Insurance and Assurance
I ran into a rant on health issurance following a comment on another entry. I was thinking about this the a couple weeks ago when I was in the hospital a lot when my daughter was born. One notable exception is in elective procedures, particularly LASIK, but also general cosmetic surgery. The competition is pretty healthy among doctors who perform LASIK, but that procedure is paid for out of pocket - when I had mine done about 5 years ago, my insurance covered 25%, but the remainder was out of pocket. Dropping $5000 on surgery makes you think really hard about the tradeoffs. In that case, for me it was worth it to pay a premium to get an exceptional doctor, as I have a friend who had a botched RK - the prospect of ending up worse than I started was not at all attractive. Dentists also seem to be more open about out-of-pocket costs as well. I'd guess that's because fewer people have dental coverage than have health coverage.
The thing about health insurance is that it's not really insurance in the sense of homeowner's or auto insurance. Insurance companies have a strong incentive to reward preventive health care such as semi-annual dental cleanings, because it lessens their risk that they'll need to pay for a filling or root canal later on. Similarly for vaccinations - better for the insurance company to risk handling a few adverse reactions than having to pay for treatments of the disease. Maybe there's another incentive that could be used; for example, asking people to pay out-of-pocket for routine visits in exchange for a rebate on your insurance premium. Another example would be an epidural - my wife has given birth without an epidural twice, which she did primarily for the experience of giving birth, but you can't avoid the fact that that choice saved our insurance company several thousand dollars.
OTOH, the way insurance is going, I expect we'll be paying out of pocket for routine care before too long. Co-pays are getting to the point where you sometimes might as well pay out of pocket. Particularly for prescriptions; with generic drugs, the price of the drug is frequently lower than my co-pay.
One thing that does alarm me is the Google ads that show up on my posts about the baby; there's always at least one for a malpractice lawyer. Malpractice premiums are absolutely a huge cost in health care. A former co-worker told me that his brother had to pony up $45 K annually just to set up a practice, and that premium doubled as soon as he took on his first patient.