More Obamacare rules

Now that Obamacare has passed the hurdles of the Supreme Court and Obama’s re-election, there is a mad scramble to make the necessary preparations before the health care program goes into effect in 2014.  The government is adding more requirements of what health insurance companies will have to cover while also allowing them to charge higher deductibles.

The Obama administration proposed new rules Tuesday that would loosen some of the 2010 health-care law’s mandates on insurers while tightening others.

Certain health plans, for instance, would be able to charge customers higher deductibles than originally allowed under the legislation. But all plans would be required to cover a larger selection of drugs than under an earlier approach outlined by the administration.

Similarly, the law permits insurers to set their premiums for tobacco users 1.5 times higher than those for non-smokers. But insurers wouldn’t be allowed to impose the surcharge on smokers enrolled in smoking-cessation programs.

The changes were included in the fine print of three regulations the Department of Health and Human Services proposed to flesh out key parts of the statute. For the most part, the regulations — which will be open for comment until Dec. 26 — would simply codify mandates in the law or in earlier administration guidance.

Those policies include a prohibition on insurers denying coverage to people with preexisting medical conditions. They also limit how much plans can vary rates based on, for example, a person’s age. Most provisions will take effect in 2014.

But Tuesday’s proposals also included a few significant tweaks.

The suggestion to grant insurers greater flexibility in setting deductibles, for example, reflected concerns that health plans would have a hard time meeting the law’s original requirements.

Specifically, the legislation prohibits plans sold to small businesses from setting deductibles higher than $2,000 for individuals and $4,000 for families. But the law also limits how big a share of total health-care expenses must be paid out of pocket by individuals or families, including through co-pays and co-insurance.

Insurers have complained that it could prove impossible to design a package of benefits that meets that requirements while keeping the deductible below $2,000.

Administration officials agreed. So the proposed new rule would exempt insurers from the deductible limit if that’s necessary to achieve the plan’s overall cost-sharing target.

Karen Ignagni, president and chief executive of America’s Health Insurance Plans, a trade group, said in a statement Tuesday that the “additional flexibility” is a “positive step.” But she added that “we remain concerned that many families and small businesses will be required to purchase coverage that is more costly than they have today.”

via Obama officials tweak rules for health insurers – The Washington Post.

You think?  With all of these requirements, how could insurance NOT cost more?  But if deductibles are going to have to go up considerably, won’t that mean lots of families that won’t be able to afford health-care after all?

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • http://theoldadam.com/ Steve Martin

    The ’1st stage thinkers’ and full time ‘emoters’ don’t care.

    They have done something ‘nice’ and foiled the mean ol’ Republicans once again.

  • http://theoldadam.com/ Steve Martin

    The ’1st stage thinkers’ and full time ‘emoters’ don’t care.

    They have done something ‘nice’ and foiled the mean ol’ Republicans once again.

  • Sandra

    It won’t mean that families won’t be able to afford health care at all. It means that they won’t be able to afford PRIVATE health care at all and will be forced into the rolls of Obamacare.

    But, “Don’t worry, if you like the insurance you have right now, you can keep it!”

  • Sandra

    It won’t mean that families won’t be able to afford health care at all. It means that they won’t be able to afford PRIVATE health care at all and will be forced into the rolls of Obamacare.

    But, “Don’t worry, if you like the insurance you have right now, you can keep it!”

  • Michael B.

    @Steve Martin

    So what’s your plan for making health care affordable for Americans?

  • Michael B.

    @Steve Martin

    So what’s your plan for making health care affordable for Americans?

  • Other Gary

    Michael, Michael…. don’t ya know? Folks like Steve believe the Free Market may be relied upon to deliver affordable health care to all Americans… ‘cuz it just works! As Republicans demonstrated during President Bush’s tenure, they’re really forward-looking people, not motivated by greed or preserving the status quo, but eager to find a workable solution to fixing a broken system that won’t require the meddling hand of Big Government!

    OK, seriously, I don’t see how this Obamacare thing is going to work. I’m skeptical this particular solution won’t cost us a fortune for mediocre improvements and more government hassle. But here’s the point: The GOP had a chance to do something, and they offered NOTHING. In fact, they stuck their heads in the sand about the whole issue. And it’s not just that they haven’t got a better idea, it’s that for 8 years they downplayed the problem instead of working on it.

    At least President Obama acted to make something happen. And I don’t think it’s going to be a disaster, it just won’t work as well as Democrats hope. But then nothing the Government does ever works as well as we’d hoped. C’est la vie.

  • Other Gary

    Michael, Michael…. don’t ya know? Folks like Steve believe the Free Market may be relied upon to deliver affordable health care to all Americans… ‘cuz it just works! As Republicans demonstrated during President Bush’s tenure, they’re really forward-looking people, not motivated by greed or preserving the status quo, but eager to find a workable solution to fixing a broken system that won’t require the meddling hand of Big Government!

    OK, seriously, I don’t see how this Obamacare thing is going to work. I’m skeptical this particular solution won’t cost us a fortune for mediocre improvements and more government hassle. But here’s the point: The GOP had a chance to do something, and they offered NOTHING. In fact, they stuck their heads in the sand about the whole issue. And it’s not just that they haven’t got a better idea, it’s that for 8 years they downplayed the problem instead of working on it.

    At least President Obama acted to make something happen. And I don’t think it’s going to be a disaster, it just won’t work as well as Democrats hope. But then nothing the Government does ever works as well as we’d hoped. C’est la vie.

  • SAL

    #3 “So what’s your plan for making health care affordable for Americans?”

    That’s not an achieveable goal anytime soon. You may as well ask “What’s your plan for making everyone happy?”

    You could reduce the cost of medical care by reducing the demand for it (encouraging healthy behavior, limiting access) and increasing the supply of it (increasing number of health professionals, allowing them to be more efficient).

    What would make healthcare affordable in the long-run is medical research that makes it easier and cheaper to keep people healthy.

  • SAL

    #3 “So what’s your plan for making health care affordable for Americans?”

    That’s not an achieveable goal anytime soon. You may as well ask “What’s your plan for making everyone happy?”

    You could reduce the cost of medical care by reducing the demand for it (encouraging healthy behavior, limiting access) and increasing the supply of it (increasing number of health professionals, allowing them to be more efficient).

    What would make healthcare affordable in the long-run is medical research that makes it easier and cheaper to keep people healthy.

  • Cincinnatus

    Michael B.,

    That’s an important question to ask, of course, but the point here is that the ACA does exactly the opposite of making healthcare more affordable.

  • Cincinnatus

    Michael B.,

    That’s an important question to ask, of course, but the point here is that the ACA does exactly the opposite of making healthcare more affordable.

  • SKPeterson

    Michael @ 3 – It would actually involve removing the federal government from every aspect of its payments and terms of provision. Followed by eliminating the corporate tax deduction for it, and providing that same tax deduction to individuals. That would allow people to decide themselves on what level of care they would like to pay for and what level of insurance coverage they would like. But, that would actually allow for freedom of choice for healthcare consumers, and Heaven Forbid!, doctor shopping for low cost healthcare provision. The immorality of all that choice is too inexpensive and uncertain to contemplate for the vested interests, though, so don’t worry. We have our devoted public servants to watch out for the best interests of the healthcare industry.

  • SKPeterson

    Michael @ 3 – It would actually involve removing the federal government from every aspect of its payments and terms of provision. Followed by eliminating the corporate tax deduction for it, and providing that same tax deduction to individuals. That would allow people to decide themselves on what level of care they would like to pay for and what level of insurance coverage they would like. But, that would actually allow for freedom of choice for healthcare consumers, and Heaven Forbid!, doctor shopping for low cost healthcare provision. The immorality of all that choice is too inexpensive and uncertain to contemplate for the vested interests, though, so don’t worry. We have our devoted public servants to watch out for the best interests of the healthcare industry.

  • Joe

    “At least President Obama acted to make something happen.”

    This is a huge part of the problem with our governance. Many people think action is necessarily better than inaction. This is not true. The cure is often worse than the disease.

  • Joe

    “At least President Obama acted to make something happen.”

    This is a huge part of the problem with our governance. Many people think action is necessarily better than inaction. This is not true. The cure is often worse than the disease.

  • http://homewardbound-cb.blogspot.com ChrisB

    @#3,

    There are no short term fixes, but long term we’ve got to make health “insurance” work like real insurance — like car insurance. People need to pay cash for minor issues and only insure against catastrophic problems — eg, cancer, heart attacks. As long as we function as if health care were free (to the user), there will be no incentive on the part of the user — and therefore the provider — to rein in costs.

  • http://homewardbound-cb.blogspot.com ChrisB

    @#3,

    There are no short term fixes, but long term we’ve got to make health “insurance” work like real insurance — like car insurance. People need to pay cash for minor issues and only insure against catastrophic problems — eg, cancer, heart attacks. As long as we function as if health care were free (to the user), there will be no incentive on the part of the user — and therefore the provider — to rein in costs.

  • http://www.bikebubba.blogspot.com bike bubba

    I’m not Steve, but my plan for making healthcare and health insurance (not the same thing, contra Obama) is to place all health care expenditures–whether patient or employer paid–on the same tax basis and require companies which contribute to a health insurance plan to match a portion of the cost for employees who carry their own insurance. I’d make all expenditures taxable, but greatly increase the standard deductions and dependent exemptions to cover the cost.

    And since when does the President get to re-write the law? Did they remove Article 1 from the Constitution while I wasn’t looking?

  • http://www.bikebubba.blogspot.com bike bubba

    I’m not Steve, but my plan for making healthcare and health insurance (not the same thing, contra Obama) is to place all health care expenditures–whether patient or employer paid–on the same tax basis and require companies which contribute to a health insurance plan to match a portion of the cost for employees who carry their own insurance. I’d make all expenditures taxable, but greatly increase the standard deductions and dependent exemptions to cover the cost.

    And since when does the President get to re-write the law? Did they remove Article 1 from the Constitution while I wasn’t looking?

  • DonS

    Good comments above. Government’s interference in the health care market, beginning with Medicare, is the cause of its distorted cost structure, and inflation running at three times CPI. More government action, in the name of “doing something” is certainly not the answer.

    In a nutshell:

    1) Decouple health insurance from employment. This is the exact opposite approach to that taken in Obamacare, but the only reason employers began offering health insurance on a widespread basis to employees is because of the wage controls imposed during WWII. Fringe benefits were exempt, so employers lured workers, in short supply, with ever more exotic fringe benefits. But, it makes no sense to require employees to change health insurance every time they change jobs, and leads to the incredible challenges we have with pre-existing conditions today. As Cincinnatus said above, strip the tax deduction from employees, and offer group-style policies to individuals that are portable and can be carried with a policyholder throughout their life. Give them the tax deduction/credits for purchasing insurance. A form of the state health insurance exchanges mandated by Obamacare could actually be used for this purpose.

    2) The federal government should not be mandating benefits. Those should be set in the private market — consumers will select policies that suit their coverage needs and insurance companies will compete with one another on price and benefits offered.

    3) Insurance is for protecting against catastrophe and financial ruin, not for covering every day expenses. It is horribly expensive and inefficient to process claims paperwork for every single medical transaction we undertake, but that’s the system that we have built, and are continuing to build for ourselves. High deductibles, coupled with tax free health spending accounts (HSA’s), keeps the power of the market with the consumer, who will be more price and benefits conscious. No forms until you reach or near your deductible would save practitioners and insurance companies an incredible amount of money, resulting in sharply lower costs and pricing in the health care market. The HSA’s and insurance premiums would be subsidized for the needy.

    More government does NOT make things cheaper. When are we going to learn this immutable fact?

  • DonS

    Good comments above. Government’s interference in the health care market, beginning with Medicare, is the cause of its distorted cost structure, and inflation running at three times CPI. More government action, in the name of “doing something” is certainly not the answer.

    In a nutshell:

    1) Decouple health insurance from employment. This is the exact opposite approach to that taken in Obamacare, but the only reason employers began offering health insurance on a widespread basis to employees is because of the wage controls imposed during WWII. Fringe benefits were exempt, so employers lured workers, in short supply, with ever more exotic fringe benefits. But, it makes no sense to require employees to change health insurance every time they change jobs, and leads to the incredible challenges we have with pre-existing conditions today. As Cincinnatus said above, strip the tax deduction from employees, and offer group-style policies to individuals that are portable and can be carried with a policyholder throughout their life. Give them the tax deduction/credits for purchasing insurance. A form of the state health insurance exchanges mandated by Obamacare could actually be used for this purpose.

    2) The federal government should not be mandating benefits. Those should be set in the private market — consumers will select policies that suit their coverage needs and insurance companies will compete with one another on price and benefits offered.

    3) Insurance is for protecting against catastrophe and financial ruin, not for covering every day expenses. It is horribly expensive and inefficient to process claims paperwork for every single medical transaction we undertake, but that’s the system that we have built, and are continuing to build for ourselves. High deductibles, coupled with tax free health spending accounts (HSA’s), keeps the power of the market with the consumer, who will be more price and benefits conscious. No forms until you reach or near your deductible would save practitioners and insurance companies an incredible amount of money, resulting in sharply lower costs and pricing in the health care market. The HSA’s and insurance premiums would be subsidized for the needy.

    More government does NOT make things cheaper. When are we going to learn this immutable fact?

  • fjsteve

    Other Gary, you’re arguing that anything is better than nothing, even something that you believe will cost more for less. Weren’t we already paying more for less? How is this better in any other way than simply that a Democrat proposed it?

    I don’t get it.

  • fjsteve

    Other Gary, you’re arguing that anything is better than nothing, even something that you believe will cost more for less. Weren’t we already paying more for less? How is this better in any other way than simply that a Democrat proposed it?

    I don’t get it.

  • fjsteve

    Obamacare is exactly what Pelosi said it would be: we have to pass it to see what’s in it.

  • fjsteve

    Obamacare is exactly what Pelosi said it would be: we have to pass it to see what’s in it.

  • http://theoldadam.com/ Steve Martin

    Michael B.,

    Not sure. But I would feel much better if the market was driving the bus and not the government who can’t even deliver the mail without losing billions every year.

  • http://theoldadam.com/ Steve Martin

    Michael B.,

    Not sure. But I would feel much better if the market was driving the bus and not the government who can’t even deliver the mail without losing billions every year.

  • http://theoldadam.com/ Steve Martin

    The only part of the current medical system that is going broke, rapidly, is the part that the government handles.

  • http://theoldadam.com/ Steve Martin

    The only part of the current medical system that is going broke, rapidly, is the part that the government handles.

  • Michael B.

    @DonS

    “Insurance is for protecting against catastrophe and financial ruin, not for covering every day expenses. ”

    According to webmd, the average cost of prenatal care is about $2,000 if you don’t have health insurance. And this doesn’t even get into the cost if there are complications, which would significantly increase the cost. For many Americans, this is simply unaffordable. What do you suggest? They do without? “The local church and charity”, I hear you saying. Okay, fine. Let’s say that isn’t available. Does the government step in, or do we just tell the pregnant mother “good luck!”?

  • Michael B.

    @DonS

    “Insurance is for protecting against catastrophe and financial ruin, not for covering every day expenses. ”

    According to webmd, the average cost of prenatal care is about $2,000 if you don’t have health insurance. And this doesn’t even get into the cost if there are complications, which would significantly increase the cost. For many Americans, this is simply unaffordable. What do you suggest? They do without? “The local church and charity”, I hear you saying. Okay, fine. Let’s say that isn’t available. Does the government step in, or do we just tell the pregnant mother “good luck!”?

  • Cincinnatus

    Michael B.@16,

    1) Part of the reason routine medical costs are so expensive is that they’ve been inflated by “first-dollar syndrome” on the one hand–that is, medical providers can get away with charging an insurance company $50 for your ibuprofin at the hospital because consumers don’t look at or negotiate the bill. On the other hand, they have to make up for the huge deficits created by Medicare and Medicaid undercompensation. If your hypothetical desperate pregnant mother weren’t forced into the corporatist insurance scheme, that routine care would be much, much cheaper–guaranteed.

    2) If a person truly can’t afford the cost of a routine checkup for her fetus, there are free clinics to help those truly in need (and if you can’t afford routine care, you are truly in need). Really, there are. At this point in my life, I’m lower middle class at best (it’s a month-to-month affair here in my household). Yet even I could scrounge together the cash for necessary routine care if I needed to do so. And so can most other people. What I can’t do is scrounge together the cost to treat prenatal complications, for example. And that’s what catastrophic insurance is/should be for.

    In short, emotive appeals aren’t helpful.

  • Cincinnatus

    Michael B.@16,

    1) Part of the reason routine medical costs are so expensive is that they’ve been inflated by “first-dollar syndrome” on the one hand–that is, medical providers can get away with charging an insurance company $50 for your ibuprofin at the hospital because consumers don’t look at or negotiate the bill. On the other hand, they have to make up for the huge deficits created by Medicare and Medicaid undercompensation. If your hypothetical desperate pregnant mother weren’t forced into the corporatist insurance scheme, that routine care would be much, much cheaper–guaranteed.

    2) If a person truly can’t afford the cost of a routine checkup for her fetus, there are free clinics to help those truly in need (and if you can’t afford routine care, you are truly in need). Really, there are. At this point in my life, I’m lower middle class at best (it’s a month-to-month affair here in my household). Yet even I could scrounge together the cash for necessary routine care if I needed to do so. And so can most other people. What I can’t do is scrounge together the cost to treat prenatal complications, for example. And that’s what catastrophic insurance is/should be for.

    In short, emotive appeals aren’t helpful.

  • DonS

    Michael B. @ 16: Cincinnatus has a great answer to your query @ 17, but let me add a couple of thoughts.

    One of the main reasons for shifting to the catastrophic insurance approach I suggest, coupled with a tax-free HSA, is to ensure that insurance premiums are affordable. The reason why many folks have no insurance today is because health insurance typically is comprehensive “first dollar” coverage, oriented toward covering preventive care without any out of pocket expense, small or no deductibles or co-pays, etc. Obamacare’s mandates are even more focused on this approach, which is exacerbating the increase in cost of insurance. The catastrophic approach would reduce premiums drastically.

    Additionally, HSA’s allow you to put away money, free of payroll and state and federal income taxes, to cover your deductible and out-of-pocket medical expenses, including premium costs. Because the money is tax-free, it has an increased value of about 1/3 for the average person (15% payroll tax, including employer portion, 15% federal income tax, and some state income tax). So if you have $2,000 in out-of-pocket medical costs in a particular year, it is the equivalent of about $1,400 in after tax money when you utilize your HSA. Additionally, HSA’s have an unlimited rollover feature, meaning you can carry any unused contributions over to future years. Once you are 55, you can withdraw the money for any purpose without penalty, paying only the taxes you would normally pay on deferred income, just like an IRA.

    Don’t forget, part of my proposal is to subsidize the insurance premiums and/or HSA contributions for low income people, so I am not saying the government would cease all help, just that it would get out of the business of providing cruddy, stigmatized, insurance, like Medicaid, that nobody takes, and it would get out of the business of mandating expensive, politically-charged benefits.

  • DonS

    Michael B. @ 16: Cincinnatus has a great answer to your query @ 17, but let me add a couple of thoughts.

    One of the main reasons for shifting to the catastrophic insurance approach I suggest, coupled with a tax-free HSA, is to ensure that insurance premiums are affordable. The reason why many folks have no insurance today is because health insurance typically is comprehensive “first dollar” coverage, oriented toward covering preventive care without any out of pocket expense, small or no deductibles or co-pays, etc. Obamacare’s mandates are even more focused on this approach, which is exacerbating the increase in cost of insurance. The catastrophic approach would reduce premiums drastically.

    Additionally, HSA’s allow you to put away money, free of payroll and state and federal income taxes, to cover your deductible and out-of-pocket medical expenses, including premium costs. Because the money is tax-free, it has an increased value of about 1/3 for the average person (15% payroll tax, including employer portion, 15% federal income tax, and some state income tax). So if you have $2,000 in out-of-pocket medical costs in a particular year, it is the equivalent of about $1,400 in after tax money when you utilize your HSA. Additionally, HSA’s have an unlimited rollover feature, meaning you can carry any unused contributions over to future years. Once you are 55, you can withdraw the money for any purpose without penalty, paying only the taxes you would normally pay on deferred income, just like an IRA.

    Don’t forget, part of my proposal is to subsidize the insurance premiums and/or HSA contributions for low income people, so I am not saying the government would cease all help, just that it would get out of the business of providing cruddy, stigmatized, insurance, like Medicaid, that nobody takes, and it would get out of the business of mandating expensive, politically-charged benefits.

  • Michael B.

    @ Cincinnatus and @DonS

    Thanks for your replies. I think we should clarify how we are using the term “catastrophic”. A medical bill that ruins a person will vary based upon that person’s financial status. If you can’t afford $2,000, it might as well be a $2,000,000 bill. The other thing is that as we get older, “catastrophic” incidents become much more commonplace. You mention there are free clinics. You mean those funded by the government or those by charity? For the clinics that run off of charity, surely you don’t mean to suggest that they would be enough to replace Medicaid?

    Finally, I have to ask, what do your parents (grandparents?) use for their health care? If they had to have an expensive medical treatment, could you or them afford it, or would you have to resort to Medicare? So they would have bought health insurance by themselves, one might say? (This leads to my question for DonS.) I can’t imagine too many health insurers would be lining up to insure a pair of 75-year olds at an affordable price. It would not be just the lower income elderly needing government help to pay their insurance premiums.

  • Michael B.

    @ Cincinnatus and @DonS

    Thanks for your replies. I think we should clarify how we are using the term “catastrophic”. A medical bill that ruins a person will vary based upon that person’s financial status. If you can’t afford $2,000, it might as well be a $2,000,000 bill. The other thing is that as we get older, “catastrophic” incidents become much more commonplace. You mention there are free clinics. You mean those funded by the government or those by charity? For the clinics that run off of charity, surely you don’t mean to suggest that they would be enough to replace Medicaid?

    Finally, I have to ask, what do your parents (grandparents?) use for their health care? If they had to have an expensive medical treatment, could you or them afford it, or would you have to resort to Medicare? So they would have bought health insurance by themselves, one might say? (This leads to my question for DonS.) I can’t imagine too many health insurers would be lining up to insure a pair of 75-year olds at an affordable price. It would not be just the lower income elderly needing government help to pay their insurance premiums.

  • Cincinnatus

    Michael B.@19:

    You’re conflating a whole bunch of issues. So actually, I think you’re the one who ought to clarify exactly what it is you want to discuss. Are we talking about the cost of health care or the cost of health insurance? Are we discussing the viability of Medicare? Or are we talking about the practicality of free clinics? Or are we talking about whether health insurers should be required to provide coverage for all applicants regardless of health? These are all very separate issues, and you manged to stuff them all into a single comment that departs markedly from your original question.

    Let’s go back to your original question: how do we make healthcare affordable for everyone? What DonS and I suggested–and the only thing we suggested–is that ACA/Obamacare does not make it more affordable. In fact, it does quite the opposite, because a major reason health insurance and health care more generally is a result of, on the one hand, the first-dollar model of insurance coverage which inflates the cost of care and, on the other hand, of Medicare/Medicaid undercompensation which requires health providers to make up the deficit by gouging folks who can afford insurance. That’s all we said. All those other issues are different discussions.

    Meanwhile, the meaning of “catastrophic” is not in the least ambiguous. It does not refer to the state of a person’s finances. It refers to severity and extent of the care provided. The distinction is not between “affordable” and “catastrophic” care, but between “routine” and “catastrophic” care. Prenatal care that costs $2000 is routine, regardless of how relatively expensive that might be for a poor person. Open-heart surgery is catastrophic care, even if it’s performed on a multi-billionaire who can pay for the procedure from his spare change. Make sense?

    So the solution here is flexibility in insurance options. If you want health insurance to be affordable, allow me to purchase catastrophic insurance that only covers catastrophic procedures; I can manage to pay for the rest out of pocket. I guarantee you that this would lower costs for everyone. For folks who truly can’t afford routine care–and such people do, of course exist–keep a minimal safety net in the form of a trimmed down Medicaid/Medicare program.

  • Cincinnatus

    Michael B.@19:

    You’re conflating a whole bunch of issues. So actually, I think you’re the one who ought to clarify exactly what it is you want to discuss. Are we talking about the cost of health care or the cost of health insurance? Are we discussing the viability of Medicare? Or are we talking about the practicality of free clinics? Or are we talking about whether health insurers should be required to provide coverage for all applicants regardless of health? These are all very separate issues, and you manged to stuff them all into a single comment that departs markedly from your original question.

    Let’s go back to your original question: how do we make healthcare affordable for everyone? What DonS and I suggested–and the only thing we suggested–is that ACA/Obamacare does not make it more affordable. In fact, it does quite the opposite, because a major reason health insurance and health care more generally is a result of, on the one hand, the first-dollar model of insurance coverage which inflates the cost of care and, on the other hand, of Medicare/Medicaid undercompensation which requires health providers to make up the deficit by gouging folks who can afford insurance. That’s all we said. All those other issues are different discussions.

    Meanwhile, the meaning of “catastrophic” is not in the least ambiguous. It does not refer to the state of a person’s finances. It refers to severity and extent of the care provided. The distinction is not between “affordable” and “catastrophic” care, but between “routine” and “catastrophic” care. Prenatal care that costs $2000 is routine, regardless of how relatively expensive that might be for a poor person. Open-heart surgery is catastrophic care, even if it’s performed on a multi-billionaire who can pay for the procedure from his spare change. Make sense?

    So the solution here is flexibility in insurance options. If you want health insurance to be affordable, allow me to purchase catastrophic insurance that only covers catastrophic procedures; I can manage to pay for the rest out of pocket. I guarantee you that this would lower costs for everyone. For folks who truly can’t afford routine care–and such people do, of course exist–keep a minimal safety net in the form of a trimmed down Medicaid/Medicare program.

  • Pingback: Logarchism » Three Simple Rules for Universal Health Insurance

  • Pingback: Logarchism » Three Simple Rules for Universal Health Insurance


CLOSE | X

HIDE | X