I cannot speak for anyone else, but I can say there are people within my circle of friends who do not trust health insurance carriers. They don’t trust insurance companies of any kind, but health insurance carriers seem to be especially irksome. I am not surprised. There are lots of reasons people have negative opinions of insurance companies.
One such reason is illustrated by a breaking story out of California. According to Stat News, two Blue Cross Blue Shield companies in the Golden State have intentionally underreported premiums in order to avoid paying ACA taxes. Combined, the companies skirted more than $170 million in taxes between 2016 and 2020.
Blue Shield of California is accused of cheating the government out of $111 million. Anthem Blue Cross of California has apparently failed to pay some $60 million in taxes. The news came to light after whistleblowers filed complaints with the IRS.
Only in It for Themselves
I am no longer surprised when friends tell me they hate health insurance companies. I’m not surprised to hear friends complain that insurance carriers are only in it for themselves. That is what the evidence points to. Until some insurance carrier decides to prove otherwise, what else are consumers supposed to believe?
Health insurance premiums continue to rise faster than the rate of inflation. Meanwhile, carriers use every opportunity to cut reimbursements, increase copays, drop coverage for services, and so on.
It would be one thing if insurance carriers were struggling to pay their own bills. But that is not the case. Insurance company profits continue to soar into the billions of dollars while subscribers are left paying increasingly higher premiums and getting less coverage in return.
Self-Funding Is Gaining Traction
As far as individual consumers are concerned, there isn’t much they can do to curtail insurance company profiteering. On the other hand, there is something employers can do about it: drop conventional health insurance in favor of self-funding.
Self-funding is a way to help employees cover their healthcare costs without paying an insurance company for their overpriced services. As the name implies, self-funded plans are fully funded by employers through a combination of their contributions and employee payroll deductions.
An employer estimates its healthcare costs for the coming year, then sets up a funding plan based on that projection. They contribute so much, and employees cover the rest. Stop-loss insurance is usually purchased to protect against any financial losses in the event the employer underestimates its expenses.
Change Has To Be Forced
The unfortunate fact of the matter is that our current health insurance system is rigged to favor carriers, politicians, and a handful of others. It is not intended to benefit consumers. Therefore, nothing is going to change unless consumers force that change. The best way to do that is to encourage employers to drop insurance in favor of self-funding.
StarMed Benefits, a third-party health plan administrator (employers insurance) out of Las Vegas, says that self-funded plans come with a lot of built-in flexibility and customization. So much so that self-funding is an option for businesses of all sizes. From one employee to 1000, plans can be customized to individual workforce needs.
Employees get comparable coverage at a lower cost. They do not have to sacrifice a lot to save a lot. Meanwhile, employers have the opportunity to control their costs as well. They are not locked into a one-size-fits-all group insurance plan that fails to take into account their unique circumstances.
People do not trust health insurance carriers. One look at the news out of California explains why. Thank goodness the self-funding option exists.