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It’s Also Not Multiple Choice!
There is one and only one condition under which the Republicans can save the medical insurance industry and protect citizens from Obamacare. It is the only way to create an economy of scale that will permit the average American citizen to afford coverage that ONLY A GOOD insurance policy can provide.
The U. S. Government needs to get THE HELL out of the insurance business. Once it has done so, there are as many methods to creating and securing good medical coverage as there are imaginative providers.
We have at least two generations that have grown up dealing with an insurance industry that had been used as a piñata, stuffed with pounds of goodies, created by the nanny state, for the groping, supposedly helpless citizens to gather up. Anyone under the age of 45 has never lived in a country where their healthcare wasn’t a byzantine monstrosity.
To explain my position, a bit of history and definition of terms might be in order.
First, what is health INSURANCE? If you look at the definition Wikipedia suggests, we are told that in the United States, health insurance is any program that helps pay for medical expenses, whether through privately purchased insurance, social insurance or a social welfare program funded by the government. The article goes on to be wrong about in every other conclusion it draws as well.
And therein lies the very crux of the problem we face with Obamacare and it’s repeal. The only thing that falls under the definition of health insurance, in the context of this discussion, is a fiduciary relationship between an individual and a private insurance provider which, based on the premiums charged, provides an agreed set of benefits to the individual. Anything else, Medicare, Medicaid, welfare, is not insurance. Those are wealth transfer schemes. Whether you think they are important or not, doesn’t change what they are.
Why? I’m glad you asked.
As I said in Street Politics (On Amazon Kindle) insurance is a bet. Insurance companies, now dependent on the government for their survival, and self-appointed social engineers working for the government, chafe at hearing insurance is a bet. It threatens their ego to think they are bookies in a gambling scheme. And in this case, they are low-life bookies who have been gaming the system since the 60’s.
But the fact remains insurance is absolutely a bet.
You (or your employer – the second problem we’ll address) put your money down every month betting that you are going to be sick or injured. Based on actuarial tables, the insurance company bets you will stay healthy. If you get sick, you win the bet. The insurance pays the doctor, the hospital, or in some cases you, the winnings. The cost of your ante (monthly premium) is based on what the actuarial tables say is the insurance company’s risk vis a vis your age and overall health.
No matter what anyone tells you, true insurance only works, and medical care only remains affordable, when it is a clean, two-party bet and the payoff only applies to a catastrophic situation.
Before WWII health insurance was a means for individuals to hedge against serious illness or injury. But over time, and in narrow-minded reaction to economic pressures, the government perverted the idea. First, with taxes rising during the war and post-war, executives were paying shameful percentages of their income to the government. Smart, high-wage employees started to ask for compensation other than money. Along with snappy benefits like company cars and paid vacations came employee-provided health care.
Well, when the unions got wind of that, driven as they are by class envy, they decided that health insurance should be a part of every workers pay package. Well…, it complicates things, and the risk becomes a bit fuzzy, but okay. Employers rolled with that. But as post-war fears of inflation took hold, the government beat the bushes looking for ways to thwart it. One of the ideas was to set price and coverage controls in health insurance. They also codified tax breaks for people carrying such insurance. And that would be the camel’s nose under the tent.
What’s That Goddamn Camel Doing In Here?!
Fast forward about a decade and a half. With its early interference in the health insurance industry as precedent, the government was primed to interfere more. And the American people gave them the excuse(s).
Anecdote: Poor Mrs. Jones. Her son got a nosebleed on Thursday and it wouldn’t clot. She had to go the emergency room and have it cauterized. It cost $X to have it done. She isn’t rich. She shouldn’t be penalized just because her son got a nosebleed. There oughtta be a law!
Anecdote: Poor Mr. Smith. All his kids caught really bad colds at the same time this year. One had a fever so high Mr. Smith had to call the doctor. He was charged for a house call and medicine. He has health insurance. Why can’t the bad, rich insurance company help him with that?
With one non-catastrophic malady after another, voters began to hound their legislators about how their medical insurance didn’t cover nose bleeds, minor stiches, colds, birth control and on and on. With each complaint, politicians found fertile ground on which to plant their incumbency desires. Why dip into your savings to pay for one of the things responsible people save money for? Can’t Mommy Government wipe your noses for you?
Sadly, not considering the consequences of their actions, the people loved the Mommy State making the big, bad, rich insurance companies pay for every conceivable thing they might suffer. By the 80’s, the mountain of mandates placed on insurance companies had reduced their profits to near zero. Government, by that time already in bed with the big companies, was interfering with interstate trade and telling companies what states they could and could not operate in. This went along with reams and reams of needless compliance.
The insurance companies, under no obligation to commit suicide, passed the costs the government had placed on them along to the customer. Insurance was getting very expensive. With each turn of the government screw, hospitals were seeing more and more guaranteed revenue streams. They had no reason to compete with each other for nosebleeds and coughs. They ran their charges right up to what the law allows, whether they needed to or not.
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