Throwing Insurers under the bus

Throwing Insurers under the bus

http://www.realclearpolitics.com/articles/2013/10/22/obamacare_in_need_of_a_doctor_120413.html


"No one even considered the scenario we are now seeing: a partially working system in which it is difficult to sign up but not impossible. This means that the most motivated consumers (the sickest) are likely to persevere in creating accounts, while the younger and healthier are more likely to skip an unpleasant process and risk a minimal fine. "If they don't get the necessary volume and demographic mix in the exchanges," Yuval Levin of National Affairs told me, "it could set off a catastrophic adverse selection spiral that would not only render the exchanges inoperable but badly damage our large health care systems.""

Not "large health care systems" but "large health insurance systems". Maybe it is time to throw them under the bus. The whole idea of health insurance was a distortion of the market created by wage controls in the 1950's (or was it 1940's ?). It is a governmental problem. It separated the individual from his health costs, causing inflation.

There is another way. Dr Ben Carson suggested it, Health Savings Accounts.

If all of your medical costs were born by a health savings account (HSA), no insurance is necessary. The HSA is the consumers money, so he has an interest in conserving it. The HSA is your lifeline, with it there is no need for death panels. In this age of ever increasing medical treatment options, the last few years or months are the most expensive, and the time left can now be the money left. That may be an over simplification, but it is clearcut. No greater public need component to be manipulated by politicians.

The major advantage is the sharpest people on the planet with a clear self interest in correct decisions are in control. well, at least those with a clear self interest in correct decisions.

And the HSA can grow. If at the start, when medical costs are low, the HSA grows. If a minimum HSA is needed, government can award each new born with an initial amount or parents could be expected to fund it.

With wise investing, the amount of money in the HSA could be very large. To assure the HSA was perceived as real money, some mechanism to reward good stewardship a portion could be transferred to a more general account. This is tricky though, a large amount of money in the account of a less able manager could result in all kinds of fraud.

A objection can be made that the least able to control themselves financially will be at a disadvantge. Of course that is the situation already.