An individual has left some comments to my post on a free market health care solution to pre-existing conditions. Rather than continue that dialogue in the comments, I thought it would be interesting to bring it up front as a post.
In response to that person saying, “If such an option is deemed profitable, then why hasn't the "free" market opted for it?” I had noted that the policy analysis had this to say:
"The individual health insurance market is already moving in the direction of health-status insurance. To let health-status insurance emerge fully, we must remove the legal and regulatory pressure to provide employer-based group insurance over individual insurance and remove regulations limiting risk-based pricing and competition among health insurers"
His reply is as follows in bold font, my reply in normal font.
You wouldn't need to shy away from group rates for this option. It can be just as easily implemented in the group rate or union benefits, or a stand-alone package to supplement your current insurance (since you are free to purchase your own insurance outside of your current employer's plan). It doesn't matter who pays for it, as indicated by the last paragraph of your post, so long as someone does.
The above is really a shallow reading or misunderstanding of what the policy analysis actually said, as we shall see.
I just finished reading the original policy analysis.
This seems to indicate the earlier comments were rather uninformed, but as we can see, he still didn’t understand the points made.
And since this individual might complain that I didn’t provide a link to that analysis, I’ll explain why that would be a rather silly retort. In my post, I noted a link to that analysis was available at the Patient Power blogs. As I had already quoted their post, I felt it was not appropriate to also have the link to that analysis in my post and I wanted to drive traffic to them so their entire commentary could also be read. Apparently, this critic is too knee-jerk in character to click a couple times, read, and then comment.
What sounded like a good idea, this professor applied it very horribly. Remove all employee group plans and government options?
No, simply equalize the playing field so there can be competition. This would be the shallow reading or misunderstanding I alluded to earlier. Right now, as noted in the policy analysis that he claims to have finally read, employer provided health insurance has a tax advantage. This advantage works to keep consumers captive to employer provided health insurance which leaves them vulnerable to being uninsured when they lose a job. This does not eliminate employer insurance but enables more competition and choice for the consumer.
The analysis also said government could provide money for purchasing health status insurance for those who already had pre-existing conditions and had no opportunity to purchase it themselves. Obviously “all government options” have not been removed. One really has to wonder what this person was actually reading to miss that.
For someone who obviously thinks highly of their own intellect, one has to wonder what the problem is with understanding what was proposed. There is the possibility of blind partisanship, or even intellectual dishonesty. Then again, maybe he just doesn’t have the discipline to get past his animosity towards yours truly in order to think clearly. Really, it’s been quite a while, time to grow up kid.
Have people buy insurance on their health insurance? What's the difference between this and the credit default swap that tanked our economy?
Credit default swaps (CDS) are different in several important ways. For one, they skirted insurance regulations by not being structured as insurance. Another difference is that one did not have to actually have a stake in what they purchased the CDS for. That would be like someone purchasing fire insurance on some one else’s home. There is also some argument that CDS themselves were not the entire problem but what was also involved was the creation of moral hazard by the potential of government bailing out some companies thereby encouraging risky behavior. This doesn’t mitigate the bad decisions that some investors and executives made, but it is not as simple as CDS caused it all by themselves. As it is, the health status insurance has the features of real insurance that CDS were lacking.
Amazing the tripe free market analysts can develop. And you lap it up like it's the holy grail of free market ideology.
This is quite funny, considering his comments indicated he was rather clueless as to what the analysis actually said. The reverse may be much more applicable. It’s tempting to think he tends to reflexively reject any free market proposal offered by conservatives or libertarians. Though he tries to portray himself as open to a free market solution in a comment to another post, his blather above indicates it’s only window dressing and similar to his claiming to be non-partisan on another matter some time ago.
You should really be more educated on the economics of health and welfare. (PDF download)
The PDF he linked to doesn’t address the health status insurance proposal. It would be nice if someone would stick to the issue at hand and actually understand it before broadening the discussion. Unlike this critic, I did read it before making my comments.
I will agree that healthcare does not respond to market pressures in all aspects like other commodities or services. However, where it does and can provide an equal or better result for the consumer, we should work to provide that. To complain about our current system and using that as a sledgehammer to say it proves the free market can’t work at all is to do so while being ignorant of all the current regulations distorting the market that increase cost, and reduce choice for the consumer.
It would be nice if the government would at least demonstrate competence with Medicare before trying to do the same to our entire health care system.