It seems like on any given weekday morning over the last 6 months you could flip on the television to CNN or the like to see Obama talking to a select crowd in Ohio on health care. HIs favorite rhetoric on the topic is to talk about insuring everyone with preexisting conditions that those evil and lucrative insurance companies refuse to insure. You could then flip it to another 24 hr. news cycle to see Mitch McConnell or John McCain informing us that the Republicans also have ideas for health reform including providing insurance to those with preexisting conditions. This seems to be one of the only bipartisan agreements in the whole health care debate. It sounds like a great idea, but nobody seems be asking the question; what about the costs?
We have to look at health insurance as a means of spreading out risk amongst a large number of people by pooling everybody’s money together and redistributing it to those who need it. I pay insurance that I might never use, but it will go to help the poor guy down the street when he has a heart attack. That’s why insurance companies refuse to insure people with preexisting conditions. They are at greater risk, and if insurance companies insure them the cost for the pool increases. The result is that the price of insurance is higher for everybody isn’t it? I find it hard to believe that the only reason people with preexisting conditions aren’t covered is so the evil insurance executives can head home with extremely fat checks. The cost of health care is expensive and is not likely to change until we make it a consumer based system. The costs of insuring everybody have to go somewhere, and isn’t that going to be the consumer who is already pleased with is or her health insurance?
I’m not saying it’s an ok thing for people with preexisting conditions to continue to go without health insurance, but it’s time to look at reality. Quality health care has a price and there is only so much of it to go around. We will have to pay one way or another to insure them. There’s no such thing as a free lunch, and legislators don’t have a magic wand that will just make those costs disappear. Thomas Sowell put it this way in his latest article:
It costs politicians nothing to mandate more insurance coverage for more people. But that doesn’t mean that the costs vanish into thin air. It simply means that both buyers and sellers of insurance are forced to pay costs that neither of them wants to pay. But, because soaring political rhetoric leaves out such grubby things as costs, it sounds like a great deal.
February 10th, 2010 at 3:36 pm
The issue of health insurance is such an interesting topic of discussion. I liked the article and the arguments of the author about the costs of insuring those who have pre-existing conditions. In general those who don’t have insurance are usually those that either can’t afford it, don’t need it, or don’t think they’ll need it. So what happens if one of these people needs medical attention? How would the cost of their medical expenses be covered? Would the individual pay for it? Or would the cost eventually trickle down to the tax payer?
I would support a government mandate for insurance. A system much similiar to what we presently have for car insurance. Car insurance is required by law, but those laws are managed and upheld by the state. This requirement puts more financial responsibility on the owner of the vehicle for damage that they may cause. So why not a government mandate for insurance? Require everyone to have some type of health insurance so that there is more of a financial responsibility on the individual.
The health care debates biggest problem is that it is a national issue. The odds of it being resolved would be better if decided on a state wide basis much like car insurance.
Bring the debate closer to the people and let the people decide what is best for the people!
February 11th, 2010 at 9:33 pm
The health care debate is yet another arena in which the line between efficiency and morality is blurred. I think that it is unfair to criticize politicians as using “pointless rhetoric” to promote health care for those with preexisting conditions. Providing healthcare for such individuals is only fiscally irresponsible to those who oppose the legislation (just consider your personal attitude towards things that you want to purchase and things that you are forced by someone else to purchase–we are more inclined to ascribe the label of “wasteful spending” to the latter group). Those who support the legislation consider the costs and feel that they are warranted, and that they are producing a policy that will benefit society (though it may certainly be argued that omitting the costs when discussing the legislation is deceptive or irresponsible).
The real problem is that the group that would be benefiting from such a system (those with preexisting conditions) is a minority. Thus, as has been pointed out, the cost would increase for the buyers and sellers of insurance and would decrease for those with preexisting conditions, resulting in a net loss from an economic standpoint. Because those in the majority must increase their costs to insure the minority, any legislator seeking to promote such legislation must provide some incentive for them to do so. This is true at the national level and at the state level.
I would submit that the reason why those who champion such a course of action do not mention the costs is because they are aware that there really is no counter-argument from an economic standpoint. Their only chance for success is to convince the majority that the sacrifice is worth the cost, and it appears that they are attempting to do so from a moral standpoint, focusing on the “injustice” of the situation. Unfortunately for them, when money is tight, the warm fuzzy feelings that come from promoting justice and the well-being of mankind do not produce a sufficient incentive. Thus, in my opinion, they must find a way to produce some other form of incentive or the legislation will fail.
February 17th, 2010 at 11:08 am
I agree with Prestone that health care is a State issue. Nowhere in the US Constitution does it give Congress or the Federal Government the power to regulate health care, though many will argue with flawed understanding of the Commerce Clause and Necessary and Proper Clause in favor of such. The 10th Amendment leaves this issue squarely and solely in the hands of the States.
If that were the case in our modern reality, then those states who so desired would try out different forms of health care. Some would succeed, some would fail. That’s the way the market should operate. These principles and this separation of powers would ensure the federal government’s refraining from unrighteous dominion. Successful methods resulting would be incentive enough to gain support.
And I like Thomas Sowell’s article excerpt, as it points out the flaw in our modern government and people’s mindset of entitlement mentality and attempting to avoid natural consequences. I mentioned the same principles in my comment on the Keynesian Economics blog.