A good definition of marketing can be found at Wikipedia: “the process of communicating the value of a product or service to customers, for the purpose of selling that product or service.”
Actually that description would be a lot better if an adjective like “supposed” were placed in front of the word value.
Let me explain. A marketing consultant once told me a story about a project he did for a software retail chain in the late 1990s. He was tasked with improving sales of a program that claimed to make dial-up Internet connections faster.
So he re-designed the box with bold colors, a new name, and had the store place the CD-ROM in the busiest checkout lane in each store. Now, this may be pure Marketing 101, but afterward even my friend was amazed at how sales of the same, useless software skyrocketed.
I guess when it comes to selling something, it’s all about how you package it.
The same can be said for health insurance. With compelling names like “National Preferred Plan,” or “Choice Advantage,” insurers aim to lure potential customers into buying the most expensive - and therefore most lucrative - policies.
By far the most brilliant makeover marketing tactic in health insurance has been the development of the so-called "metal" plans - Bronze, Silver, Gold, and even Platinum - that are all the rage under the new ACA guidelines.
If you believe that these labels were created to help shoppers pick the best insurance, make no mistake. These shiny precious metals were designed to fool you into thinking that the more valuable the level, the “better” coverage you'll have.
I mean, who wouldn’t want to go platinum with a hit record instead of settling for gold? Have you ever heard any coaches telling their athletes to ”go for the silver?” Of course not.
In our society, platinum is better than gold, which is better than silver, which is better than bronze. Applying this to the concept of health insurance, it then begs the question - what exactly would one get for a "Bronze" level policy?
Well, as it turns out, a lot. A lot of potential risk to be sure, but in the majority of cases a lot of actual savings too. And for better or for worse, both in sickness and in health, you could be a lot richer or a lot poorer, depending upon which metal you’d like your health insurance coated with.
To illustrate, I went to ehealthinsurance.com and used The Wacasey Equation to compare various health insurance plan offerings from Aetna, Blue Cross/Blue Shield, Cigna, and Humana:
- In no cases did I qualify for a subsidized premium :(
- For myself, I used my birthday (10/12/1968), my gender (male), and my ZIP (76051).
- I did not check the “Tobacco User,” or “College Student” categories in any instance.
- I checked the “I recently lost or am losing coverage” selection, and for the “Date of
event” I entered August 24, 2014.
- For my spouse I used the same birthday as mine (10/12/1968).
- For the children I chose one Male and one Female with the same birthday (01/01/1998).
For Aetna, I compared the following plans:
- Bronze: TX Aetna AdvantagePlus 5500 PD
- Silver: TX Aetna Classic 5000 PD
- Silver: TX Aetna Classic 3500 PD
- Bronze: Blue Choice Bronze PPO 006
- Silver: Blue Choice Silver PPO 004
- Silver: Blue Choice Gold PPO 011
- Bronze: myCigna Health Savings 6100
- Silver: myCigna Flex Health 1500
- Silver: myCigna Copay Assure Silver
- Bronze: Humana National Preferred Bronze 6300/6300 Plan with Children's Dental
- Silver: Humana National Preferred Silver 3650/3650 Plan with Children's Dental
- Platinum: Humana National Preferred Platinum 1000/1500 Plan with Children's Dental
Next time we'll take a closer look at some of these numbers, and introduce a few more mathematic terms that will help quickly and easily prove - again - that when it comes to health insurance, less really is more.
Remember, It’s not the COSTS of healthcare that are outrageous…it’s the CHARGES.