Economics columnist Robert J. Samuelson finds another quirk in the Health Care bill. Already, our system of entitlements is forcing the young to subsidize the old, what with Social Security imbalances.
Now comes the House-passed health-care "reform" bill that, amazingly, would extract more subsidies from the young. It mandates that health insurance premiums for older Americans be no more than twice the level of that for younger Americans. That's much less than the actual health spending gap between young and old. Spending for those age 60 to 64 is four to five times greater than those 18 to 24. So, the young would overpay for insurance that — under the House bill — people must buy: Twenty- and thirtysomethings would subsidize premiums for fifty-and sixtysomethings. (Those 65 and over receive Medicare.)
Dictating how much something is allowed to cost is always disastrous, since market mechanisms work whether one wants them to or not. (When I was in Estonia under the Soviet Union, the communist government kindly mandated that bread be sold for a price that was less than what it cost to produce it, which meant that bread was reasonably priced but that there was no bread in the shops!) For the bill to presume to set these kinds of prices–as well as others, such as not allowing insurance companies to charge extra for pre-existing conditions–is a dire sign.
But now to force young adults just starting out–who already have a hard time making it, thanks to housing prices and the rest of our high cost of living–seems especially unfair. This is not a matter of the young helping out the venerable old. Retirees are under Medicare. This is paying for their parents, who are at a stage where they make far more than their 20-something kids.
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