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From Phyllida's Desk

Double Indemnity

In all the "discussions" about the cost of healthcare and President Obama's castrated legislation, one question that is rarely asked is: why do we use "insurance" to pay for what is, or should be, on ongoing, regular household expense?

For those of you wondering who is this phantom blogger who has taken over Ann Herendeen's web site, and what happened to the real Ann Herendeen who writes about her bisexual m/m/f ménage fiction, the answer is that this is the real Ann Herendeen, and I'm stuck at a rough spot in revising my latest "Eclipsis" story, and this healthcare issue has been bothering me for some time.

Many people point out that our current "fee for service" system of payment, in which doctors and hospitals are reimbursed for treating us when we're sick but not for helping us stay healthy, is no way to control costs. And it's obvious that a single-payer system, like Medicare, is the only way to provide decent, affordable healthcare to everybody—young and old, rich and poor, healthy and sick, working and unemployed. (And then there are Republicans who don't think a modern society should provide decent, affordable healthcare to everybody, but let's not go there.)

Few people ask why insurance is how those who can afford it or who have jobs with "benefits" pay for their healthcare now.

"Insurance" is what we use to protect ourselves against rare, catastrophic expenses: death, fire, accidents. The insurance business, which began in the late seventeenth century at a time of gambling mania, was based on the concept that by getting many people to pay regular small amounts into a system from which only a few large payouts would be required, the insurer could make a handsome profit. ("Insurance," probably not coincidentally, is also what we can buy at the Blackjack table when the dealer is showing an ace.)

That is, death happens to us only once, and it's possible to live our entire lives without ever being in a serious accident, having our house burn down, or being robbed of everything we own. Ideally for insurers, young people in good health who live sober and smoke-free in safe neighborhoods and who drive defensively pay their various insurance premiums every month, and at the end of their careful lives their various insurers will owe, at best, only that promised "death benefit" to their grieving families.

It's why there are "insurance investigators," people whose job it is to prevent their company from paying Barbara Stanwyck for colluding with Fred MacMurray to bump off her inconvenient husband, or my dad for setting the couch on fire while smoking and drinking and sleeping, or the former owner of a Rembrandt who gave the burglar-alarm code to his partners in crime.

These days, healthcare is not something most of us require only once or never, like reimbursement after burglary or help after a fire. But health insurance clearly began when it must have seemed as if it was. It's only in the past fifty years or so that "medicine" can claim to have done, on balance, more good than harm. For most of human history, medical care was a haphazard joke of guesswork, witchcraft, quackery and folklore. Being poor could save your life, because you couldn't afford to pay a physician to torture you to death for a condition from which you stood a good chance of recovering if left alone.

Into the nineteenth century, routine "treatment" included bleeding, and dosing with "purges" and emetics (to induce vomiting and diarrhea) which led to severe dehydration in sufferers already weakened by loss of blood. Famous people killed by their doctors include Charles II in 1685 (kidney disease), George Washington in 1799 (fever, bad cold?) and President Garfield in 1881 (gunshot to the back that hit no internal organs or major blood vessels). While Charles had a chronic and fatal illness, Washington and Garfield might have recovered if they had not been subjected to procedures that, in Garfield's case, amounted to criminal assault. In my own family, at the turn of the twentieth century, one of my mother's maternal uncles died at age nineteen from a burst appendix, misdiagnosed and wrongly treated.

My favorite story, because it has a (sort of) happy ending, is of the little boy in early-eighteenth century Versailles whose entire family (almost) was annihilated by smallpox (and a hunting accident). In those days, members of royal families were required to submit to "medical treatment," but this child had a devoted governess who locked the two of them in a back bedroom, refusing to open the door to the blood-letters, and saved his life. A year or two later, in 1715, at the age of five, he became Louis XV (après moi, le déluge) of France.

Eventually, even doctors began to listen to people like Louis Pasteur and Joseph Lister, who had been warning for years about the dangers of going from patient to patient with unwashed hands and wearing the same blood-and-guts encrusted coat. The development of anesthesia meant that good surgical technique could be defined by more than mere speed. Penicillin was discovered. Somewhere along the way, in some places, things improved to the degree that, even if you were suffering from something pretty serious, a doctor might actually be able to help. Women began giving birth in hospitals, and when people were sick or in pain they went to a doctor, sometimes with the justified hope that they would be cured or treated, and not killed in the process.

I imagine that's when "health insurance" began, gambling on the idea that the big, bankrupting surgery was a rare occurrence: right before medicine began diagnosing and devising expensive tests and treatments for—everything. For one brief shuffle and deal of the business cards, it must have looked to some confident actuary as if "modern medicine" was another great way to make a profit. Smallpox and bubonic plague were relics of the past. There was a vaccine for polio. All they had to worry about was the occasional car crash or the odd gall bladder that "had to come out."

And so, as for death and fire and burglary, health insurers need to be certain that what they're paying for isn't fake. It's why every claim is reviewed, many rejected. In a gambling business, insuring people with "preexisting conditions" (like being old) and old people (who are likely to have existed long enough to have at least one preexisting condition) are losing propositions. Because the thing about insurance is, it's supposed to be something you rarely, if ever, use.

No, I'm not arguing that health insurers are nice, kind people who only want the best for us. I'm arguing the opposite: that the insurance model is the exact wrong way to pay for a necessary, ongoing expense that is much closer to food and rent in terms of how frequently we need it and how big a chunk of our income it takes.

I'm old enough to remember when going to the doctor "only when something is wrong" was still an almost sensible attitude. If you weren't at death's door, or feeling pretty close, why would you go? For the conversation? The chance to spend half the day in an overheated room full of sick people reading last year's Highlights magazines and five-year-old New Yorkers?

Nowadays, if we're employed full time or have a trust fund, we all have frequent and regular medical exams: general physician and gynecologist (or urologist), eye doctor and dentist. As we age, we inevitably acquire some condition or two or three that requires a specialist. We survive cancer, keep our teeth, have our cataracts removed and control our blood pressure and our cholesterol. Even more radically by the standards of just a few decades ago, this regular monitoring can avert or at least postpone the catastrophic medical emergency that insurance is supposed to pay for.

We've reached the absurd point where health insurance won't pay for routine checkups or relatively inexpensive ongoing treatment, but will pay for major operations on old people at the end of their lives. Insurance, invented in the days when surgeons were literally "sawbones" and physicians were nicknamed "leeches" after one of their favorite tools, is not a workable system for modern healthcare.

Whether or not you believe that human beings, social animals who live in societies, need "social medicine," paying for it can't rely on the business model of Double Indemnity. It's a great movie, but bad medicine.
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