The American private health care system

I love the American Private Health Care. My American friends might think I’m crazy but let me explain and compare Australian vs. American private health care as I see it and having experienced both first hand. I wont go into the detail of these plans because it’s never a clean apples to apples comparison but I will compare the cover based on my usage of the plans in both Australia and USA so you can see where the 2 differentiate on a daily basis.

In Australia my wife and I had private insurance for nearly 10 years. We had MBF Healthsmart for couples. MBF stands for Medical Benefits Fund. This plan is meant to cover most health scenarios a young couple might encounter. It basically allows me to visit any specialist, hospital or medical group to get service.

In USA we are covered by HMO from Blue Shield of California. HMO is a Health Maintenance Organization. It is a medical plan that has a network of selected physicians at a modest co-pay. Thus I had to choose a “Medical Foundation” to be my primary source of care. I chose Palo Alto Medical Foundation (PAMF) because of a good reputation and of having great specialists from a top-tier USA University, Stanford University. PAMF is a massive group of hospitals spanning the Bay Area. I have 3 of them within 15 minutes drive from Mountain View (my hometown).

PAMF - Palo Alto Medical Foundation
PAMF - Palo Alto Medical Foundation

This is the only medical foundation I can visit during the year. That’s the rules of the game with Blue Shield.

Let’s compare the two plans

In Australia (MBF) In USA (HMO Blue Shield)
Dental. I have 2 root canals and in Australia was quoted $1,500 for a crown to protect those teeth. That would end up $3,000 in total and I’d be out-of-pocket by $2,700 after MBF cover. Today, I have 2 crows. Both done in the USA over the last 1.5 years and all it cost me was $300 out-of-pocket.
MBF gave me $300 budget every year on dental. Is that even enough for 1 filling and a clean. HMO gives me $1,500 budget every year on dental. Enough to get a crown, 5 fillings and 2 cleans. Here’s the catch – there is a gap and most dentists will cover this gap hence it costs you nothing out-of-pocket. Find the right dentist!
General practitioner (GP).
Free. Actually covered by the public health system else it would be a $40 out of pocket fee per visit (as of 2009). Private wouldn’t cover it. Co-pay of $10 per visit. Without the private you would end up paying in the hundreds.
Specialist visits. The Australian public health care system (Medicare) helps with covering some specialist visits to around 30-40% of what you paid. But you still have to visit Medicare, fill out a bunch of papers and wait for an hour to get your money back.
MBF covers 20-30% of specialist visits. Supposedly they would cover 100% if you could find one which is part of the MBF network and complies with MBF gap cover – Good luck with that! lol neither of the specialists my local GP suggested over the last 10 years ever were a part of the MBF network of specialists. HMO co-pay is $10 for “any” physician I see within my network. It doesn’t matter if it’s a geneticist, x-ray, ENT, skin or allergy specialist et al that I see the most I will pay for each visit is $10. Even an “in-house” procedure like Nasal Turbinate Surgery is included in the $10.
Medical supplies (medical prescriptions/drugs)
Prescribed by the GP and/or specialist vary in price and only a very very small number are covered by private. I only ever came across 1, and this I had to file & lodge the claim myself. Asthma inhaler costs around $30 (2009). Most will cost me $10 or $25 if it’s a rare med. Asthma inhaler costs me $10.
Other differences
  • Waiting period of up to 3 months before I can start using the benefits – like wtf!
  • My medical supplies are prescribed on a piece of paper and I have to hand it to the pharmacy of my choice and then wait.
  • No waiting period to use the benefits.
  • All my med supplies are electronically sent to the closest pharmacy (nominated by myself) and they call me a machine calls me to inform me the medical supplies are ready to be picked up. Typically within an hour.

So how can this be true Ernest… I hear you asking. It’s true. But only IF you have private health insurance in the USA. Without it you are a sitting duck in the water. Not only do the private health insurance plans vary in benefits, not all are as good as the one I outlined above. I consider myself lucky and am very thankful for the amazing company I work for to be offered this level of cover and security. Most companies in the bay area are known to offer benefits like private insurance (of varying degree) which helps ensure good ongoing health of the their staff. God bless America!

My aim with drawing this comparison was to illustrate that private health is all proportional to wherever you are and whatever situation you are in. Having had an active cover in Australia and one here I am able to draw on these conclusions. I hope this was an eye opener and also a myth buster to some of the false views of the American health system.

Ernest