This post on Powerline discusses the same issues I have been concerned with, namely the difference between insurance and what we call health insurance. He also links to an excellent piece on the issue of pre-existing conditions.
There are two basic problems:
First, if you get sick and then lose your job or get divorced, you lose your health insurance. With a pre-existing condition, new insurance will be ruinously expensive, if you can get it at all. This, the central defect of American health insurance, explains why most Americans are happy with their current coverage yet also support reform.
Second, health care costs too much. Yes, we get better treatment, but the cost-cutting revolution that has swept through manufacturing, retail, telecommunications and airlines has not touched health care.
I agree completely with both points.
A truly effective insurance policy would combine coverage for this year’s expenses with the right to buy insurance in the future at a set price. Today, employer-based group coverage provides the former but, crucially, not the latter. A “guaranteed renewable” individual insurance contract is the simplest way to deliver both. Once you sign up, you can keep insurance for life, and your premiums do not rise if you get sicker. Term life insurance, for example, is fully guaranteed renewable. Individual health insurance is mostly so. And insurers are getting more creative. UnitedHealth now lets you buy the right to future insurance—insurance against developing a pre-existing condition.
This is a great idea and one that had not occurred to me before.
The right to future insurance could be transferrable to another company, for example, if you move. You could have the right that your company will pay a lump sum, so that a new insurer will take you, with no change in your premiums. Better, this sum could be occasionally placed in a custodial account. If you got sick but had something like a health-savings account to pay high premiums, you could always get new insurance. Insurers would then compete for sick people too.
Innovations like these would catch on quickly in a vibrant, deregulated individual insurance market.
How do we know insurers will honor such contracts? What about the stories of insurers who drop customers when they get sick? A competitive market is the best consumer protection. A car insurer that doesn’t pay claims quickly loses customers and goes out of business. And courts do still enforce contracts.
The left will, of course, be uninterested in this sort of innovation because they, like the Jacobin Club in Paris 1789, are interested only in control. Any argument that reduces control will be rejected. Only they are entitled to be in charge. If you doubt this, read about Obama’s concept of medicine and doctors’ motives. From Obama, we are offered the IRS monitoring our insurance.
Read the rest of the article.
Here is an article about innovation in the care of the elderly. There is hope that Medicare may support this approach but, aside from the really poor, I doubt it will be worthwhile except as part of a retainer practice.
This Atlantic piece is pretty good and has some useful suggestions about how reform could work. The author describes himself as a Democrat but is refreshingly candid about the fact that Obama’s proposed legislation will not solve the problems the writer sees. It’s worth reading.
Tags: economics, health care
The idiot who is AMA president this year was talking about the reasons why the AMA supports the Obama plan (whatever that is) and mentioned pregnancy as a “pre-existing condition”! Some poor woman was trying to get insurance now that she is pregnant. This is exactly the issue but he was on the wrong side of it. Why didn’t she keep her legs together until she had insurance ?
Oh stuff it, bots.
I haven’t found the solution to the comment spam except diligence with the spam button. It should be screening them but Word Press is not as swift as it could be.
Oops! Now I look rude.
It really does seem to be pandering to the lowest common denominator to imply that one should be able to buy coverage after discovery of a health issue. Don’t people understand that’s not how it works? Talk about infantilizing the populace.