Health Insurance - The Cheap Rider Problem
I'm a freelancer and pay for my own health insurance. Since I'm (relatively) young and healthy, and since I rarely see a doctor more than once a year, I have a fairly inexpensive plan with a pretty high deductible.
Stupid question: If the House health care bill is adopted, shouldn't I opt for the cheapest plan that I can find?
Who cares about the deductible, the benefits cap, or the allowable procedures? Since the health care bill prohibits insurance companies from rejecting customers based on preexisting positions, couldn't I buy the "Kia" plan and upgrade to a "Cadillac" if I were to get sick?
Thought experiment: Suppose that there are two insurance companies, one that sells only Kias and one that sells only Cadillacs. Healthy folks buy the Kias; sick folks buy the Cadillacs. When the healthy folks get sick, they upgrade. In this scenario, the Kia dealer makes easy money because it never has to pay out anything. The moment its customers get sick, they upgrade, and then the hefty benefits payments are the Cadillac dealer's problem. Conversely, the Cadillac dealer gets screwed. No matter how high the premiums, benefits for sick people cost more than their premiums, which is why the sick people sign up for the Cadillacs in the first place.
Stupid question #2: If the House health care bill is adopted, shouldn't insurance companies offer the fewest benefits they can?
In becoming a Kia dealer, an insurance company can maximize the number of young, healthy members by offering low premiums, and it can minimize the number of old, sick members by offering paltry benefits.
If that's the case, then every insurance company would eventually become a Kia dealer, and there would be no more Cadillacs for sale. The nation's insurance premiums would go down, but the benefits would be poor. Deductibles would be high, and expensive procedures would be prohibited.
To date, there has been much discussion about the free rider problem, according to which "free riders" game the system by purchasing insurance only after they get sick. The mandatory insurance requirement of the health care bill avoids the free rider problem.
But what about the cheap rider problem, according to which "cheap riders" game the system by purchasing expensive insurance only after they get sick. Is there anything in the health bill to deal with this problem?
I should note that the the "cheap rider" problem may not be all bad. It could certainly bring down health care costs by eliminating expensive, unnecessary procedures. But it could also deny Americans access to expensive, important procedures that we may not want to give up. Worse, it could mean that Americans without a lot of money may forgo essential treatment because of the high deductibles.
I confess to limited understanding of the health care bill, and perhaps someone can explain how the bill avoids this problem. If so, please speak up...
Cross-posted at dagblog.com
I thought the healthcare bill eliminated caps.
As far as limiting benefits, what types of benefits do you mean?
November 11, 2009 2:13 PM | Reply | Permalink
Thanks, you're right. I'll amend the post.
November 11, 2009 2:34 PM | Reply | Permalink
You are getting very close to the truth. There is a big free-rider problem, and it is caused by the government.
We need to allow insurance companies to discriminate against anyone they want. We need to allow hospitals to deny care to whoever they want.
Right now American families pay, according this socialist site, $1,100 more a year in premiums due to the uninsured. Allow hospitals and doctors to deny care and there are your savings right there.
But as you mentioned, the problem is only going to get worse with Obamacare. Currently it is legal in Texas and many other states for insurance companies to deny coverage, or ask the consumer to pay more, for those with pre-existing conditions. After Obamacare this could be illegal.
Then you really will have temptation to not get coverage until you are sick. Granted, you may have a tax penalty, but depending on how steep the tax penalty is then it may or may not influence you to buy insurance. If the tax penalty isn't steep enough, premiums could explode.
Of course if you do buy insurance, the cheapest plan will be your best bet because you can always upgrade later. So these "cadillac" plans will be especially hard hit by Obamacare.
November 11, 2009 2:24 PM | Reply | Permalink
Thanks, Pirate. Call me a bleeding heart liberal, but I'm not into letting people who are too poor or shortsighted to buy insurance just die.
November 11, 2009 2:52 PM | Reply | Permalink
Exactly.
It is immoral to do so.
A system where the Rich stay healthy and the Poor get sick and die is immoral.
November 11, 2009 3:25 PM | Reply | Permalink
It is ridiculous to apply normal insurance concepts to health and life. Death is easy, since we don't mind a range of choices for what happens to our money when we're already dead; it's the part before then that's a problem.
We've had a couple hundred years' practice on insuring property. This is a sensible concept, since, like all investing or consuming choices, the difference between being insured and not is simply property. Similarly, the difference between buying stock X or stock Y is just money. But buying KIA plan X might mean death, and similarly, choosing to not buy, the ultimate economic verdict, means early, unneeded death for the guy considering whether to buy.
This means that people with money are as hostage to their providers as any addict, and that people with no money know they will only get help at the county hospital. What is the absolutely sensible choice for the destitute is to show up at the ER. They have zero incentive to not exploit the system. But not helping is both illegal and immoral.
This is new to the 20th century (21st is barely getting going, so let's ignore it). Before then kings and tycoons all died of infections or appendicitis, just like paupers. The main difference was the rich ate well and slept in dry, warm bedclothes. But now we have to also say that the better off will survive health crises we know how to fix, and the poor will not.
There should be a range of status; we're adapted to settle into hierarchies, to compete for better mates. But it does not need to be the conscious choice of watching the poor die or stay diseased because we're to cheap to make the reasonable state of the art available to all. Could there be anything more un-Christian than rationing health care on the basis of wealth?
There will always be difficult, expensive procedures, that can't be universal. The inequity won't go away, and expect more nasty arguing over real life extension techniques when they arrive, because they won't be cheap, either. Are we amoral enough to ensure the ultimate class war, between the near-immortal and the rest? I think I know which side I would be on, packing heat, but if I had enough money my loyalty would be strained, I'm sure.
Society has to step in and take this issue out of the realm of economics, to the extent it can. The rich will always have their private clinics, that can evade any national laws, but can we at least not give the approval of society to the most extreme selfishness imaginable? With eventual universal health care, we can make better decisions on what is appropriate intervention and life extension.
Right now there is no rationale at all, just a free-for-all of weird, perverse incentives, that sometimes reward excessive procedures, sometimes deny life-or-death procedures, sometimes reward competition, sometimes punish it, and that inarguably waste craploads of real money, unless you consider profits for insurers and doctors creation of value. And don't tell me we would not have doctors without the huge money many American docs haul in--it's one of those callings, like nursing. It's far from obvious whether have the world's best doctors, but there is no argument that we have the richest.
November 11, 2009 5:11 PM | Reply | Permalink
Right. The only way around this is single-payer, where everyone has the same specific coverage, and the young and healthy subsidize the old and infirm (until the young and healthy become the old and infirm and therefor get subsidized). Sharing the risk is the only way to make it affordable and workable. There could be private plans that would give more coverage (such as including private-room hospitalization, etc).
Currently (at least in Virginia) if you have a high deductible policy you cannot change it to a lower deductible, for exactly the reason you mention above. The only way to accomplish lowering your deductible is to get into a group plan for at least 2 years and then start all over again from scratch (assuming you didn't actually get sick during all that time).
What I REALLY don't understand is why they are trying to reinvent a square wheel! There are countries all over this world who do what we are trying to accomplish well. We could easily cherry-pick based on those country's experiences and costs and come up with something really excellent. But no, we have to get out the stone tablets and pound out our very own problem-laden system. Why is that? Can anyone tell me?
November 11, 2009 2:53 PM | Reply | Permalink
I think we're choosing to become a KIA nation in place of the Cadillac nation we once were. We've replaced "we're number 1!" for "we're number 30 and proud that the red states do worse".
November 11, 2009 3:08 PM | Reply | Permalink
KIA nation? Try Yugo!
November 11, 2009 3:26 PM | Reply | Permalink
I was going to use "Yugo" but thought that the reference might be lost on the young'uns.
November 11, 2009 3:30 PM | Reply | Permalink
What are you suggesting? Adopt ideas from socialist countries? Heresy.
November 11, 2009 3:28 PM | Reply | Permalink
I have heard more than one person say they plan on paying the fine and doing out of pocket for minor care until they have the need. I don't think we know yet whether that will make sense of be possible, but it's clear some are thinking of it.
The question I have on that is: where would the fine money go? If they kept track of how much was being paid in fines, they could argue that fines paid were helping the government pay for subsidies for the low income buying insurance? Maybe they foresee a certain number of people doing this, and it's ok by them?
There may be some answers on these questions in the Massachusetts example? They have the mandate. I vaguely recall Maggie Mahar writing some things about it not turning out all hunky dory there, yet at the same time, there are not riots in the streets about it.
November 11, 2009 3:08 PM | Reply | Permalink
I assume that the fines will go into the big Fed barrel (or maybe the smaller state barrels) so that Congress can play accounting games with it.
The 2.5% tax does seem a bit low. Let's see. As a freelancer, I was able to find cheap plans for under $1000 per year, which is equivalent 2.5% of $40K. I'm not sure at what income level the subsidies kick in, but it seems like you might as well go with a cheap plan.
(Note: I moved to Philly from NYC. In New York, the cheapest plans were around $2500 per year, which would be equivalent to 2.5% of $100K. Big difference. In that case, it could pay to take the tax hit if you make less than $100K.)
November 11, 2009 3:41 PM | Reply | Permalink
I think the effects are just starting to gel.
November 11, 2009 5:16 PM | Reply | Permalink
Here's one link: (a mite bitter take on it)
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x6593942
November 11, 2009 5:57 PM | Reply | Permalink
I am 100% sure we are going to see sticker shock like that among many who have not had to pay for their own health insurance, both those who haven't had coverage and those who haven't a clue what their employers have been paying for them.
Also I get a sense that quite a few of bloggers who like to chant "Medicare for all" haven't a clue about Medicare's real $ value, conveniently forgetting that for those over 65 it has been subsidized by a lifetime of tax payments by the users. (Medicare premiums for hospital coverage alone--Part A--are free for those who have paid enough tax BUT for those who have not, they are $443 a month for one person, and that's with the initial $1,000 deductible, and co-pays after a certain number of days are used. Throw in the true value of Part B, the non-hospital coverage, which is surely higher than the $96 subsidized premium for seniors--which also has co-pays, and Part D, and I think the premiums for "Medicare for all" as Medicare exists now, should be at least $800 per month for one person, probably more.) Our employer-based system has really made it so that only a few people realize how expensive health care is now.
In a way I thought that was intended by the incremental plans proposed by both Obama and Clinton when they were running, that sticker shock. How else could the needed cost reforms begin, without people slowly learning how expensive even a public plan would be?
November 11, 2009 11:24 PM | Reply | Permalink
CVille hit it on the head:
It's the only way.
It ain't happening any time soon.
November 11, 2009 3:30 PM | Reply | Permalink
You mentioned that Kia coverage might cause less expensive tests and procedures. Maybe for scammers, but I'd imagine lots of docs would order them a) for a person's health and b) to cover themselves. And no, I'm not going to mention tort reform, I don't know enough about what's fair in that regard.
November 11, 2009 5:19 PM | Reply | Permalink
Scammers are extreme examples, but like all people, doctors are not immune to financial incentives. Consider this study:
In addition, there are tests that a conscientious doctor might recommend to cover all bases but which cost too much to justify doing all the time. Any headache could turn out to be brain tumor, but as a society, we can't afford to give anyone with a serious headache an MRI. Limiting expensive medical tests and treatments with low probabilities of success offers one way to reduce overall health care costs.
Obviously, there is a question of finding the right balance, and I wrote this piece out of concern that we will go too far the other way, but I just wanted to point out that there is some advantage to financial limits on treatment.
November 11, 2009 6:29 PM | Reply | Permalink
Yes, the right balance. Good-o.
November 11, 2009 7:27 PM | Reply | Permalink
If you'd like a few more examples, Maggie Mahar wrote a nice little rant as a comment on my "Money-Driven medicine" thread.
November 11, 2009 7:44 PM | Reply | Permalink
oops that was supposed to be a reply to your comment @ November 11, 2009 6:29 PM.
November 11, 2009 7:49 PM | Reply | Permalink
Thanks. Interesting post + rant.
November 11, 2009 11:57 PM | Reply | Permalink
You raise some provocative questions,()enghis, and I'm not sure whether we have a complete answer in the proposed bills, but let me provide some information that might help. I'm most familiar with HR3962, but also to some extent the Senate Finance Committee and HELP Committee bills. What follows is mainly from HR3962.
Every insurer in the Exchange, and eventually every insurer anywhere, will be required to offer coverage for all essential medical benefits - hospitalization, physician services, laboratory tests, medications, etc. There will be no plans omitting any of these.
Every insurer operating in the Exchange, including a public option if that should come to pass, is required to offer a basic plan, and may also choose to offer a further enhanced and premium plan. The basic plan must have an actuarial value of 70 percent - a fancy way of saying that it must pay 70 percent of the total costs the average subscriber will incur for those essential services. The enhanced and premium plans cover more - something like 85 and 93 percent or thereabouts. The rest is paid out of pocket. The premiums will also be higher.
You are probably right that individuals who see themselves at low risk may prefer the basic plan, while those more worried about current conditions or future illness will either choose the higher value plans initially or shift later. The higher premiums will reflect higher payouts the insurers estimate they must make based on the nature of their subscriber pool. However, the insurers will not be permitted to charge discriminatory rates based on health status - they must charge the same rate to every subscriber. What that rate is will be up to them, but the market will be competitive.
Although a public option, if it exists, will be required to offer all three tiers of plans, private insurers may choose not to, but none may decline to offer the basic plan covering all services at an actuarial value of 70 percent. They must therefore compete on the basis of the premiums they charge and the details of how they arrive at that 70 percent figure.
As you know, government subsidies will help low income subscriber meet the premium expenses. The combination of subsidies plus the minimum requirements in the basic plan provide a degree of coverage to all that while less than ideal, is substantial, and far better than what millions of Americans enjoy today.
Finally, you refer to other nations, but all the industrialized democracies do it their own way, based on the manner in which their health care system has evolved. A minority are single payer, most combine a public and private component in a variety of ways, and a few utilize private insurers exclusively. There is no evidence for a difference in the ability of these differing mechanisms to provide universal coverage at affordable costs and with good health outcomes. However, they all do better than we do with our current chaotic system.
November 11, 2009 7:56 PM | Reply | Permalink
Thanks for the details, Fred. Will the government specify "essential medical benefits" in detail? Obviously, hospital visits and standard tests will be covered, but what about less common / more expensive tests, procedures and medications. That is to say, will insurance companies be forced to cover specific tests and treatments? If not, what's to stop them from refusing to cover those tests and treatments?
The point that I was making in the article is that if healthy people enroll in basic plans until they get sick and then switch to the premium plans, the basic plans will be money earners (because most members will be healthy), and the premium plans will be money losers (because most members will be sick). That seems like a recipe for a race to the bottom, where companies offer only the basic plans and cut corners every where they can to offer the lowest premiums and attract healthy customers. Healthy customers won't care about the cut corners b/c they can always get a better plan if they need one--unless no one offers a better plan. Do you know of anything in HR3962 that will prevent this outcome?
November 11, 2009 11:53 PM | Reply | Permalink
[]enghis - The basic benefits are specified but not itemized - e.g., one type of blood test vs another. The requirement for a 70 percent actuarial value means that an insurer can't reduce its costs by refusing to cover needed tests, but it could choose which tests to cover if they served a necessary purpose at a lower cost than other tests. Ultimately, consumers would need to compare insurance plans for value and feedback from subscribers, and the proposed Exchange would do this. The best examples are formularies that are required to include all drugs needed for various conditions, but which might utilize generics rather than expensive name brands when there is no good evidence for the superiority of the latter.
Regarding money earners vs money losers, the plans will choose their premiums based on estimated payouts, taking into account the health status of subscribers. Because the estimates are not always accurate, the reform proposal does include a risk adjustment mechanism to compensate those insurers who inadvertently covered sicker patients than other insurers offering the same level of coverage (at least that's true for the basic plans, although I'm not sure about the higher levels).
Although you refer to the basic plans as a "race to the bottom", they offer exactly the same benefits - all the essential services - as the higher level plans. The difference resides in the degree of subscriber cost sharing, which is 30 percent for the basic plans and less for the higher level ones.
November 12, 2009 10:51 AM | Reply | Permalink
Thanks, Fred. Perhaps I don't understand the 70 percent actuarial value requirement. I thought that concerned out-of-pocket payments by members, which squares with your statement that the only difference between the basic plans (70%) and the premium plans (85% - 93%) is the subscriber cost sharing. So how does the actuarial value requirement force an insurer to cover needed treatments? To use a specific example, suppose that a cheap generic drug is by most standards inferior to an expensive brand drug, but the insurer cites an outlier study that concludes they are equivalent, and refuses to pay for the brand drug. Or worse, suppose that an insurer refuses a particular treatment altogether on the grounds that the effectiveness is not "proven."
With reference to the "race to the bottom," benefit equivalence between basic and premium plans eases my mind somewhat, but I'm still concerned that the incentives are backwards. You write:
But the healthy cheap riders don't care much about quality of service. They just want a low premium and won't worry about quality of service until they get sick. Thus, companies with cheap premiums and poor service could actually make higher profits than companies with higher premiums and better service because healthy consumers buy the cheap plans and sick consumers buy the quality plans. So what's the incentive to provide quality service and go beyond the letter of the legal regulation? This is the core of my concern.
November 12, 2009 12:28 PM | Reply | Permalink
The actuarial value of insurance coverage is monitored. If an insurer covers services inadequate for subscriber health conditions, forcing them to pay higher out of pocket costs to receive proper treatment, that will show up in the retrospective analysis, and the insurer will face financial penalties. To the extent that subscribers simply utilize the inferior services and achieve poorer health outcomes, that too will show up in the feedback offered to the public who must choose among plans.
You are right, of course, that there is no way to guarantee absolute parity, but the experience of other nations (e.g., The Netherlands) indicates that when insurers are required to offer basic services and are then held accountable by the public and by government oversight, egregious violations don't escape attention.
In general, insurers probably won't micromanage to the extent you may fear, because that increases their overhead costs. Even today, when they reject claims, as they often do, their justification is sometimes that the provider was not in their network, the referral process was not followed, or that a particular type of service was not covered, but not usually because the doctor used Test A intead of Test B. They don't have enough staff to make the many thousands of fine distinctions that would be required for that degree of oversight.
November 12, 2009 10:11 PM | Reply | Permalink
I recall that when the prescription coverage for Medicare came out, all were required to sign up for some level of it. There were deadlines, and if anyone missed the last deadline and wanted the coverage later there was a substantial financial penalty.
I think it would be possible to reduce the gaming of the system by factoring in disincentives, but again, the only way to do this and save money as well as provide health care is to do it with a singl-payer system for basic care, augmented with private plans for those who want and can pay for them.
November 11, 2009 8:53 PM | Reply | Permalink
France is a good example of a successful system utilizing a single payer mechanism for basic coverage supplemented by private insurance (both for-profit and non-profit) for additional coverage.
No nation does what we are proposing to do in having private insurers and a public option competing to provide exactly the same services, at least at the basic level. I don't think that would be a stable arrangement. As some obstructionists claim, the public option could undercut private insurers and drive them out of the market. However, if we wanted to go in the direction of the French system, the public option could serve as a springboard by eliminating the private insurers from basic coverage but retaining a niche for them in providing supplemental coverage. That's not what anyone is proposing publicly, but I don't think it would be a bad idea.
Unfortunately, it doesn't look like we're about to get a very powerful public option at this point, but even a scaled down public option might be a useful start.
November 11, 2009 9:20 PM | Reply | Permalink
The French system would be ideal - everyone gets the basic service and those wanting more have the option to purchase supplemental coverage over and above. Here in Germany, everyone has medical coverage, but people over a certain income level can opt out and purchase private insurance with services somewhat better than the standard public system. But the basic service coverage is a given with no strings attached - it's a tax supported through payroll taxes on individuals and businesses. So if the US shifts the burden of corporate employee health care coverage from the private sector to a government tax of the same value, a single payer system is totally funded. And if employees wish better coverage than the standard fare under single payer, they can opt for supplemental coverage insurance to suit their particular medical and health care needs.
I can't understand why no one in Congress has the slightest clue how to build a health care bill using existing models employed by other countries that are working.
November 12, 2009 8:39 AM | Reply | Permalink
I think executives of Fedex and UPS would laugh at the notion that private interests can't compete effectively with a heavily subsidized public agency. Heck, the Post Office has advantages that even a strong public insurance option wouldn't. It can be done. The problem is that health executives are wimps and cowards.
November 12, 2009 9:53 AM | Reply | Permalink
Fedex/UPS exist because they offer services not easily available to people who rely on the postal service - rapid and convenient door to door delivery of packages - whereas only the postal service is permitted to utilize mailboxes at residences. What I was suggesting is that private and public insurers could co-exist in separate niches (even with some overlap), but a system requiring them to offer identical services would be inherently unstable.
November 12, 2009 10:38 AM | Reply | Permalink
Oh I do not know.
Look, the rich will always be with us. They will be fully insured for heart transplants and butt lips and hip liposuction and tummy trims....
There will be a basic coverage in the end. Everyone will be entitled to a Kia but certainly not a Cadillac.
Nobody, will ever, ever be able to change that.
Private insurance should be left to the richer classes and some employment packages. that is it.
But if nothing is done, the private insurers will keep on having a field day. And the repubs are just fine with that.
November 12, 2009 3:29 AM | Reply | Permalink
I wasn't suggesting that nothing be done. Just raising a flag of unease.
November 12, 2009 10:29 AM | Reply | Permalink
The health care reform is a day late and a dollar short and there's no way to fix it. Best we can hope for would be it gets voted down. In a few years, all those opposing the current legislation will be screaming for relief, then we can start to build a bill that will not have any opposition...perhaps even a single payer or some very similar to the one enjoyed in France. But it will take the entire system to go down in total failure before the conservatives realize there are problems the free market can't fix without the government stepping in to set rules.
November 12, 2009 8:28 AM | Reply | Permalink
Yeah, people thought the same thing after the Clinton plan want down 15 years ago. How long do you expect us to wait for "the entire system to go down in total failure?" How many people will have to die before that happens?
November 12, 2009 10:28 AM | Reply | Permalink
About 35,000 - 45,000 are estimated to die annually in the U.S. due to lack of insurance. The current proposals are a huge step toward correcting that (particularly the House version), and a huge step toward correcting many other deficiencies, and I think it would be unfortunate to forfeit the chance to do this when we've come this far, and are in a position to save thousands of lives and avert thousands of bankruptcies.
The plans in fact do most of what is needed to reform the insurance system. Inclusion of a public option would make this aspect of reform even more valuable, but even without it, the worst insurance inequities will be eliminated. Where the bills are less progressive is in reforming the healthcare system itself to eliminate duplicate or unnecessary facilities, tests, procedures, and specialty referrals driven by a fee for service paradigm that rewards excess. It is here that by far the bulk of excess healthcare costs resides, and the proposals, while taking small steps toward this type of reform, will need to translate the types of demonstration projects they propose into system-wide reform to correct the worst faults with U.S. healthcare.
November 12, 2009 11:01 AM | Reply | Permalink
Under the current system, this is happening anyway, but worse. Deductibles are rising, premiums are rising, benefits are falling, insurance companies can and do exclude the sick and insurance companies protect themselves with lifetime expense caps on policies. So all the cadillac plans are dying except for the few good union contracts still in effect and, of course, for denizens of the executive suites of big companies.
The answer to the cheap rider problem here is more regulation -- raise the minimum standards for basic coverage and leave it at that.
November 12, 2009 8:58 AM | Reply | Permalink
That's possible, but regulation works better as a correction to excess than as an incentive. If insurance companies don't want any members who actually use their services, they may design their services to be as unusable as possible -- following the letter of regulation but making cuts whenever possible. That's already happening, as you note, but cheap riders could make the problem worse because they won't consider the quality of care when choosing a plan, so companies who like the healthy cheap riders have no incentive other than gov't regulation to provide quality service.
November 12, 2009 10:19 AM | Reply | Permalink
One more thing: I think we need to consider that the free rider problem, at least with regards to health insurance is really not evidence based in any way. If it existed, we'd be experiencing it now under the current system but it really doesn't exist -- the uninsured don't just take services and not pay, at least not in any great number. Uncompensated care for the uninsured is well less than 2% of our total medical spend. The uninsured, quite rationally, use less health care than the insured. They don't free ride. Far from it. They for the most part don't participate at all.
This leads me to believe that the whole notion o free riders is just a good story being sold to us by an industry lobby that would desperately like us to pass a toothy law that forces people to buy their products.
We shouldn't accept the free rider claim at face value.
November 12, 2009 9:07 AM | Reply | Permalink
It's fair to question the assumption of a free rider problem, but you can't rely on current data to demonstrate that a future health care plan that allows anyone to take insurance won't have a lot of free riders. There isn't a substantial free rider problem now because you can't get uncompensated care except in life threatening situations.
November 12, 2009 10:26 AM | Reply | Permalink
If that's the case then the industry has no data at all to justify its claims. But they're using it to get what no other industry has -- the force of law behind its sales practices. Convenient, no?
November 12, 2009 10:27 AM | Reply | Permalink
As I recall, it was your champion, Hillary Clinton, who pushed universal coverage. Obama wanted to keep it optional. So now it's universal, and you're disappointed?
I agree that it's hard to measure the impact, but the free rider problem is basic game theory and affects almost any social institution. Think about all the workers who benefit from unions but don't pay dues. Free riders.
November 12, 2009 10:39 AM | Reply | Permalink
Obama didn't change his mind because he thinks he's wrong. He traded this to the insurance industry. Have to wonder why the insurance industry would want to make that trade. It's not because they think it'll lose them money!
And c'mon Genghis, no fair holding me to every primary position that Hillary took!
This is excellent news... for me!
November 12, 2009 11:07 AM | Reply | Permalink
Exactly, you should be gloating and preening like a pro-wrestler.
I don't claim to know Obama's rationale, but isn't mandatory coverage a win-win-win-win?
Dumbasses who don't want to buy insurance don't suffer for their folly. Hospitals don't have to have to provide free emergency care. Insurance payers don't have higher premiums because of free riders. And opposition from insurers has been less intense because of the expanded market, which is probably helping passage of the bill.
November 12, 2009 12:00 PM | Reply | Permalink