Smile Politely

Where is it all going to end?

Healthcare as a hot button issue isn’t going away soon, especially as all of our coverage continues to weaken as our costs go up. We’ve all seen this debacle played out on a grand scale locally as the state of Illinois awarded its latest health insurance contracts. It’s been pretty shady on all levels.

To briefly catch you up, Illinois excluded Humana and Health Alliance after their bids were not competitive enough. Health Alliance is the local carrier that predominantly deals with Carle, the primary providers of healthcare in Champaign. Since University of Illinois workers get their care through the state, this means a lot of people’s coverage would immediately change. There was an immediate uproar because the HMO contracts were awarded to Blue Cross/Blue Shield, who does not currently have any deals in place with local hospitals, meaning locals would have to travel far and wide to get in-network care. There were immediate cries of a rigged bidding process and the state government has borne the brunt of complaints. Local legislators pushed through a bill that would change the bidding process, but the governor will not sign it. And a judge recently halted the planned changeover.

Interestingly enough, many people have used this occasion to ramble on about how this somehow is a sign that we’re all doomed because of “Obamacare” or national health insurance or Mitt Romney. I am not surprised to see this kind of opinion, but it’s still pretty disheartening that people can be so far off the mark.  

Just to clarify, the biggest concern people have regarding Obamacare is the individual mandate, which would require everyone to buy insurance from private providers. Relating that issue to the state changing its health insurance plans requires quite a few logical leaps. More to the point, the real issue at play is our system of tying health insurance to employment. This same situation happens all the time with smaller employers when they choose to change providers, though the scale and impact is often different. The state is not acting all that differently than any other employer would. The main difference is that most employers can change insurance coverage without having to worry about legislators intervening or judges shutting the process down and requiring it to be re-evaluated. But the end result is almost always the same for the consumer: higher costs and less options for care.

Having lived in Canada and worked on healthcare policy there, I know firsthand that a national health insurance plan would ensure that everyone had coverage equally with only one provider. This would solve all of the issues state employees currently face, because they would not need to worry about whether their employer provided an HMO. You see, if we had healthcare like they do in Canada, you would get to choose whichever doctor you want and go to your doctor without threat that your employer will suddenly decide to change providers. Everyone has open access and you pay no co-pay. You wouldn’t have to worry about HMO vs. Open Access and you wouldn’t have to root for a local business with a monopoly over a much bigger monopoly. Canadian healthcare is not perfect, and I’m not here to tell you that it is. But it is a hell of a lot better (and cheaper per capita and as a percentage of GDP) than what we have here. Though I’m not really allowed to say such things, right?

If you read any local coverage of the state’s healthcare plan, you’re repeatedly reminded how Carle, and especially Health Alliance, are the victims in all of this and the corrupt state is up to its same old tricks. It’s the same old let’s-all-blame-Chicago refrain. Unfortunately, reality is much more complicated. Carle owns Health Alliance. It is not in Carle’s interest to make it easy to access their services with a different provider, and they are not going to go out of their way to make it any easier for their current patients out of the goodness of their hearts. Health Alliance is in a situation locally where they pretty much get to set their own terms because they are dealing with themselves. Carle is the second-largest employer in the county and happens to have a little local political clout, so I can’t say I’m too shocked that they’ve managed to rally those of all political stripes to their side. And they’re not exactly going out of their way to mention PersonalCare still offers coverage at Carle with continuity of care that’s still a relatively reasonably priced plan.

Let me be clear: Carle has excellent doctors and very good people work there. And I have met many great people who work for Health Alliance. This is not an issue about any of their employees or their efforts to maintain their contracts. A very real result of this plan going through could be a lot of people at Health Alliance losing their jobs.

If it were my decision, I would favor Health Alliance getting the contracts because I’m a huge fan of local development and, economically, we’re much better off keeping health insurance dollars in town. But it’s silly to pretend that Health Alliance automatically put in the best bid. How can we expect a competitive bidding process in a market like C-U, where the largest provider just happens to own the largest insurer? Many have argued that the state shouldn’t have awarded these contracts because Blue Cross/Blue Shield didn’t have contracts in place with Carle or other local providers. But I can imagine no scenario where Carle would work with Blue Cross/Blue Shield at the expense of their own company’s coverage to have contracts in place to make Blue Cross’s eligible for the state’s plan in advance. This thing is rigged on so many levels.

The state’s bidding system is probably flawed. There definitely seem to be some weird things going on there. I’m not going out of my way to defend their choice of Blue Cross/Blue Shield for the HMO. I have little doubt that existing relationships were massaged. But if we put the blame squarely on the state in this bidding process, we ignore the bigger issue — tying insurance to employment makes employees virtual slaves to the decisions of their employers and often forces them to make employment decisions based solely on health insurance. Take the case of Cynthia Voelkl, local blogger extraordinaire, who was basically forced to get a job at the U of I to have access to health insurance and is indefinitely tied to that job because of her husband’s healthcare needs. From all accounts she currently has a very good job that she enjoys, but I think it’s fair to say she can count herself as one of the lucky ones. (See my full interview with Cynthia here.)

Cynthia is much more forgiving of Carle and Health Alliance than I am because she has a long, established relationship with them. You should trust that she knows what she’s talking about, since she’s interacted with them on so many different levels. But one thing that stands out to me from the interview is when Cynthia explains that her fight is not with Health Alliance or Blue Cross/Blue Shield because she realizes they are just businesses trying to make money. So even a woman who has gone to the state capital to defend her right to maintain Health Alliance realizes that their secondary interest is to provide great care.

And it is incredibly obvious that money is more important than good coverage for Health Alliance (or any insurance company). For example, here’s what Health Alliance CEO Jeff Ingrum told the News-Gazette about the implementation of healthcare reform’s individual mandate in 2014:

The largest effect on premium rates can be expected to come after 2014, when everybody will be required to buy health insurance and insurers such as Health Alliance will not be allowed to weed out higher-risk customers to keep their costs lower, Ingrum said.

We live in a world where it’s completely acceptable to refer to sick people who desperately need healthcare as higher-risk customers who need to be weeded out. I have no doubt that Ingrum doesn’t think that way about his neighbor or his family, and he’s probably a very nice person to the people he cares about. But once he starts talking about a larger pool of people, it’s okay to stop talking about human beings and start emphasizing risk. In other words, Health Alliance will be in trouble because they’ll have to service the people that need health insurance the most. Anecdotally, I have heard that the they really stick it to the users in their current individual market plans. And I can guarantee that Cynthia’s husband Ernie would count as high-risk if he didn’t already have coverage through Cynthia’s work. This is where we currently stand in America, and it makes me very sad.

Ingrum might be making a good argument for Health Alliance, but he’s making a poor argument against costs for the rest of us. We all end up paying for these high-risk customers anyway. Even if Health Alliance doesn’t cover them, most of the uninsured will get emergency services at Carle and won’t be able to pay their bills. And that gets passed on to all of us when we pay for our services and our insurance premiums.

Until we stop looking at each other through the lens of dollar signs, we will continue to play this same game. I have no doubt the current local healthcare mess will work itself out. Even if the bidding process stays the same, everyone knows that Carle will need to start working with Blue Cross/Blue Shield, and we’ll have a local HMO soon enough. It’s not in Carle’s long-term financial interest to lose out on the largest pool of customers in the county. And local people will still be able to get pretty good local coverage through PersonalCare. Or if Health Alliance gets to maintain its very enviable deal with University of Illinois workers, then a lot of very hard-working people in this town will get the deal they want and many others will get to keep their job.

But soon enough, something else will come along with a different large employer and we will play the game over again. We’ll continue to pretend that it’s possible to have a competitive market that provides ideal coverage for those of us lucky enough to have employment. But we all know it doesn’t. People who have access to even the worst type of health insurance appear to be a lot happier and seem to have better health outcomes. This means that they will probably cost us less in the long run.

Honestly, how many times do we have to keep hearing that the competitive market is the best answer for healthcare (or would work better if we just got rid of all the pesky regulations)? Capitalism works well for cars and booze, but I’m done pretending it has the magic answer to everything human beings deal with in modern society. The sooner we realize that pure consumerism is not a cure-all elixir, the sooner we can start living more productive and healthier lives. Obviously, this is a very long way off. But I hope it happens sooner rather than later, because our dogmatic adherence to the nonexistent “invisible hand” of the healthcare market means we all keep getting choked.

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