House to vote on health care reform Sunday.

[DGuller]

I was thinking about the fundamental problem of cost in your system.  I havent read anything to indicate that any of these reforms which addresses the cost of your system.  I dont think it makes much sense for government to essentially underwrite a system where there is no real cost control.  Seems a recipe for huge government expenditure over time.

Yes, that is a huge problem.  I think the bill does attempt to introduce many cost control measures, but I think it's safe to say there has been no concerted effort to focus on costs.  That could be another fatal flaw of the bill as it is right now.

[DGuller]

I can live with mandatory insurance, because having worked for a medical center up in Boston, I know what happens when people show up at the ER when uninsured: the medical center gets reimbursed by the state for the cost of the person's care.  So, whether people up there realized it or not, they were paying for at least emergency health care for anyone not otherwise covered.

That doesn't mean I think the government will implement and regulate this well, but at least in theory it makes sense.

That's one argument for it.  It's not a weak argument, but the far stronger argument is that private insurance market will get destroyed by adverse selection without mandates.  If you want to ban denial for pre-existing conditions and limit the actions of the insurance company, you have to balance it out by limiting the actions of the insured as well.  One will not work without the other.

[grumbler]

So you have to buy health insurance or be fined?  I hope there will be some scam insurance providers

That's exactly the problem I have with this "solution."  You have to have insurance, so you buy some from FlyByNight HealthCo for $50 a month, getting no significant benefits in return.  Then, a year later, you discover that you have leukemia, so you switch to Blue Cross Blue Shield for $250 a month, taking out $10k a month in benefits.  After a year, you have gone into remissions, so you switch back to FlyByNighCo.

Over two years, you have paid $3600 in premiums and gotten $120,000 in benefits. 

Multiply by a million.  Problem?

Now, this is an extreme example, for sure, but I don't see anything yet that makes me think something like it won't happen.

[grumbler]

...the far stronger argument is that private insurance market will get destroyed by adverse selection without mandates.  If you want to ban denial for pre-existing conditions and limit the actions of the insurance company, you have to balance it out by limiting the actions of the insured as well.  One will not work without the other.

That's how I see it as well.  Free rider problem, anyone?

[Caliga]

I think the important thing here is that Marti loves America once more.

Of course, that will change next week when a gay kid gets beat up at some random high school.

[viper37]

That's exactly the problem I have with this "solution."  You have to have insurance, so you buy some from FlyByNight HealthCo for $50 a month, getting no significant benefits in return.  Then, a year later, you discover that you have leukemia, so you switch to Blue Cross Blue Shield for $250 a month, taking out $10k a month in benefits.  After a year, you have gone into remissions, so you switch back to FlyByNighCo.

Over two years, you have paid $3600 in premiums and gotten $120,000 in benefits. 

Multiply by a million.  Problem?

Now, this is an extreme example, for sure, but I don't see anything yet that makes me think something like it won't happen.

I don't think the insurance company is forced to accept you when you are sick if you already have insurance.
If you are sick today and are uninsured, yeah, Blue Cross Blue Shield need to accept you, as long as you can pay the premiums.

Besides, if I'm wrong, and they are forced to accept the sick people changing for a better plan, there is nothing in this law preventing them from signing a multi-year contract, I think...  So, they could accept you, but you sign a 5 year contract with them, where if you leave from your own will, you keep on paying the insurance.

All these things aside, I still think your health care system is needlessy complicated.
Cover everyone from base, allow people to buy private insurance and get whatever treatment they want.
See, not that hard to do?
It's what they do in Europe, and it works well.
On the other hand, the Canadian way is to prevent you from going to the private, much like Cuba and North-Korea and it works just as well as you'd expect...

[DGuller]

So you have to buy health insurance or be fined?  I hope there will be some scam insurance providers

That's exactly the problem I have with this "solution."  You have to have insurance, so you buy some from FlyByNight HealthCo for $50 a month, getting no significant benefits in return.  Then, a year later, you discover that you have leukemia, so you switch to Blue Cross Blue Shield for $250 a month, taking out $10k a month in benefits.  After a year, you have gone into remissions, so you switch back to FlyByNighCo.

Over two years, you have paid $3600 in premiums and gotten $120,000 in benefits. 

Multiply by a million.  Problem?

Now, this is an extreme example, for sure, but I don't see anything yet that makes me think something like it won't happen.

As I said earlier in the thread, what will make this not work is the regulatory system already in place.  All insurance products sold to individuals are heavily regulated, even now.  You just won't be able to sell a nominal non-coverage and have it pass muster with regulators.  You can't get fake car insurance just to satisify an insurance requirement, can you?

What's an open question is how easily one can switch from no insurance at all to insurance, after getting a cancer diagnosis.  I don't remember off the top of my head what the final solution to this wound up being, but something like waiting periods before the coverage starts would have to be mandatory.

[Barrister]

You can't get fake car insurance just to satisify an insurance requirement, can you?

Not fake insurance, but there are companies that will give you the cheapest bare bones car insurance so you can get registered.  Liability-only, minimum coverage, high deductible...

[grumbler]

All these things aside, I still think your health care system is needlessy complicated.
Cover everyone from base, allow people to buy private insurance and get whatever treatment they want.
See, not that hard to do?
It's what they do in Europe, and it works well.

I think the US should just have adopted the German system, lock, stock, and barrel.  Agree that the US current system is the worst of all worlds, and that the Hope! Change! doesn't make it much (if any) better overall.

[DGuller]

You can't get fake car insurance just to satisify an insurance requirement, can you?

Not fake insurance, but there are companies that will give you the cheapest bare bones car insurance so you can get registered.  Liability-only, minimum coverage, high deductible...

Yes, of course, but even that insurance goes a long way, especially in states that have adequate minimum liability requirements.  The reason car insurance is mandatory is due to the liability aspect of it.

[Syt]

All these things aside, I still think your health care system is needlessy complicated.
Cover everyone from base, allow people to buy private insurance and get whatever treatment they want.
See, not that hard to do?
It's what they do in Europe, and it works well.

I think the US should just have adopted the German system, lock, stock, and barrel.  Agree that the US current system is the worst of all worlds, and that the Hope! Change! doesn't make it much (if any) better overall.

The German system is also searching for cost efficiency, though. Ca. 20 years back there was no free choice of insurance (it was mostly decided by who your employer was), and everyone paid the same. In an effort to let the market do its magic the government decied that insurances could set their rates themselves, and everyone could choose the insurance they liked.

The result was that many young, healthy, flexible people moved to the cheap insurances, while many of the old and chronically ill remained with large, ineffective, expensive insurances. This lead to a central funds into which the insurances with a surplus paid a share of their revenue to subsidize the insurances that made a loss (this led to my then insurance having to raise their rate more than they wanted to, in order create more payments for the central funds). Also, the government introduced minimum times you had to stick with an insurance.

Meanwhile, the share of medical costs that patients have to bear themselves has risen constantly (though generally capped at 2% of the annual income - 1% for socially weak), and for some treatments (esp. expensive dental procedures) you can expect to pay either all or a rather large part of the cost.

Eventually, they re-introduced one rate for all insurances (though the insurances charged a little bit on top recently to cover their losses).

The latest discussion point is to force the pharma companies to lower their prices for medications, and to create more incentives for doctors to prescribe generics.

[grumbler]

The German system is also searching for cost efficiency, though. Ca. 20 years back there was no free choice of insurance (it was mostly decided by who your employer was), and everyone paid the same. In an effort to let the market do its magic the government decied that insurances could set their rates themselves, and everyone could choose the insurance they liked.

The result was that many young, healthy, flexible people moved to the cheap insurances, while many of the old and chronically ill remained with large, ineffective, expensive insurances. This lead to a central funds into which the insurances with a surplus paid a share of their revenue to subsidize the insurances that made a loss (this led to my then insurance having to raise their rate more than they wanted to, in order create more payments for the central funds). Also, the government introduced minimum times you had to stick with an insurance.

Meanwhile, the share of medical costs that patients have to bear themselves has risen constantly (though generally capped at 2% of the annual income - 1% for socially weak), and for some treatments (esp. expensive dental procedures) you can expect to pay either all or a rather large part of the cost.

Eventually, they re-introduced one rate for all insurances (though the insurances charged a little bit on top recently to cover their losses).

The latest discussion point is to force the pharma companies to lower their prices for medications, and to create more incentives for doctors to prescribe generics.

Yeah, i know the German system isn't perfect, but it seems to me to be the best mix of cost and effectiveness that I can find.

[crazy canuck]

Cover everyone from base, allow people to buy private insurance and get whatever treatment they want.
See, not that hard to do?
It's what they do in Europe, and it works well.

The real question is what would be base coverage and what would be privately insured. Access to privately paid medical care varies widely by province here in Canada.  Here in BC I can purchase, either through insurance or personally, a wide range of additional care in addition to my general medical care coverage.

As I understand it, that was not possible or was highly restricted in Quebec until somone went to the SCC and obtained a judgment that preventing timely access to medical care - even if it was private - was contrary to the Charter.  I am not sure how that case has changed access to private care in Quebec.

[The Minsky Moment]

I was thinking about the fundamental problem of cost in your system.  I havent read anything to indicate that any of these reforms which addresses the cost of your system.  I dont think it makes much sense for government to essentially underwrite a system where there is no real cost control.  Seems a recipe for huge government expenditure over time.

The more the cost goes up, the more powerful and well-resourced are those interests who have strong incentives to keep costs high and increasing, and thus the harder it is politically to achieve meaningful cost controls. 

[crazy canuck]

The more the cost goes up, the more powerful and well-resourced are those interests who have strong incentives to keep costs high and increasing, and thus the harder it is politically to achieve meaningful cost controls.

That is certainly true but without real reform that addresses the issue you folks are doomed to continue have the most expensive system without having the best outcomes.