Here in the US we enjoy the world’s most expensive socialized health care system. The system provides insurance through private, for profit, insurance companies where most people get insurance through their employer. Depending on the employer you can choose between a limited set of health care options. All these have one thing in common: they are expensive, complicated, confusing, annoying, and ultimately result in loss of productivity of the American worker. And that’s if you’re lucky to be employed and have health insurance at all!
I call our system “socialized” because we get socialized health care. The patient experience is one where your doctor sees you for mere minutes before they need to run off and see another patient. There is no personal relationship with your doctor whatsoever, unless while you remain healthy. Our pets, who all see private doctors, in contrast, have wonderful personal relationships with their veterinarians. Going to the vet is a completely different experience, where everyone knows our names and the names of our dog and cats, and the vet takes ample time examining the critters and discussing treatment options with us.
So, here’s a short story of dealing with our system. Is this a story of hardship, life and death, financial ruin? No, sorry. Fortunately the family is healthy and we’re financially stable. This is a story of for-profit companies choosing the most rational path: denying health care, therefore maximizing profits. It’s a story of ridiculous bureaucracy that results in overhead costs that aren’t spent on the actual care. One of the compelling reasons to adopt a single payer system was to vastly simplify administrative procedures, therefore reducing much of the overhead. But we’re not going there. Even after Obama’s Health Care reform, the current system remains in place. In this story you see our dysfunctional system at work.
A Change of Employer
It all started in the end of 2008 when I switched to a new employer. The first thing you do when you join a new place is pick the Health Care option that’s best for you. It’s typically about which doctors you need to keep seeing. Our family has been going to the Palo Alto Medical Foundation (PAMF) for years, and all I had to do was pick the plan that had a deal with that clinic so that my current doctors would be “in network”. There was only one choice: Guardian’s PPO, subcontracted to Interplan.
The first time you go to see your doctor after such a change, you’re asked to see the administration and give them the new insurance information. In my case the information was pretty simple. Guardian sent me a card containing my name, my employer, our group plan number and finally my own member ID. I passed on this information to PAMF and forgot about this altogether.
Claims and their Paper Trail
When you go see the doctor you are charged your co-payment, which can vary depending on your plan. Then the health care provider bills your insurance company for the services provided. If all goes well, the insurance company accepts the claim, pays the health care provider and you’re done. You receive a statement from the insurance company explaining what happened (the instance, the amount billed, the amount covered) and you also receive a statement from the provider showing how much the insurance has paid and asking you to pay for the rest, if insurance did not cover you fully.
The statement from the health care provider is pretty simple. The one from the insurance company is incomprehensible. Typically it’s accompanied by “codes” that indicate the reason something was not covered. The amount covered also can depend on various factors, including deductibles, and percentage of coverage based on an idealized expected total for the given procedure. The point of this is that it’s non trivial to figure out what these statements are saying and it’s non trivial to understand exactly what your health plan provided.
In 2009 I had to see a doctor for something. After a while I got a bill from the provider for about 100 dollars. I thought that was a bit strange, but assumed there was a small deductible in the plan and just paid it. That month I was probably too busy to look into it as I was doing the bills and the amount was not significant enough to trigger alarms.
This happened a couple of more times, and I paid again. Then I got a bill for $800. That one caught my attention. What was going on? Was the health care plan covering anything at all? Strangely, I noticed I had not received any statements from the insurance company. I assumed PAMF had misplaced the data I gave them on my first visit and called them to find out. Nope. They had all the data and we painstakingly double checked it all. It all matched. And yet, the insurance company claimed that my “identity cannot be verified”. That is, they had my name, employer name, group plan and member id and somehow this was not enough to match the claim to my person. Mission accomplished. Claim denied, more profits this quarter. Continue reading →