Monday, January 14, 2013

The Shape of Things to Come

In the Wall Street Journal today, you can read an excellent piece on the imminent spike in health insurance premiums we can expect thanks to Obamacare. A slice:
How do we know [Obamacare's] requirements will have such a negative impact on premiums? Eight states—New Jersey, New York, Maine, New Hampshire, Washington, Kentucky, Vermont and Massachusetts—enacted guaranteed issue and community rating in the mid-1990s and wrecked their individual (i.e., non-group) health-insurance markets. Premiums increased so much that Kentucky largely repealed its law in 2000 and some of the other states eventually modified their community-rating provisions.

States won't experience equal increases in their premiums under ObamaCare. Ironically, citizens in states that have acted responsibly over the years by adhering to standard actuarial principles and limiting the (often politically motivated) mandates will see the biggest increases, because their premiums have typically been the lowest.
According to the article, Virginia is one of the states that will see the largest premium hikes in the coming months.  As a Virginian who has just recently entered the individual insurance market, I can express my opinion only thusly: oh, shit.

A friend said to me recently that medical care is so messed up in America because medicine is "privatized" and "corporatized." Well, it's not quite as simple as that---almost three-quarters of all hospitals are non-profit, which makes them a different beast from your average retail outlet or corporate megalith.

Now, it's true that insurance companies are privatized and corporatized. But so is Wal-Mart, and Wal-Mart is somewhat slightly cheaper and easier to deal with than your average private insurer and/or doctor. Imagine if shopping for health insurance and medical care were as easy and as relatively cheap as shopping at Wal-Mart.* So there's something else at work making insurance unaffordable (see the above-referenced article). In spite of what the European Union would have you believe, privatization is not the enemy, though surely it is a convenient scapegoat with the government utterly fails at its own game.

That's a pretty sweet deal, when you think about it: the more the government mangles private health care and health insurance, the more it can justify a single-payer system! It's like a mobius strip, except it ends with you getting inferior health care from the State.

*If you find Wal-Mart to be repugnant and---let's just come out and say it---beneath you, then imagine how it would be if the health care market were at all akin to the markets of Target or Nordstrom or Dillard's: higher quality than Wal-Mart, but still geared towards giving you the most amount of choices at the lowest price possible for that niche. Can you think of any hospital that even remotely resembles such a setup?

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