Health care should be separated from health insurance like car care is separated from car insurance. When it’s time for an oils change do you reach in your pocket for your car insurance card to pay for it? “Of course not.” you say, “That would be ridiculous.”

I ask you now to stop for a second and think why that would be a bad idea.

In case you don’t know, let me give you a little primer on insurance. Insurance premiums are based on, among other things, claims – both the number and the amount of the claims. The individual states Department of Insurance ride herd over insurance companies to see that the amount paid out in claims is in proportion to the amount collected in premiums. So an insurance company doesn’t get a rate increase unless they have the claims to substantiate the increase. (That, by the way, is the one good service that the departments of insurance serve, since as individuals we don’t have the time nor the inclination nor the resources to look all of that information up.)

So let’s now go back to the oil change scenario and look at it again. Instead of the one, two or three claims that you may file in a lifetime on your car insurance, you now find yourself filing a claim every three months or 10,000 miles. What would you expect your premiums to be like? How much would they increase? Also take this into consideration; your local mechanic or oil change service would have to wait 90 to 120 days to get paid for their money for the oil change. Plus there would be layer upon layer of paperwork to file the claim. The fact is, that if car insurance was like health insurance, your local oil jockey would have to hire an entire billing department just to file the correct forms with the correct codes – not once – but maybe as many three or four times.

Do you think the oil change would still be $35.00 at your local Spiffy Lube would still be $35.00 or with the added payers of paperwork and personnel would the cost go up?

The average face time with a medical doctor in the United States in now less than 10 minutes. The average amount of office labor involved in collecting the money for that 10 minute visit is upwards of three hours. How much is that costing you? Since there are no statistics kept on this let me do the simple math for you here. Billing and coding personnel make an average of $15.00 an hour. That could mean as much as $45.00 of your health care dollar goes toward processing your claim… and that is just at the doctor’s office. To be fair it is probably close to $30.00 on average but that is still a mighty large chunk of money.

It is even larger when you look at what the doctor gets paid. (I told you earlier we would get back to this.) Don’t look at what the doctor bills, Look instead at your EOB, Explanation of Benefits that comes in a few months down the road. Don’t get caught up in the coding and insurance gibberish but instead look good and hard at the amount that was paid to the doctor. In many cases it will be something around $50.00, up to very rarely, $100.00.