.
What's the take away message from all this?
The argument in favor of insurance companies controlling our healthcare has no merit. Over the years, insurance has evolved from a system designed to protect patients needing healthcare from financial hardship, to a money pit that tends to punish patients by interfering with their ability to receive timely healthcare more often than it provides benefits for their healthcare. Whether it be bad faith practices, or onerous prior authorization requirements, insurance company policies tend to prioritize profits over patients.
Why aren't these unscrupulous practices being properly regulated? It's painfully obvious that the insurance industry has watched the pharmaceutical companies get rich by gouging U.S. patients for many years, and they've learned their lessons well. And the best part (from the viewpoint of the pharmaceutical and insurance industries) is that all this is taking place with the apparent blessings of the U.S. government, and its regulatory agencies.
Why aren't these unscrupulous practices being properly regulated? It's painfully obvious that the insurance industry has watched the pharmaceutical companies get rich by gouging U.S. patients for many years, and they've learned their lessons well. And the best part (from the viewpoint of the pharmaceutical and insurance industries) is that all this is taking place with the apparent blessings of the U.S. government, and its regulatory agencies.
References
1. Sokolove Law Team. (2023, August 17). Why Are Insurance Companies Telling Doctors How to Practice Medicine? Sokolove Law, Retrieved from https://www.sokolovelaw.com/blog/bad-faith-insurance-problem/
2. Robeznieks, A. (2018, March 30). How insurance companies’ red tape can delay patient care. American Medical Association (AMA), Retrieved from https://www.ama-assn.org/practice-management/prior-authorization/how-insurance-companies-red-tape-can-delay-patient-care
3. Rosenthal, E. (2017, May 19). Insurance Policy: How an industry shifted from protecting patients to seeking profit. Stanford Medicine Magazine, Retrieved from https://stanmed.stanford.edu/how-health-insurance-changed-from-protecting-patients-to-seeking-profit/
4. Pollack, R. (2023, August 8). Health Insurance Barriers Delay, Disrupt and Deny Patient Care. U.S. News & World Report, Retrieved from https://www.usnews.com/opinion/articles/2023-08-08/health-insurance-barriers-delay-disrupt-and-deny-patient-care
5. Hamby, C. (2024, April 7). Insurers Reap Hidden Fees by Slashing Payments. You May Get the Bill. The New York Times, Retrieved from https://www.nytimes.com/2024/04/07/us/health-insurance-medical-bills.html?campaign_id=9&emc=edit_nn_20240407&instance_id=119539&nl=the-morning®i_id=219091490&segment_id=162819&te=1&user_id=5dfc16e8efb91fe67ecbf1b4eda4a654
