Innovation Medical Specialties News

health insurance companies are the problem in healthcare

David Lazarus writes as if health insurance companies are the problem in healthcare. In fact, the insurance market in California is quite competitive and already has multiple nonprofit companies.

The main problem is the lack of provider competition. There are fewer competing hospitals and medical groups in California every year. This results in higher prices that insurance companies must pay for their members. They have no choice but to pay these higher prices if they want to offer products that include most hospitals and doctors.

The Medicare option would not address this problem, since Medicare does not have to negotiate prices. Rather, Medicare tells providers how much it will pay to hospitals and doctors. A Medicare option would leverage much lower Medicare prices to offer new insurance products that would be 30% to 40% lower than what commercial insurance companies can negotiate in California’s concentrated provider markets.

A sign outside a hospital building reads Welcome Kaiser Permanente Los Angeles Medical Center

This is important to understand since, if we do not have a Medicare option in the near future, we need California policymakers to act now.

We need policies to restore competition to hospital and physician markets and limit the ability of providers to charge excessive prices when patients need emergency care and access to providers that are not on their plan’s approved list.

Sandesh Ilhe
Sandesh Ilhe
With an Engineers degree in Advanced Database Management and Information Security, Sandesh brings the deep understanding of the digital world to the table. His articles reflect the challenges and the complexities that come along with every disruption in the industry. He carries over six years of experience on working with websites and ensuring that the right article reaches the right reader.