The number of uninsured in the USA has been reported to be between 30 and 50 million. Just for shits and giggles.... let's assume the number is 40 million.
The cost of giving everyone of them a standard yearly health care insurance plan worth $5K would come to $200 Billion. How much of that insurance coverage would actually be used? Not as much as many think.... most people never even use the current health care system... even when they are insured!!!
There is no question, that Insurance Companies are raping us to tears!! Health INSURANCE Reform is absolutely necessary.... not Health CARE Reform!!
If a system could be created where un-used premiums re-enter the pot every year.... and if Insurance Company Regulations are changed to include portability across state lines to force fair competition.... is it not reasonable to expect policy premiums might (at least) level off... if not decrease? Couple simplistic themes like that with other simplistic regulation changes like the elimination of "pre-existing condition" denials , physician's mal-practice legal & insurance reform , closer inspection and enforcement of fraud & waste..........
Originally Posted by MrGiz
No offense Giz, but I'm giving you the award for the most ignorance professed on this subject today.
I like you, but your comments indicate that you have no concept of insurance whatsoever. Where do I begin?
How about here "The cost of giving everyone of them a standard yearly health care insurance plan worth $5K would come to $200 Billion. How much of that insurance coverage would actually be used?" Well probably $5,000 per head -- if the plans are worth $5,000 then thats the average cost. Somebody cost $100,000, someone cost $1 million, some cost $20,000, some cost $5,000, lots cost $2,000 and a bunch cost nothing. But total costs divided by total number of people = $5,000 less a profit margin. The definition of an average means that the "money goes back in the pot".
Yeah, lets talk about those
fat profit margins. The people screwing us are folks like Budweiser (now InBev) with an average profit margin of about 26%. That means that out of every dollar they take in, 26 cents is profit. Health insurance margins? Well that industry ranked #86 -- about 3% of revenue. So in your example above, that is $150 per head. Yeah, they are screwing us big time.
Okay, maybe the stupid pills were wearing off at the end of your post, because you actually started to make sense. Some things that would actually "bend the cost curve down" include:
1) Interstate sale of insurance -- not to protect us from insurance cartels, although thats part of it, but to protect us from state legislatures that mandate specific coverage to benefit special interests (e.g., chiropractic, holistic healers, etc.) Not that there is anything wrong with these things -- they do benefit people, but making everybody buy them is like saying that every car must have a GPS system. Sure, nobody would get lost, but lots of people couldn't afford a car (sound familiar). I've heard estimates that ancillary coverages like this add 15% to the typical policy.
2) Malpractice reform -- not so much the cost of damages (including pain & suffering & lost income) to the injured -- thats a pretty small number -- maybe 1-2% of annual health care costs. No, the big issue there is the defensive medicine that docs practice as a result of the Machiavellian scheme for paying for malpractice costs. With deductibles on malpractice policies, docs pick up a fixed dollar per claim -- that can be as much as $100,000. Docs make good money, but not enough that they are immune to those costs. So they have a choice -- run every test under the sun (btw, they make more money by doing that) or take a chance that they missed something. Guess what happens. A better approach would be to institutionalize these costs and get rid of shitty docs.
3) Tax Code Bias -- Health insurance paid by an employer is tax free in this country. If I pay you say $50,000 in cash, lets say the taxes all in with FICA and the rest is maybe 25% or $12,500. Now if instead, I pay you cash of $40,000 and $10,000 worth of health insurance, your taxes are only $10,000. You have the same total value of income, but less taxes. Dang, I need health insurance, I'll take that deal (see posts above re unions and tax breaks). But damn, if I'm getting that much money in health insurance, I better use it. Can anyone spell demand pull inflation? I saw a cool graph recently, that I can't find at the moment, which showed the growth trend in health care costs relative to the share of the costs paid out of pocket. Its dropped from maybe 40% in the 50's to 10% today. Anyone know what costs have done?
4) Pre-existing conditions are a problem that I agree the insurance industry has totally fucked up. The reason for pre-existing is really to protect the other policy holders (see margin discussion above). If there were 1000 people in Giz's $5,000 insurance pool and you let someone in that had a pending $1,000,000 claim, that would increase everyone else's premium by about 20% (now $6 million in costs divided by 1,000 people.) There have to be better solutions that allow more portability of coverage and the ability to change carriers, without contaminating insurance pools by letting people sit out until they think they need it. That "free riding" costs other policy holders a lot of money.
Anyways, I hope you didnt take offense Giz, nothing personal, your post just touched me off. As DG will note, this exceeds my monthly quota of words in one post. I'm now reverting to one-liners.
. In isolation all of these things sound good, but we can't afford to do them all....
