Friday, December 25, 2009

Health Insurance

While working for Oracle consulting, Renee recommended me to my boss for some good work and I was sent to Banff Canada for few days along with 100s of other consultants from all over USA. It was a good trip. Our tour guide, who was employee of the hotel, said that hotel provides them free housing. But he did not accept the housing because if wanted to change the job, he has to look for housing first. It reminded me my desire to work for Godrej India Ltd in Mumbai, India. They too provide almost free housing but waiting list was huge and that discouraged me. If waiting list was not huge and I had taken job at Godrej then it is very much possible that I would have been working there happily or unhappily and never came to US.

Here in US, many companies provide health care and people are stuck with their employer because of it. I know one person, she wants to retire early but her husband has some medical condition and they can not buy health insurance, so she is unwillingly going to work everyday (but she is doing great job). I myself never cared about health insurance because my medical bills are less than the premium cost and Oracle provided great insurance. Now I am working as independent consultant and we have insurance through my wife's job. She works in a bank. They fire their employees often. She cares more about her health insurance then her salary although we can buy health insurance from open market for around 500 dollar per month. Cost of health insurance in open market (for us) is not much but we care about company provided health insurance.

I think if people buy their health insurance like housing, food, transportation, vacation, education etc from open market, people will be slightly better off. They will not have to worry about health insurance when changing their job or leaving their job and enjoying life at home for some time.

Imagine if companies provided food to their employees at minimal cost, what would happen? Some companies do provide food at minimal cost to their employees. Example Glaxo India Ltd. They did provide breakfast and lunch (dinner to night shift) to their employees at minimal cost but still some people brought their lunch from home. Food quality was probably the best but taste was not that good. I enjoyed their dinner but only because of lemon juice. It made swallowing food easier. Food cost was biggest driver (Rs 2.35 for Glaxo's dinner verses Rs.14.00 plus tip for outside dinner, I never cooked or even made tea at my room. I was living as paying guest in Mumbai, India)

I think if everybody buys their health insurance independently and claim their medical expense instead of doctor's office doing the claim work, it will reduce the medical cost to some extent.

I want one thing from doctors and hospitals: Whether I have insurance or not, charge me same amount. I noticed that doctors charge quite a lot if I have do not have insurance. For example, my wife needed some cortisone shots. Doctor's bill was around $2000.00 but insurance paid them only $798.00. I cannot understand this kind of discount to insurance companies. If doctors and hospitals were to get payments from patients then they will tailor their services based on general public's payment capacity. I hear on MPR that in Minnesota, you need permission to start a hospital. Reasoning is that more hospital will cause over capacity and hospitals will try to over sell their services. If I have good insurance than doctors or hospitals do not have any incentive to not sell unnecessary services. And as long as my premium does not change, I do not care much what doctor/hospital is charging. If people have to pay for medical services from their pocket first then they might think about it before receiving the service and ask right questions or will learn to do some research before receiving expensive services.

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