It is said that noticing that you are confused is a great virtue

[contrarianarchon]

Specifically, I'm confused about insurance companies: People keep talking like coercing insurance companies into covering more health costs and more routine health costs in particular as a good thing in the context of the American health system trashfire. Why? They're for-profit companies, so if regulations demand they spend more money per contract, their only plausible response is to raise the cost of offering that contract? And maybe there's some tangled web of them being obliged to offer contracts to people or employers being obliged to pay for them that diffuses that cost off into the aether but *surely* this checks out to you paying more money or being paid less money because your employer is spending their budget for keeping you around on keeping you properly ensured? 

... also there's a market for insurance on objects which are smaller than the amount of money in your savings account, so like, I guess one of the answers here is "some large percentage of the population just does not grok the transition that insurance is? 

(like the actual answer is public healthcare and I guess that also checks out in notional increased taxes again to the exact same tune of some amount of diffused extra cost, but it's 99% less legible and less accountable if you pass it through a dozen capitalists on the way to you rather than through a government budget-line saying "we spend X million dollars on giving people free dentistry" or whatever?) 

... apparently this blog is about finance now, IDK how that happened

Comments

[mindstalk]

The Bismarck model of universal health care looks overcomplicated, but in various ways it works quite well in Germany, France, the Netherlands, Japan, and Switzerland, if not others. Obamacare is just a lame implementation.

And yes, it is a web, or "three legged stool" in the words of Krugman if not others. The key reforms of RomneyObamaCare were

* the insurers have to take everyone who applies, no turning away due to "pre-existing conditions"
* the insurers have to charge everyone the same rate, modulo a few simple variables (location, age), aka 'community rating'
* everyone has to buy insurance, aka the individual mandate

Plus subsidies for those who can't afford insurance even then.

Plus in most countries the insurers are non-profit, and even in the US post-reform there's a cap on "medical loss ratios"; the insurers have actually been sending refunds to subscribers, when they collect sufficiently more premium than they end up paying out. So they can't abuse the mandate by just cranking up premiums.

So everyone buys insurance, and everyone gets insurance, and insurers don't go into the death spiral of adverse selection caused by voluntary individual insurance.

And yes, the reforms included banning shitty cheap insurance that didn't cover much. The goal is to prevent medical bankruptcies, and for that you need unlimited coverage policies, not $50,000/year caps.

Medicare/aid for all seems simpler, but when you already have insurers and people who think they like there insurance and you also have a tax averse government and electorate, this sort of thing looks like the way to go. Worldwide it may outnumber simple single-payer systems.

[contrarianarchon]

Thanks for explaining this. This is the Worst Tax Evasion, then, because it's the government avoiding everyone else paying taxes despite ultimately charging them the same amount of money (not: Not actually the worst tax evasion at all). I guess you get *some* amount of generating price incentives not to live in dangerous places in proportion to the cost of that danger? That's nice, at least. Not sure the "well we have insurance already" argument really holds water but it does seem like a lower-friction reform. I do worry that [Americans in particular] suffer a lot of weird costing issues because the insurers want to play mind games with the healthcare providers but I guess the government can do all it's own fuckups as well.