Health Insurance is a socialist institution. Everyone pays for everyone’s illnesses. Your insurance rate is set by the collective needs of everyone else under your plan. When the collective needs increase, so do your premiums. A Corporation manages this brand of socialism.
The difference between Corporate Socialism and Government Socialism is that the former has profit motivations. Normally, profit-mindfulness in a capitalist context can benefit both consumers and capitalists, but Health Care is a special case, because there are three hands in the pot.
Health Insurance acts as a mediator between Health Care Providers and Health Care Consumers. Thus three interests are placed in contention. The Consumer seeks low costs, while Insurance and Hospitals seek to maximize profits. One consumer is placed against two profit-seekers. The two profit seekers are then placed against one another in competition for the consumer’s payments.
Let’s begin illustrating this dilemma with the Consumer, who gets ill one day and must seek treatment. The Insured Consumer must contact their Insurance Company and search their directory of Health Care Providers. This list of Hospitals and Doctors within the Insurance Company’s Network is only one of many slights against Capitalism. In this case, one Corporation is acting to restrict the Consumer’s market access.
From the Health Care Provider’s perspective, failing to accept Insurance denies them an influx of patients. Patients come to the Hospital via Insurance Company referrals. Bills for service are evaluated by the Insurance Company, who then pays a discounted rate to the Provider in exchange for providing Consumers. In order to protect their profits, Hospitals artificially inflate their costs to compensate. Thus Capitalism is slighted again, as fair market value is distorted through regulating the flow of Consumers to the Product.
Thus the Insurance Company serves as a mediator between Consumers and Providers. They must collect maximum income from the Consumer and minimize costs from the Provider. Consumers ultimately pay more than fair market value in such a system and Providers ultimately earn less than fair market value. An entire market category has fallen into a situation where neither consumers or providers are happy, because a third party is regulating the market for gain.
There are two solutions to such an anti-capitalist system that I see at present:
One possibility is to remove the third hand from the pot. Hospitals could offer their own insurance to the local community. This would allow the Hospital to re-enter the capitalist marketplace and provide an overall lower cost benefit to consumers.
Another possibility is to remove the profit-motivation from the third party. The State (preferably) or Federal Government could provide a Voluntary system of Health Insurance. This would function almost exactly as Corporate Insurance, but without the profit taking. Participants would be like shareholders in the system, helping to determine Democratically what the system will cover and at what costs.
Neither system is ideal for consumers, but both uphold the principles of Democracy and Capitalism better than our currently Corporate Regulated system does. Health Care is a Macrosystem and any changes made to its regulation and oversight should include Providers and Consumers in the policy-making.