Showing enviable prudence, most of the uninsured are ignoring Healthcare.gov:
PRINCETON, NJ — In the midst of widespread news coverage of problems with the federal health exchange website, relatively few uninsured Americans (18%) — the primary target population for the exchanges — have so far attempted to visit an exchange website. The percentage is slightly higher, 22%, among uninsured Americans who say they plan to get insurance through the exchanges.
the Gallup organization has found. They also find that nearly half don’t plan to purchase insurance, period. As my wife sometimes say, you can lead a horse to water but that won’t make him into a duck.
Free riders enjoy riding free. Big surprise. The fines will push some of them, peer pressure will push others.
There’s another group, Michael. People who refuse to give their money to companies that have spent decades ripping them off. This may become an effective referendum on how much legitimacy people place in our government. If tens of millions refuse to play along that says something, although I think we could debate exactly what.
“Big surprise.”
Apparently took Obama totally by surprise.
I’ve always been haunted by a former secretary, who would withdraw every dollar we ever put into her retirement account within days. She would receive several thousands of dollars in profit-sharing from the firm, but she needed the money now more and paid the penalty (10%), plus taxes to get it. She wasn’t terribly income poor, though she held a full time and a part time job. But she was relatively young, had a kid early, dropped out of college, and had irresponsible sperm donor. She had large bills and debts, like a lot of twenty/thirty-somethings. She was smart, independent, and understood that she had to make a lot of tough choices in her position.
Since there are massive tax deductions for group insurance, but none for out-of-pocket medical care, it’s the insured who are the “free riders,” Michael.
Likewise for Obamacare, when you consider the Medicaid insurance that is partly funded by the uninsured, as well.
@PD Shaw
This woman was/is a free rider. By not participating, she causes rich white liberals to have high premiums. Thanks to Obamacare she will now pay for a policy she cannot afford, but more importantly, rich white liberals will have substantially lower premiums.
@jan
Notice how the same rich white liberal who cries to have his taxes raised is the same rich white liberal who celebrates paying substantially less for his premium. The money he saves on the premium will need to be paid by somebody with less money, but notice how he justifies it. These people are freeloaders.
The poor, minorities, and powerless are useful for increasing a liberal’s bank account. The proclaimed concern is about increasing political power, and increased political power generates more money.
It’s all about the “Benjamins”.
IMO, a huge pall seems to be settling over people as they are caught up in this government medical insurance net called Obamacare. It has been a total waste of time, energy, and cost savings from it’s conception, processing, and now the reality of it’s painfully unfair implementation.
I just don’t get how people like Reynolds continue to glibly endorse it, jab at those who don’t, as he puts a condescending finger in the eye of the middle, entrepreneurial classes who are being squeezed by it. The potential loss of insurance coverage is simply staggering over the next couple of years. Anger doesn’t even begin to describe how people, myself included, are feeling about not only the incompetence of the government, but how it is literally ripping people off, and then scolding them because they don’t like it!!!!!!!!!
Obama’s poll numbers hit new lows. I’m surprised they aren’t even lower…..
I’m actually afraid that a lot of folks are going to end up dying very prematurely because of this ACA, and not unintentionally. Single payer, gov .controlled access to timely treatment, planned parenthood, and the eugenics movement all share the view that there are just too many of us for the planet to sustain. They really mean this, they have no right to say how many we should be, but they believe in their superiority and are now firmly in power. And by the way, these government “public servants” reserve a different health care plan for themselves. You will cry when your loved one is refused a life saving procedure because of health status, age or a decision made by HHS, ( Sebilius)
Free riders? I thought they were the poor desparate for health insurance. Huh. The target of the program seems to have changed over time.
Using the Massachsetts experience we shouldnt expect much activity this early.
http://theincidentaleconomist.com/wordpress/this-chart-should-be-getting-more-attention/
“And by the way, these government “public servants†reserve a different health care plan for themselves. ”
The level of ignorance remains high.
Steve
I know this will probably fall on deaf ears, but I will try it once more.
Preamble: The current health care delivery and insurance system needs redress. But Obamacare is taking an economically boneheaded and, from an execution point of view, a meat ax, approach. I suspect Michael actually has good intentions. I just don’t believe he is equipped with the economic, business management or executive understanding to know what a mess this really is, and was always destined to be – his positively orgasmic European thrill up his leg moment not withstanding. I’ll leave the support for a cynical and arrogant bald faced liar for later.
1) We need the consumer to suffer price incidence. I’ve been told countless times “health care and health care insurance is different.” No its not. Look at what is happening as people are starting to see the bills. Everyone eats steak on an expense account……..but……….
2) This leads to portability and pre-existing conditions. I’ve never seen anything an insurance company cannot underwrite. Ever hear of Loyd’s of London? The only difference between insuring your car or home and health care is that your expected value of claim increases with age. (free rider in a moment) But this is not an insurmountable problem solvable only through a miserable takeover of health care by the government. Enforce cross state insurance. Let private insurers offer lifetime policies that are portable and non-cancellable and they will do the actuarial analysis and price accordingly. Its not rocket science.
3) The free rider problem. What these people do is throw themselves on the expected mercy of our society by disrupting the actuarial analysis for no premium payment at an early age and then bitching about premiums when no insurer can low price a high risk candidate later on. Leaches such illegals and people talking about health care as a “right” do this. They also want to buy car insurance two minutes after their wreck or renters insurance after they are robbed. It is truly a vexing problem.
But lifetime underwriting could solve this, or catastrophic insurance at an early age and more comprehensive, though more expensive policies later.
The problem with ObamaCare is it addresses none of these. Its a raw political scheme for votes, and who is surprised? The apparent resolution of the free rider problem is really a crass subsidy by the young of the free riding old.
Let’s see – Medicare, SS and now ObamaCare – all bald faced intergenerational rape. What a mess.
Lefties want a death tax. Seems the least we could do is allow those who understand this intergenerational issue and forgo personal consumption to help their family and other loved ones finance this building burden should be allowed to do so.
Folks, its not enough to “care.” This solution is an absolute abomination.
Red:
Is this lecture delivered with the same outstanding confidence that you told us employment figures would be revised down and there’d be fewer jobs this go-round?
Not that it apparently deserved notice here, but just the opposite occurred: surprising growth plus upward revisions.
There’s not much point debating you. All I have to do is wait for time to pass and for GM not to fail, and Romney not to win, and for the deficit not to explode, and for the housing market not to drop still further, and for millionaires not to flee higher taxes in California, and next for Obamacare to do better than you expect. You’re becoming the Dick Morris of bombastically wrong predictions.
Oh, and I totally forgot that Syria wouldn’t comply with destruction of chemical weapons. Yeah, you were wrong there, too.
Do you give stock tips? Because I think if I did the opposite of what you suggest I might make some extra coin.
Massachusetts had a two-step, hand-written, snail mail process that is nothing like Obamacare.
To enroll in the Massachusetts exchange, the applicant had to fill out a fifteen-page Medical Benefits Request by hand, attaching proof of income, citizenship/immigration status and potentially HIV status.
The applicant waited for the bureaucracy to review the document and mail them information on what types of insurance they were eligible for and what their subsidy would be.
Assuming the application was not rejected for want of additional information, the individual then applied for the coverage they wished based upon the approval received.
@TastyBits, I see what you did there.
But I do want to make my point clear, our former secretary would not have purchased health insurance under these conditions. She would have spent the 5 minutes googling to discover how to avoid paying any penalty . . . I mean tax, by reducing her withholding, assuming she hadn’t already.
Drew-
1) Yes, and there are ways it can work in health care. The problem has been that people tend to save money on care (high blood pressure, diabetes) that leads to higher costs down the line. Even with HSAs, you reach that point where you go past the deductible and the insurance kicks in. You, the consumer, actually save money if you skip on a lot of preventive care and maintenance care and just wait until things are bad enough that you will go over your limit in one year. Value based insurance might get around this. I am not sure why no insurance company wants to try it out.
2) Lot to unpack. I hope you understand by now that insurers can sell across state lines, they just have to comply with state insurance rules. If you want to do away with state mandates, I am with you. Are you willing to use the powers of the big federal govt to overturn state’s rights on this issue? Let me know when your party is willing and able to overcome the cognitive dissonance here and address this.
I love portability. Lifetime health insurance? Sure, but you still have the same cost issues. Assuming your actuaries are any good, this wont really change costs. (Since experience with lifetime costs is smaller I would expect them to be a bit higher, but not much.) Still doesnt address affordability. How does someone making $20k/year afford insurance, especially if they have asthma or something? Universal catastrophic insurance would better address this (see Capretta), but the deductible limit then becomes key. If you are making $15k/year and you set the deductible at $10k, you still cannot afford health care. Set lower limits on the deductible, and you are back to having a plan close to Obamacare, which you are supposed to hate.
3) You forget the free riding young. We pick up their maternity costs and trauma care costs. Still, you are looking at this wrong. It is the healthy subsidizing the sick. Yes, this will largely go from young to old, but not entirely. I think this is how health insurance needs to work. Remember health care spending demographics. 50% of people account for 3% of spending. The top 5% account for 49% of spending. This is usually chronic care (dialysis, autoimmune diseases) or big things like heart surgery/chemo. If you want to shift costs more towards those consuming the care you make it less affordable for them and guarantee more free riders.
Steve
@Drew
“But lifetime underwriting could solve [the free rider problem], or catastrophic insurance at an early age and more comprehensive, though more expensive policies later.”
Wouldn’t the success of the lifetime underwriting scheme require a “no rescission or lifetime cap” condition be imposed on the companies offering the policies? Absent such a condition, what would ‘lifetime’ mean? Moreover, wouldn’t some the same kind of provisions need to be imposed on the catastrophic policies (especially the no-cap provision)? Hard to see how such provisions could be imposed absent government action (read: meddling in the marketplace).
“This leads to portability and pre-existing conditions. I’ve never seen anything an insurance company cannot underwrite. Ever hear of LLoyd’s of London? ”
LLoyd’s is an interesting example as regards health care:
[blockquote>How asbestos brought Lloyd’s of London to its knees in the 90s
Asbestosis, a deadly lung condition caused by exposure to asbestos fibres, is a classic example of a “long-tail†risk – one that can result in insurance payouts years after an original policy was first underwritten.
Most sufferers of asbestosis and other asbestos-related conditions, including lung cancer, only developed symptoms years after they were first exposed to asbestos fibres.
This meant that when their employer eventually lodged liability claims to its insurer the policy was often decades old. It also meant that reserves of money set aside to pay claims were often insufficient because awareness of the illness had been non-existent.
This resulted in the bankruptcy of thousands of Lloyd’s investors who had underwritten policies exposed to billions of pounds of asbestos-related claims. These included so-called “names”, private individuals who agreed to take on the liabilities associated with insurance risks in return for any profits made from premiums. [Source]
I would think that that experience militates against the lifetime insurance scheme.
One thing that’s always troubled me (and others) about cross state insurance is the applicability of standards. Right now, states regulate the kinds of policies that can be sold within the states. Basically, a state says, “To sell insurance policies here, you have to cover, at a minimum, A, B, C…”. Why wouldn’t insurance companies create and market policies from a state that has the least stringent requirements on policies? The problem this engenders is that for this to scheme to be successful, the states would have to be denied to right to regulate the sale of insurance policies within their borders. And this would require federal legislation. I suppose you could do this under the Commerce Clause, but note that this would amount to a “federal takeover of healthcare”, too. Presumably, not all federal takeovers are created equally, though. (And the problems of rescission, caps, pre-existing conditions, etc. don’t go away here, either.)
@sam, as to your last question, self-insurers ignore state mandates; that is part of their appeal.
What Drew is talking about was doable before the ACA required no pre-existing conditions. Insurance policies are contracts and can be written to have features similar to life insurance. The quid-pro-quo is that the young actually get a valuable feature by buying a policy early, since it locks them in. The insurance company gets more customers and less adverse selection problems.
The worse thing about ACA stems from Obama’s statement that Wyden-Bennett was too radical in seeking to shift away from employer-sponsorship of healthcare. So, we’re left with a system which tries to get those without group care to feed off each other — those with the most money, but the most need, feed off those with the least money and the least need.
“@sam, as to your last question, self-insurers ignore state mandates; that is part of their appeal.”
Yeah, but we’re not talking about self-insurers.
And notice this. I’m pretty sure that if the cross-state scheme were to be instantiated, the Congress would say something like — Well, you guys can do that, and you can even have different plans and different prices, but the different plans will have to offer minimum categories of coverage and ….
Hey, wait a minute. That sounds an awful lot like Obummercare…
The blame game begins over Obamacare debacle, as insurers dump doctors.
Jan:
Pro tip: If you want to be taken even a little bit seriously don’t like to the New York Post.
Michael,
Gotta tell you that it gets tiresome having people from OTB orientation telling others what are ‘good,’ and newsworthy sources to read, versus what are not. It’s kind of like this administration telling people what are good and bad HC policies to purchase.
As for the government stepping up it’s blame towards insurance companies — it’s been reported by news outlets other than the NY Post. And, what the government fails to discuss is how their agreements with insurance companies included some contingencies, such as non-government compliant plans had to be canceled if they were to qualify for any government subsidies. This, IMO, makes the government culpable and very much behind most of the mass individual HC policy cancellations we are seeing, rolling out in the second half of 2013.
BTW, Michael, when did liberals become such rubber-stamped conveyers of orthodoxy? I used to think this was the group promoting unconventional wisdom, calling for people to ‘question authority.’ I relished that phrase, activating it a lot in my own life.
However, now in the era of social progressivism, such a rallying cry has converted to “don’t question authority.” Is it because so many liberals are getting old, complacently smug and comfortable with their philosophies, not wanting to rock the boat? Or, is it because they are now in command and control of government, and have shut the door on anyone outside their ideology questioning their authority?
For those interested, probably no one, here is how the ACA is approaching the 10 essential benefits that need to be covered, while addressing state mandates. In short, one of the three largest plans in a state must be used as a benchmark. That plan will have already been approved by state regulators and will have been tailored to the needs of that state. A survey showed that these plans dont really vary that much from state to state, pediatric dental and vision being the services most likely not included. If the selected benchmark plan does not cover one of the 10 essentials, the state may use another state plan’s approach to covering that essential.
In short, the ACA has given the states a lot of latitude in how they address benefits. The most popular plans in every state already address most of the mandated benefits. There is no mandated federal approach on how to cover these benefits.
Steve
Thanks, steve. I’m interested. Do you have a link?
Oops. Work has been killing me and I forget to add the links when I am tired.
http://www.healthaffairs.org/healthpolicybriefs/brief.php?brief_id=68
Steve
Michael and sam – Thank you for your typical lightweight, useless and somewhat bizarre responses.
steve – thank you for the thoughtful response. Its late and I’m tired having just returned from Sea Island (played with British Open champ and Ryder cupper Darren Clarke – what a great guy) and will give your comment some thought. Can’t imagine this topic is over here and a chance to respond will exist.
steve
“You, the consumer, actually save money if you skip on a lot of preventive care and maintenance care and just wait until things are bad enough that you will go over your limit in one year.”
I understand your point, but a) I don’t know what we do about irrational behavior that says “I will harm myself to the point of being sick and in need of expensive, unnecessary and not necessarily curative care.” These people exist, like drug addicts, but do we base broad based public policy on this?…….b) Allstate, for example, has “safe driver” discounts. That is, if you take certain steps there is a value. Maybe that is what your term “value based” means. You might know better than I what is unique in health care that has prevented this approach. I suspect its the abnormal intrusion of government and the third party payer.
“If you want to do away with state mandates, I am with you.”
I am. I’m not a total “anti-regulationist” or “states only.” I can only assume the current system is a creature of political favor. And “my” party and “your” party both do boneheaded things. Its not party. I, unlike sam or Michael, am not a slobbering slave to Democrat or Obama everything. I’m a realist and pragmatist. I actually care about good and effective public policy, and it comes from both parties depending on the issue.
“I love portability, etc, and “#3.”
Without portability (which is also a proxy for lifetime) nothing works.
“Lifetime health insurance? Sure, but you still have the same cost issues. Assuming your actuaries are any good, this wont really change costs.”
No, only price incidence will. But ObamaCare doesn’t do this really.
“Still doesnt address affordability.”
Nor would wholesale government regulation or takeover of car insurance, home or renters casualty insurance, life insurance…….
That’s no predicate for the government taking over health insurance. Has the government ever done anything like this cheaper? No. No motivation to do so. They will simply default to other measures of total cost: reduced availability, reliability and quality.
“How does someone making $20k/year afford insurance, especially if they have asthma or something?”
You might as well replace “insurance” with “food, clothing and shelter.” Health insurance is not unique.
“You forget the free riding young.”
No I didn’t. But its a very difficult problem.
“Still, you are looking at this wrong. It is the healthy subsidizing the sick.”
No, I am not. By its very nature insurance subsidizes those who have the unfortunate circumstance of a claim, pitted against the pool who do not, but insure against that circumstance. The difference in health care as opposed to home or car insurance is that you have a variable – age – that is directly correlated with the probability of a claim. I have no problem with, say, renters insurance in that if you live in a high crime area your premiums will be higher. Or if you have a habit of fender benders you have increased car insurance premiums.
I do have an issue with being penalized for just getting older. And I have a problem with a free rider skipping the premium until they get sick. That simply does not work in a private or government setting. (And Obamacare isn’t fixing this, its a raw younger to older subsidy – and what is happening is that the young will just pay the penalty because of the “no pre-existing condition exclusions” component and the penalty can’t be made punitive or it will be deemed a penalty and not a tax and the Supreme Court decision dies – What a fine mess.) It ought to be possible to set a reasonable expectation for lifetime premiums and then have portability without the Rube Goldberg system that is ObamaCare. It could be made a fair and actuarily sound system…………if, of course, that was the goal.
Yes, it is. Of the goods you’ve listed it’s the only one that has increased in real cost over the period of the last 40 years.
Dave
That’s faulty analysis. Other insurable events are not subject to the whole suite of health care dynamics: subsidy, lack of price incidence, regulatory capture/limited competition, supply constraint, significant regulatory burden.
Is your house more or less likely to burn down than 40 years ago? Then one would expect fire insurance premiums, adjusted for replacement cost inflation, to go down. How about competition in the auto insurance market?
You don’t look at an insurable event littered with non-market conditions and conclude that the only solution is, of all things, a government solution. You chip away at the underlying causes of the price escalation of the insurable event and to competition.