turbo-1 said:
We should remain cognizant that the US has a (potentially) incredible health-care system that is being sucked dry by health "insurance". Such "insurance" defies the traditional definition of insurance as distributed risk - typical plans can bleed you dry before the "insurance" plan kicks in and can drop you like a hot potato if you get sick. It is high time that average workers are allowed to buy some coverage that won't evaporate the first time you need it.
I think we also need to look at how we got to this point. I'll throw a little gas on the fire here to move the conversation forward.
How many people have health insurance that is comparable to the GM/Union health care policies? These "Cadillac" policies cover everything and are very expensive. An individual can not purchase such a policy, and if they could the price would be double their normal choices.
Health insurance (like car insurance, fire insurance, flood insurance, homeowners insurance, etc.) should be used for catastrophic events, not routine doctor visits, teeth cleanings, and eye glasses. But, large employer paid groups (including unions and government) have required such "coverage". This group is typically not willing to pay more for the same coverage.
A different aspect is the effect of a "network discount". Insurance companies don't pay "list price", they negotiate discounts. Accordingly, people that self pay for high deductible plans ($5,000 to $25,000 deductible - perhaps an HSA) pay less in monthly premiums but need to pay amounts up to the deductible. However, unlike the person with no insurance coverage at all, the people with high deductible coverages are entitled to a "network discount". A typical doctors visit costing $85 might actually cost the insured person $45. Whereas the uninsured person would pay the full $85 fee. The same is true for tests, etc. This is a major problem for uninsured people with pre-existing conditions - they are subject to the maximum price. Many find their best alternative is to purchase a catastrophic indemnity plan (pays fixed amount per a schedule) that provides network discounts. These plans can be expensive but do offer limited coverage.
Another important topic is prescription coverage. The government could be helpful to level the playing field for prescriptions. There are too many variables to address in this post.
Still another consideration is the capital requirements of an insurance company. They are rated by A.M. Best and others as to their ability to pay claims. A good company might be able to pay within 14 days, a below average company 45 days? Either way, the minimum capital requirement of a major health insurance company is typically $500 million to $1 billion in assets. Small companies are precluded - they are limited by their ability to pay claims.
These companies also need a very large administrative capability. As I posted earlier, they need to register the company with each state, register each policy they sell with each state, meet the mandates for each state for each policy, and register their agents with each state. Additionally, the companies must monitor the content of ads for each agent, provide training and support to the agent network, and insure HIPPA compliance at all times. Next, the companies must negotiate with (HMO/PPO) networks and work with these organization to pay claims and manage care.
My point is there are many variables to consider. The trend in Congress lately (stimulus Bill) has been to not even read the legislation before voting on a Bill. Health care reform (at nearly 20% of our economy) is too big and too important to approach as a political issue. Throwing money and more regulations at it won't fix the existing problems - just alter them.