Health pensions and trusts: not health insurance

Health insurance is a misnomer. We can’t insure our health. It is not like motor vehicle insurance where the guarantee is that our damaged cars will be repaired.

We need health pensions and trusts not health insurance.

For humans, as opposed to cars, insurance provides no guarantees. We can’t buy insurance that will ensure that our health will return to its previous functional level when it is damaged. Also, unlike cars, an interaction with the health care industry at some time in our lives is inevitable for all of us. Each of us will get sick at some point; use healthcare services; and many of us will die in health care institutions – usually, later in life, after an extended period of high cost health care.

As individuals, we have little control over what or how much we want to spend to “insure” our future illness care. Yet, in other areas such as pensions and education, we are able to personalise our assets in a tax efficient manner.

A first step could be the transfer of greater control of health care funding from insurers and providers to individuals and families. For example, accrued health care policies should be transferrable across, and within, families in the same way that pension sharing and allocation are now routine – even in situations where the families are disrupted such as after divorce.

The person who is accruing the health pension fund may not be the one who needs it in the future. Allocation of accrued benefits from healthy individuals to their sicker family members should be as simple as transferring loyalty points.

Underlying any changes is the transfer of greater control of health care funding from insurers and providers to individuals and families.

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