Diagnosis: Intentional Boneheadedness
Does health insurance cover stupid decisions?
Over an eight-year period, a single Rhode Island hospital treated 305 cases of intentionally swallowed objects such as razors, knives, pens, and batteries. * The swallowers ran up more than $2 million in medical bills, and 21 percent of them had no history of mental illness. If you do something incredibly stupid that you know will result in injury, does your insurance company have to pay?
Usually, yes. Insurers are free to include clauses in their contracts that exempt them from paying for self-inflicted injuries or those incurred during specific risky behaviors like skydiving. (If a self-inflicted injury was the result of depression, the insurer has to pay no matter what.) Such clauses are pretty rare, though, especially in group coverage. Plans for individuals are somewhat more likely to include such exceptions—so freelancers shouldn't go swallowing any razors until reading through their contracts carefully.
A potential catch for would-be sword-swallowers is that until the full panoply of protections in the health care reform bill comes into effect, insurance companies can deny coverage to prospective clients based on a history of risky behavior. Companies sometimes scour applicants' medical records for evidence of frequent emergency room visits or revealing doctors' notes. New rules will severely limit the factors they can consider starting in 2014.
Life and disability insurers are often stricter. Certain companies refuse to pay your disability and long-term-care benefits if you hurt yourself committing a crime, become disabled because of a drug addiction, or injure yourself intentionally. However, after years of confusion and controversy, life insurers now usually do pay the family of a suicide victim, as long as the victim has been insured for at least two years. (So if you swallow razors and the ER doctors save you, you might get your long-term or disability policy voided. But if they don't save you, your family will likely get a payout from your life insurance company.)
Economic theorists have long been concerned about moral hazard—the assumed tendency to engage in risky behaviors, like eating razors, because your insurer will always have your back. But recent studies have shown the opposite to be true. People who have health insurance are actually less likely to drink heavily, smoke, or have a high-risk job such as logger, airline pilot, or taxi driver. The insured are also more likely to wear seat belts and seek preventive care services. Researchers speculate that risk-loving people may perceive forgoing health insurance as just another adrenaline rush.
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Explainer thanks Seth J. Chandler of the University of Houston School of Law, Timothy S. Jost of Washington and Lee University School of Law, Lori McLaughlin of WellPoint Inc., and Susan Pisano of America's Health Insurance Plans.
Correction, Nov. 10, 2010: The original mistakenly stated that 305 patients were treated for swallowing foreign objects. It was just 33 patients; they were responsible for 305 cases. (Return to the corrected sentence.)