Addressing Healthcare in Colorado

11 thoughts on “Addressing Healthcare in Colorado”

1. Sorry David but your approach is almost the opposite of letting the free market work.  

   1) People with pre-existing conditions are charged more because historically these conditions generate more claims.  Although not exact, reducing medical underwriting would be like not charging drivers with more accidents the same as a driver who has never had an accident. Someone with a history of higher claims is being subsidized by someone with a history of low claims.  In many cases the pre-existing condition is not the fault of the person applying for medical coverage but the same principle applies: insureds who know they will have claims are being subsidized by insureds who do not expect to have claims.

   I don’t deny that these subsidies might not be a good idea but there are more transparent ways of subsidizing those who need insurance most.

   2) How would the appeals board determine when to overturn claim denials?  Would the appeals board use the plan’s documents? For instance if the insurance contract specifically listed the cancer treatments that would be covered, would the appeals board be able to overrule the plan documents and authorize a new experimental treatment?

   How would an insurance company be able to control its cost or should the company just assume that it is writing a blank check and pass that cost along to the consumers like other companies in free markets?

   3) If drafted properly, this idea would not be too costly but wouldn’t a true free market  solution be to allow insurance companies and providers to contract freely.  If a provider decides that an insurance company pays to slowly that provider simply stops accepting that insurance carrier.  I do agree that your policy might help with emergency rooms where the insured may not have much choice about what provider to use.

   4) While including a COBRA like guarantee for the small group market would probably not be too costly, how would this or COBRA proper continue for multiple years?  Given that the small group market still uses age banded rates would the member still receive the price increase due to increases in age?  What would happen if insurance carrier went out of business or ceased to offer coverage in Colorado?

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   1. Can insurance companies charge them more for auto insurance?

      Insurance companies want to weight it based on probably expense but the law also says what may not be used in this weighing. And it is necessary in the case of insurance for government to do this.

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      1. As a society we have decided that certain statistical relationships are often or should often be spurious and race is one of those factors, so race should not directly interact with premiums.

         But there are two big differences between the health insurance market and the auto insurance market.  The first is that a pre-existing condition is almost by definition an indication of higher claims future claims and not simply a type of classification.  The second is that society allows experience rating in auto insurance so your rate increases after claims occur or decreases if there are no claims.  If one group has a higher claim frequency then this effect naturally passes through to premiums and prospective rating takes on less importance.

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         1. We would say that higher claims that are due to who we are, not our actions, cannot be counted in our premiums. So they can charge more for smokers, but not for someone who got cancer due to their genetic makeup.

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         2. [irony-sarcasm] Your logic is impeccable! Higher risk people should pay more for insurance. Therefore, older people should be paying HUUUGE insurance premiums. It’s the Libertarian Capitalist way!

            A huge portion of health care costs are caused by older people. How to solve this crisis to insurance industry profits? Shift old people off their books and onto the government.

            Same thing with pre-existing conditions.

            Instead of using insurance as a huge statistical pool (everybody in and nobody out…  hat tip to Health Care for All Colorado, the profit model for the insurance industry is to find all sorts of tricks to remove higher-cost individuals from the pool.

            Besides being fundamentally immoral, it doesn’t solve the social problem, that:
            
            – everyone needs health care (we don’t know when)
            
            – everyone needs protection from unexpected health crises
            
            – The cheapest way to cover the risk, is with the broadest pool possible.
            
            – Insurance overhead is 25-30% of health care costs.

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2. It’s refreshing to see some non-partisan analysis of insurance issues.

   The main reason I would like to see health care reform is the COLOSSAL waste of resources and money spent determining which insurer is responsible for a specific condition: not whether the patient needs treatment, but who’s gonna pay. In the meantime the patient is stuck in limbo – sometimes until death, and often for many painful months if not years.

   A major reason that meaningful health insurance reform won’t happen or will be blocked at every turn is because there’s an enormous infrastructure of lawyers, doctors, and insurance personnel whose entire lives and careers are dedicated to battling whether a patient’s condition happened on their client’s watch or is the “fault” of someone else: another employer/insurer, a pre-existing condition, etc. It would be wonderful if we could reach the conclusion that every citizen deserves proper health care as a birthright, without all this discussion of who’s responsible for it.

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   1. With single payer, there is no medical coverage.  You’re hurt, you go to the hospital.  You get care.  Insurance companies aren’t involved, and neither are lawyers.  No blame to apportion.

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   2. Every Doctor I have talked to is open to almost any plan that reduces the existing cost of getting paid by insurance companies.

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3. What role does “insurance” play…in general, not just in health care?

   Insurers are gamblers. They gamble that the collective premiums of their members will exceed the claims. In order to improve the odds, they base the premiums on the statistical properties of the insured (young drivers pay more, for example)…or refuse to take on certain would-be policy holders.

   Any program that dictates premiums, or insists that everyone be covered, is not insurance. It is spreading the costs over time and over the entire population and over time. Those are the right goals, but insurance is distinctly NOT the approach to achieve them.

   Medical care is unique in this respect: everyone has the potential need (not everyone drives a car or owns a house, for example) and everyone should receive preventive care to avoid a more serious illness down the road–an aspect of medical care that is often absent in discussions about insurance The emphasis here is on EVERYONE.

   It is a matter of some distraction to me that the discussion about funding medical care continues to use the term “insurance” as if this were the issue No one needs medical insurance; everyone needs medical care, and everyone should participate in paying for the health infrastructure that needs to be maintained so that care is available when needed by those who need it.

   When we get caught up in our own rhetoric, such as “letting the market work” (which is manifestly does not), we spin off the rails and begin discussing details of an approach that we already know from experience is NOT able to solve the problem. If private insurance plans were the answer, we wouldn’t be having this discussion after so many, many decades of trying this approach!

   From the evidence (in Europe, the closest analog to the US) the answer is in front of us: Single Payer care financed by taxes in lieu of premiums. Benefits: a) lower total costs; b) everyone is covered; c) costs of a vital social infrastructure spread on the basis of ability to pay. Just like: police, fire, education, roads, military. Frankly, any other discussion is doomed to failure if success is defined as making medical care available to everyone who needs it.  

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   1. The only reason to not have a single payer system is ideology.  Oh, and lobbyists and CEO’s fearing the loss of billion with a b dollar salaries.  

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      1. U.S. spends about 15% of GNP on medical care to cover ~85% of the population, assuming 45-50 million uninsured with many others underinsured (high deductibles that discourage preventive care).

         Europe in general spends ~7-8% to cover 100%.

         No verifiable difference in quality of care, unverified anecdotes about waiting for plastic surgery and the like notwithstanding.

         Ergo: we spend (or rather, waste) at least 5-7% of GNP on ideological commitment that makes no sense whatsoever–as Parsing says, only the private health care insurers benefit. That’s one helluva lot of money to pay for insisting on the right to be wrong!

         One teensy step towards correcting this is to elect representatives who stand for single payer health care (which, btw, almost certainly has to be done on a national, not state, level to avoid state economic development types pitting themselves against other states for the benefit of corporate shareholders and at the expense of their citizens). Jared Polis is one.

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