Carrots, sticks, and health insurance

carrot-stick approachWe insure things of value because we know if something happens to them, repairs won’t be free. Our health is a thing of value. Therefore we insure it. Except a lot of people don’t. They don’t because repairs are free at the nearest ER. Why pay to insure something when free repairs are readily available? Yet some way, somehow, those repairs must be paid for. Parts and labor — drugs, equipment, and doctors — are expensive.

Enter the U.S. government with the Affordable Care Act and its mandate that everyone buy health insurance or pay a penalty (one way or another, they’re going to make you pay).

Instead of a stick (the mandate), why not a carrot (cheaper insurance)? Rescind the McCarran-Ferguson provision that exempts health insurance companies from federal anti-trust laws; force them to compete like other for-profit companies. Nothing like a little competition to keep prices down — even if the competition is a public option from the government. The original ACA legislation included a public option but it was cut before final passage; it should be brought back. In addition, consider rescinding the EMTALA requirement that hospitals provide free ER care; it’s a disincentive to buying insurance and it greatly increases hospitals’ costs, forcing rate increases in other departments.

If the government’s stick, currently being examined by the U.S. Supreme Court, is declared unconstitutional, perhaps carrots should be employed.



Categories: Health, health care reform / Obamacare, Law

19 replies

  1. Check out both Taiwan’s health care system – which is like Medicaid but for everyone. As well as Switzerland, which Obamacare is nearly word for word. Both are opposite ends of the spectrum and both are very successful. They each have their downfalls, but either are better than what we have here.

    • I’m not familiar with either, but a glance at Wikipedia seems to indicate both are forms of universal or socialized health care. I confess that as a doctor’s daughter and former medical association employee, I’ve been heavily indoctrinated against such plans. I can see certain advantages, and Medicare seems to be working pretty well for me. However, Medicare is only a payment plan, an insurance plan. My doctors do not work for the government and I would not want them to. Nor do the ones I’ve talked with want to. My current GP says the bureaucracy has already gotten so bad that, when asked, she’s advises young people to consider other fields. … and people wonder why there’s a doctor shortage.

      • The medical system you grew up with and are most familiar with no longer exists though. Sadly. The Switzerland is the foundation of Obamacare, requiring everyone to have private medical insurance, so I’m surprised that Wiki says it is socialized. Perhaps in the fact that the gov’t set up the plan because they did.

        • On second reading, it appears the Swiss require everyone to have insurance (“universal coverage”) but have a much more tightly regulated and competitive insurance industry. Our insurance companies are still exempt from having to compete in a national market. I found a Forbes article that helped explain the Swiss system. I could probably go along with such a system, since it seems the government is controlling health insurance, not health care. But in the U.S., fixing our health insurance mess (which ACA doesn’t do) does nothing to address our health care delivery system, which faces doctor shortages and maldistribution. Insurance is useless if doctors are too far away or non-existent.

          • Yeah. I don’t think there is a “perfect” system, but ours is failing miserably and very quickly. Something needs to be done. We can’t just sit around arguing in an attempt to create something perfect which will never be.

  2. Why not cut out the thieving, murderous middle man? Like most the other western countries with a far better lifespan, quality of life, and far better quality of healthcare at a fraction of the cost that insurance” provides? Why not mention the alternative in this post?

    • If by “middle man” you mean any third party who comes between me and my doctor, I’m all for that. But I think you mean cut out the insurance companies and go to 100% government healthcare — and I don’t want a government drone for a doctor.

      • So, the insurance ripoff is ok with you? Corporatism and the monopolies are far worse than Single Payer healthcare. Virtually every European nation that has them far exceeds our health and services. By far.

        Don’t fall for the BS. Learn the truth about it.

        • I think I’ve made it quite clear here that something needs to be done to rein in the profiteering U.S. health insurance industry. The ACA doesn’t do that. In fact, the mandate creates million of new customers for them. That’s why I oppose it.

          • So, why not the next, logical step? Because it is Gubmint Run? Why? Single Payer does not have to be Medicare for all, in the sense that the insurance companies (corporations) have seized the model.

            My point is that even the Gubmint has been hijacked by corps(e)s… we call this fascism down here in Tennessee. It ain’t the other way around.

            To continue the insurance model is stupid, in any form (including the malicious, corporation mega-funding ObamaCare).

            Have you ever wondered why Single Payer was NEVER on the agenda to be debated? Do you think it is because the Gubmint officials know what they are doing? Or maybe they want to fund the Insurance Companies even MORE?

            So, the obvious next step is… what, in your opinion? Going back to Insurance Company dominated way things were before ObamaCare? Or maybe (just maybe) a new paradigm that many other countries have proved beyond any shadow of a doubt works and is FAR SUPERIOR to the old insurance monopoly (or the new one… ObamaCare)?

            I believe that a sensible, sane approach needs to be taken that STOPS feeding the over-bloated, health-denying model that broke me and everyone else I know. The middle-man has NEVER offered anything except denial, higher costs and a humungous take of money that has NEVER been deserved.

            • I’m sorry to hear about your experience with the insurance companies. I blame them more than anyone else for skyrocketing health care costs.

              I suggested several possible next steps in my post — eliminate the anti-trust exemption for insurance companies, establish a public option, and rescind EMTALA.

              As I’ve said before, one reason I oppose the mandate is because all it does is create millions of new customers for the insurance companies. Rather than eliminate or severely regulate the insurance companies, it creates more business for them. A public (government) option (which was in the ACA until the insurance lobby got it taken out) would at least have created some competition for existing insurance companies, forcing them to establish lower, more competitive rates.

              I’m not opposed to government health insurance (I’m on Medicare and so far it’s working pretty well). I’m only opposed to government health care. Single payer makes sense to me, if a way can be found to implement it. A comprehensive, inexpensive public option would be a good start and, done right, might even eventually drive the for-profit companies out of business.

            • Thank you. We are basically in agreement. And your last sentence nailed it: “for-profit” companies (especially when they control administration and discontinuance of potential health services).

              A single payer system would not cause doctors to limit care, nor their pay. The “middle-man” takes almost 35% off the top while a non-profit system (which can still pay well, especially Doctors and healthcare workers) can still cater to a very similar model we have now.

              Its just taking the gluttonous middle man out and saving money (and lives) and providing BETTER service on top of that.

              Take care…

  3. Changing a system, or initiating a “new and improved” system (that speaks to American health care), and any change or improvement that would be beneficial for more [of us] and not less [of us] is made all the more difficult, if not impossible, by those lock-stepped into….greed.

  4. You and I, as you probably know PT, are singing in synchrony here. As I have posted on my own blog, EMTALA is likely the single largest unfunded mandate ever passed by Congress in the history of the nation. But it’s not technically a mandate – I call it a “phantom mandate”. It achieves the accommodation by healthcare providers of unpaid bills by extortion, driving up the cost for all. I submit that the vast majority of the voting public is happily oblivious of EMTALA and its effects. As I mentioned on a different blog post, it would be fascinating to see the Supreme Court address a lawsuit against EMTALA.

    • Anyone who gives it a moment’s thought can see that if ER services are dished out for free, something else is going to get more expensive to make up for the losses. Hospitals are allowed to bill ER patients after the fact, but how well that works is anyone’s guess. EMTALA turned ERs into local “free clinics,” resulting in their being jammed with non-emergencies and impeding care for true emergencies. And yes, I agree that most people probably are completely unaware of the situation.

  5. Personally, I prefer the plan still used by my veterinarian. It’s just like the one I had when I was raising a family almost 50 years ago. It wasn’t prepaid medical coverage paid for by someone else, it was a plan where I paid 20 percent of the costs up to a maximum annual amount and then a major medical (optional plan) covered the costs exceeding that number. I know that kind of self preservation isn’t popular by the majority of people alive today because they’ve never seen anything else and they see no problem accepting other peoples money because the service it buys appears to be free. Anyone who dispassionately looks at inflation in the cost of health care can easily see that it not only isn’t free, it’s doomed to increase exponentially because companies create laws which guarantee they’ll be paid.

"Opinion is the medium between knowledge and ignorance." ~ Plato

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