Health care debate confirms this is not the Barack Obama we elected

[alexamenos]

He does get it -- he's three steps ahead of you and waiting for you to catch up.

What you're describing is not an insurance program, it's a socialist redistribution welfare scheme. It's fine and dandy if you want a socialist redistribution welfare scheme, but administering socialist redistribution schemes isn't what insurance companies do.

[kg_veteran]

Originally Posted by alexamenos

He does get it -- he's three steps ahead of you and waiting for you to catch up.

What you're describing is not an insurance program, it's a socialist redistribution welfare scheme. It's fine and dandy if you want a socialist redistribution welfare scheme, but administering socialist redistribution schemes isn't what insurance companies do.

Exactly. Welfare isn't what insurance companies do.

BTW, Mavdog, if you think that insurance companies are going to operate at a loss just because the government tells them that they can't deny anyone coverage, I think you're in for a rude awakening. The reality is that if you mandate coverage for everyone, for everything, you're going to eventually run all the private insurers out of the market.

And then you'll have the single-payer system.

[Mavdog]

Originally Posted by kg_veteran

Exactly. Welfare isn't what insurance companies do.

right, and that is why insurers aren't "socialist welfare schemes".

BTW, Mavdog, if you think that insurance companies are going to operate at a loss just because the government tells them that they can't deny anyone coverage, I think you're in for a rude awakening. The reality is that if you mandate coverage for everyone, for everything, you're going to eventually run all the private insurers out of the market.

And then you'll have the single-payer system.

and if they operate with a profit because they correctly approximate their losses with appropriate premiums, the population will be better off, the industry will be better off, and the government won't be in the insurance business.

the risk associated with pool of insured won't materially change, and the actuarial tables will be valid and reliable.

and just like we have now, there will be competition in the marketplace.

[Mavdog]

Originally Posted by alexamenos

He does get it -- he's three steps ahead of you and waiting for you to catch up.

What you're describing is not an insurance program, it's a socialist redistribution welfare scheme. It's fine and dandy if you want a socialist redistribution welfare scheme, but administering socialist redistribution schemes isn't what insurance companies do.

ah yes, the "socialist redistribution welfare scheme" mantra. apparently you are part of the cabal of nay sayers whose goal is to repeat the phrase enough times expecting people will be blind enough to believe it.

the boogeyman of "socialism". it's so scary!

people pay a premium, and they get coverage in case of a claim. if you believe that is a "socialist redistribution welfare scheme", then we've got a bunch of "socialist redistribution schemes" in operation today masquerading as insurance companies.

you're wrong. very, very wrong.

[alexamenos]

Originally Posted by Mavdog

people pay a premium, and they get coverage in case of a claim. if you believe that is a "socialist redistribution welfare scheme", then we've got a bunch of "socialist redistribution schemes" in operation today masquerading as insurance companies.

There's a very big difference between socialist redistribution schemes and insurance companies.

What insurance companies do first and foremost is discriminate. They discriminate between healthy and unhealthy, between the old and the young, between those with and those without medical conditions.

As I read your comments, I invariably get the impression that you believe discrimination by insurance companies is a problem to be solved.

The 'fix' as you suggest seems to involve a great deal of central planning by the state in order to arrive at a system where each pays according to his ability and receives according to his needs. The reason I call this a socialist redistribution scheme is not to hype some bogeyman, but instead because it's the most accurate description I can think of.

[Mavdog]

Originally Posted by alexamenos

There's a very big difference between socialist redistribution schemes and insurance companies.

What insurance companies do first and foremost is discriminate. They discriminate between healthy and unhealthy, between the old and the young, between those with and those without medical conditions.

As I read your comments, I invariably come to the impression that discrimination by insurance companies is a problem to be solved.

The 'fix' as you suggest seems to involve a great deal of central planning by the state in order to arrive at a system where each pays according to his ability and receives according to his needs. The reason I call this a socialist redistribution scheme is not to hype some bogeyman, but instead because it's the most accurate description I can think of.

insurance companies don't "discriminate", they use data to correctly assign risk.

this is not that difficult to do, and there are instances where the data (actuarial tables) end up in error. that's when the insurers lose money, and if they do this repeatedly the insurer goes out of business.

the insurer understands that when a health insurance policy is issued, they will eventually need to pay a claim. there is really no such thing as an insured person who never gets ill, everybody at some point in time will be afflicted.

the insured does not "pay according to their ability", they pay according to the risk pool they are a part of.

in the case of the universal coverage, the risk pool is expanded about 20% over the current amount. this addition to the pool of those covered will include higher and lower risk insured, pretty much parallel to what is currently covered.

people will pay a premium just like they do today, a premium that is aligned with the risk tables. those tables won't show a material change.

no socialism involved.

[alexamenos]

Originally Posted by Mavdog

insurance companies don't "discriminate", they use data to correctly assign risk.

Based on the data they discriminate. (Ideally) those with higher risk factors wind up in higher premium pools, blah blah blah.....

And it's entirely reasonable that a 48 year old fat alcoholic smoker should have to pay more for coverage than a 24 year yoga instructor on a rabbit food diet, right?

[aquaadverse]

Originally Posted by Mavdog

insurance companies don't "discriminate", they use data to correctly assign risk.

this is not that difficult to do, and there are instances where the data (actuarial tables) end up in error. that's when the insurers lose money, and if they do this repeatedly the insurer goes out of business.

the insurer understands that when a health insurance policy is issued, they will eventually need to pay a claim. there is really no such thing as an insured person who never gets ill, everybody at some point in time will be afflicted.

the insured does not "pay according to their ability", they pay according to the risk pool they are a part of.

in the case of the universal coverage, the risk pool is expanded about 20% over the current amount. this addition to the pool of those covered will include higher and lower risk insured, pretty much parallel to what is currently covered.

people will pay a premium just like they do today, a premium that is aligned with the risk tables. those tables won't show a material change.

no socialism involved.

The big fly in the ointment is assuming all this takes place in a vacuum. It's assuming that the insurer just picks a premium, that they dictate all the costs involved. The strategy for the last couple of weeks for the administration has been to pile on the insurers. That simply extending coverage to everyone is the answer.

The kick in the teeth is the reality that much of the cost is simply paying the bill presented to them for payment. Simply saying "we'll pay this amount for this service" and the rest of the system just snaps to and adjusts is a fallacy. It's backwards. It's why Doctors are opting out of taking new Medicare patients.

It's not a coverage or access problem, but that's the main thrust of the proposed solution. There is a huge amount of what and very little how.

It's similar to what we saw here in Florida after the rash of hurricanes over the last decade. Insurers were dropping property coverage and the State's solution was to create a pool of last resort since no mortgages are written without it.

The exposure for the State quickly ballooned far past the level of reserves to liability Florida required of insurance companies. They tried to remedy the situation by first raising the premiums to the legal limit because private insurers couldn't compete under the States own requirements. The next step was to require homeowners to accept any private offering, even if it was more expensive. Insurers were just leaving the market despite nothing in the law requiring them to do so.

You could keep what you had, except what you had was no longer available. The problem was finally brought under control using the Vegas technique of laying off the risk by capping the amount insurers had to pay and the State paying the rest. Yes, the government was subsidizing insurance policies.

The second was to change the requirements. They raised the allowable deductible amounts and let insurers separate hurricane damage from the other liability so I have to get storm damage past 5% of the insured home value before it kicks in, and mandating insurers give discounts for storm shutters and other preventative measures. The State also beefed up building codes to keep the market attractive for insurers. There's no doubt the insurance companies had some predatory and unethical practices and the builders were lax in making code compliance. Extending access to coverage did nothing to change the real issue.

If they had started with those measures to control costs first, it's unlikely they would have needed to provide coverage, or had to do it to the extent they did. Simply extending coverage was not the answer because it was an affordability issue. If that patterned had continued there would have been a single insurer because they would have needed to grab the less risky policies to balance the high risk ones and the private sector companies that were left were unable to compete since the State wasn't adhering to the same requirements the insurers legally had to follow.