I want to make a point about our capitalist system, privatisation of essential services and ‘competition’.
This week I took a day of annual leave from work. That sounds nice but the day off was necessitated by a weight of personal administration which had been building up for some time that I wanted to knock over in one hit. One task was to reconsider our options for private health insurance. Sounds like a gripping subject for a blog post but please bear with me…
A few years ago we upped our hospital cover to the top rate and purchased extras for the first time. Since then we have claimed nothing, nada, zip. And we are currently paying out $328 per month for the privilege. I decided a while ago that it wasn’t worth it but when I went online to look for information about private health insurance I was confronted with a confusopoly*. I baulked and put off the task of further investigation.
But yesterday I bit the bullet. It took me about three hours online, a few cups of tea, many sighs and several swear words. In the end we went with the same company we were already with, lowered our cover and will save around $130 a month.
In the three hours I checked out about 10 different companies and got quotes for each. I struggled to understand the terminology on each website as these companies make up their own terms for the same thing (accident override anyone?). I learned that ‘joint services’ may or may not cover reconstruction or replacement – you need to read the fine print.
This in itself is a confusopoly, but the health insurance industry takes this a step further. Not only are there company websites but also an array of ‘helpful’ sites promising to take the guess work out of shopping around by comparing options and recommending the best one for you (Compare the Meerkat ring a bell?) The thing about these sites is that they are in league with the insurance companies. They will only recommend policies from companies with whom they have a relationship because they make commission (reportedly as much as 50% of your first year’s premium) when you sign up. Make no mistake, that commission makes your premium more expensive. So now we are not only paying for insurance, but we are paying for advice about which insurance is right for us. And this in a country with an enviable public health insurance scheme available to all – Medicare.
Confusopoly is not confined to the health insurance industry. Think telecommunications, energy and banking. Like health insurance these industries have spawned ‘helping’ industries dedicated to taking more of our money in return for advice about how to spend what little remains. Look online and you can find endless sites which, for a fee (either upfront or disguised somewhere in the cost of what you end up buying), will help you to navigate the confusing array of product options available.
This is one thing when it comes to discretionary spending. I don’t mind looking at product reviews and spending a bit of time considering options for the purchase of a holiday or a new coffee machine, for example. I don’t ‘need’ these things, so the time and money I spend on them is entirely at my own discretion. But when it comes to health insurance, telecommunications, home loans and electricity I have much less choice. I have to purchase these things (I know, arguably I could go without private health insurance but that’s a subject for another blog post..). For this post we’re thinking about essential services.
When progressive governments went through the process of selling off their stake in essential services and opening these markets to competition we were told this would be a good thing for us. Privatisation, it was argued, would lead to increased competition which would lead to better products offered for lower prices. They didn’t tell us that to find these supposedly cheaper products we would end up paying a premium for advice about an ever more confusing array of options, and they certainly didn’t tell us how long we would spend wading through the options and the advice to find the best solutions.
And here’s the nub of it: I don’t want to spend my life comparing options for health insurance or electricity. Why would I choose this over hanging with my friends and family, or writing or reading or just about anything else? I just want to be able to afford medical care when I require it and for the light to come on when I flick the switch. I resent the three hours I spent looking for private health insurance, the day of leave I took to do it, and the $23 I paid Choice Magazine to help me understand what I needed to know to make a good selection. I get angry when politicians respond to increases in the cost of living by telling us that good deals are out there if only we shop around. Just make it easy and affordable and let us get on with the business of living.
*Confusoploy: For those unfamiliar with the term, it was coined by Scott Adams, author of the well-known and genius comic strip, Dilbert. According to Adams the word, a portmanteau of ‘confusion’ and ‘monopoly’, describes a group of companies with similar products who intentionally confuse customers instead of competing on price.
