Footing The Bill For Your Health (and the Health of Others)

By MAYS Latest Reply 2012-07-06 07:01:49 -0500
Started 2012-06-30 12:34:01 -0500

Socializing Risk

When discussing health care, people often jump into a public versus private debate. Do we want socialized medicine or private competition? For today, I’d like to skip that discussion. Regardless of how coverage is paid for or provided, the risk from illness needs to be socialized. Everyone needs to be covered, healthy or sick, so that the risk can be distributed over the largest possible group.

Insurance companies have a phrase for people who try to buy insurance when they know they’ll need it: adverse selection. In health insurance, insurers use limitations on pre-existing conditions to prevent someone from simply picking up insurance after they get sick. If you know you’ll be taking advantage of your insurance immediately, then you’re not really buying insurance at all. Insurance requires hedging against future risk. Instead, you’re simply trying to buy medical services on the cheap.

The best way to avoid adverse selection on a large scale is to require everyone to buy into the insurance system. This could mean a single-payer model, with services provided by some combination of public and private sources. It could also mean universal basic coverage with private insurance covering the balance. Either way, the key is to require everyone, sick and healthy, to pay into this system every single month.

It is especially important for those that are young and healthy to be paying into the health insurance system. There are tens of millions of healthy people who don’t have insurance right now. Their employers don’t provide it, it’s expensive to buy an individual policy, and the need for it doesn’t seem immediate. Unfortunately, when something does go wrong, they show up at the hospital and we foot the bill with our tax dollars. It is especially important to get this group paying into the system early when they are most likely to be healthy.

Wait! This sounds like Universal Coverage! Isn’t that expensive?
This is universal coverage and it is less expensive. The United States spends a massive amount of money on routine and acute care to uninsured people at hospitals every single day. That’s a big reason why we spend over twice as much per person to provide care than they do in the United Kingdom. Think about that. We spend twice as much and don’t have universal coverage!

I am not arguing to adopt a socialized medicine model mirrored after the National Institutes of Health. But we do need to find a way for everyone to pay into the insurance system and get coverage. It’s the only way to perfectly distribute the risk, minimize cost, and maximize coverage for all.

(As a fringe benefit, a single-payer system would be excellent for people with diabetes. If everyone is paying in to the system, adverse selection is not possible. So there is no need to disallow pre-existing conditions like diabetes.)


13 replies

red flower lady
red flower lady 2012-07-01 01:15:37 -0500 Report

You know, I don't care how the health care is paid for as long as I have it and it is affordable and excellent care given. I feel that is my right, especially when I am a tax paying American. Something has to change because it hasn't been working. Nobody should have to forgo drs, dentists, and meds in order to keep their house running and food on the table.

jayabee52 2012-06-30 16:43:25 -0500 Report

Sorry Mays, will have to respectfully disagree with you here.

You cite the UK as a model for health care coverage. As I understand it the reason for their low costs is twofold: #1 delayed care, which can in some cases be fatal, and #2 rationed care. Some gov't bureaucrat decides what procedures one may have. For instance were I in the UK, I may not get either dialysis treatments or a kidney transplant due to the fact I am unable to contribute meaningfully to the common good or the GDP of the nation.

swlinda 2012-07-02 13:32:51 -0500 Report

We are limited by our insurance company in what we can have or not have so I guess the government isn't a lot different. My doctors are sick and tired of being told by my insurance company what test, procedures, medications etc they can do.

old biker
old biker 2012-07-02 14:46:35 -0500 Report

You do know that the doctors are not entirely with out blame for this..yet we are the ones to suffer.. I had a friend who had a good paying job at the hospital, so I was quite surprised when she told me she quit..When I asked her why she started to cry and said I can't go on hurting these old people anymore..The Doctors are sending me in to draw blood 4 or 5 times a day on people that are dying and they do this to everybody that has insurance.There is no reason for half the test and procedures they are doing..It's just to run up the patients bill ..I would be willing to bet the insurance co figured this out how badly they were being scammed and now they question everything and we pay the price

MAYS 2012-07-02 15:09:37 -0500 Report

That happens alot with sleep apnea test, most hospitals are doing them on patients that do not need them, it's a great way to make money for the hospital.

swlinda 2012-07-02 14:49:45 -0500 Report

I am sure you are right but when my doctor had told me 15 years earlier that I needed to have a hysterectomy, when we finally got ready to do it, I had to have at least 4 unnecessary procedures before insurance would pay for a hysterectomy. They had to be entirely sure it was necessary.

old biker
old biker 2012-06-30 19:24:52 -0500 Report

Hi James you are not limited to governmental health care in the UK..That is just one option..You can always purchase Ins. on your own..There is always going to be someone deciding on what procedures that they deem necessary.. The Brits are very vocal on their dislikes..I haven't heard to much complaints from them, about the system
Perhaps if there are some members from the UK out there..They could help us on this one

MAYS 2012-06-30 17:30:57 -0500 Report

Not my words, or my opinion here James, (link provided below discussion) I just thought that the view of another (the author of this article) would prove to be interesting.

Government supported healthcare whether it's here in the U.S.of A, or abroad is still somewhat new to me, no matter how much research I may do on the subject because each country differs according to their governmental structure, their economy, politics, quality of life among the residents, healthcare systems and laws among other things.

Still looking, still searching, praying for the best but preparing for the worse!