Individual Health Insurance Markets That Work, Part One
HLM: Where do you see opportunity for the U.S. from examples you saw in the countries you visited?
Gordon: What I saw in Australia was a working consumer market for health insurance. For example, I landed in Sydney, went to my first meeting, which was with the Director General of the Health Department of New South Wales, and then left. It was a beautiful day, and I had flown across the world and felt a sense of accomplishment, and while walking down the street in Sydney, I realized I was looking at health insurance stores.
Fifty percent of their population buys private insurance. The government really wants them to buy in to relieve the financial pressure on the public system. But then there is a whole industry that knows how to sell, service, and market to individuals. There is almost no role for employers. Employers might be a marketing channel, but virtually no one gets their health insurance through their employers, except for expats, that's what I was told.
It's very timely. Putting politics aside, we can all agree that the Healthcare.gov implementation has been sub-optimal. Where you stand on the political spectrum affects how you interpret that failure. Some people are saying, 'See? That's why we shouldn't have this legislation,' and others are not worried about it.
What I would say, based on what I saw in Australia, is it can work, it does work. I think a lot of people have dismissed that we (U.S.) could have a working market for health insurance. But, the fact is there is a country, not that dissimilar to ours… that has in its mix a thriving health insurance industry that serves individuals.
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