Wednesday, September 30, 2009

The simplified case against this version of health insurance reform

From Angus at Kids Prefer Cheese:

I actually think we are going to get a reform that is both worse than the status quo and worse than a pure single payer system.

Kudos to our Congress!

As I understand it, insurance companies will not be able to refuse to cover some one, nor will they be able to charge high risk people a premium that reflects their risk. The price won't be uniform, but the maximum variation will be well below what it would take to correctly price the variation in risks.

As I noted before, this will make premiums for healthy people extra high. And as the WSJ pointed out yesterday, at least on the margin, it will make healthy people want to hold off from getting any insurance until they are actually sick.

Problem solved, you say?

Ahh, but now it appears that the third leg of the trinity will be rule that it will be illegal to not have insurance!

So young healthy people will be forced to buy way overpriced (relative to their risk) insurance. Plus if said young healthy people make good money, they can look forward to paying more taxes to subsidize the purchase of said insurance by others.

Guaranteed Issue, Community Rating, Individual Mandate. They sound so reasonable and innocuous, but they are freakin' lethal.


Notice that this is not necessarily an argument against health insurance reform, just an argument that this particular flavor of health insurance reform in ... financially idiotic.

2 comments:

Anonymous said...

In what media accounts are casting as a serious setback for President Barack Obama and lawmakers who back the "public option," the Senate Finance Committee Tuesday voted against including the provision in the bill. Reports also remark on GOP unity against the provision, which they compare to the Democratic split apparent in Tuesday's committee votes. Where I am a health insurance agent with www.benefitsmanager.net/SelectHealth.html . I find this frustrating somewhat. I don’t agree with the design of the “public option” where it works against a health system in place now and causes a financial burden on tax payers. But, I think we need one out there. I need the ability to get my clients a insurance policy that won’t decline them for pre-existing medical conditions. See Utah’s response to health care reform and health insurance reform. www.prweb.com/releases/utah_health_insurance/health_care_reform/prweb2614544.htm.
Perhaps the feds should look at the only second state case attempt for reform as a model. What about TORT reform? That honestly impacts doctor insurance costs as well as health insurance premiums by 13% See study in prior link.

Anonymous said...

Insurance companies win, the american public looses. Simple and to the point. Insurance companies have received 428% profit over the past 8 years? $24M for CEOS, and god knows what the rich fat cat shareholders took home.

Max Baucas, Carper et al the republicans in democratic clothing together received $19M since Feb. 2009.

We no longer have a democracy we have a corporate lobbyocracy who has bought every senator and every congress person in one way or another.

If there is no public option, no one should support this additional corporate giveaway to the for profits. Adding millions of people to the for profit roles will do nothing to contain costs, and will not add to the quality of health care.

If you want to change this country we must push for Campaign Finance and make sure there is enough money to run city, state and national elections. If any candidate is caught taking money from corporations they should be fined millions, sent to jail and force to step down as a candidate.

This should go for both corporate parties working against all of us. Thats true bipartisanship.