The San Diego Union Tribune, today, has a story about an entrepreneur who is providing limited-benefit health plans, useable in both US and Mexico, and marketed toward low-wage workers.
Details on exactly how this works are thin, so I’m a little shaky on the economic benefits of this, but from what I was able to glean from the story, I’m not clear that consumers are getting THAT MUCH of a benefit.
So the premise is this: lots of low-wage Latino workers, who consider both countries home, don’t buy health coverage because it’s too expensive and it’s not useful in both countries. So this company, Sekure, sells insurance policies at a cost of between $100 and $300 that can be used in both the US and Mexico.
Benefits are a $300 annual maximum on doctors visits, $3,000 maximum on hospital and discounts for doctors visits, prescription drugs, etc. from participating providers.
So essentially — you get approximately $3,300 in actual dollar benefits (excluding discounts) for shelling out $3,600 in premiums. (The individual may not be responsible for *all* these premiums, the idea is employers would buy this kind of plan, rather than a comprehensive plan — or no plan at all.)
The entrepreneur says he doesn’t think this kind of plan is for everyone, and I’m sure he genuinely believes that. That’s what they all say. But the reality is, given this option – versus a more expensive comprehensive option that actually provides coverage – some employers who consider their workforces “disposeable” will opt for this cheaper, bare bones plan.
I don’t see this type of bare bones plan an “innovation.” It’s more of a distraction to what we really need to do, which is to somehow extend affordable coverage — that is useful practically and culturally — for all Californians. Lowering the bar for coverage hurts everyone.