It’s something we all have to buy… from health, car, homeowners, or life, we all need insurance. Find out the ways insurance companies are taking advantage of you!
Pharma Companies Cash In
According to an essay by Dr. Marcia Angell, the profits that pharmaceutical companies now make far exceed the other 490 of the Fortune 500 businesses. She further asserts that they have moved very away from their original purpose of actually finding drugs that help people and now pedal drugs that may or may not work, simply for the profit.
When this is combined with insurance companies, you have one thriving free market, but only of course for the insurance companies — not for the consumer. Drug companies are regularly negotiating with insurance companies; however, they never reduce the cost of the drugs but just give insurance companies rebates.
This is why prescriptions are constantly going up in price, which is especially bad news for you if you can no longer afford insurance or you are dropped for whatever reason. Take for instance Martin Skhreli, the former CEO and co-founder of Turing Pharmaceuticals and the bio-tech company named Retrophin.
Skhreli skyrocketed to fame after Turing gained the manufacturing license for the durg Daraprim, which is an HIV/AIDS medicine. He raised the price from $13.5 to a shocking $750 per pill. This is a medication people need to survive! How could someone be so unbelievably uncaring about human lives?
In other news, Skhreli also purchased the WuTang Clan’s latest album for two million dollars. He promised to release the album for free if Donald Trump won the 2016 presidency and destroy it with Hillary Clinton won. The day after Trump was called the winner he released the intro to the album and one track. Skhreli is also currently out on bail after being indicted on securities fraud. So the lesson here is that greed doesn’t pay.
If insurance companies are at the losing end of the free market, more than likely that will result in higher insurance prices payed by the consumer. Wouldn’t it be a wonderful world if these companies actually had the benefit of keeping human beings in mind instead of just the almighty dollar? It would be nice to see some actual legislation to prevent companies from keeping live-saving medicines from people who really need it!
They Can Deny You Coverage
Although health insurance companies can no longer reject you due to pre-existing conditions, there are still ways they sneakily try to deny you coverage. And for what reason? Money, of course! Perhaps Wendell Potter, a former Cigna executive who is now an industry critic, said it best. He told the Huffington Post, “Insurers would do all they could to try to preserve profit margins.
For example, they can still refuse payment of a bill that they claim is not medically necessary. For example, musician Zoë Keating hit Twitter to fight back with an colorful and expletive-laden 140 characters after her husband’s insurance company denied coverage because they deemed his cancer treatments not medically necessary. After Zoe publicized their struggle, the insurance company magically agreed to pay for the care. Imagine that!
Charging Low Premiums
While hearing the words “you have a low premium” might sound like a good thing, the opposite is actually true. While insurance companies might offer an up-front low premium, they are finding ways to actually charge most of the actual care right back on the customer.
They do this through having outrageously high deductibles or charging something called coinsurance. Coinsurance is where customers are required to pay a percentage of the cost of care instead of a co-payment. This obviously means that more expensive care or more invasive treatments are definitely going to cost more for the consumer than a regular doctor’s check-up.
Making The Sick Pay More
Insurance companies charge patients based on their own development of tiered drug lists. For people who have serious or chronic medical conditions, this is absolutely crazy. Tiered drug lists basically means that patients pay less for generic medications and more for brand name or specialty medications. Insurance companies use these lists to make sure they don’t spend too much (of course while they simultaneously profit billions of dollars).
Some of the top tier drugs are medications that are needed for HIV patients or multiple sclerosis, which means those who are constantly ill are going to have to shell out major cash in order to survive. According to the Huffington Post, the AIDS institute filed a complaint with the federal government against four different insurers located in Florida, claiming that insurers are discriminating against sick people. It certainly sounds like it. What a travesty!
Not Covering Out of Network
After Obamacare was implemented, insurance companies still found ways to make money off of the consumer by targeting the sickest individuals. Often, insurance companies offered through the exchange have small networks which means there is only a small list of medical providers that will accept their plans. The problem here, again, is that often these networks don’t cover specialty care like cancer treatments.
The sickest people will also be more expensive as they will need more and constant medical care. Thus, the sickest people will actually end up being denied coverage because such doctors are out of network or they can’t get an appointment with the few that do exist within their network. Although the Obama administration has tried to take action to get insurers to add more options to their networks, their efforts have often been blocked by opponents in other parts of the government.
Making It More Difficult To Get Treatment
It is also thought that insurance companies will find more hoops for costumers to jump through to make it difficult for them to get the medical treatment they need. The more hoops they create the more likely a consumer is to give up on actually finding treatment.
Carmen Balber, executive director of the nonprofit organization Consumer Watchdog, told the Huffington Post, “To save money, insurance companies will be stricter about approving and paying for medical treatments. I have no doubt that claims denials or delays will be the new discriminatory tactic of the industry.” Dealing with insurance companies has truly become a nightmarish scenario.
Issues for Same-Sex Couples
In New Jersey, four lesbian women sued the state for being denied insurance coverage for infertility treatments. A law passed in 2001 requires that insurance companies must cover infertility issues, including in vitro fertilization and other reproductive technology.
However, the law also states that the person applying for infertility coverage must be able to prove that they have engaged in two years of unprotected sexual intercourse while trying to conceive. According to Mother Jones, these women were denied coverage because they couldn’t prove that they had tried to conceive naturally. Clearly, this is common sense because a same-sex couple will never be able to conceive naturally through intercourse with their partner.
Fighting To Have A Baby
However, since the 2001 law was passed something very important has happened. The Supreme Court legalized same-sex marriage and it has been prohibited by the Affordable Care Act to discriminated again patients based on their sexual orientation.
The women’s lawsuit alleges that the law is discriminatory against same-sex couples. Grace Cretcher, the women’s lawyer, told the New York Times, “These women are already going through what can be a difficult experience, and they have the added stress of affording it financially and the added insult of being treated like a second-class citizen.” It’s truly remarkable how insurance companies will stretch any law or wording to benefit them.
The Purpose of Insurance
While there has been much controversy over the Affordable Care Act, many assert that it’s not Obamacare that’s the problem but that the entire health insurance industry needs an overhaul. Many people think that insurance is only to be used for catastrophic events, like cancer. However, what about the preventive care in between these occurrences?
Preventive care has been proven to lower the rate of mortality, especially in preventive deaths. Often people don’t bother getting insurance because they think they are healthy. However, insurance could now help them get preventive care. People are still foregoing insurance because of high premiums.
Hidden Fee Scam
In 2013, automotive technology company Hi-Lex Controls took Blue Cross Blue Shield of Michigan to court after they became suspicious that the company had been systematically overcharged for over 19 years. It was revealed that Blue Cross Blue Shield was in fact charging the company tons of unlawful hidden fees, causing both the employer and the employee to spend more money.
In the scheme, Blue Cross Blue Shield would mark up hospital claims up to 22%, and regardless of the amount they paid out to hospitals they would report that they actually paid more. They then listed the fees under different names like provider network fees, contingency/risk fees, retiree surcharges, and other-than-group subsidy fees.
Common In The Industry
It was also revealed that Blue Cross Blue Shield knew that customers were unaware of these markups and if they brought up these fees, the company trained its employees to downplay them. The court found that Blue Cross Blue Shield knowingly committed fraud by charging these markups and purposely keeping the extra charges from customers.
During the hearings an actuary from the consulting firm Milliman Inc, testified that many other insurers engage in the same practices. The case was later taken to appeals court, which upheld the decision of $6.1 million fraud judgment against Blue Cross Blue Shield. So it seems that insurance companies aren’t only trying to scam you but your employer as well! Ridiculous!
Total Loss = A Chance To Scam
Health insurance aren’t the only insurance companies out for your money. Car insurance companies are engaging in many very similar practices. For instance, we see so many commercials purporting car insurance agencies “being on your side” and offering full coverage. Insurance policies also often say that if your vehicle is a total loss, they will cover a replacement.
Yet almost without fail insurance companies deliberately offer a lower amount of money. They will then say the car is not in the best condition and complain about things like paint chips. They also often overlook good qualities about your vehicle like if it had low mileage. So if you lose your vehicle you might not be able to get an actual decent replacement and after to settle for something less than.
Renewal Price Rise
Have you ever noticed that every time your car insurance renews there is a price rise for some reason? Well apparently insurance companies do this on purpose. They get away with it because the majority of people don’t pay attention when they are too busy juggling everyday life.
Insurance companies also have a very desirable introductory offer. When the time comes for renewal they very often try to nonchalantly insert a price rise with no explanation, because there is none! Even when you have not gotten in any accidents or been given any tickets they still add in a price rise. This is yet another ridiculous insurance scam.
Are you an avid traveler? Without fail, travel agents try to sell you on what they say is much-needed travel insurance. They often terrify you of with horror stories, including extra lurid details about losing luggage or having flights cancelled.
However, what they are leaving out is that quite often you are already covered by homeowners insurance. Also, airline companies often have legal obligations they must meet. Travel agents also often get their own kickbacks from a particular insurance company, which is why they will rave about a particular company and suggest you buy insurance with them.
Have you bought a home recently? Read this before you decided to purchase title insurance. It’s definitely necessary for home buyers to get title insurance but it is better to be cautionary and not listen to the advice of your broker. Your broker is, like many others, often out for themselves in a situation like this.
They will frequently have a relationship with a particular title company, and thus push towards that specific one. They also definitely won’t let you know that the company that the previous owner used is likely to offer better rates because they are already familiar with the property. The lesson here is to shop around and don’t necessarily settle for what the broker is telling you.
Here is yet another scam that insurance brokers attempt to get over on you. Here are some things to keep in mind if you are planning on buying life insurance. Often a broker might be trying to sell you whole life insurance.
This is often advertised to you as an “investment”. In reality, a term life insurance policy is often the much better option for you as you actually pay less and have extra money on the side to invest. However, pushing the whole life insurance will make the insurance company more money, and therefore they try to pedal that option to you.
Insurance Companies Profit Off Katrina
After the horrible natural disaster of Hurricane Katrina in 2005, insurance companies even attempted to profit off people’s misfortune. This is completely unacceptable! In the states of Louisiana and Mississippi particularly, people who held homeowners insurance policies tried to collect on damage to their homes that was done by the wind.
Obviously, wind is something that would go hand-in-hand with a storm like a hurricane. Yet, insurance companies sneakily tried to characterize all damage as water damage done by flooding. Unfortunately, homeowners insurance does not cover floods, and flood insurance is an entirely different policy. Obviously, insurance companies nor those who run them have any sense of empathy.
Purchasing Flood Insurance
Quite often people are not aware that they must purchase flood insurance separately but it is an absolute must if you live in an area prone to flooding! Why would insurance companies separate flooding from a homeowners policy? To make more money, of course! Many lawsuits arose after Katrina, alleging that insurance companies were purposely exaggerating flood damage so that US taxpayers would be the ones footing the bill.
And even worse, insurance companies allegedly trained their employees to underestimate repair costs so they wouldn’t have to pay full liability coverage. In a time when people are suffering so horribly, like after Katrina, moves like this are completely incomprehensible. There should be some kind of legal ethics check for insurance companies that do this.