Comments on: Private health insurance?

By: Anonymous

Anonymous — Tue, 25 Aug 2009 02:02:00 +0000

It may be enlightening to look back to the 1920s. One of the main reasons Americans spend as much on health care as we do is that we can, and that we want the goods and services. The poorest quintile in the US, if memory serves, are now 5 times better off in real terms than the comparable cohort of the early 20th Century. Even accounting for the inflated cost of medical care, the poorest American is far better off now than the average American was then.

We talk about the problem being cost, the problem being the government, and so on. I believe the seminal discussion, if we do intend to arrive at a market solution we can live with, must center on the single biggest obstacle: egalitarianism. If it is not socially and politically acceptable to come right out and say that those of lesser means will not receive the same medical care as those of the highest means, then the government will ultimately step in and arbitrarily determine the allocation of resources.

This is not to say that the poor and near-poor would not receive quality care — they would. But if insurers and providers are not permitted to develop solutions that make basic care and basic insurance affordable, and if they are not permitted to deny the most expensive treatments to some policyholders and not others, the market will be hamstrung. As government intervenes, there will be winners and losers, not determined by impersonal market forces but by arbitrary standards.

By: Anonymous

Anonymous — Mon, 24 Aug 2009 14:54:00 +0000

Well… I suppose if you think the government isn’t doing enough then government is the solution – but that’s a really odd sounding problem to me.

I’m talking about real problems too – not imaginary non-sensical problems.

“Market failure” is an unfortunate and odd monicker, but I see no reason to stop talking about it as a concept (and using the label that we’ve inherited for that concept). There’s no point in using only an over-simplified concept of the market that doesn’t really exist to understand the world. If there are problems with who holds relevant information, then no – the market hasn’t “failed”. But it works differently and it’s not a bad thing to think about that. If producers aren’t incorporating all costs of course the market hasn’t “failed”, but it works differently and it’s worth considering the implications.

I hope you aren’t mistaking my use of a common term that I didn’t come up with as me thinking that markets literally “failed”. It’s just a label for a phenomenon, russnelson. We can coin a new one here, though, if that’s troubling for you.

By: Health care vs. health insurance

Health care vs. health insurance — Mon, 24 Aug 2009 12:12:41 +0000

[...] this post, I asked you to respond to this question I received from a reader, Tom: Imagine we had entirely [...]

By: Anonymous

Anonymous — Mon, 24 Aug 2009 03:01:00 +0000

If true, it was probably because no company would bother (or was legally allowed) to charge the kind of premiums commensurate with their degree of risk. If they did, people like you would claim they were preying on the elderly.

You need to stop and think about what insurance really is–a product, a hedge–and what is not–charity, financing.

By: Anonymous

Anonymous — Mon, 24 Aug 2009 02:43:00 +0000

“But it does not mean you have the right to “associate with others” the way an armed robber “associates” with his victims.”

In short, a consistent set of rights cannot include the right to violate rights.

By: Ken

Ken — Mon, 24 Aug 2009 01:39:00 +0000

How do I afford to have good term life insurance coverage at a reasonable price in my 60′s with several common conditions of that age? It’s fairly simple. I simply purchased guaranteed premium term insurance when I was about 40 and perfectly healthy. Why should health insurance be any more complicated?

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Fix XBox 360 Red Ring - We Pay Cash for Your Scratched Video Games! — Sun, 23 Aug 2009 15:17:20 +0000

[...] Private health insurance? [...]

By: Anonymous

Anonymous — Sun, 23 Aug 2009 08:47:00 +0000

“the market is not better at solving that problem.”

How would you know? It has never been tried. At least since the 1930s. If it were not for those brilliant interventions of the government, health care inflation would have been a fraction of what it has been. Maybe markets can’t do everything, but I think they can do pretty much anything the government can do better than the government. If not, then it probably is something the government should not be doing.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 08:32:00 +0000

This hypothetical “free and democratic society” could fall anywhere on a fairly broad spectrum of levels of freedom. While it is true that any one citizen will not have a decisive vote, there ought to be some serious constitutional limits to the government’s ability to invade that citizen’s sphere of individual liberty. He ought to have the final say over most of what happens in his life–including how he spends most of his wealth and income. Without these constitutional limitations, it won’t be long before the society is unrecognizable as free.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 08:15:00 +0000

If they were going to do any explaining, it would be to the likes of you and muirgeo.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 08:13:00 +0000

“The Constitution of Liberty”
But you have to read the whole thing–it won’t do to pick and choose tiny fragments of a thousand-page book to support your own specious argument.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 08:09:00 +0000

Clever trick. Also erroneous. Carefully read, Hayek’s statement would not come close to justifying modern medicare. It would appear Hayek did not anticipate the urge of the welfare state to metastasize. His idea is more consistent with catastrophic health insurance. Secondly, IMHO Hayek likely would regret having said it in the first place, had he known the manner in which statists would employ it.

As far as Adam Smith, no doubt he never could have envisioned a “public expense” that would require more than half the income of the wealthy. About the time he made this statement, Ben Franklin declared that the government that would take so much as ten per cent from its subjects was intolerable. Smith was much closer in his politics to Franklin than to Obama.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:49:00 +0000

Brilliant.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:47:00 +0000

This is gobbledygook. Everyone sharing the risks–much like everyone sharing the responsibilities–is generally a recipe for disaster.

And he said he would try to get to it Monday.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:44:00 +0000

Bravo! It is the abhorrent “social contract” that underlies and justifies “the Obama-led statists/leftists/liberals/progressives that are trying mightily to extinguish our remaining freedoms.” This idea is accepted on the left reflexively, unexamined and unquestioned, despite its having been twisted into the service of tyrants and despots from its very first day. You do a great job of exposing it. Great post.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:29:00 +0000

You said: “To address the system I pose the question is medical caer so expensive because demand is up or supply is low? I’m 99% certain it is because demand is up.”
–It is clearly both, as your list of remedies suggests. Libertarians say do away with licensing, and I agree. More practitioners and different specialties and services would spring up.
–Why is med school enrollment stagnant? For the same reason doctors are working less and retiring younger–being a physician in America has been becoming gradually less and less attractive for decades as the cost of malpractice insurance, of complying with Medicare, the cost of med school has gone up, reimbursements have gone steadily, or quickly down. More headaches, less income. Obamacare only accelerates that process. I read that under the Public Plan an anaesthesiologist’s reimbursement would be cut immediately more than 50%. Something needs to be done.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:18:00 +0000

Well put. Why not make the Medicare fund voluntary? We would then see how much of a moral obligation Tom really feels, along with all other wage-earners. I’ll wager an awful lot of people find that in their mind the obligation belongs to everybody else.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 07:15:00 +0000

You are quite right. Regrettably, such a scenario will meet with implacable resistance from the levellers, who will object to ‘the rich’ receiving life-saving treatment for a condition which is terminal for the poor or the average Joe, only because he can’t afford the treatment. That is the single biggest obstacle, in my opinion, to truly free market medical care and health insurance: the deification of equality by the left, which is for some reason more intense vis a vis health care than anything else. It will be necessary to do a lot of educating in order to have most Americans realize the benefits of the rich early adopters, and even more to convince them that it is acceptable that the rest of us make do without until the treatment becomes affordable. I expect, though, that our job will have been made easier by the disintegration or conversion (to private) of the current nationalized health insurance programs in the interim.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 06:51:00 +0000

There is a world of difference between the individual family members of the elderly dependent providing the care and support, and “society” providing that support. In order for society to do it, coercion on a massive scale is required, including coerced giving to strangers, and some third party decides how much each taxpayer is “willing” and able to give. The extended retirements and free medical care most Western nations now support on the public dime are a luxury, not a necessity, and as such ought to be seen not as an entitlement but a transfer payment (aka welfare). If we were more parsimonious to our seniors–providing this welfare only to the truly needy–our productive citizens would change their behavior so as not to arrive at their early retirements depending on the state for support.

By: Anonymous

Anonymous — Sun, 23 Aug 2009 06:50:00 +0000

Who in the world believes that “everyone can find insurance”? But I think you are correct that in order for insurance to be profitable to an insurance company, the premiums have to be a function of risk times event cost. As risk goes to 1, insurance companies are usually just middlemen, or at best negotiators. But you will be giving them more than the full cost of your health care. Insurance is usually cheap, because true insurance is for high event cost items where the risk is so low that the product risk*cost is low.

I don’t get your bit about euthanasia.