Wednesday, September 17, 2008

The Worst Case Scenario

I am sure you've heard the expression "worst case scenario", sometimes used in the context of "what's the worst that could happen? I lose $20 bucks?" Well, last week I found out what the real worst case scenario looks like and believe me, it's bad.

The story goes like this: a colleague's uncle was diagnosed with terminal cancer. Bad enough for you? Well, it's not even close to the end of the story. The uncle has been in treatment for a few years and has now maxed out on his lifetime medical insurance cap. As far as the insurance company is concerned, from this point forward he is on his own. Bad enough for you? Hold on, we're not quite done. To get medical care he now needs to go on Medicaid, but to do this, he basically needs to declare bankruptcy and exhaust all his savings.

So let's summarize. You have medical insurance. You are diagnosed with a terminal illness. You receive medical care until you reach your insurance lifetime cap, at which point you find yourself without health insurance. Your only prospect of receiving medical treatment (which has no hope of saving your life anyway, but which might extend it and relieve your suffering) is to declare bankruptcy, thus insuring that your spouse and kids are destitute once you have departed from this world.

Now that's what I call the worst case scenario. This is also something that I would refer to as a complete and utter failure of our society. How is it that we, as a nation, the richest country in the world, allow someone and his family to be so completely and utterly devastated by the tides of fate with absolutely nothing that he can do about it and with no fault of his own?

This is clearly an example of a major market failure. This is where Congress needs to step in and draw the line. Americans should, at the very least, have state sponsored catastrophic health care coverage that will prevent such things from happening. The current state of affairs is simply not acceptable. Health reform now!

Here is someone else who has a similar opinion.


Traciatim said...

This is why I love living in Canada. Though we have our share of problems I have a great storey that happened this past weekend.

My son had a cold on Sunday, we stayed up most of the night since he had coughing fits. Through Monday it got worse to the point he was having trouble breathing and getting lethargic. We figured he had Pneumonia or something so we called a clinic at 1PM, and had an appointment for 6:15PM. At 6:15 the appointment was on time, they said they couldn't diagnose it without a chest X-Ray and to go to emergency at the local hospital. Since this was called in by the clinic there was no wait tie, they were waiting for us to arrive. After the X-Ray, oxygen, and a puffer medication he wasn't getting much better and stayed overnight for observation after they ruled out pneumonia. They had him on medication to treat asthma like symptoms. In the morning he was getting much better, was given a prescription and released on a day pass to go home where the doctor will call the following day to see if his situation keeps improving. We filled the prescription with out work coverage for a total out of pocket cost of $2.99 for the pharmacy filling fee. That was our total bill. I won't even see the bill for the clinic, the nurses, the doctors, the room, the supplies, . . . anything. 3 bucks.

Anonymous said...

This seems like a reasonable progression of events to me. The tragedy is that he has terminal cancer. His insurance company has spent a million dollars (or whatever his maximum was) treating him to extend his life a year or two. Now he wants the government to do the same, even though he is unwilling to spend his own money to extend his life. If it's not worth it to him, why should his treatment be a higher priority to the taxpayer than things like preventative care for children? There is no way you have a "right" to unlimited treatment from the taxpayer.

If you file for bankruptcy you get to keep your house, retirement accounts, and some exempt assets. When you die your wife and kids get a payout from your life insurance. That's hardly destitute.

plonkee said...

Yes. If you don't get why this situation is wrong, then you are suffering from some kind of empathy failure.

If you pool the risk across enough people (like the whole population) it will be better for everyone.

Shadox said...

Traciatim - compare that with my own similar experience with my 3 year old. Again, shortness of breath, rush to the emergency room, over night observation. We have medical insurance. Hundreds of dollars, and this is after having to negotiate with the insurance company that sent us a bill for over $2000 Dollars. You stuck up Canadians with your good medical system and value for human life and health. Shame on you. Communists.

Anonymous - if you seriously believe what you are saying, this is a completely benighted view of the world. Insurance is there to provide coverage for events an individual cannot deal with financially. Your comment seems to suggest that this poor man's family is about to strike it rich when he dies. That's twisted thinking my friend.

Plonkee - I couldn't agree with you more. Life is not just about money. I would argue that life is mostly not about money. There is something to be said for safety, social responsibility, and making sure that we don't let each other rise and fall based on a random whim of fate.

I may sound like a socialist - but nothing could be farther from the truth. I am talking about a purely economic arrangements, like Plonkee says: pooling risk to mitigate an unacceptable financial outcome.

Traciatim said...

In Canada we provide emergency and health care. It's not like we're doing nose jobs on the tax-payer dime (unless the nose job was due to a car accident and the persons face is mangled). We just ensure that if you need help you will receive it. That basic level of service should be universal around the globe. The USA is living in the dark ages for not providing it.

Shadox said...

Traciatim, I completely agree.

Andy said...

Markets are strange beasts right now, but the "cleaning" of our system was necessary and if this is the bottom, you now have a once in a lifetime opportunity to get in. Still wait and watch and eventually equilibrium will be restored.