Value-Based news
Time for Value-Based Health Insurance?
September 24, 2009 | By Miranda Marquit
The “debate” about health care reform continues. But of a little more interest to me is an article I read earlier today on MarketWatch. This article, from Kristen Gerencher, describes one health insurance company that is gravitating toward what is known as “value-based” health insurance. And, quite frankly, this type of health insurance looks better than what we have now.
What we have now for health insurance
Right now, our health insurance is costly and largely inefficient. In any insurance system, the healthy are going to subsidize the unhealthy. That is just the way it is. But right now, we have a system that is costly largely because there are no real incentives to engage in healthy behaviors. In fact, Gerencher describes one of the main issues associated with the way insurance is currently administered:
…Health insurers’ tendency to pay attention to members only when they’re diagnosed with a costly chronic condition, as opposed to actively encouraging healthy people’s routine and preventive care. …
Some health insurers create the conditions where small-business clients can afford their coverage no more than two or three years, giving the insurer an excuse not to invest in members’ long-term health.
For all the costliness of our health insurance, we don’t even have the best health care system in the world. We rank #37. The fact that we pay more per person for health care than any other developed country, but that our health care isn’t even the best, is an indication that our current insurance system is horribly inefficient.
Value-based health insurance from a new company
Instead of relying on an insurance culture that basically encourages unhealthy behavior, the company SeeChange Health is looking to change things up a bit. The company claims that it will offer affordable health insurance, and adjust premiums and co-pays so that there are incentives to live healthier and get preventative care. The idea is that if people can use their insurance more easily to see doctors and get the care they need early on, they can avoid the costs that come with waiting until it becomes too late.
SeeChange will initially launch in California, and could spread elsewhere. This insurance company is a big reason why the idea of getting insurance across state lines is appearing even more attractive to me. I didn’t care at first at the idea of being able to better shop around, since nearly all insurance companies are the same. But this idea of value-based health insurance would definitely make a difference.
Taking care of your health can help you prevent some of the costliest diseases. Unfortunately, health insurance companies have not made this particularly easy. Perhaps SeeChange can provide us with a health insurance alternative that makes sense — and saves everyone money.
Source: http://www.bizzia.com/yieldingwealth/is-it-time-for-value-based-health-insurance/Tags
