I recently had a conversation with my health insurance company that gave me some interesting perspective on the current US health care system. I’m pregnant, so I called to figure out whether my insurance covered a new breast pump for when I return to work while nursing. There was good news and bad news.
Good news: insurance covers (most of) a new breast pump!
Bad news: Due to federal regulations and insurance bureaucracy, I cannot simply order the pump I want from Amazon, where prices are clearly laid out, the pump I want is in stock, and I know what I am getting. Instead, my insurance gave me a list of 10 different medical supply companies, all of which provide different pumps and half of which do not list prices. This is a problem, since my insurance only covers $178 of the pump’s price.
So rather than spending two minutes ordering a pump from Amazon, I will spend at least an entire morning sifting through websites mostly designed circa 2004 and filling out various information request forms to find out whether the company carries the pump I want and how much the same pump costs at these different websites. I will also need to get a prescription from my doctor, which will require another appointment and more paperwork.
All in all, a process that should take two minutes will now take at least a week of back and forth, many emails, multiple phone calls, and shipping that will definitely take longer than two-day Prime shipping.
So what’s going on here?
The Unintended Consequences of Health Insurance Mandates
The breast pump example is a classic case of unintended consequences. When the Affordable Care Act (ACA) was passed, one much-lauded goal was to provide better support for breastfeeding mothers and their babies. The requirement was touted as a way mothers could nurse longer (a major public health goal that may or may not make a lot of sense), particularly once they reentered the workforce.
The breast pump example is a classic case of unintended consequences.”] The requirement, as many have noted, turned a normal consumer good into a medical device that all women could get for “free,” regardless of income level. Some four million American women give birth every year, and some large percentage of those at least attempt to breastfeed. Many, if not most, nursing mothers will need a breast pump at some point, so the costs of this mandate are not small.
Insurance companies, predictably, did not respond altruistically and absorb the costs of an expensive new mandate. They passed some of these costs on to consumers in the form of higher premiums, but also sought to control costs by limiting the kinds of pumps mothers had access to. My insurance, for example, only covers a single electric pump, which is ironic because the last time I checked, most women have two breasts. But insurers’ rationale is understandable: they’ve been ordered to provide a free thing — not necessarily the best free thing out there, nor the free thing that actually would meet women’s wants and needs for pumping.
Companies also, predictably, increased the red tape associated with ordering a breast pump, both to ensure they can prove their compliance to the federal government, and also probably in part to make it harder for women to access the benefit. I didn’t bother getting an insurance-covered breast pump for my second child (the ACA wasn’t fully in effect when I had my first) because I had an old breast pump a friend had given me and I didn’t want to deal with the hassle of getting a new pump while wrangling a newborn.
I’m faced with paying both higher premiums and being forced to choose a product that does not fit my needs.”]Without government interference in my insurance plan, where would I be today? I probably would have taken some of the money I would have saved in slightly lower premiums and bought myself the breast pump I really wanted. Instead, I’m faced with both paying higher premiums and being forced to choose a product that does not fit my needs. As FEE’s Pamela Hobart discussed, lower-income women already had access to low-cost breast pumps through the supplemental nutrition program for Women, Infants, and Children (WIC). Why did the government believe it necessary to mandate coverage for all women, when most women not on WIC would have been better served simply buying the breast pump they really wanted out of pocket? Obviously, the answer is political, but it makes little to no economic sense.
Government Micromanagement and Insurance Bureaucracy
My breast pump saga is merely one example of a much broader lesson that goes well beyond nursing mothers. The more government micromanages what insurance companies are required to do, the more insurance companies will respond with red tape and hurdles to lower their own costs and prevent being taken advantage of.
Health insurance was never meant to provide people with basic consumer goods.”]The breast pump saga is also an important reminder of what insurance was originally not meant to do. Health insurance was meant to help cover the catastrophic costs of medical care that an average person could not have foreseen: getting hit by a bus, developing cancer, or needing a liver transplant. Health insurance was never meant to provide people with basic consumer goods they can and should be saving for themselves. It also was never meant to pay for regular checkups, physicals, and the foreseeable and moderate expenses of being a human being with a fallible body.
Now we use health insurance to pay for everything from yearly physicals to breast pumps to blood pressure screenings, and the government continues to mandate more and more covered items and procedures. The result has not been better care, but escalating costs and more restrictions on consumer choice. None of that seems like much of a “benefit” to me.
So how did my pump saga ultimately end? After a few hours of wasted time Googling and talking to medical supply companies on the phone, I ended up ordering the pump I wanted from a local medical supply company. That pump, available for $174.98 on Amazon, ended up costing my insurance $178.00 and me another $70, while the sticker price on the receipt inexplicably totaled $318.00. Total extra bureaucratic costs: a few hours of my time, my insurance company’s time, the medical supply company’s time, and an extra $70 to $140, depending on which price you hold to be the “real” price.
But yes, by all means, let’s get MORE government involvement in health care.