I’m conflicted on this issue.
On one hand, I have sympathy for folks who have been diagnosed with a medical condition, especially if they are sitting without health insurance.
Now, there’s a groundswell that insurance companies should have to take all comers – even those with known pre-exiting conditions.
Here’s the rub: people with disqualifying pre-existing conditions are – by definition – more costly to cover than most of the folks already in the insurance pool. In other word, average medical expenses for people in the pool will increase.
So, the pivotal question is who should pay for the “extra” medical care that the pre-existers require.
Some folks apparently believe that there are no additional expenses, or that there is an insurance fairy who take care of things.
Other folks think the insurance companies should just eat the extra expenses – just paying the extra amounts out of profits.
The reality is that the high cost of covering a pre-exister will be spread across all people in the insurance pool. In other words, premiums will go up.
So remember, when you cavalierly say “cover all people with pre-existing conditions”, you’re really saying “I’m willing to pay higher insurance premiums so that people with pre-existing conditions get coverage”.
That may be the right answer. Just don’t whine when your premiums get jacked up. There are no free lunches.
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The Homa Files 
August 13, 2009 at 8:10 am |
That’s why insurance companies have already agreed that if everyone is forced to get insurance, including the healthy, they will agree to stop denying people on the basis of pre-existing conditions. It’s irritating to hear so many well-educated people (politicians especially) speak so ignorantly of economic issues like insurance, moral hazard and adverse selection. It’s like compassion trumps all things – is that how you really want to run public policy?
August 13, 2009 at 12:32 pm |
Seems to me that those with a pre-existing medical condition who aren’t able to get health insurance will still seek health care..and many hospitals will continue to treat them and pass those costs on to the insurance companies anyway (that’s why a roll of gauze in the ER costs $40). It’s probably cheaper to allow insurance companies to negotiate on behalf of these folks.
August 13, 2009 at 9:07 pm |
Getting treated for a pre-existing chronic condition is not as easy as getting treated for being in an accident. Both are heart-tugging situations, but simply ignoring economics and logic is not the way to address them in public policy. A few claims from heart attack hospitalization, cancer treatment etc. can blow a hole into a health insurance company’s bottom line. A lot of changes to the American medical system need to be synched up if one wants to drive down the cost of healthcare (no one has addressed the cost of going to medical school and how the time spent losing undergraduate years contributes to school loans, but it is a part of it). It’s just unfortunate that too many interests are in this to permit systemic fact based arguments to come before sentiments.
August 13, 2009 at 10:38 pm |
I’m willing to pay higher insurance premiums so that people with pre-existing conditions are covered.
Ken: what are you thoughts on John Mackey’s WSJ column? He makes some good points.
http://online.wsj.com/article/SB10001424052970204251404574342170072865070.html