The focus of the Administration's health-care plan, and of its campaign to enlist public support for the plan, is dissatisfaction with health insurance. To see the problem--or whether there is a problem--compare health insurance to fire insurance. Almost everyone has fire insurance (even if he doesn't want it, invariably it is required by the mortgagee, if there is one). The reason is that a fire can wipe out a big part of most people's wealth, and, given declining marginal utility of income, which makes most people prefer a certainty of obtaining a million dollars to a 50 percent chance of obtaining $2 million (and a 50 percent chance of nothing), the cost of fire insurance is a good investment. The insurance company knows how much it may have to pay if there is a fire because the insurance policy has a dollar limit.
If someone is convinced that his house is fireproof and therefore fire insurance would be of no value to him, and therefore refuses to buy it, the insurance premiums charged the buyers of fire insurance will be slightly higher (because his being in the pool would have reduced the expected cost to the insurance company). But no one is concerned with this, because very few people opt out of fire insurance.
Health insurance is different superficially because of the extreme variance in costs of medical treatment; some people have medical conditions that cost literally millions of dollars to treat. But this is a problem in other forms of insurance as well, such as liability insurance in which the insurer undertakes to pay the insured's legal expenses, which can be astronomical; and insurers deal with such difficult-to-estimate risks through reinsurance and large deductibles.
Health insurers, if left to themselves, generally refuse to insure the cost of treating pre-existing conditions; but that is no different from a life insurer that refuses to issue a policy (or charges more for it) to someone whom a medical exam reveals to have a short life expectancy. Prudent people buy life insurance when they're young and in good health.
Health insurers often cancel an insurance contract, or refuse to renew it, after discovering that the insured is in bad shape and likely to cost the company a great deal in the future. Fire insurers and automobile insurers often do the same thing. If people want to have lifetime protection, they have to pay higher premiums but it is hard to see why health insurers would refuse to offer such contracts; in fact some people do have such health insurance.
There are several puzzling aspects to health insurance, one of which, however, is rather easily solved, and that is the fact that a significant fraction of the population has no private health insurance. If your house burns down and is uninsured, tough luck. But if you get sick and have no insurance and no money, you can still get treatment at the nearest hospital emergency room. (You will be billed, and if you have enough money you will have to pay the bill.) If you have no money, you're a free rider, but the amount of free riding is kept down by the cost that emergency rooms impose on patients by making them wait--and a queuing cost is a real cost to the people forced to stand in the queue.
Many of the uninsured are young and healthy; they are like the person with the fireproof house. If they were forced to insure, therefore, premiums for health insurance might fall, though this is highly uncertain. Many of the uninsured, rather than being young and healthy, are uninsured because of pre-existing medical conditions that imply that these people will incur abnormally high costs of treatment in the future.
Medicaid, charity treatment in emergency rooms of hospitals, and Medicare when utilized by indigent people constitute a form of poor relief. There is no reason why Medicare shouldn't be means-tested; people who can afford medical care should pay for it themselves.
The fact that, because of tax subsidy, most health insurance is offered as an employment benefit screws up the health-insurance system considerably. Not only does the subsidy result in giving people more medical benefits that they would want if they had to pay the full, unsubsidized price. They lose the insurance if they lose their job or if the employer cancels the group insurance policy, and when they seek new insurance they may find themselves turned down, or made to pay a very high price, because of their age or because they now have a pre-existing condition.
If people were willing to pay high premiums, and accept high deductibles and copayments, they could buy health insurance policies that would give them lifetime protection against all major medical problems they might encounter. But people are not willing to pay high premiums or (mysteriously) to accept high deductibles and substantial copayments. They prefer to take a chance on their employer-supplied health insurance and on making it to 65 (Medicare eligibility age) without going broke as a result of a medical condition for which they are not adequately insured. And if they have no employer-supplied health insurance they may decide to do without and hope for the best even if they could afford to buy an expensive individual policy.
Repealing the deductibility of employer-supplied medical benefits from federal income tax, and instituting a means test for Medicare, would reduce the demand for, and therefore total cost, of medical services and reduce the federal deficit as well, since Medicare costs the federal government more than $300 billion a year. Since Medicare would cover fewer people, there would be less need to institute procedures designed to limit expense by limiting treatments--something people fear, whether rationally or not.
forex broker
free forex grail spreadsheet
islamic perspective on forex trading
i tell you when to trade forex
forex trading dynamic barriers
forex terms definitions tic
the best forex trading software
imeter forex currency strength
forex mt4
forex insider code
forex indicator software
value signals forex
crack forex
forex cracked
forex lou rivas
forex wireless
how can i open or manage a forex bureau as an entrepreneur
succesfull traders on forex
i forex
best forex sites
forex time
forex best time
get free forex trading system advance
forex strategy and forums
forex killer tutorial
dvd kumpulan ebook forex trading
autotrade forex sytem
forex api
how forex operates
kaskus cd collection forex belle femme
uk online casino reviews
phantom efx downloads do not appear in online casino
harrah casino online
black jack casino school online
best online casino guide
best online casino worldwide
online casino promotions bonuses
uk best casino online
online slots casinos payouts
online casinos usa players
online casinos with the best slots
casinos online online baccarat
casino surveillance online degree
online casinos
casino online business opportunities
us friendly online casinos
dansk online casinos
best online casino bonus
online casino reveiw
dansk online casino
online casino penge
de bedste online casino
online casino betalings
online casino spiller
online casino nyheder
online casino spil
online casino spille
online casino blackjack tips
online casino gamble
online casinos that offer e check as a deposit option
online casino royal
bedste online casino
best online casinos
online casino black jack
bet royal online casino bonus codes
eurolinx online casino
online casino scames
what is the best online casino to play at
online casino no deposit required
starting an online casino
online casino vegas strip
best online casino
online casinos with tournaments
rate online casinos
casino online roulette
online no download hot hot penny casino
blog casino online roulette
a online casino
canadian online casinos
vegas casino online
no deposit online casino promotions
online casino poker
play poker online casinos online
registering with online casinos
online real money casinos for united states
download online casinos
online casino real money
play casino slot online
new online no deposit casino
online casino us bonus
casino game online play poker top
online casino wheel of fortune
blackjack best online casinos
virtual roulette online casino gaming
no deposit online casino listings usa
online casino with paypal
paypal deposite online casino
top online casino blackjack
best us online casino
lucky nugget online casino
best paying online craps casino
online casino roulette spin no bet
playtech online casinos
online casinos excepting us players
online casinos us players
online casinos that allow us play
divici online casino
platinum play online casino
online casino mac download
casino pit boss online
atlantic vegas casino online
blackjack game best online casino
best paying online casino
no deposit online casino bonuses
online casinos that accept us players
best payout online casino
spinning jackpots microgaming online casinos news
old samurai casino online keno
online casino site
owning an online casino
golden nugget online casino
online caribien casinos
links to no deposit online casinos
online casino blackjack
best casino slot online
online casino review
online casino bonuses for us players
online casino no deposit bonuses for us players
no deposit online casino
online casinos giving new players no deposit bonus
casino casino gamble gambling gambling online online
vegas strip online casino reviews
online casinos using moneyexchange
casinos gambling online
It is doubtful whether any other measure consistent with American culture and values would reduce medical costs substantially, though one can imagine a series of modest reforms that might add up to a net savings, including limiting liability for medical malpractice, imposing large deductibles for medical treatment for injuries experienced in dangerous recreational activities, reducing highway speed limits, and taxing fattening foods and beverages. None of these is likely to figure in any health reform enacted by Congress at the present time, however.
The opposition to the Administration's health plans is understandable, though some of it is uninformed and even irrational. The Administration's problem is that it wants to expand insurance coverage, and this will increase the cost, including the public cost, of the health-care system, but that the only serious way in which the Administration can imagine limiting the cost increase (as there is insufficient public support for terminating the tax subsidy of employee health benefits, let alone for limiting Medicare to people who can't afford private health insurance) is by curtailing treatment. And that upsets people, since they don't trust the government to decide what medical treatments are cost-justified. (And why should they?)
In all likelihood, moreover, the Administration is underestimating the cost of expanding coverage. It wants to push as many of the currently uninsured as possible into insurance plans, and this will not only cost a lot in subsidies, as well as in higher costs to employers; it will also increase the demand for and thus the aggregate cost of medical services (because supply is inelastic). Once a person is insured, the marginal cost (which includes the queuing to which the uninsured are subjected, as well as monetary cost) to him of treatment drops to the copayment or deductible. The government also wants to forbid insurers to deny coverage on the basis of pre-existing conditions or to rescind policies after paying a large claim to an insured (and foreseeing future such claims). This will increase the cost of health insurance, and the government will doubtless end up picking up the tab, because there is great resistance on the part of the public to paying higher insurance premiums.
The cost of the projected health reforms cannot be estimated. One reason is that no one seems to know what is actually in the literally thousands of pages of health-reform bills drafted by different congressional committees. Or if they know, they are not telling. Another reason for uncertainty about cost is that no one outside government (maybe inside it as well) knows what the Administration is likely to settle for in its negotiations with the various interest groups and legislators.
But worse than not knowing the cost is not knowing how it is going to be paid. Higher taxes, unless trivially higher, seem politically infeasible, which means that health reform if enacted will add to our soaring national debt--and probably add a lot, though we cannot know how much.
Anon @ at August 17, 2009 8:18 PM
A twist on your plan, which would make it far more palatable to conservatives, is to hand every citizen a voucher to purchase the catastrophic insurance from private companies. From a conversative perspective, that keeps the government out of our business, especially in the sense that the government won't be collecting information on our medical conditions. The positive benefit would be that insureds could use the voucher to partially fund a policy that provides better-than-catastrophic coverage. Presumably, these policies would fall back to catastrophic coverage if the insured fails to pay the additional premium. If you want that to be progressive, make the voucher count as taxable income. States could opt to top up the voucher for poor people, or offer them a state-run policy on the condition that the state-run insurer receives the voucher.
You could completely pay for this by abolishing Medicaid and the deductibility of employer-paid insurance. I did the math once using actual insurance premia quoted on one of the health-insurance shopping sites. Abolishing those two programs (and a bunch of smaller ones, but only using the federal dollars) would fund a policy with a $5,000 deductible for everyone under the age of 65. (I assumed that the premium would change with age only.) I didn't check every state, because I got bored of the effort, but (I think) I checked CA, TX, and NY.
But none of this will ever happen. It makes too much sense.
Posted by: Anonymous | 08/19/2009 at 02:39 PM
Anon, Aug.19,2009 2:39pm
To "H" with the Conservatives, they are the reason why this Nation does not have an effective, both from a Medical and Cost standpoint, Health Care system today. These are the same guys who have been hindring and blocking a resolution to this vitally important issue since 1948.
Posted by: Anonymous | 08/19/2009 at 04:11 PM
Now let'see; Medicare is bankrupt, Medicaid is bankrupt, Social Security is bankrupt, the federal government is bankrupt, the postal service is bankrupt, Amtrak is bankrupt, the highest taxing states are bankrupt, many big counties are bankrupt and many local communities are bankrupt. Yep, it sure makes sense to me to put 17% of the economy into the hands of the same folks who brought us to this point and have managed all of those entities so well.
Posted by: Anonymous | 08/19/2009 at 04:33 PM
Anon, Aug. 19, 2009 4:33pm
Now let'see; All of the Governmental Programs and entities are "Bankrupt"! Really? Then why are they not in Bankruptcy proceedings and Receivership and "full faith and credit" still stands? Is this just another case of not letting the Facts stand in the way of a good rhetorical ploy to confound the facts and issues and foist an Ideological perspective onto the minds of the weak. Such as, "Government is Evil, Anarchy is Good"? And better yet, the Status Quo is the best of all possible worlds.
As a great American once said, "The occasion is piled high with difficulty and we must rise - with the occasion. As our case is new, so we must think anew and act anew. We must disenthrall ourselves and then we shall save our Country."
Posted by: Anonymous | 08/19/2009 at 05:22 PM
OK. Bad choice of words. How about they are all out of money without taking more from the hapless tax base. And no, not all government is evil, only bad government and stupid idealogic politicians and their minions. And no, anarchy is not good but is usually the end result of bad government. And no, not every solution is a good solution. Usually there are multiple solutions which will suffice. Frankly I would rather be cynical and proven wrong than naive and proven wrong.
Posted by: Anonymous | 08/19/2009 at 06:54 PM
SS isn't bankrupt yet, but it will be soon. Medicare and Medicaid are essentially bankrupt. You don't see proceedings because the FEDs have a printing press.
Barney Frank is selling Obamacare the way he sold us a bill of goods on the GSE's (fannie and freddie). Democrats are a disgrace to this country.
STOP OBAMA, STOP THE COMMUNISTS..!
Posted by: Anonymous | 08/19/2009 at 11:15 PM
"How many illegal immigrants does Obama want to cover...?"
This was in the first comment in your post. The comment ended with a rallying cry asking all of us to stop Obama, stop the Communists.
The answer to the illegal immigrants question is zero. Every version of the bill I have seen excludes treatment for illegal immigrants. As far as the last part of the post, the Republican party seems to be unsure whether Obama is a Nazi or a Communist. I wish they'd get their story straight.
Posted by: Anonymous | 08/20/2009 at 07:13 AM
Nazis and Communists are at the same end of the spectrum. Both are totalitarians and the end result is the same. The point is that we are losing our freedom to people who believe in their own and the government's omnipotence. I also might remind you that the barbarians brought Rome down out of jealousy for their way of life and that after the fall the destruction was so complete that no one even new how to lay bricks.
Posted by: Anonymous | 08/20/2009 at 08:40 AM
I keep reading articles on the health care system.
I am surprised that hardly any stresses that whereas the American health care system is good a caring for patients (provided they can pay for it) it does very little to keep people healthy and preventing them from becoming patients in the first place.
Hospitals, drug companies, and the health care industry in general have plenty of incentives to provide probably the best and most advanced level care in the world. But who benefits from convincing Americans to adopt a more healthy lifestyle? To exercise? To eat well? To have regular check-ups?
Posted by: Anonymous | 08/20/2009 at 08:52 AM
The previous generation's most admired democrat made this honorable statement:
"...ask not what your country can do for you- ask what you can do for your country"
http://www.youtube.com/watch?v=VB6hLg3PRbY
Today's democrats are a bunch of crybabies clinging to the notion that government must wipe their behinds after they drop a deuce.
The evolution of American society is going down the exact same path Rome went. We are on an unsustainable course of incremental dependence on a centralized government. The international community is not going to finance Obama's version of the Communist Manifesto. The American people, at some point, will stand up to this encroachment on their liberty. At some point, this entire thing pops really hard.
Obama and today's democrats are Communists, no doubt about it. But they also use fascist tactics to forward their ideology. Rules for Radicals is their tactic. They sell their communism by saying things like "choice and competition", yet their proposals are the exact opposite of these are free market capitalist principles. Government internalizing everything is COMMUNISM... SO STOP USING FASCISTS tactics to fool the American people. Obama is the biggest liar this country has ever seen. I know used car salesman that rank far higher on the ethical scale.
Posted by: Anonymous | 08/20/2009 at 10:35 AM
"The answer to the illegal immigrants question is zero. Every version of the bill I have seen excludes treatment for illegal immigrants."
Then why do all you lying liberals use illegals in your number of uninsured when crying that you are entitled to government healthcare...? Why do your liars in State-run media continue using illegals in every propaganda piece they run on behalf of your ideology?
Move to Canada if you want to be a socialist and wait in line for healthcare...! Don't destroy our prosperity that was built because of our system by bringing Canadian healthcare here.
The most irresponsible people on the planet are our democrats. Internalizing healthcare when social security, medicare, and medicaid entitlements all have problems is outrageous.
http://www.youtube.com/watch?v=EiyfG4WMxA0
Posted by: Anonymous | 08/20/2009 at 11:46 AM
I may just give up trying to improve my life and get in line for the free goodies. I can move some place where I can have a good life for less monry and stay under the tax radar. Let the rest work themselves into the dust to support me with subsidized housing, medical care, food stamps and transportation. I suppose I can get a free education too. Hey, why work.
Posted by: Anonymous | 08/20/2009 at 12:14 PM
If govt. healthcare is ever passed, we are screwed.
Today, Social Security is just a 12.5% income tax. FDR sold us this entitlement program as a way to assist the final years of our lives (2-3 years). Well, the average lifespan has increased from 65 to 78 since FDR's program started. So our liberals have simply changed this program to be a retirement entitlement for the last dozen or so years of our lives. In other words, THE DEPENDENCY ON GOVERNMENT HAS INCREASED. It should be zero surprise to anyone that this program will burst once the baby boomers are fully retired.
Any effort to MODERNIZE social security is obstructed by democrats. Anytime someone proposes reasonable scalebacks Chuck Schumer and the gaggle of irresponsible communists do a photo opp. to politicize the issue.
Today, Obama is making promises with healthcare. Tomorrow, the DEPENDENCY will increment and our liberties will be sacrificed (both by higher taxation and rationing of choice for healthcare). We'll be stuck with another double-digit tax on our income and any effort to scale back something that should not be the role of government will be blocked by libs again.
This is the surest path to socialism. Liberals are going to bankrupt and destroy this nation. I actually think they want to. $10 trillion in deficits is not enough for obama, he wants government to provide healthcare entitlements for all...!
You people are certifiably insane...!
Posted by: Anonymous | 08/20/2009 at 12:40 PM
Ahh... and the "Ranters and Ravers" have not been satisfied with destroying any rational and reasonable discussion in public townhall meetings on the subject of Health Care & Insurance Reform, they now wish to attempt to shut down any rational and reasonable discussion of it on scholarly blogs.
My, what has this Country come to?
Posted by: Anonymous | 08/20/2009 at 02:44 PM
Ranting and raving is what you call disagreement with your opinions. I suppose it is just fine to demonize someone as long as you do it calmly and with the understated tones of NPR.
Posted by: Anonymous | 08/20/2009 at 04:44 PM
By what I've observed so far, Obama isn't a Marxist or a Maoist or a commie of any kind. He's an accomplished, thoughtful American. His allegiance to the Constitution per which he serves far exceeds his immediate predecessor's, IMHO. But he is weak and unseasoned in the wiles of foreign powers and the treacheries of Washington, D.C. and the lobby $$$ that keeps the monster fed. A president's performance as Chief Executive can't peak unless he gets out of Washington and clears his head at every opportunity. He's gotta be willing to step on some toes, disappoint some acolytes, admit some mistakes, and trust the pulse of the American people who pay the taxes and keep the lights on. Bill Clinton was a stubborn guy in '93 and he learned things the hard way. This time it's not just healthcare but the economic bust and bailouts for Wall St, washouts on Main St. Obama's bright enough to figure out for himself that more Big Government's the worst answer. Less is best. I'll remain optimistic. What choice does any of us have?
Posted by: Anonymous | 08/20/2009 at 07:10 PM
Ranters and Ravers....?
The other side is waaaaayyyy above that, right? We never saw the left express their minority opinions the past 8 years..(insert sarcasm here)..!
Public option with Ben Bernanke's printing press destroys private sector health insurance. It will actually do the complete opposite of what Obama is promising (much like his stimulus bill). He is promising "choice" and "competition" to fool us, yet he proposes the govt. option. Govt. will eliminate players in the private sector reducing and this will actually reduce choice and competition. We are going to be stuck with long lines at govt. programs and higher costs at the private option. See Canada...! We actually can point to examples of this mess, yet Obama and the Dems are still trying to sell it to us.
Rant or Rave...? No, freedom of expression and outrage at irresponsible govt. making BOGUS promises by lying to the American people. I'm no Timothy McVeigh, so you don't need to use that fascist tactic either.
Posted by: Anonymous | 08/20/2009 at 07:38 PM
ÿ¥ÿßÿ™
دردشه
Posted by: Anonymous | 08/20/2009 at 07:53 PM
شات الشلة
دردشة تعب قلبي
Posted by: Anonymous | 08/20/2009 at 07:53 PM
ÿ¥ÿßÿ™ ÿØŸÑÿπ
شات الود
Posted by: Anonymous | 08/20/2009 at 07:54 PM
شات حبي
شات الحب
Posted by: Anonymous | 08/20/2009 at 07:54 PM
buy Menosan
Posted by: Anonymous | 08/20/2009 at 08:43 PM
Anon. Aug.20, 2009, 4:44 & 7:38
"Freedom of expression"? Have either of you ever read "Article 1 of the Bill of Rights"? Let me enlighten you, "Congress shall make no law ... abridging the freedom of speech or the press ...", but the Supreme Court can on occasion and has. As one of it's Justices once commented, "although we have Freedom of Speech, it does not grant one the right to yell "FIRE" in a crowded Theater.
With that said, let's get back to the topic at hand and deal with it in a rational, competent and civil manner.
Posted by: Anonymous | 08/21/2009 at 04:29 PM
Apparently the commenter at 12:40 PM is oblivious to the fact that the life expectancy data he cites in his post shows that these government programs have worked.
The United States is the only country where the primary means to receive health insurance involves a profit-making company. It makes no sense, as the only purpose of the company is to make money, not to keep people healthy.
I'd be fine with something like the Milton Friedman plan; it would be easy enough to regulate the sale and purchase of private insurance for non-major medical care. But isn't the existence of the single payer government catastrophic insurance SOCIALISM and COMMUNISM? Doesn't that make Milton Friedman a COMMIENAZI? Maybe he just realizes that insurance company care is awful, it creates all kinds of perverse incentives, and the Ron Paul nutjobs don't have a clue what they're talking about.
Posted by: Anonymous | 08/21/2009 at 04:55 PM
Per capita total spending on health care, 2007:
United States: $7290
Switzerland: $4417
France: $3601
United Kingdom: $2992
Average of OECD developed nations: $2964
Italy: $2686
Japan: $2581
Think about these figures. Note that our life expectancy and our infant mortality ratings are not particularly good, that we fail to provide universal health coverage for all legal residents, and that the things we do well, basic medical research and treatment of certain kinds of cancer, is largely financed by the government. Then make an argument in favor of continuing our present system, and try to do so without calling people who disagree with you communists or nazis. Hard to do, isn't it?
Posted by: Anonymous | 08/22/2009 at 09:45 AM