The insured (that’s you and I) are faced with a simple choice. Avail ourselves of a free vaccine and reduce our risk of hospitalization from Covid and its subsequent variants by around 90% or continue to expose our insurers to a potentially astronomical hospital bill or life cover claim. It isn’t difficult to foresee imminent changes to an industry that is built on risk management.
With figures quoted in past weeks for those recently hospitalized for Covid-19 infections, one clear trend is emerging. It’s the unvaccinated that are taking up beds and developing severe and often terminal cases of Covid-19. Take this staggering statistic.
“99.2% of U.S. COVID deaths in June were unvaccinated people”
In countries where there are vaccine shortages, the problem is even more pronounced. South Africa has vaccinated around 3 million of its 60 million people and a third wave is now sweeping the country, with hospitals at capacity. There simply are not enough vaccines available.
America doesn’t have this problem. They suffer from an even greater conundrum, one that has had the Federal government scratching their heads. How to overcome vaccine hesitancy in a country beleaguered by conspiracy theories and radical fringe elements bent on discrediting the scientific community.
Arguably a community that during the course of the pandemic, has often proven at times to be its own worst enemy.
Currently, large swathes of America — notably in Republican territories — remain unvaccinated and their intent is clear. To remain so. As the Delta variant gains a new foothold in states like Texas, Florida, and Mississippi, and hospital numbers again begin creeping upwards, health care insurers are on the verge of providing the impetus for covid vaccination the federal government has to date been unable to supply.
And sadly, for the unvaccinated, it’s not just their healthcare insurance but life cover too that will be affected.
Vaccinate or pay up
Various scenarios are going to emerge over the coming weeks. I’ll deal with the most likely and least controversial first and for those considering this an immoral use of pressure to ensure vaccination, please consider this. If you were a house and you were unvaccinated this what you currently look like to insurers.
If you build a house in an area prone to flooding, your home insurance is going to be adjusted for the risk. Choose higher ground, where it’s safer and the premium drops to reflect the lesser risk. Health and life insurance are no different. If you smoke or drink heavily, your premiums reflect it. More risk.
1. Increased premiums from private insurers
If you are not able to provide proof of vaccination to your healthcare insurer, expect your monthly or annual premium to skyrocket. There is clear statistical data now available for healthcare insurers to develop risk models for the two scenarios. Covid-19 vaccinated versus the unvaccinated.
Understand you’re not being forced to take the vaccine, you’re merely being penalized for not taking it. Like building that house on flood-prone land. If you’ve been vaccinated you pose far less risk and therefore will benefit directly by not facing increased premiums. Hell, they may even give you a discount.
This is a sound business move and in an industry that can ill afford to increase the risk they carry, passing it back to you in terms of increased premiums will be the most immediate response. Look at it along the lines of gentle persuasion. Help us and we’ll help you.
2. Refusal of coverage, or exclusions
The alternative option is one of refusal of coverage, and one that may well be favored by some companies, and may possibly even affect Medicaid should a desperate government be able to address changes to the Affordable Care Act. In other words, if you are not vaccinated against Covid-19, you will not be eligible for medical coverage for Covid-19.
Various models can be explored under this scenario. Increased payment from the insured (larger excess payments for the unvaccinated) is one possible solution all though many insurers may simply choose to void coverage entirely.
Life insurance premiums
Exactly the same logic applies to your life coverage. Like it or not, pro-vaccine or anti-vaccine, your personal life cover is based on risk. Without the vaccination, your risk of death is increased. If you already suffer from related conditions likely to aggravate a Covid-19 infection, obesity, diabetes, heart conditions, and other diseases considered comorbidities, expect a massive hike if you’re unvaccinated.
Conversely, those vaccinated may well be in for a small premium reduction to reward them for playing ball, so to speak, in terms of managing their risk profile. Again, for the conspiracy crowd, this isn’t a coercion tactic. It’s about simple business and risk models. Stop smoking and drinking, shed fifty pounds, and watch what happens to your premiums.
In exactly the same way your address affects your insurance premiums, so too, your Covid vaccination status.