Colorado SB 061 is a case of what is seen and what is not unseen. What is seen: fewer denied insurance claims (probably). What is not seen: increased insurance premiums and more people who cannot afford insurance.
The bill summary states:
For purposes of workers’ compensation, property and casualty, and health insurance, requires any internal review of claims, independent medical examination, or utilization review to be conducted by a Colorado-licensed health care professional who is in good standing and has appropriate expertise in the same or similar specialties as would typically manage the case being reviewed. Requires written denials of benefits to identify the health care professional on whose opinion the denial is based.
No one wants their own insurance claimed denied. After all, if you have insurance, you want it to cover as much as possible. Hence the political appeal of this bill. Yet, this bill will surely increase premiums:
- It adds time and resources to processing.
- Insurers will have to pay health care professionals for their time
- Health care professionals probably won’t feel great about their name being associated with a denial of benefits, so they will charge a high fee.
- Insurance companies might deny fewer claims. This sounds good on the surface, but in the end it increases premiums.
Again, a case of what is seen and what is not unseen. Also, a case of diffuse costs and concentrated benefits. Everyone will pay the cost of higher premiums, but few will benefit from (if it occurs) not having a claim denied. (Maybe I’m missing an unintended consequence that somehow insurers will deny more claims…)
The question is: who decides? In a free market for medical insurance, you’d be able to choose what plan is best for you. Insurers would be able to decide what products to sell, though of course they’d have to satisfy customers (rather than politicians) to stay in business.
Maybe you want a low-deductible plan that is effectively pre-paid health care. But then you might have claims denied. Or maybe you have a high-deductible plan and (conservatively) invest the premium savings self-insurem, which can pay for care that is not covered. (Today you can do that with a tax free Health Savings Account, but in a free-market the tax system would be neutral to how you spend your money…) Or maybe you’d want to pay a physician a flat fee for services, and self-insure the rest. Or any combination of these.
But as it is, the U.S. already has socialized medicine, and politicians make the choice. Not you.
