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An
Overview on the Medical Insurance System
in United States
The
medical insurance system in the United
States is considered to be one of the most
important insurance systems available in
the country.
It
is a well-known fact that the costs of
medical care in the United States are
steep. Hence, it is best to purchase a
medical insurance plan and have your
medical care expenses covered by the
medical insurance company.
An
Overview
The
concept of the medical insurance system in
the United States was first seen as
voluntary programs. As early as 1850,
medical insurance policies were already
made available provided mainly by
fraternal beneficiary associations and
cooperative mutual benefit
organizations.
However, the
proliferation of medical insurance systems
in the United States was still vague until
the 1920's when people were mostly treated
at home, hence, the need for a
comprehensive medical insurance coverage
was not necessary.
Moreover, most insurance companies during
that time were hesitant in providing
medical insurance policies, taking into
consideration the very low demand for such
type of insurance. Experts say that it was
in this point in history that insurance
companies believe that health was not an
insurable service due to high
probabilities of moral hazard and adverse
selection.
Moral
hazard refers to the mental condition and
behavioral changes caused by one's
awareness that if something terrible were
to occur, everything is relieved by his or
her insurance policy. Adverse selection,
on the other hand, refers to an
individual's predisposition of getting
insurance because he will most likely have
a use for it. Hence, those who are sick
and unhealthy will more likely purchase a
medical insurance than those who are
healthy. Healthy people would most likely
not buy medical insurance because they
don't need it and would consider it as
elective and not extremely necessary,
besides being an additional
cost.
But
as the development of medical technology
and medicine proceeded, the costs of
medical treatment has become high-priced.
And with the growing need for medical
care, particularly the older generation,
more and more people knew that they have
to get a good medical insurance policy to
cover up for their medical
expenses.
And
as the medical insurance system in the
United States continue to progress,
commercial companies have been able to
provide restricted medical insurance
coverage. Many labor unions and other
businesses were also able to provide
limited medical insurance plans. Most of
the medical insurance policies were
implemented by Blue Shield and Blue Cross.
They were available primarily as
non-profit services and community-funded
plans based on agreements with the
subscriber and the concerned hospital.
The
Medical insurance system in the United
States was further improved through
various government policies that promote
the use of health insurance. The need to
provide feasible medical care for the aged
was apparent, hence, the creation of
Medicaid and Medicare.
Medicaid
was created for the poverty-stricken
populace. Since its inception in 1972, the
number of people who were previously short
of medical insurance has significantly
increased. Alternatively, Medicare, a
government-sponsored medical insurance
program, was created to cover costs of
medical care for the
aged.
To
date, more than 80% of the American
population is already covered by medical
insurance policies. Nearly 60% of the
overall insured members obtained their
plans through employers while more than
25% of Americans obtain medical insurance
through different government agencies. The
number of people who obtained medical
insurance grew from 12 million to more
than 220 million in 1996.
However,
the increasing costs of medical insurance
policies was felt and seen by the members.
This goes to show why nearly 44 million
people in the United States chose not to
get medical insurance. Premium rates have
significantly increased, thus, employers
providing medical insurance policies to
their employees has likewise increased the
amount of their employees'
contribution.
In
this manner, the need to restructure
medical insurance system in the United
States is important. A nationalized
medical insurance system in the United
States was seen as the next best thing to
a good government. Experts say that the
United States should consider a
nationalized health insurance scheme, like
that to be found in all countries in the
world.
Many
people see the medical insurance system in
the United States more of a luxury than a
privilege. Hence, advocates of
nationalized medical insurance system in
the United States believe that legislators
should create bills for national health
insurance plans and provide comprehensive
coverage for people with low incomes.
Reports show that this marginalized sector
of the community comprises two-thirds of
the uninsured populace.
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