Health Insurance Fable

Once upon a time, there was an insurance company named Profit Insurance. The Profit Insurance company sent it's marketing people across the land to determine the best price to charge for health insurance. The marketing results were that the best price for insurance was $100.

Management sent the the database trolls to the dungeon to work out a strategy for achieving the $100 price point. After examining years of health cost data, the trolls determined that they could sell insurance for $100, and still make a profit, if they did not sell it to people who were already sick. The managers liked the plan and made it so. Many people bought this insurance, but even though it was inexpensive, many young healthy people decided not to buy it. Profit Insurance managed expenses by artful claim denial and returned generous profits to the stockholders.

Now it turns out that in the same kingdom, there was a socially responsible insurance company that did not think it was nice to exclude people from having insurance just because they were sick. This benevolent insurance company decided to sell insurance to anyone who wanted it. Unfortunately, the trolls of the database told them they would have to charge $120 for this insurance policy. The management decided that the good hearted people of the land would surely be willing to pay $20 more to enable anyone to get insurance. Management put the Benevolent Insurance on the market.

People who were excluded from Profit Insurance because of existing illness flocked to Benevolent Insurance. Unfortunately (for Benevolent), existing Profit Insurance customers were not willing to pay $20 more for Benevolent Insurance, nor were the people who opted out of Profit Insurance willing to buy Benevolent Insurance. With only sick people in it's insurance pool, Benevolent Insurance was unable to survive at $120 and they went out of business.

The moral is that if you are in the insurance business and you want to maximize profits, it is best to limit your clients to the youngest, most healthy people you can find and deny as many claims as possible.

If, however, you want everyone to have the opportunity to buy affordable health insurance, you need to spread the risk across the entire population so that the young and/or healthy (while they are young and /or healthy) pay the majority of the costs of the old and/or infirm (until they become the old and/or infirm).

Single Payer/Medicare For All..... the only way to achieve reasonably priced coverage for all. If you bring in everyone, including the young and/or healthy who previously opted out; and eliminate the wasteful administrative duplication across the private insurance companies, everyone can be covered for the $100 (or less) policy.

Health Care I

Most of the people I know have health insurance.... and pretty good health insurance at that. While they might grumble about the cost, they are getting pretty decent coverage for the cost (assuming they don't consider how much their employer is contributing). Unfortunately, not a one of them sees the train wreck on the way. Insurance is really pretty simple; everyone puts money in the pot and those who need it take it out. If you don't need it (e.g. you're healthy) you're paying for peace of mind, nothing more.

Unfortunately, we've lost sight of that fundamental principle. In the name of providing "choice", we've allowed younger, healthy people to go uninsured, or buy insurance policies with minimal coverage. Without these people in the pool, the rates for those in the "not so healthy" category have soared. This, in turn, causes even more people to be unable (or unwilling) to pay the cost of health insurance, which shrinks the pool even more and tips the bias even more toward people who need to use the insurance rather than just pay for it.

How does it all end? Why does this need to be so difficult. Let's put EVERYONE in the insurance pool and have ONE insurance company that negotiates rates. We'll decide how much of the budget we want to spend on health care and we'll tax everyone appropriately. It works people. Don't listen to the hype. It really does work. No, it's not perfect. But if we don't do it, we're headed for a cliff. And oh, by the way... in case it matters to anyone, the 30+ million people that currently don't have health insurance will be covered. No, this isn't welfare. Most of these 30 million are hard working people who simply can't afford or qualify to get insurance. Don't forget, we already cover the poor with Medicaid.

I really think the half-assed compromise politically motivated non-legislation being floated around Washington needs to be killed. We really do need to start over, BUT, we need to start by resurrecting H.R. 676 and get everyone behind a Medicare-for-All, single payer system. If you agree, please write your congressman. If you don't.... think it over again. You're not feeling the pinch nearly as much as you're going to in the not so distant future. You may soon be one of the ones on the outside looking in.