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Agence France-Presse, AFP, is in the news business. It is a leading global news agency, which bills itself as ‘providing fast, comprehensive, and verified coverage of the events shaping our world and of the issues affecting our daily lives’.
The first paragraph of AFP’s article datelined Washington DC, published in last Sunday’s Observer, read: “Jokes, snark (an attitude or expression of mocking, irreverence, and sarcasm), and a striking absence of sympathy have dominated public sentiment since the murder of a US health insurance executive – exposing deep frustration and anger with America’s medical system”.
US Senator Elizabeth Warren did not mince her words in the wake of the killing. She said “the visceral response from people across this country who feel cheated, ripped off, and threatened by the vile practices of their insurance companies should be a warning to everyone in the health care system”.
A reader brought the Observer article to my attention. That murder, he felt, has the potential to affect our daily lives in Jamaica. Were there any lessons to be learned from the killing of UnitedHealthcare CEO Brian Thompson who was shot dead outside a New York hotel on December 4 in a targeted hit? My initial response was no.
That incident was more likely to occur in the US because of easy access to guns, the size of its population plus the fact that as of 2023, about 92 per cent of its citizens had health insurance coverage. More persons were likely to be affected by the actions of insurance providers – negative or otherwise – than in Jamaica.
UnitedHealthcare is the largest provider in the United States. It insures 50 million people and earned profits last year of US$16.4 billion. One research firm found that the provider denied one out of every three claims that were submitted for reimbursement. Its rate of claims denial was two times more than all the other health insurers. Medical bills are a leading cause of personal bankruptcies in the US. Even with health insurance, many people face high out-of-pocket costs that can quickly become overwhelming.
In contrast, Jamaica’s smaller population, gun laws, and the 25 to 30 per cent of its population who have access to health insurance are likely to face lower levels of frustration and anger with the medical insurance system. Informal surveys here suggest that health insurance outcomes seldom meet claimants’ expectations.
Claims for life-threatening illnesses, from my first-hand experiences, are mechanically processed with minimal human intervention or communication and services are delivered in an uncaring manner. No information is usually provided about an appeal tribunal in the event of a claims dispute. The prevailing ethos is, take it or leave it. We know best. Our decision on your claim is final.
Local consumers have little influence over how health insurers behave. This is because there are only three providers, and they are not equal. The companies call the shot. The result is that insurers’ actions will be driven by what is in their best interests.
Based on the local health insurance market’s history, it is therefore unlikely to take any actions on its own initiative to improve consumer outcomes except when forced to do so by regulators. On the other hand, local regulators do not have a history of taking initiative-taking and decisive steps to steer insurers to do things that are in the best interests of the society.
Andrew Witty, CEO of UnitedHealthcare’s parent company has the message. He drafted an essay that was published last Friday in The New York Times. He said, among other things, “we know the health system does not work as well as it should, and we understand people’s frustrations with it. No one would design a system like the one we have. And no one did. It’s a patchwork built over decades. Our mission is to help make it work better”.
Industry experts forecast that the brazen killing of Mr Thompson is likely to trigger changes in the US health insurance industry in at least three broad areas as follows:
1. Re-evaluation of industry practices
• Claim denials and transparency: Insurers are likely to revisit denial practices and communicate more effectively with patients and providers to minimise grievances and public backlash.
• Customer relations: Providers may implement strategies to address customer concerns more proactively to prevent escalations and improve public trust.
2. Reputation management
• The incident has highlighted tensions between the public and the health insurance industry, particularly regarding perceived profit motives and limited coverage options. Companies may work to improve their image by emphasizing their role in delivering accessible healthcare and addressing public frustrations.
3. Policy and regulatory changes
• Regulatory oversight: The tragedy is likely to accelerate regulatory efforts to ensure fairer practices in health insurance, particularly around claim approvals and customer grievances.
• Legislation: Lawmakers could introduce measures aimed at balancing the profitability of health insurers with greater protections for consumers.
The United States, like Jamaica, is a member of the International Association of Insurance Supervisors, IAIS, a voluntary membership organisation of insurance supervisors and regulators from over 200 jurisdictions, representing 97 per cent of the world’s insurance premiums. Benefits of membership of this entity includes the development of international standards and best practices in insurance supervision.
Will the conduct of insurance business in Jamaica continue to remain immune from the changes that are likely to take place following Brian Thompson’s murder? The answer is it’s unlikely.
IAIS Core Principle 19, Conduct of Business advocates that “insurers and intermediaries, in their conduct of insurance business, treat customers fairly, both before a contract is entered into and through to the point at which all obligations under a contract have been satisfied”. The changes are not projected to take place soon.
The Financial Services Commission is reorganising to focus on market conduct and consumer protection – issues that it has ignored in the past.
Cedric E. Stephens provides independent information and advice about the management of risks and insurance. For free information or counsel, write to: aegis@flowja.com or business@gleanerjm.com
English (US) ·