Health Insurance Woes- Five ways they screw us over and how to fight back
"I have had a couple of Medical PPO Insurance Companies over the Years. Our large Aerospace Company recently switched our Healthcare Coverage over to Anthem Blue Cross Blue Shield (was United Healthcare previously). All last Year I have had nothing but problems with Anthem Blue Cross Blue Shield. Takes forever to process claims, and they keep denying valid, complete Medical Claims in Error. This company/organization is completely incompetent. On top of this, I am paying $499. a month for this shabby service. My advice... Run as fast as you can from Anthem Blue Cross Blue Shield." Anthem one star review on Consumer Affairs website.
"We had to switch health insurance because my husband switched jobs, unfortunately United Health Care is the only option his employer offers. This is the most we paid for an insurance, but the worst coverage we've had ever despite opting for their best plan. They deny prescriptions we've been taking for years, they deny crucial claims... Their staff is not knowledgeable, and trying to get any answers is an absolute nightmare. Beware, stay away if you can. If you're dealing with any medical conditions, they will make it worse and much harder to deal with. It's beyond my understanding how they are in business to begin with. SHAME ON YOU UNITED HEALTHCARE." United Healthcare one star review on Consumer Affairs.
"What a terrible group of non-humans. They paid for my diabetes meds since April 2023 and now, out of the blue with no denial letter, warning or explanation, they just decided to stop paying for it. Also, I had a neck injury in April. They wanted me to do Physical Therapy before they approved an MRI, then refused to cover the therapy. Then they denied the MRI saying it wasn't medically necessary." Cigna one-star review on Consumer Affairs.
What is going on here???? When I google reviews of the top three healthcare companies, this is the type of thing I see. Lots of one star reviews with similar denial of service and customer service complaints. People who are upset with a service are more likely to post online than those who are happy. But the stories that some of these reviews tell are heartbreaking and disturbing, especially in a country that supposedly has the best healthcare in the world.
Health insurance is probably the most expensive and impactful of all insurance types that we sign up for. People are insuring their very bodies with eventual life or death consequences. Plans can cost $5,000 to $10,000 per person and they typically require deductibles to be met before they pay for many services. And before the Affordable Care Act, it was even worse. They used to be able to exclude any type of pre-existing condition, which covers almost everybody over the age of 40. Now they are required to cover any and all medically recognized conditions, but they are increasingly sneaky about how to avoid paying for it.
The insurance equation is an elaborate game where the large insurers collect premiums and then try to limit services as best as they can without being fined by the states or losing customers. There is very little incentive for them to try to keep you healthy, because the nature of the industry is that you will eventually switch insurers anyway, so it's to their benefit to pay only for the most dire medical emergencies and deny anything else they can get away with. Here are some of their most clever techniques, and how you can avoid them.
1- Confusion from the start. The entire process is made confusing on purpose. Even trying to sign up for insurance is hard to understand. There are terms like deductible, HMO, PPO, in-network, co-pay, and more that the average person doesn't truly understand. They pick what their friends or family have, or they stick with employer insurance, or whoever has the most appealing marketing materials.
Plans will supply you with a network of providers- but here's the catch- a lot of those providers have moved, are out of business, or aren't accepting new patients. So you have to wade through the list and make many phone calls to find someone that you can work with. And if your current provider doesn't take your new insurance- tough luck.
Perhaps the worst part of the confusion from the start is the confusing nature of healthcare in general. Because these companies don't particularly care about their clients, very little preventative care is recommended or suggested. Preventative care at a young age can save thousands of dollars in claims down the road. People who are obese, pre-diabetic, have family histories of cancer or other serious diseases, or have untreated mental health issues are discouraged from seeking help because of the high deductibles that accompany most plans today.
How to fight back: there are no easy fixes here. People must educate themselves (or find someone else who is knowledgeable) about health insurance tricks and go into the process prepared for what the insurance companies put out there. Only by knowing the ins and outs of the process can they make intelligent decisions amongst many bad options.
2- Make it hard to get help. Reaching someone that can help you in an insurance company is almost as hard as contacting the IRS. Phone lines are frequently busy. Online access in mostly one way- they tell you what they cover and you can't dispute anything. Customer service is a double cost for insurance companies- they have to pay the people who answer the phone calls, and they have to pay out more money if their people help clients get services that should be covered by their plans. Making it hard to get through saves money, and more and more companies are relying on artificial intelligence programs to handle consumer questions on the cheap.
How to fight back: expect delays and work around them. Try the 800 number if you like, and perhaps you will get lucky to get a good answer. Use the online access to see Explanations of Benefits and to follow. But the key is to be persistent and vary your contacts- chat, email, phone calls until you are satisfied with the answers. You also can't always take their word for anything, so check what they tell you with online sources, your doctor's office, or others who have have dealt with that company.
3- Deny claims, even if they are legitimate. Denied claims are a serious problem for those who have limited money and urgent medical issues. So far there have been few consequences for companies that routinely deny valid claims. They know that because of the confusion from the first two steps, a large portion of those valid claims will never be appealed or paid. They can make up reasons and nothing happens to them, except that they get more profit from the money that doesn't go out.
Pro Publica did a study in 2023 that showed one of the giants, Cigna, was relying on algorithms instead of doctors to determine if services were medically necessary or not. According to the report, doctors signed off on the denials, thousands at a time, without ever once looking at the patient files. They relied on the algorithm, instead.
A recent KFF study showed that on average, 17% of claims with in-network doctors were denied in 2021 for a variety of reasons, and less than 1% of those denials were successfully appealed.
It goes without saying that claims that are borderline or invalid are also denied. A lot of experimental and alternative medical care falls into borderline areas that actually prevent disease and save lives, but that's a topic for another time. This is where the first trick comes into play. When customers are confused, they will obtain services that are specifically excluded in their insurance agreement. Too bad for them.
How to fight back: appeal, appeal, appeal. Most people don't appeal smaller denials, often because the companies make it complicated. But since so many denials are done by computers and not humans, it makes sense to appeal every single denial, unless you know for a fact that it was a prohibited service. Appeals may require your doctor to get involved, and they may take months to process, but every time the companies get away with bogus denials incentivizes them to do it even more.
4- Force consumers to pay the deductible first. Deductibles for employer plans have almost doubled in the past decade, meaning that the first $2,000 or so of medical expenses, even if approved and in-network, still must be paid by the customer. On the Healthcare.gov exchange, the most affordable bronze plans have deductibles as high as $10,000! Deductibles are an insidious insurance gimmick, popular in both home and car insurance. Having a deductible is almost like having no insurance at all. Add that cost to the price of the premium, and you have the truly out of pocket cost for healthcare. All a high deductible plan helps you with is for major injuries or illnesses. Routine things only add to the deductible that is never met in most cases.
How to fight back: look for low deductible plans. Low deductible plans are generally more expensive, so it takes a bit of math to see if the extra premium payments are worth it. Just be aware that those deductibles prevent any payments going out for actual healthcare beyond the required preventative stuff.
5- Opaque pricing. Pricing for medical services are almost impossible to find before getting treated. Even worse, there is a "list price" for certain procedures that is purely fictional and ridiculously high. Insurance companies negotiate with providers in their network, and then adjust the prices down to an agreed upon more normal amount. Thus customers see the explanation of benefits that shows a $2,000 price tag reduced to $500 and think, "wow, my insurance saved me so much money!" There is little of value here, especially if the insurance company still doesn't pay anything. They are fooling people that insurance is working for them when it really isn't. The provider is still making plenty of money with the $500 price tag.
How to fight back- educate yourself on the true cost of most procedures. The tragedy here is that those without insurance are forced to pay these ridiculously inflated "list prices" if they get sick or injured. Because they are so outrageous, hospitals may write them down if people ask them to, but this is one reason medical debt is so out of control.
There are so many things that are wrong about how we handle health insurance in this country. We pay more per capita on medical care than any other country, and yet have mediocre results at best and dropping life expectancies. Health insurance and medical care should be a natural human right and not a profit center. Most industrialized countries have some sort of socialized medicine, but not the US (with the exception of Medicaid, Medicare, and the VA). Most of those countries also allow private insurance for the wealthy, but in our country only the wealthy can count on basic care.
The incentives of private industry incentivize profit at all times. Insurance companies make the most money when they deny care and get away with it. Customers put up with it because they don't have much choice- as you can see from the quotes at the top, all of the companies are equally bad and profit-driven, so switching doesn't do any good.
Health insurance companies aren't evil, but all the incentives point them to outcomes that hurt their customers. Until that changes, we will have to play under their rules and fight back every chance we get. But we all deserve better, and hopefully the next generation will improve things.