What has caused Americans to become enraged with health insurance and what could potentially alter the situation?

• The assassination of UnitedHealthcare CEO Brian Thompson has sparked a wave of anger and resentment against the insurance industry, prompting renewed calls for reform and reigniting the debate over healthcare in the U.S.
• Numerous individuals, organizations, and professionals argue that the healthcare industry and the U.S. healthcare system have significant flaws or are entirely broken, resulting in disadvantages for Americans seeking care.
• There is less agreement on the underlying cause of insurance problems and how to address them.

The assassination of UnitedHealthcare CEO Brian Thompson has sparked a wave of anger and resentment towards the insurance industry, prompted renewed calls for reform, and reignited the debate over healthcare in the U.S.

No expert, provider, or patient would claim that the U.S. health care system functions optimally for patients, and the challenge lies in determining how to enhance it.

On December 4th in midtown Manhattan, Luigi Mangione, 26, was accused of fatally shooting Thompson outside the Hilton hotel. As the CEO of his company's parent was heading to the annual investor day, investigators stated that Mangione was a critic of UnitedHealthcare and the broader health-care industry.

The murder of Thompson led to an outpouring of social media posts expressing negative experiences with insurers, praising the killing, and threatening other insurance executives, which sparked outrage and condemnation from those who deemed the reactions inhumane following Thompson's death.

Despite spending the most on healthcare among large, wealthy countries, the U.S. has the lowest life expectancy, according to the Commonwealth Fund. Over the past five years, U.S. spending on insurance premiums, co-payments, pharmaceuticals, and hospital services has increased, as per government data.

While many individuals, organizations, and professionals agree that the healthcare industry and the U.S. system are inadequate or completely broken, there is less agreement on the underlying cause of insurance problems and the most effective way to reform American healthcare, a complex and deeply ingrained system that costs the country over $4 trillion annually.

Experts acknowledged that insurers are essential and must navigate a complex system where various stakeholders must balance providing care with profit motives. Additionally, insurers have faced challenges such as lower reimbursement rates for private Medicare plans and higher medical costs among enrollees in those programs. Furthermore, UnitedHealthcare is currently dealing with the aftermath of a massive ransomware attack that targeted its subsidiary, Change Healthcare, which processes medical claims.

Patients and advocacy groups frequently emphasized that insurers' decisions to reduce costs often come at the expense of patients. Insurers' efforts to control expenses can result in denied or delayed claims, higher premiums, and unexpected bills, which can leave patients without care and ultimately determine the difference between life and death.

Patients frustrated with a flawed system

The U.S. insurance industry is mainly controlled by private-sector firms such as UnitedHealth Group and Aetna, and operates as a largely profit-driven enterprise in contrast to most other affluent nations. As a result, the industry's primary objective is to maximize profits by charging premiums to customers and managing claims to minimize payouts while adhering to regulations and meeting customer expectations.

Insurers can increase their profit margins by weeding out unnecessary or unproven care, but they can also deny reasonable and necessary claims, leaving patients without the care they need or saddling them with high medical bills.

Insurers employ various tactics to limit payouts, such as delaying or denying valid claims, increasing premiums disproportionately affecting lower-income patients and people of color, and requiring prior authorization, which makes providers obtain approval from a patient's insurance company before administering specific treatments. Insurers increasingly rely on technology, including AI, to review claims, which can lead to inaccurate denials or improper payouts.

A March survey from KFF found that about half of insured adults are concerned about affording their monthly health insurance premiums. Additionally, the survey revealed that many adults with employee-sponsored plans and government market coverage consider their insurance to be "fair" or "poor" in terms of their monthly premiums and out-of-pocket costs for visiting a doctor.

Nearly one in five adults had claims denied in the past year, according to a KFF survey from 2023. The poll found that people who used more health services were more likely to have their claims rejected.

The exact frequency of private insurers denying claims is unknown since they are not obligated to disclose this information. However, UnitedHealthcare, as the largest private health insurer in the U.S. with a revenue of over $281 billion last year, frequently faces criticism regarding its claim handling practices.

A case brought by a severely ill student at Penn State University against UnitedHealthcare, who claimed the company denied coverage for drugs his doctors determined were medically necessary, has been settled. ProPublica's investigation revealed that UnitedHealthcare went to great lengths to reject claims, including burying medical reports.

Last year, families of deceased customers sued UnitedHealthcare, claiming the company intentionally used a flawed algorithm to deny elderly patients coverage for necessary extended care, as per their doctors' recommendations. In court filings, UnitedHealth Group argued that the lawsuit should be dismissed because the patients and their families did not complete Medicare's appeals process for their claims.

Some individuals expressed their grievances with the company's procedures on social media following Thompson's passing.

The first Instagram user expressed their condolences, but they were out-of-network. The second user commented on a CNBC Instagram post about the killing, stating that they were sorry but with the way coverage was being denied for everyday patients, they had no comment.

Caitlin Donovan, senior director of Patient Advocate Foundation, stated that celebrating or justifying the death of anyone is "appalling." However, she acknowledged that it is not surprising that people are frustrated with the health-care system.

"Donovan stated that people desire a fair system where they can pay a reasonable amount for health care coverage and access their provider's prescribed medications."

What is the root cause?

Determining which stakeholders are responsible for the issues is a complex process.

Experts contended that insurers must manage expenses under the current healthcare system, as they are primarily funded by employers and government entities that establish coverage guidelines.

If insurers paid out every claim they received, premiums would likely increase significantly, according to Evan Saltzman, professor in the department of risk management/insurance, real estate and legal studies at Florida State University's College of Business.

To maintain affordable premiums, insurers must regulate some of the claims being submitted, according to Saltzman. He conceded that insurers sometimes reject "legitimate claims" in addition to fraudulent or unnecessary care.

Insurers can aid police in identifying and combating bad actors in the health-care system, including some doctors who engage in unethical practices to boost their profits.

According to Saltzman, one of the reasons for insurance problems is the "information disparity" between patients and insurers. While patients are usually more knowledgeable about their own health risks, insurers have a greater understanding of healthcare networks and coverage specifics.

In a New York Times opinion piece on Friday, Andrew Witty, CEO of UnitedHealth Group, attributed the insurance industry's lack of transparency as the reason for the shooting. He emphasized the need for insurers, employers, governments, and other payers to improve communication about what is covered and how those decisions are made.

He argued that insurers' claim decision-making processes are based on a comprehensive and updated body of clinical evidence aimed at achieving the best health outcomes and ensuring patient safety.

Donovan criticized Witty's column for not achieving its goal, stating that the health-care system requires more transparency. However, Donovan argued that Witty's proposed solution places too much responsibility on patients.

Insurance policies are frequently written in technical language that is hard to comprehend. As a result, patients may become perplexed about what is included in their coverage and may not become aware of its limitations until they attempt to file a claim, she stated.

Donovan believes that the fundamental problem is cost, as the system is designed to prioritize maximizing prices and revenue over assisting patients.

The consolidation of the industry has resulted in limited competition, and its traditional payment model compensates providers for each service they provide, which can lead to overtreatment and higher costs.

Pharmacy benefit managers (PBMs), who negotiate drug discounts with manufacturers on behalf of insurance plans, also exert influence on other parts of the system. In particular, lawmakers and drugmakers have accused PBMs of charging insurers more for drugs than they reimburse pharmacies, pocketing the difference as profit.

While Donovan acknowledged that insurers try to negotiate with providers to lower prices for services and products, she pointed out that insurers are more focused on managing their own costs than advocating for patients.

How health care could be reformed

Experts in the industry predict that insurance companies will not significantly alter their policies following the killing.

According to Veer Gidwaney, the founder and CEO of Ansel Health, policy changes at companies won't significantly enhance patient care. His private company provides streamlined supplemental insurance for members with over 13,000 conditions.

The structural changes required in the industry may be difficult to achieve with Republicans set to control a closely divided Congress for the next two years.

Donovan suggested that the government should intensify its scrutiny of health-care consolidation to reduce costs and barriers for patients. Additionally, she proposed that legislators enact more laws to safeguard patients from surprise ambulance bills and tackle shortages in the health-care system, such as the scarcity of certain drugs or clinicians, which contribute to rising costs.

The new administration under President-elect Donald Trump may also advocate for greater transparency in the healthcare sector, as suggested by Stephen Parente, an insurance professor at the Carlson School of Management at the University of Minnesota. Parente has previously worked with UnitedHealthcare's Thompson and held two health policy positions in the first Trump administration.

The Trump administration implemented a rule in July 2022 that mandated most employer-based health plans and issuers of group or individual plans to disclose pricing and cost-sharing information for covered items and services.

Insurers and Medicare should be transparent about their denial rates, according to Parente.

Patients can take control of their own health by taking notes and asking questions during appointments, tracking insurance payments, learning more about their condition, and seeking help from third parties, said Michael Hinton, a patient with gastroparesis diagnosed more than 14 years ago.

Hinton was able to receive coverage for a critical surgery with the help of the Patient Advocate Foundation, after his insurance denied it twice.

"Hinton expressed his disbelief and sadness at the recent fatal shooting, stating that there are other ways to bring about change, such as advocating for oneself."