This interesting statement was written by David Axene (President & Consulting Actuary, Axene Health Partners) in his article "Is California leading states in health care reform?", posted in SoA Blog. Many people have an perception that insurance companies are the greedy devils which always look for opportunities to get excessive profits by increasing the health insurance's premium rates - but do they really complain on the increasing medical costs charged by the medical providers (like private hospitals)? They do not understand the premium increase is mainly attributed to the increase in medical costs, or they refuse to understand?
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| "Public" here refers to those public who have bad perception on insurance companies selling health insurance |
Perhaps this disappointing public behaviour can be explained by the above chart - public needs to pay premiums to insurance companies, but they receive treatments from the hospitals. We can easily understand with common sense that it is human nature to consider the party which they need to pay money to as "bad guy", especially when there is premium increase. Even though the insurance companies explain that the increase in medical cost is the main culprit, they fail to (or refuse to) comprehend the key problem as the medical bills are not paid out from their pocket directly. To make the matter worse, sometimes the government also think the insurance companies are the "bad guy" and impose a lot of restrictions and controls - while they do not take sufficient measures to control the root cause.
On the other, the medical providers are the one help the public by providing medical treatments and they do not pay or only pay small amount of deductibles / co-insurance. Since the medical bills are settled by the insurance companies and not from their own pocket, they don't concern what the amounts are. Since the Malaysian Government is currently working on healthcare reform, they must invite expertises from insurance industry to join the working committee - the public behaviour will change dramatically according to how the healthcare policy is established.
It is human's nature for not appreciating insurance companies - My friend, Jane, has a relative who just received treatments in a hospital, was complaining that her insurance company did not fully reimburse the pre-hospitalization medical bills (i.e. the prescription drugs costed a few hundred ringgit). Even though the insurance company has paid a few thousand hospital bills. Of course, no gratitude to the insurance company.
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