Wednesday, October 21, 2009

My Insurance Solution

Insurance, at its core, is based on communism. It is a collective in which each participant pays the same amount and those who need it are helped. The "lucky" participants are those who pay more than they get back, they are healthy(health insurance) and alive(life insurance). There is very little social rationale for health insurance companies to be for-profit, and for non-mutual life insurance companies. These companies' business models inherently contradict the collective rationale for actually having insurance, since they want to deny coverage for those who need it (or risk needing it in the future). Insurance companies as businesses are not failures except that their progress and success directly contradicts our societal goals of a healthy populous. It therefore becomes obvious that we need to extend this basic government services to the most vulnerable segments of society, since it is under provided by the free market.

This is not dissimilar to the extra USF charges we see on our phone bills. Those charges help pay for the rural and thus unprofitable segments of our society to have basic phone service. Phone companies would never pay $100K to extend a phone like 4 miles up a road to 1 person who would pay them $30/month, but they are required to by law, and thus we subsidize. Perhaps the solution is not a public option, but an option that does not allow for denial of coverage, that is subsidized by a small tax on everyone else. Of course, that is exactly what insurance is, everyone who’s healthy and alive subsidizing those who aren’t, so why do we need these companies at all?

To implement this, we need federal regulation with states out of the picture. 1) Competition will increase because not every insurance company is in every state. 2) Maximum premiums will be regulated, to make sure everyone can afford the insurance. 3) High risk individuals, which insurance companies would deem “unprofitable” and would likely not have insured, will be subsidized by the government to the point that the actuarial assumptions used by these companies would render them profitable to take on as customers as well.

We will not need a "new" government run health plan for the uninsured and uninsurable (a new medicare), but we'll have a regulated, outsourced, and subsidized healthcare plan, which will increase competition among insurers but also increase the pie for them to make money.

And if some people still choose not to have a phone line in their house, that’s their own damn problem.

PS - I plan on editing this numerous times before its perfect.... then maybe a NYT editorial submission...

10 comments:

Anonymous said...

I feel that the argument for insuring "pre-existing conditions" is ridiculous. That's not insurance. Can I wreck my car and then go to an auto insurance company and give them the 15k dollar bill in exchange for me paying them a 1000 dollar premium? No way. In addition, it incentivizes people to hold off paying any premiums until they actually need the benefit. No system can work that way. How about your thoughts on that?

Meistro said...

How strict is your interpretation of "pre-existing?" If you have failing kidneys, need dialisis, and switch jobs, should your new insurance company at your new job not have to accept you? I think they should. What about if you get fired and need new insurance, should they not have to cover you? In both of those cases, you got sick while having insurance, and thus should continue to be covered. Under my plan, those people will have been covered when that pre existing condition happened. I have no problem if part of my insurance premium goes toward paying those expenses, that is the POINT of insurance! The problem is that insurance companies need to not only be profitable, but also grow, for their shareholders, creating moral issues that contradict societies goals and the purpose of actually having insurance. If only healhty people with low riks of disease got insurance, they wouldn't need an insurance company, they could just pool money together for a rainy day fund on their own.

The main problem isn't the denial of pre-existing conditions (which will no longer happen under my plan b/c everyone will be covered when those conditions materialize), its the denial of people just because they are old, or because they weigh too much or b/c the actuarial assumptions the company uses estimates that this person will cost more over their life than another person. When dad switches jobs, should the new insurance company not cover his kid b/c his kid has asthma?

http://www.msnbc.msn.com/id/33411196/ns/today-today_health/

Meistro said...

Are you saying we shouldn't insure old people b/c they are going to be way to expensive? I think you are... Oh wait, we don't insure old people b/c they are too expensive, so instead the GOVT pays for them. . . hmmm

The pre existing condition of "old age" is much more expensive than many other pre-existing conditions that are being denied (asthma, jouvenile diabetes, alergies)

Considering her mother and sister had breast cancer, perhaps my mom should be denied coverage b/c she has a pre-existing condition of genetics? Again, denying those who actually need fundamentally contradicts the whole purpose of insurance.

Anonymous said...

Giving everyone insurance doesn't incentivize them to live healthier lives. Why would someone eat better or exercise if they are covered?

Meistro said...

I don't believe people eat unhealthy because they have insurance and thus will be able to pay for the open heart surgery. Technically, uninsured still get open heart surgery when they need it, the hospital will have to pay the bill when the patient w/o insurance has to declare personal bankruptcy (Did you know over 60% of personal bankruptcy in this country is caused from health bills due to the lack of insurance and the inability to buy it either due to expense or denial?)

Anonymous said...

By covering everyone, you also allow for people to take preventive measures to protect their health. It is far less expensive to provide a colonoscopy, treat any suspicious growths, etc than to pay for the battery of chemo/radiotherapy treatments, the surgery, long hospital stays, etc that will be needed should the cancer go undetected for a long time - because a person cannot cover the cost of a screening test.

In regards to a chronic condition that is growing in incidence - asthma - it is far less expensive to control the condition with medication than to pay for the emergency room visits that could be easily prevented by access to regular medical care.

We can't change the behaviors of all people - but you can assume that there are people out there who because of a lack of education and a lack of access to regular medical care do not know how to engage in a healthier lifestyle. Perhaps by giving people the opportunity to have this information, we would start to see changes in behavior in a larger portion of the population. People are motivated to change their health behaviors by a range of external and internal factors. Having health insurance is unlikley to be an un-motivating factor in changing health behavior, for a majority of the population.

Anonymous said...

The problem with the car wreck example is that the person wrecking the car is not the one that ultimately pays the bill. The way our system works, we indirectly cover the medical patient whether they have insurance or not by forcing hospitals to provide the service. Since we are paying for the service one way or another, why not at least force the person to have insurance. It's amazing to me how many people play russian roulette with their and their children's health by opting not to get insurance. Unfortunately, when their gamble fails we pay the bills.

Meistro said...

http://www.livestrongaction.org/campaigns/healthcare

Lance Armstrong just sent me that. Cancer survivors are denied future coverage...

Mom said...

Definitely NYTimes-worthy.

Anonymous said...

Just try to make sure you don't let anything logical or anti-bureaucratic slip in there when you send it in. And certainly use big words and long sentences to try to obscure your obvious political bias in a shroud of elitist condescension.