So.. Health Care Reform

My liberal friend had to send that article to me. She had said companies wouldn't even think about doing that. She had to admit she was wrong.

At least I think she did. It was hard to understand her with that entire crow in her mouth.

The thing that gets me is the line "the employers that shed their plans will need to give their employees a big raise, and those raises could be higher, even after taxes, than the premiums the employees will pay in the exchanges"

Sure. Yeah that will happen. Companies will hang on to every dime they can as long as they can.

 

SO my question about this article... They would have saved more money before the reform passed, they wouldn't have been penalized at all...

 

Also the article says employer based HC would be demolished if alot of companies did this... I think that would be a good thing making HC insurance just like auto insurance and actually have real competition chosen by the individual.

 

It's all politics. The same four companies mentioned in the article are heavy supporters of the Tea Party movement. It's just a cynical attempt to oppose the Democratic Party in any way they can. I'm not a Democrat, and there are plenty of good and proper reasons to oppose them, but I think this sort of thing is getting ridiculous -- we need to stand for something besides childish opposition for the sake of opposition.

 

I agree with your general line of reasoning here, though I think I have somewhat different ideas for the specifics. More individual responsibility for health care costs would definitely be a good thing -- currently, our culture promotes the view that health care costs should not be the responsibility of the individual. Part of that is the culture of employer-based insurance, part is the fact that costs are highly inflated. Part of the reason costs are highly inflated is that so many people without insurance simply cannot afford to pay for their care (which, to be fair, is hideously expensive), part of it is due to wrangling on the part of the big doctors' union, a little bit is due to simple greed on the part of the hospitals.

I think President Bush had the right idea with his push for tax benefits for health savings accounts, as this does promote the idea of individual ownership of health care costs. However, with his typical tone-deafness (he always reminded me, in a good way, of a very well-off friend of mine, a fellow who thought that a solid middle-class income was around half a million dollars a year, and who couldn't fathom that there are people who even make less than $250,000 or so), his plan didn't consider the fact that in order to be effective, one would need to pay more than the median family income into their HSA every year. Only a few percent of the country can afford to do that. That's why insurance is so popular, it spreads the risk pool.

Insurance also artificially inflates prices for care, though. As an example, take laser eye surgery -- it's not covered by insurance policies, as it's an elective procedure. When it was first introduced, it cost several thousand dollars. Now, competition has pushed the price down, and it can be had for a few hundred. The simplest fix for our health system would be to simply discontinue the public health-care plans and ban private insurance. This has its problems in the short term, of course.

The insurance reform signed into law a few months ago doesn't seem too bad, as an incremental sort of thing. It forces the responsibility issue in a ham-fisted sort of way with a simple mandate to carry health insurance (which I don't entirely agree with), but at least it's there, and there are a lot of good insurance reforms along with it. Only time will tell whether it all works in practice.