in Musings

Dependent Verification programs are a stupid idea

Many employers are implementing audits of those employees using their company’s health insurance to verify that the dependents claimed are eligible to receive health insurance benefits. I think this is … well, evil.

Sez the Pittsburgh Post:

Employers like the audits because they are often able to help save on health care costs overnight without reducing benefit levels for employees. One in-depth study by the University of Colorado showed the return on investment for its own audit was 13 to 1, in the first year.

But employees targeted by the audits aren’t always fans.

“It creates a lot of anxiety,” said Richard Kolodziejski, legislative affairs director of the Minnesota Association of Professional Employees, whose 13,000-member union is now in the middle of a 130,000-employee audit covering all of the state’s employees.

Or as the Physicians for a National Health Program says:

Many employers have instituted dependent verification programs in order to ferret out this fraud. Is this really what we want to be doing?

It seems ironic that at a time in our history when theoretically we are attempting to enroll as many individuals as possible in health insurance programs, we are pushing a program designed to disenroll individuals currently covered as dependents when they are not technically entitled to such coverage.

We are expanding yet more administrative excesses which are resulting in the opposite of our policy goals. That is, we are increasing the numbers of uninsured through application of these dependent verification programs.

Wouldn’t it be far simpler to have a system that automatically covers everyone, regardless of dependency status or any other criteria? Instead of advancing policies that make health care coverage a crime, shouldn’t we make health care a right for all?

It would be one thing if employers offered first class insurance programs but gone are the days where one’s employer picked up the lion’s share of healthcare costs. Today’s reality is one of high deductibles and spiraling out-of-pocket charges. Forcing employees who are already footing most of their own healthcare bill to cough up extensive paperwork proving the dependents they claim are actually who they say they are is petty and distrustful.

And what if Joe Employee’s sick five-year-old kid is found to be ineligible for coverage? Can anything good come from kicking the kid off health insurance? The kid is going to be SOL and how do you think Joe is going to feel about working there any longer?

Is there anything more evil than a company that would deny a kid healthcare just to save a few bucks? At a time when we should be getting more people health care coverage, why are so many employers focused on kicking more people off of it?

There is plenty of obscene cost to be trimmed from what passes for this country’s healthcare. Going after kids wouldn’t be the first approach I would take. Dependent verification is a stupid idea being sold to employers by healthcare companies that are only looking to make a buck. As Freakonomics says,

The next time you’re counting up all the reasons why employer-based healthcare insurance is a bad idea, you can include this one, too.