The U.S. Healthcare System Is Racist Because It’s Nothing More Than a Capitalistic Pyramid Scheme

Melinda Crow

White people didn’t plan to exclude POC from quality healthcare; they simply planned to make a bundle off of stupid white people by Satwinder Singh on Unsplash

They sold us a drug that addicted us, and like any addict, we are still in denial. We crave better plans when what we need is a system that does not revolve around “plans” at all.

Our healthcare system is not only racist, sexist, ageist, and classist, it’s dehumanizing. That’s what happens when you put a price on other people’s health and call it a “plan.”

Insurance plans were initially tied to work, which is what made them wrong from the get-go

Healthcare plans (I’m thinking schemes or scams are far better word choices) were job-related when they began in the early 1900s. Some were tied to nursing, some to educators, others to work done under hazardous conditions like coal mining.

Workers paid pennies a paycheck for a guaranteed number of hospital days a year in return. These were catastrophic hospital plans. There was no coverage for sniffles, sneezes, or sprained ankles. Payment for treatment that did not require a hospital stay was between you and your doctor (if you even bothered with one).

As companies like Blue Cross and Blue Shield (which were originally two separate companies) discovered that the true benefit to their bottom line lay in enrolling lots of healthy people whose premiums offset the costs of insuring workers in high-risk categories like those coal miners, profits soared and the pyramid began to rise.

Early plans left out people of color purely based on the type of jobs they held.

They lured workers into the pyramid with “benefits”

Any good marketer will tell you that to sell something, you’ve got to explain its benefits. Healthcare plans began as a benefit of having a certain job. Eventually, the benefits of the plans themselves expanded to include care beyond the doors of a hospital.

Employers who offered insurance to its employees were applauded — even if the employees themselves paid for the plans. The next step was an easy one: Employer-paid plans, frequently only offered to senior employees and executives.

It was capitalism at its best. The more people who enrolled (especially those in less hazardous white-collar jobs) the more money the insurance companies made. Employers benefitted because they could offer insurance as a supplement to wages without any of the payroll taxes that are levied on actual wages. Plus, workers rarely stopped to calculate the employer’s cost of insurance versus the actual pay they could have been getting instead.

The allure of a job with benefits was as blinding as that of a drug addict's craving for their next high.

Today, every single piece of the system uses the words “benefits” and “plans”

Benefits are rewards for hard work. What about those who don’t work, or who work in lesser quality jobs? No problem, there’s a “plan” for them, it’s called Medicaid. Of course, it’s a plan of far lesser quality, and it may not be accepted by every doctor. Plus there’s a stigma attached to it that keeps many from enrolling in it, even when they qualify. Unless you have children or are elderly, signing up for Medicaid feels like you are a card-carrying failure — someone unable to reach the level where jobs come with bennies.

Medicaid is the guilt-relief valve that allows everyone in the pyramid — the insurance companies, the employers, and the employees with great coverage to justify their position in the pyramid. It allows them to sleep at night thinking that there’s coverage of some kind for everyone.

And there’s no reason to feel guilty about veterans who served our country. We’ve got them covered, right? Oh, they get benefits all right. Veterans healthcare benefits are historically ranked below even the worst benefits of private insurance plans. Why? Because there’s no profit involved at any level. It doesn’t fit anywhere in the pyramid. by Yazan ALAzab on Unsplash

The scheme would never work without two key parts of the base

Medicare began in 1965. Workers pay money into the system straight out of their paychecks. Employers kick in a matching portion. (Remember why employers offer bennies in the first place? Reduced wages means fewer dollars they are required to pay their 6.2% share on.)

What’s the reward waiting for all of us when we reach 65? We get to choose from an almost incomprehensible menu of “plans” that award better benefits to those who are willing (and able) to pay more. The plan that was supposed to protect the health of our seniors slid nicely into the pyramid.

Here’s how that happened: In 2003, when the oldest Baby Boomers were 57, insurance companies saw that there would soon be a huge dent in their profits as millions of boomers retired from the employer-based pyramid they had constructed and moved to Medicare. Solution? They simply wormed their way into the system by creating Medicare Advantage plans. This created a massive base for the scheme to feed off of.

How about Obamacare? Doesn’t that help cover those with incomes not quite low enough for Medicaid or those who don’t have coverage at work? It is nothing but a mirror image of the employer-based system, except with Uncle Sam footing a portion of the bills in the form of tax credits.

Enrolling starts with an applicant’s sex, age, zip code, and income before routing them to choices of reward-based policies ranked from the most expensive “gold” plans with deluxe benefits, to the least expensive, “bronze” plans. (I’m sorry ma’am your age, gender, zip code, and bank account only qualified you for third place, but here are your healthcare consolation prizes.)

Everyone has a different story

I just had a conversation with a woman I don’t know in my front yard. She was lost and stopped for directions. She was from a nearby cluster of cities with a population of over five million; I live in a county with a population of under 30,000. Because there’s a pandemic raging, we stood the required six feet apart on my sidewalk and the topic of the virus eventually turned toward healthcare.

It was her contention, as a retired nurse, that Obamacare was the absolute downfall of the healthcare system in the country. It was obvious that she felt not only a disdain for the program, but for anyone who needed it because, in her mind, it had driven up the costs of care for everyone else.

Oh, the horror of the wealthy paying a bit more to help ensure that everyone has proper healthcare! This public sentiment is what holds us hostage to a failed system.

She was entirely ignorant of how people without employer-sponsored insurance struggle. My husband and I have been self-employed for the last 22 years. We both had corporate jobs with employer-paid healthcare earlier in our lives. We were part of the pyramid long enough to be fully addicted to the benefits of low deductibles and copays and premiums paid by our employers.

I remember the heady feeling of landing a job with benefits that provided full coverage, including dental and orthodontia. At age twenty-eight, I finally got the braces that my single mom had never been able to afford thanks to my employer-based health insurance.

When you are on the receiving end of benefits like that, it’s impossible to see the harm of a healthcare system that is so grossly intertwined with employment — one where white twenty-eight-year-olds with mediocre pink-collar jobs could have all the healthcare they wanted. One where a complicated pregnancy cost me only a thousand dollars, including labor and delivery. Plus, that child was covered under my plan the minute she entered the world.

It was a system where a young black woman earning just a few dollars less than I did per month but in a service industry job because she didn’t know how to type, could not have her teeth straightened and should she become pregnant, would likely have a far lower quality of care than I had.

When my husband and I purchased our business and moved to a rural community, we sought out private health insurance. At first, it was affordable, but by 2008 (two full years before Obamacare), when the country was suffering a raging recession and just when our business was at its low point, our health insurance premiums began skyrocketing. They quickly rose from $15,000 a year to $20,000 a year to cover our family of three (our daughter was in college).

As the premiums climbed, so did our deductibles. First $5,000, then $10,000. The response from my front-yard guest was, “That’s not even insurance. Why did you pay for that?” Her tone indicated that by now she was thinking I must be a bit dense.

“Because all it would take is one car accident, one fall from a ladder, or one recurrence of my husband’s cancer to wipe us out. Our business would be gone. Everything we’ve worked for.”

“They can’t take your business for medical bills,” she insisted.

“Of course they can,” I explained. “It’s called medical bankruptcy. A court would decide what assets we were allowed to keep and which we had to forfeit or sell to pay the bills. And since we live at the business (it’s a lodging business) we could easily have been rendered homeless by one large medical bill.”

I continued to explain that we eventually signed up for Obamacare and can finally afford our crappy insurance. What I did not tell her was that we avoided signing up for the first few years it was available. Why did we wait?

The problem was pride that started with those years we spent in the corporate world working for benefits.

In our minds, Obamacare was a handout. It was for those who lost the race to the top of the insurance pyramid where the treasure chest of superior benefits was hoisted high for everyone down below to aspire to. We never thought we’d be at the bottom looking so far up.

The reward system is great for those at the top

But you never know when you are going to fall off that reward system ladder. I know a man with a job that offers health insurance benefits that I didn’t even know existed. Everything is paid for. He has no deductible. He has access to the best specialists in the country; his insurance will even seek those specialists out for him and fly him to them if he has a complex medical issue.

Guess what?

He has two complex medical issues at the same time — one of which could eventually cost him the job that provides those amazing benefits. What then? His first stop on the way down will likely be the state-run workers’ comp program (at least for the job-related issue) with benefits far below what he has been getting. Luckily, his other medical issue is not job-related so he’ll keep his primo bennies on that until the company decides whether he can ever come back to work.

If he can’t, and if he’s lucky, he’ll qualify for Social Security Disability, which comes with Medicare after two years. But for those limbo years while he waits on the disability to be approved and then the built-in two-year delay, he’ll be stuck paying premiums himself, either outrageously-priced COBRA rates if he can afford it, or he can turn to Obamacare with crappy coverage. He’ll be like a hockey player in the penalty box. Oops, you fell off the pyramid. No more healthcare rewards for you.

The real problem with a rewards-based healthcare system is that it comes with penalties — even if you cannot work due to a physical disability.

The top of the pyramid is a mirage you can never reach

The insurance companies sit at the top. They rely on the recruiting efforts of the next layer: the U.S. government and employers. The upper layer of the insured consists of those with employer-sponsored plans. The bottom layer is for those with government-sponsored plans. As an insured, you are continually teased with better healthcare if you just work a little harder or spend a little more of your hard-earned money.

But that’s the mirage. You can’t ever break the ceiling of your layer in the pyramid and you will always, always (unless you’re a billionaire, in which case you honestly don’t need insurance) slide down to the government-sponsored levels, if not to Obamacare due to life catastrophes, then most certainly to Medicare when you reach 65.

There are penalties for every year you delay signing up for it. You knew that, right? In true pyramid fashion, your recruiter (the government) needs you to sign up and start paying your mandatory $144 a month — hopefully before you require those pesky and really expensive end-of-life treatments.

So tell me again why you keep saying you don’t want “socialized medicine” when you know damn well you will be on it at some point in your life.

Why wouldn’t you be fighting to make it the best socialized medicine on the globe? It feels like a huge number of people in this country continually cry “socialism” for no other reason than to protect what they deem as“their” Medicare. They somehow see it as their ultimate benefit.

And if they are near the top of the insured level of the scheme, they probably have enough extra cash for retirement to spend it on the best Medicare supplement or advantage plans.

But we could flip the scheme on its head

Rather than remaining the victims of this massive scheme, why not start thinking like the insurance companies who have been extorting us for more than a century? Let’s use their tactics against them and invite everyone in the country into the best damn socialized medicine plan, for a small token amount. Entice them with amazing benefits. Cover everyone the same, but throw in a few stupid benefits (for a stupid price) for those still attached to things like boutique hospital coverage and cosmetic surgery.

Kick the insurance companies to the curb. Find a well-managed non-profit to run the whole thing and voila! No more pyramid. No more victims.

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Available as an accomplice to your capers. Let's break out of our chains together. Writing about #travel, #business, #writing, #publishing, and #life.

Waco, TX

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