Health Intuition

Health insurance companies have not enjoyed a lot of good press in recent years. Despite law suits, movies and books about scandals and corruption, most health insurance companies are run honestly and are there to offer financial protection against an unforeseen accident or illness. This protection offers great peace of mind, because after all, what good is life if you can’t enjoy it? Health insurance helps ensure that you will be able to live your life without constant worry.

While technology allows for basic comparisons of insurance plans, the best way to pick a health insurance company is to do a lot of research, and then call a company’s customer service. One of the main things you want to pay attention to how they handle your questions. Are they polite? Do they answer your questions? Can you understand what the individuals are saying, or were the jobs out sourced to a country that might not have the best English training program? If you’re impressed with the service, then give that company a high mark and consider them among the finalists. If the whole experience is giving you a migraine, it’s a safe bet that may not be the health insurance company you want handling your claims.

Not every health insurance company is perfect, but there are some basic things you should want from a company that you are going to give your business to, and also trust to follow through on their part when you really need it. Here are three things you should absolutely be looking for from any insurance company you’re considering:

* Fantastic customer service. This should be a no-brainer. If a health insurance company is really interested in their customers versus their customers’ wallets, then they are going to have excellent customer service to help you out in any way possible.

* A Large Solid Network. This means that the company is well established, and you have no fear of them folding up and disappearing on you tomorrow. When you do need to use the insurance, you know they have the money to pay.

* Competitive Pricing. If their prices are ridiculously high, then why would you even consider a policy from them? The same service costs the same amount no matter what health insurance policy you have, so why should you pay an extra $200 a month to a company for the same coverage? It doesn’t make any sense.

Go through this check list and then look at the specific policies of the health insurance companies you are interested in. Once you have a policy you like with a company you trust, then everything should fit together. Health insurance companies are there to provide services for their customers, and in an age where expenses for medical treatments continue to sky rocket, it is critical to find health insurance companies who can provide the type of coverage that people need and can afford.

Publicly traded health insurance companies present a highly uneasy balance between various constituents. Policyholders rely on their insurer to provide timely, relevant, and cost-efficient care when needed. Healthcare is a very unique product and service offering – you could say an anomaly – in the marketplace, in that it is an extremely “high leverage” offering. When customers need the product or service, they are at the mercy of the provider. If you were stranded in a desert and you came across a lemonade stand, how would you feel if the vendor charged you $10,000 for a glass of lemonade? Or if he chose not to sell you lemonade at all?

Secondly, the insurance is also a very distinct product in thes marketplace. Individual, organizational, and systemic risk can often be difficult, if not impossible, to quantify. Policyholders are constantly paying premiums to their insurer, but the insurer must be adept and ethical enough to ensure that they have the capacity to honor their pledged policies. When customers need treatment, they absolutely need to get their care at that very time. Being a publicly traded company, however, forces the management team to cater to Wall Street’s quarterly and yearly earnings expectations. The source of these periodic performance measures are analysts from investment banks and research firms that are often wrong in the measuring stick that they hold company executives to. What happens when earnings expectations for the third quarter are unreasonably high? Does management “play games” with policyholders? Perhaps the insurer will no longer honor certain terms, or cut costs that prevent care with effectiveness and efficacy. That’s just a few examples of a dangerous balancing game.

On an additional note, since the passage of the Sarbanes-Oxley Act (after the Enron and WorldCom scandals), companies have been averse to going public due to the very significant bureaucratic and financial burdens of complying with SOX. Might this additional cost and burden cause publicly traded healthcare companies to pursue a more extreme version of cost cutting in order to protect the bottom-line? Other sectors, such as retail, telecom, and financial services, go through the occasional cost trimming as part of management’s mandates. The nature of healthcare’s offerings, and its critical importance to the lives of its customers, materially elevate the sensitivity of cost-cutting measures when lives and limbs may be at stake.