printIf the state allowed a market in insurance for catastrophic events to develop, we’d all benefit from quality and choice in health care, at reasonable rates. But it won’t. Obama seeks to “limit competition and consumer choice by banning risk-based premiums.” Writing for the Cato Institute, John H. Cochrane explains the ins-and-outs of “health-status insurance”:
“None of us has health insurance, really. If you develop a long-term condition such as heart disease or cancer, and if you then lose your job or are divorced, you can lose your health insurance. You now have a preexisting condition, and insurance will be enormously expensive—if it’s available at all.”
“Free markets can solve this problem, and provide life-long, portable health security, while enhancing consumer choice and competition. “Heath-status insurance” is the key. If you are diagnosed with a long-term, expensive condition, a health-status insurance policy will give you the resources to pay higher medical insurance premiums. Health-status insurance covers the risk of premium reclassification, just as medical insurance covers the risk of medical expenses.
With health-status insurance, you can always obtain medical insurance, no matter how sick you get, with no change in out-of-pocket costs. With health-status insurance, medical insurers would be allowed to charge sick people more than healthy people, and to compete intensely for all customers. People would have complete freedom to change jobs, move, or change medical insurers. Rigorous competition would allow us to obtain better medical care at lower cost.
Most regulations and policy proposals aimed at improving long-term insurance—including those advanced in Barack Obama’s presidential campaign— limit competition and consumer choice by banning risk-based premiums, forcing insurers to take all comers, strengthening employer-based or other forced pooling mechanisms, or introducing national health insurance.
The individual health insurance market is already moving in the direction of health-status insurance. To let health-status insurance emerge fully, we must remove the legal and regulatory pressure to provide employer-based group insurance over individual insurance and remove regulations limiting risk-based pricing and competition among health insurers.”
Read the policy paper.
So far the utilitarian technicalities. On the dynamics of socialized medicine, read “Mephisto’s Medicare: A Parable.”
A naive question: where in the U.S. Constitution does it give the government the authority to regulate health care, provide health care “insurance” (not legitimate insurance by any measure), or to socialize health care?
If every feel good, bleeding heart liberal pipedream can be shoved through the regrettable commerce clause loophole, one wonders why we have a constitution at all. Whatever the majority can shove down the minority’s throat is considered legitimate, which is the sorry state in which we find ourselves.
When our money is worthless and everyone except the elite are destitute, it’ll be entertaining to see who they’ll try to soak for the hand-outs. The Chinese?
They’ll tax the pennies on your eyes. http://www.lyrics007.com/The%20Beatles%20Lyrics/Taxman%20Lyrics.html
As for the proposal, thank God.
I found out I had malignant melanoma last summer. I now have health insurance, but did not at the time. I hope something like this comes to pass and soon.
We would have to not only eliminate the federal government from monkeying in the mess but also get rid of the state regulations. The elderly (e.g. AARP) who currently mooch off the younger would never allow it. These ideas might be workable in a free society if we ever have a free society – which is, sadly, NOT the direction we are heading towards. It should be noted that in today’s world, much “insurance” pays not for catastophic events like cancer and heart attacks but for routine medical visits – I did not see that distinction in Cochrane’s analysis (I admit that I skimmed) – since some people might opt for “catastrophic” only and be happy to contract “rates” with preferred providers for routine procedures in a free market.