Employers Should Be Very Concerned With The Future of Healthcare Insurance Costs


Just about everyone misses the point on needed healthcare reform. The constant barrage of news regarding “Healthcare”, “Obamacare”, “Reform”, etc. all targets insurance rather than healthcare. The real problem is simple and should be obvious to all and it is the incredibly high cost of actual healthcare. What is healthcare? It is the cost of doctors, hospitals, medical procedures, medicine, care, and research. But when we talk about healthcare these days (especially the ACA or “Obamacare”) we tend to overlook all these areas and instead look to the cost of insurance. To be sure, controlling the cost of insurance does nothing to control the costs of healthcare. So, why is this? Why is that every news report or commentary we read regarding healthcare just addresses insurance? I know why. It is because Washington is full of attorneys. You see, when a doctor gets sued, attorneys make money on both the plaintiff side and on the defense side. And the more lawsuits there are, the more these attorneys make. When a doctor is held negligent for doing his or her best, attorneys win – and it doesn’t even matter if the doctor ultimately wins or loses the lawsuit. The mere fact that there is a lawsuit means attorney profits. If we really wanted to have healthcare reform, we would target healthcare rather than insurance – what can be done to reduce true costs? Eliminate unnecessary procedures. Allow market competition with less regulation. And finally and most significantly we need to severely curb the number of lawsuits.

Now that Trump is in office, there is a lot of talk about reform. The reform is being met with a lot of opposition based a weak premise that millions of Americans would lose there “healthcare”. Fact is that the ACA (or Obamacare) has only been around for a few years and enrollment has been slower than expected, so it’s not like it is some long-standing benefit engrained in our lives. Also, there is no constitutional mandate that the issue of healthcare should be in the scope of the US government. In my opinion, the workers compensation system stands to be greatly affected by any “healthcare reform” as any potentially uninsured injured or sick people will be encouraged to make claims against their employers’ no-fault insurance. This will create a short-term squeeze on the workers compensation insurance providers, but ultimately it means workers compensation insurance costs will rise.

You see, insurance companies don’t lose money in the long-term, nor do they earn excessive profits (they aren’t allowed to by either market forces or in some cases state regulatory oversight). They simply price according to the actual costs of the system. The more costs get pushed from “healthcare” to workers compensation, the higher the workers compensation premiums will rise. And alas, the business owner thus bears the brunt of high healthcare costs (encouraged by attorneys) whether it be through healthcare insurance or workers compensation insurance.

Beware – but let your voice heard.

Scott Reynolds

About Scott Reynolds

Scott Reynolds is the President of Member Insurance Ltd. and CEO of Member Insurance Agency, Inc. Scott joined Member Insurance and was elected to the MIL Board of Directors in 2011. He is responsible for the overall operations of Member Insurance Limited and Member Insurance Agency. [Full Bio]

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