One can only marvel at the fact that Democrats keep saying this:
“I have a problem with this government option plan,” [Rep. Rick] Boucher [D-VA] said. “I’m troubled that the government option plan could become very popular and if it became sufficiently popular it could begin to crowd out the other” private insurance companies.
I’m interested to know what the moral case is for maintaining the profitibility and viability of private health insurance companies. It seems that Congress wants to create some kind of artificial balance where there isn’t any clear advantage to buying the public option over the private ones. The public option is supposed to put some downward pressure on the cost of buying private insurance, but without actually being, you know, a better deal. Or, if it is a better deal, it isn’t so obviously better that everyone will opt for it.
Essentially they are trying to create an alternative to buying insurance on the private market that will force the private insurers to offer plans at a lower price, but not so low as to wipe out their profitibility. The goal, I suppose, is to reach a point of equilibrium where there is no difference between the public and private options, but the private insurers are still making profits.
While doctors, nurses, specialists, and hospitals need to make a profit and earn good incomes, it isn’t clear to me why private insurance companies need to be involved in the provision of health care. All they do is increase the cost of obtaining treatment without adding anything of value to the patient. It is transparently in the national interest to provide health care to as many citizens as possible at the lowest possible cost. There is no way that private insurers should be part of solving for that problem.
What we want to prove is that we can cut the private insurers out of the transaction without it lessening the quality of or access to care. Eliminating a needless third-party that leeches record profits out of the medical system will dramatically drive-down the overall societal cost of health care and free up all that money to be used in more efficient ways.
Protecting the private health care insurers makes no sense for anyone but the private health care insurers, their stockholders, and their employees. So, why would anyone even admit to caring about their fate?
It’s worth noting that Medicare is the best thing that ever happened to the private insurance industry. People over 65 are an insurance executive’s nightmare. They have a much higher incidence of life-threatening illness, they often require long term care, and they need expensive diagnosis and treatment. The passage of Medicare relieved the private insurance companies from the responsibility of insuring the most vulnerable (and least profitable) segment of society. The taxpayers are picking up the tab, and the same is true for the healthcare afforded to our veterans. We have conceded the most desirable and lucrative shares of the health insurance market to private industry– those people who aren’t ill very often. The private heathcare scam artists are in the enviable position of insuring that portion of the population which is least often in need of expensive care.
“Protecting the private health care insurers makes no sense for anyone but the private health care insurers, their stockholders, and their employees. So, why would anyone even admit to caring about their fate?”
Because he’s really speaking to his constituents — private health care insurers, their stockholders, and their employees.
If health insurance don’t actually provide any added value to the system, then why does anyone purchase them? Part of the answer is that its tax deductible to get it from your employer, but part of the answer is that there is some value to a “good” insurance.
Sure most of the purpose can be accomplished by health saving, but there is also value to some level of screening of doctors and removing the cost deterrent from preventative medicine.
The real concern at the moment is that insurance companies seem to be making extranormal profits in part by denying claims from their customers.
Our real complaint is that insurance companies are not providing those potential services to their customers and there is very little market pressure for them to do so. Ideally the reform we arrive at will create regulations and incentives that ensure that everyone is covered and that insurance companies provide a service that is satisfactory to the vast majoreity of Americans.
you purchase insurance so you are not faced with catastrophic costs if you get ill. There is no other reason to pay for it. And if you can buy it from someone who is providing it non-profit, you will obviously prefer that. Wouldn’t you like to buy a car as cost, rather than paying extra? Of course you would.
If the goal is to provide health care to our citizens at the lowest possible cost, there is no reason to involve profit-making corporations.
The way to disincentivize overuse of the system is through co-pays and deductibles, not through tacking on needless cost.
Not sure that is how most people think of it though. For example my folks keep saying that I need insurance so I can see a doctor, I think that most Americans confuse having insurance with the ability to afford medical care.
There is a differenct between profit and super normal profit. I think that the market failure of the current insurance industry is due to lack of competition, consumer choice, and reasonable regulation. I favor a public option, but it is a means not a goal.
You should ask your parents when the last time was that a healthy man your age spent $8000/year so they could get a physical.
Why spend $8000/year to save a bit on your prescriptions?
You would never rationally purchase health insurance to make it affordable to see a doctor or pay for prescriptions. You only do it in case you have something catastrophic happen. Period.
Buying it from a private health insurer makes zero sense for you. You would obviously prefer to buy it from someone who doesn’t add profits into the price tag.
You do it because your company picks up most or all of the costs when you have a good job. Otherwise you don’t do it and then visiting a doctor is a real hassel because they are worried about uninsured patients skipping their bills and the uninsured are generally charged more for the same care.
Wiki:
Let me put this another way.
A profit motive is important for, say, the pharmaceutical industry because they use the profits to make new investments in potential new treatments. It’s important to doctors to help pay for the cost of medical school. It’s important to hospitals to keep the efficient and competitive. But the health insurance industry provides nothing to make care better. Their role is wholly superfluous.
When I was a child, five+ decades ago, a visit to our local GP cost $15. If I got a shot of antibiotic from his nurse, that was another $5. Everyone simply paid for doctor visits and prescriptions out of their pockets. Insurance was just for catastrophic illness or injury; the deductible was something like $2K which would be the equivalent of $10K today, I guess. When my mother got cancer, our family budget was hit hard but monthly payments were arranged and we weren’t bankrupted by her surgeries and treatments.
Somewhere along the line, the insurance companies managed to insinuate themselves into every medical transaction and bumped up the costs across the board. Was it the invention of HMO’s, the PPO’s? I can’t remember…
“So, why would anyone even admit to caring about their fate?”
Because it’s important for some people- those afraid of change- to have the chopice to be ripped off by these insurance companies.
I say, let them. Just give me the choice of a public option.