Inn-Sewer-Ants

[vovat]

I'm not quite sure what to think of the proposed idea that every American should be required to have health insurance. This article says that advocates of this idea are trying to determine how "to make insurance affordable to the uninsured," but I have to question whether what industry officials (and members of Congress, for that matter) consider "affordable" is the same as that of the average American, especially if said average American isn't making much money and has no obvious medical conditions. I'm in favor of universal health care, but I think you should even be able to opt out if you'd like. I mean, if you were able to get medical care for free, but you thought you could get better care by paying for it, why should anyone stop you? The article mentions how Ted Kennedy is trying to keep the insurance companies involved, unlike Hillary Clinton did in the nineties. I guess that's a good idea in that we probably won't get rid of the insurance companies, but I still kind of think they SHOULD. I suppose I don't think that health is something that our country should be gambling on, and isn't that largely what insurance is? But since I'm also opposed to layoffs, I think the abolition of insurance companies should be accompanied by helping the people working in them to find new employment in fields where their skills would be of use. Numbers racketeering, perhaps? (Just kidding. I think.)

Comments

I think you should even be able to opt out if you'd like.

[bec-87rb.livejournal.com]

Good point.

Here's the problem: insurance companies are not our friends. They only survive if they suck more money out of us than they pay out, and if they took their cut proportionally, no one would buy insurance, because it would be a bad deal. Health insurance only works because healthy people pay good money for someone else's care.

Furthermore, there are two kinds of people who don't pay into insurance: people who, regardless of their health, simply cannot afford it, and healthy people for whom health insurance is a bad deal. This second set of folks make out better monetarily if they pay as they go out of their pockets for doctor visits, and don't offer to pay for others via premiums.

The essence of this universal payer idea is that you have to make everyone join so that the healthy people who are not in the system now pony up so that the poor get care instead of dying or using emergency rooms.

As it is, hospitals bear the difference as do richer people who can afford to pay in or who pay in because they perceive higher risk for not having insurance.

It is a happy horseshit thought that if we all pay in, somehow everyone will get better care. Nope. It just shifts the burden of cost from one set of people to another and the health resources around more thinly. Notice that Canadians come here for care, not the other way around?

Re: I think you should even be able to opt out if you'd like.

[vovat.livejournal.com]

Doesn't the Canada thing actually work both ways?

[dragonxbait.livejournal.com]

We have it in Ma (mandatory health insurance). I think the idea behind it is sort of like the idea of social security. Young healthy people need to be paying into the system and not just old sick people, or it really can't be generally affordable. Also it's *very* hard to collect on medical debt, particularly from people with few assets (I speak from experience) so people who are uninsured tend to utilize medical services (like ERs and mental health facilities) and then ignore the bills. Places that take state money generally can't turn anyone away who needs care, so it raises costs for the people who are insured and are paying for their services. That said, the mandatory health insurance thing in MA has not really worked as intended and has been *way* more expensive than they expected, because there was no sort of oversight or cost regulation. One of the major insurers in this area and one of the large hospital chains are currently in some legal trouble because they basically colluded to raise prices.

[vovat.livejournal.com]

I think the idea behind it is sort of like the idea of social security. Young healthy people need to be paying into the system and not just old sick people, or it really can't be generally affordable.

I guess I agree with that in a way, what with my socialistic leanings. My main suggestion would be to cut out the middleman, and just support health care through tax money. I'm sure it would be expensive, but so are multi-billion-dollar bailouts, and the government has been handing them out like candy.

Under a system like the one Massachusetts, it does seem to me that the poorer people aren't able to afford this mandatory insurance. Or can they get it for free?

[dragonxbait.livejournal.com]

We have Mass Health which is our version of medicaid, but I think it has higher income guidelines, and you can purchase it from the state if you are self employed or work for a firm that has less than a certain number of employees. I also think there is some sort of requirement that larger employers provide it to employees, but I am not sure how this works out in practice. I do know that some of the girls at my previous job (where salaries were in the 10-15 dollar an hour range) found the health insurance provided by our work to be burdensomely expensive, but I am not sure if they had looked into the state plan or not, because this was right when the rules first changed. I agree that cutting out the insurance companies, or at the very least heavily regulating them and requiring them to operate as not for profit companies is a much better solution than what we have going on in MA. I feel very lucky to have the great insurance that I have, and I could never afford it if I were not getting it through Tom.

[graycardinal]

bec87rb has part of the equation right -- indeed, the modern health care system is largely designed to work by averaging the cost of all care over the widest possible population. This is pretty much the only way "major medical" or "catastrophic" care is affordable for 90% or so of the population (and that's more or less been true even before the last couple of decades' upward spiral in the cost of care).

However, the underlying economic model isn't unique to health coverage. Most forms of insurance work in exactly the same way. Homeowners' or renters' insurance is just as much a "bad deal" if you never need to file a claim; auto collision insurance is a "bad deal" if you are fortunate enough never to be involved in an accident, and a doctor who never gets sued will certainly grumble about the cost of his malpractice insurance.

Now as a rule, so long as everyone plays by the rules of the economic model, insurance works pretty much as it's designed to do. People who incur claims are paid out of the insurer's income (premiums plus return-on-investment of accumulated premiums), and people who don't continue to pay on the theory that they may need to make claims in the future. Yes, this is a gamble; it is not, however, necessarily a "bad deal". Rather's it's a security blanket, or a hedge against bad luck. And the flip side is also true; insurance becomes a very good deal if/when you need to make a claim for an amount far greater than the cost of your accumulated premiums (say, your house burns down).

Where the insurance model begins to break down, one of two things is usually the case. The first happens when people try to game the system in order to extract unjustified payouts -- whether by making false claims or filing lawsuits for excessive damages.

The second is trickier, and more applicable to health "insurance". Traditional-model insurance works only as long as the insurer can (a) price coverage flexibly, and in reasonably direct proportion to the overall risk/cost of providing coverage for a given customer, and (b) pay out claims to "good deal" customers (those who receive more in benefit than they've paid in premiums) by drawing on revenues from "bad deal" customers (those who've paid in more in premiums than they receive in benefits).

If an insurer has to charge all customers the same premium regardless of risk, the model breaks; both low-risk and high-risk customers will opt out -- the equalized price will be high enough to drive low-risk customers away, and for high-risk customers, it becomes simpler to pay for incurred expenses directly.

And if an insurer has to pay out benefits at least equal to the cost of base premiums to every customer (that is, if everybody starts making claims), the model also breaks -- before long the total cost of claims will exceed the available revenue, and the insurer will go bankrupt.

This is one reason I put "insurance" in quotes earlier in describing health care coverage; health care providers today are rapidly migrating away from the insurance model. Preferred provider networks are the functional equivalent of discount buying clubs; health savings accounts aren't "insurance" at all. And traditional health insurance premiums are rising so fast precisely because so many consumers are opting out of coverage, meaning that those still in the system must pay virtually the entire cost of their own care.

Abolishing health insurance companies won't help (and a number of the largest are already legal nonprofits anyway), because it mostly isn't the insurers' fault that the model is breaking -- it's a function partly of enormous amounts of government regulation, partly of immense increases in raw demand for services, and partly of the rapid pace of scientific advance (everyone wants not just access to care, but access to expensive care). The matter of providing cost-effective health care to all is a resource allocation issue that transcends the insurance model, and blaming the insurance companies is pretty much an exercise in scapegoating.

[arfies.livejournal.com]

Ever since I saw "Sicko" (yeah, yeah), it's getting harder and harder for me to accept that US health insurances companies are NOT evil...

[vovat.livejournal.com]

I feel much the same way. Yeah, Michael Moore usually only gives one side of an issue, but there was quite a bit there about insurance companies that would have been difficult to take out of context.