Navigating Healthcare – Patient Safety and Personal Healthcare Management

Medical Insurance and Medical Bankruptcy

Posted in Uncategorized by drnic on October 21, 2008

An old report highlighted recently in the British Journal of Healthcare Management in a review of the National Institute for Health (NICE) “Denial of life-saving drugs is not NICEsubscription required for this pdf covered the issue of those wanting to spend their own resources on their medical care. I talked about this issue in another post (Balance between Private and Welfare Medicine) but it was the reference to a 2005 study by Harvard University Researchers: “Illness and Injury as Contributors to Bankruptcy” that reported that nearly half of all bankruptcies in the USA were at least partly the result of medical expenses hat is shocking. Even more so when 75% of those filing for bankruptcy reported having medical insurance at the onset of the illness. Those who did not have it prior to onset would no doubt have fallen foul of “pre-existing condition” clauses.

There’s a crisis if ever I saw one – families descending into debt and bankruptcy as a result of medical bills and the spiraling costs and inability to pay.

In my mind this is because medical insurance is not “insurance” per se

From the Free Dictionary

Coverage by a contract binding a party to indemnify another against specified loss in return for premiums paid.

But my guess is medical insurance is more about:

The periodic premium paid for this coverage.

I like the Wikipedia definition

Insurance is defined as the equitable transfer of the risk of a loss,
from one entity to another, in exchange for a premium, and can be
thought of a guaranteed small loss to prevent a large, possibly
devastating large loss

Somehow this got lost in the provision of medical insurance for these folks? But answers.com features a definition on medical insurance that reveals the gap

Health insurance is insurance that pays for all or part of a person’s health care bills

And there lies the problem – most have part coverage and the part that is uncovered escalates at an alarming rate with serious illnesses, chronic conditions and in the case of diseases with limited treatment options that are often priced far above any typical plan coverage.

When checking your insurance find out what you maximum liability could be in the case of any of these circumstances

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