Thursday, September 10, 2009

Health Care = A Tricky Generational Issue

President Obama mentioned last night that young healthy people who choose not to buy into the insurance system are being irresponsible, and everyone pays for them when they go into the emergency room for expensive visits.


However, a mandate to buy insurance that doesn't provide for the creation of truly low-cost plans that cover the services young people can realistically expect to use, and that that doesn't subsidize coverage for low-income young people, is just driving a fatted cash cow into the arms of the lucky insurance companies.
1 doctor visit a year + (1 OB-GYN checkup for the ladies)+ 1 dentist visit+ catastrophic coverage if you have a car accident or something. $100 a month. Something reasonable like that.


Home Loans said...

Thats really a woderfull thinking and point to incourage the younger people

BenLinOregon said...

Gee, I'm so "incouraged" :P

Seriously, though, this is what I've been spreading around my discussions for months -- affordable basic coverage that actually covers what it should, though I would add vision coverage for annual checkups and biennial corrective lenses. I do think $100/mo is too steep for the use most young people will get out of it, since it's most likely to be purchased on the individual market with after-tax dollars. If it's only covering those simple office visits and catastrophic care (depending on the definition of catastrophic) something closer to $75/mo is a lot more reasonable.

jte said...

But this misses the point that insurance doesn't work by breaking even on the most common uses in one portion of a person's lifespan. The same young person who wants affordable coverage while young will also want affordable coverage when old -- but you can't provide affordable coverage for elders only by charging them their likely usage (multiple visits per year + oncologist or other specialist + physical therapist + dentures + 6 different prescription drugs + etc). The only way to have it be reasonably affordable across the spectrum of lifespan is to spread the costs over the full lifespan, which includes those usage-lite years in your 20s and 30s. (That and spreading the cost across the population, so in combination you end up spreading the risk of overwhelming health care expenditure over both time and space.)

That insurance companies might profit from this is still somewhat up in the air. The Baucus bill doesn't include a public option, but it's only one of several circulating. We may yet end up with a public option, in which case each young person grudgingly buying health insurance will have the option of handing profits to private insurers or, hopefully, getting equivalent coverage at lower cost that works like insurance is supposed to work through the public plan. I'm not offering predictions, just mentioning that we aren't yet beyond all conceivable hope. Also, keep in mind that insurance companies are themselves not actually all that wildly profitable. Most of the fatted cow sent the way of the insurance companies will end up in the pockets of other wings of the health care sector ( -- that is, unless further reforms are adopted that reign in the cost spiral for those wings. (E.g., Dean Baker's ongoing campaign to eliminate monopoly rents accruing to medical drug and device manufacturers through patent protections.

Anonymous said...

Anya, depends on how you look at it. If it is fairly spread out, meaning that yes, while I am young, I could get by with less, but when I am old, it will be affordable an meet my needs because of this
"subsidy," then I will buy in.