Retraining our Minds about Health "Insurance"

We really need a different term for "health insurance" than, well, health insurance. Let's think about it:

Car insurance - How many people go to All State so they can drive headlong into a light pole after insuring themselves?

Home owners insurance - I live in Florida, and I don't know of anyone who prays for a hurricane so they can test how well State Farm pays claims!

Life insurance - Unless you're an unethical despot looking to fraudulently scam the system, no one's looking to use this type of insurance any time soon...

Insurance, by definition, is about transferring the risk of the unknown, unbudgetable expense. But most people, especially those with group plans, view health insurance as something to be used, rather than something to be avoided, but there when you need it. Health insurance, then, really shouldn't be called insurance, but rather a medical services plan.

In 2004, the government paid for 45% of all health care costs, private industry paid for 36%, and individuals paid for roughly 15%. According to Alan Reynolds, senior fellow with the Cato Institute, in 2008 the government accounted for 60% of health care spending, putting private industry still at 36% and individuals at 3%. Why the increase in government involvement?

Perhaps because private industry has incentive to keep costs down, and so do individuals (at least theoretically). If I want to keep my costs down, I know eating healthy meals, regularly exercising, and avoiding stressful situations will lead to better health...the insurance companies know the same. The government has no incentive because they have discretionary funding at the taxpayer's expense to treat whomever they will, regardless of the lifestyle of such a patient.

Which goes back to the idea of our health needing "insurance." It's far more economical to take individual responsibility for our health - by healthy eating, regular exercise, not smoking - than it is live abhorrently selfish lifestyles and ask the government to rescue us when we're sick. Health care reform is necessary only in that we need to retrain how we think about the role of insurance in the debate.

We should be letting Congress know that we desire individual liberty when it comes to our health care and affordable insurance to cover us when, after doing everything right, we need chemotherapy treatment because of the random ravages of cancer. When we understand the definition of "insurance" we'll finally mitigate the price of health care.