A Lesson in Health Care Costs from The Biggest Loser

When I watch “The Biggest Loser” I am always struck by how great the contestants feel even after losing just a little bit of weight. By eating more healthily, getting more active, and caring about their health, they start noticing tangible benefits almost immediately. Many speak of going off medications and controlling dangerous health conditions, like high blood pressure. You can really see the quality of life improvement after they have been voted off, and they report how much weight they have lost at home.

This brings me to health care costs. I am thankful that I have health care, don’t get me wrong. However, I admit this issue gets me a little testy, because our insurance rates go up at a rate much higher than the rate of inflation every year. Personally, I am tired of increased health care costs eating into my raises, because like all people, I could use that extra raise money. Right now, for family health insurance, between me and my employer, we pay over $1,000 a month. I can’t believe it. I get upset because my wife and I go out of our way to make good and healthy choices, and visit the doctor only when necessary, and we are paying for those who couldn’t care less about it. I know how insurance works, and I know that it is about a group taking on risk, so I know I have to be in a pool with other people. However, why not provide financial incentives for those who are healthy and don’t use the system that much? I would take a $1000 rebate at the end of the year because I am within my weight range, or because I only went to the doctor twice, etc. Why not set up a system of rebates based on healthy choices? I know a lot of people who would suddenly care about their weight and health if they knew an extra grand was in it for them at the end of the year. And I am not saying anybody should be forced to be healthy. You don’t want to get healthy? That is your choice, but, as common sense dictates, you will be responsible for taking on the cost of your increased risk to the group. Obviously, the companies should not penalize things out of a person’s control, e.g. a congenital condition, but some rather large risk factors are within a person’s choice. I don’t think this is unfair, but it does get rid of the “free ride” mentality that many currently have related to health insurance.

Right now, the way most insurance is set up, it incentivizes bad behavior, because you might as well use all you can get because you’re paying anyway. The “throw money” at health insurance approach, whether government sponsored or through private insurance companies, isn’t working. Let’s use “The Biggest Loser” as an example. When people get healthy, they find that they don’t need to take as much medication, and their risk of suffering from expensive, chronic, diseases drops. Just imagine if half the people in your insurance group made changes like they do on “the Biggest Loser.” Even the initial drop in prescription drug costs would be tremendous. You may even see a rare decrease in rates! Now imagine if half the overweight people in the United States made a similar move. It wouldn’t fix our health care costs, but it would certainly help.

Some Thoughts on the Health Care Crisis

This was originally posted on my old blog in 2007, but I think it is still relevant:

Whole Foods Market has instituted a revolutionary insurance policy for their employees, involving a health savings account, with a high deductible for certain preventable conditions. However, the company contributes money to the Health Savings Accounts of their employees, which can be used for medical expenses that are not covered until the deductible is paid off. This means that (gasp) employees actually have the ability (and the responsibility, if they want to keep some of their money) to shop for better – and cheaper – medical care. In fact, it also means that an employee might think twice before going to the emergency room for a sore throat, when seeing the doctor the next day would save him a couple hundred dollars. It also might make an employee ask a doctor why he is prescribing antibiotics for a viral infection, when they do no good and just add to the cost of the visit. In other words, such a plan may actually help consumers and companies save money, because the consumer saves money by being frugal about health care.

One problem with health insurance in America is that most Americans forget what health insurance actually is. It is designed as a way to spread out risk from serious illness or injury among many people. In other words, you pay a small(!) amount each month in the event that you get seriously ill or injured, you will be covered. It is not meant to be an all-access pass to free health care. However, I can’t help but think most Americans view it this latter way. One perfect example is the way over-protecting and hysterical parents freak-out over any minor illness in a child. If little Johnny has a slight fever, the reasoning is that it is better to get him to a doctor and be safe than sorry (costing the employee about $30 in co-pay, and the insurance company about $100-150). While I can sympathize with such concern for a child, how did most of us ever manage to grow up and survive into adulthood without such over-protection?? In times past, common sense, a little rest, chicken soup, and some time, likely would have easily healed Johnny, yet if his fever got around 103 or 104, then the doctor would have been called, and insurance used. Now, imagine my figure of $130 per event like this, and multiply it by the number of Americans that actually take this overprotective attitude about health care, and you can see why health care costs are out of control. Insurance is not free. My dental plan covers 100% preventative care, and sometimes when I am getting ready for an appointment, I use the word free…and trust me (as my school and I see every paycheck) it is not free.

This day and age, it seems many people go to the doctor for just about anything, whether serious or not, and insurance allows them to get away with it. Also, there is no incentive to shop around for cheaper and better quality care when everything is seen as “free” because of insurance. So you may very well be overpaying an incompetent doctor, but because of insurance, you won’t know it, and because your costs generally remain the same regardless, nobody cares. I guarantee that if I had to pay out-of-pocket for a doctor’s visit, and if my employer gave me a couple hundred dollars a year towards this, I would shop around for the best deal (price coupled with quality), just like I would whenever I use my hard-earned money in the real world. For example, if my insurer said, “you currently pay $4,000 a year in insurance, and if at the end of the year, you have used less than $2,000 of it, we will give you $500 back,” you bet I would make wise decisions to save that money, although if I needed to spend it on health care because of catastrophe, I would. Can you see my point here, how our current system doesn’t really provide us with incentives to save money on health care?

One thing we should all remember, and teach our kids, is that insurance isn’t “free” by any means. When I was a single male paying for my own insurance, I was paying 120 dollars a month (up from 85 the year before), which translates to $1440 per year. This amount went up every year. Now, I pay about 1000 dollars a year, and my job pays about 3,000 per year. “Free” care indeed! [Now that I am married, my school and I pay around 10,000 combined for insurance]

I admit I don’t care for big medicine very much. I have great respect for doctors, but I don’t like the idea of taking prescription drugs. Part of this is because they have so many side effects. It is estimated that adverse reactions to prescriptions killed 106,000 people in 1998 alone! In fact, there are 783,936 annual deaths due to conventional medicine mistakes! Compare that to dietary supplements, which while not free of side effects, have claimed only 230 lives from 1983-2004, averaging out to about 11 deaths per year. For some reason, politicians jump all over the supplement regulation bandwagon when one person dies from using an herb or vitamin, but why don’t we see more regulation of prescription drugs? I am not arguing for more regulation of drugs, but what is good for the inexpensive goose (supplements) should be good for the pricey gander (prescription drugs). So yes, I am suspicious of prescription drugs, and thus less willing to seek them out, let alone pay for them. However, when I absolutely need them, I will use them. Perhaps this attitude of only taking drugs when necessary would help lessen the health care crisis, leading to a better situation for most Americans (disappointing only those working for or investing in pharmaceutical companies).

As an example of my lack of use of prescription drugs, I have had only three antibiotic prescriptions in the last 7 years, one because of a misdiagnosis (the problem wasn’t related to an infection). I took steroids for 2 weeks a few years ago for a bad case of poison ivy on my arms. That is the extent of my recent prescription drug use. When I have the flu or a cold, I rest a lot, up my intake of garlic, vitamin C, Vitamin D, and cayenne, and start taking Olive Leaf extract, Zinc Lozenges, and Oregano Oil at the first sign of infection. I monitor my temperature and symptoms, keeping alert for more serious symptoms. I almost always get some type of 2-3 day “bug” a year, and with the exception of a period in 2002 when I had a chest infection that didn’t go away for 2 weeks, I usually get over them without aid of modern medicine. I also get my flu shot every October too. I try to get regular physicals, keep my weight at a normal level, exercise regularly, eat right, take my vitamins, and use hand sanitizer. I am not saying I am immune from all illness because of my lifestyle, or that I am perfect and to be imitated, but I am saying that I am taking commonsense steps so that when I do get sick (whether very serious or not), it is an occasional, essentially non-preventable occurrence, the exact scenario for which insurance exists. In other words, I am trying to live a safe, healthy, and commonsense lifestyle, which means I am taking reasonable steps to prevent illness. Obviously, genetics, random occurrences, and other factors outside of my control will affect my health, and I understand this. This is what insurance is for, a safety net for the unpredictable, not a crutch for an unhealthy and unsafe life.

Maybe I learned this from my grandmother. She does not have a particular philosophy against prescription drugs, but at 84 takes one, count it, one prescription medication, a drug she has taken since she was in her twenties, after she had her thyroid removed. Through living moderately, eating right, and walking 2 miles almost every day, she has managed to stay healthy enough to avoid overuse of prescription drugs. While you may not find this too impressive, consider that the elderly spend an average of $2,322 per year on prescription drugs! My grandma spends about 120 dollars a year. If even 30 percent of the elderly were this healthy, I guarantee your and my health care costs would go down. Not to mention, remember that you, through Medicare, are paying for the health care of many elderly persons.

While my interest in health has allowed me to take these attitudes about health care and health, I know many people who would never view insurance and health this way, unless there was a financial benefit to being healthy, or some financial penalty for being unhealthy. It seems to me that what Whole Foods is doing is providing this sort of incentive and punishment system, and not surprisingly, it is saving both the company and employees money in the end. Also, such a high-deductible plan would be far more affordable for your average uninsured person to afford. Maybe the “answer” to our health care crisis is not throwing more tax-payer money at a ridiculously broken system, but setting people up with health savings accounts in which there is incentive to save money and seek better, and less frivolous, care. Perhaps some government money could even make its way into our accounts in the form of tax rebates, and so forth. Of course, then again, the same government known for buying 500 dollar nails and 200 dollar toilet seats isn’t probably going to take the lead on this one, so maybe it is up to us consumers and small businesses.