Auto Insurance Provides a Model for Health Insurance Reform

Auto insurance has paved the way for health reform to follow. Nobody has suggested auto insurance is liberal or conservative, Republican or Democrat. Auto insurance is bipartisan and non-partisan, universally available and mandatory in all but two states (Virginia and New Hampshire).

Consider the auto insurance companies’ offerings.

  • Liberty Mutual’s tag line is “Only pay for What you need.” The basic principle behind that motto is “choice.”
  • Allstate offers a “vanishing deductible.” The basic principle is “rewards and incentives.”
  • State Farm offers “good-driver discounts.” The basic principle is “personal responsibility.”
  • Progressive offers an industrywide price calculator. The basic principle is “competition.”
  • USAA Offers insurance to “high-risk drivers.” The principle here is “universal access” regardless of history (pre-existing conditions).

The basic principles everybody accepts and welcomes in auto insurance, then, are choice, rewards and incentives, personal responsibility, competition and universal access. Non-partisan health reform can follow the lead of auto insurance, with personalized health insurance as one such approach that is based on these same principles.

Choice. Personalized health insurance can provide unique solutions depending upon an individual’s health profile and source of  health insurance (employer or personal purchase). Plan options would include preferred provider organizations (PPOs), health maintenance organizations (HMOs), accountable care organizations (ACOs), high-deductible health savings account (HSA) eligible plans, short-term health insurance, and multiple supplemental plans. Care choices would include inpatient, outpatient, telemedicine, health-sharing programs, concierge services, and other pre-pay options.

Rewards and incentives. Personalized health insurance includes features of consumer-focused healthcare. These would include:

Personal Care Accounts (Flexible Savings Accounts, Health Reimbursement Accounts and Health Savings Accounts)

Programs covering wellness/prevention, early-intervention, disease/condition management and case management

Programs for health literacy, information and decision support

Incentives and compliance reward programs

Personal responsibility. Personalized health insurance can encourage personal responsibility with “good health discounts” for lowering cholesterol, improving Body Mass Index (BMI), good blood pressure readings, and other measures of wellbeing. It can include such actions as prevention, early intervention, using medical care only when needed, and following treatment plans.

Competition. Personalized health insurance inspires expanded competition through price transparency, provider options and the promotion of insurance alternatives. It can accelerate competition by reducing provider scope-of-practice limitations, reducing or removing hospital certificate-of-need restrictions, and reducing insurance capital requirements.

Universal access. Personalized health insurance can provide financial support for the neediest populations. First, it can offer guaranteed affordable insurance and coverage of pre-existing conditions for those with significant impaired health conditions. Second, it can offer premium support for low-income families. Anyone wanting health insurance is eligible for affordable coverage.

The non-partisan principles of auto insurance health insurance can be consumer-oriented, affordable, comprehensive, and possibly the only way to create a truly “Affordable Care Act.”

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