Quote:
Originally Posted by Cletus Miller
As of today, I cannot opt in, no matter what, the day I or my wife or kids get sick and have the treatment covered. Also, as of today, there is tremendous provider price discrimination b/t those w/ insurance and those w/o (those with get discounts of 50% or more off the rack rate of virtually everything). Also, as of today, if I want to opt in next week, the rate I would pay would be much higher, as there is tremendous insurer price discrimination.
Get rid of all three of those problems, and I would not carry insurance
Also, you hypothesized that everyone would be okay paying substantially more to cover anyone who has a catastrophic illness who decides to opt-in after diagnosis--what this would mean is that (say) 50% of Americans carry no coverage until they are diagnosed with cancer, then they all initiate coverage to defray the cost of their (again, say) $1,000,000 course of treatment. How much does insurance have to cost to cover all these people opting out until *immediately* prior to incurring a huge expense? Remember, everyone similarly situation by age has to pay the same rate, regardless of existing illness.
If there were no price discrimination by providers or insurers and I could opt in and out of insurance coverage as I saw fit (ie, whenever I needed it), hell yes I wouldn't pay for it every month**, because insurance would cost way more than $15000 per person per year (with current total medical expenditure of about $7500/person/year), to cover for all of the people who opt not to (or can't afford to) carry insurance and then drop it immediate after completion of a course of (expensive) treatment, which would be *most*.
**note, this is theoretical as my wife would not let this happen. I would *absolutely* do it, given those (impossible) facts.
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Under your theory, we are essentially back to a PayGo system, except with respect to catostrophic illness, which is exactly what Sebby is proposing, because everyone would do exactly what you are suggesting.
What I am suggesting is within the current framework. The overwhelming majority of people are covered via their employer, so the costs of insurance are subsidize (in some cases, like my firm, we subsidize 100% of our employees costs, and just make them pay a portion for dependents). I highly doubt that your wife would allow you to allow your family to go naked, and I think that is where most people would be. So what I am suggesting is that most people who are already paying for insurance (whether as an employer benefit or as subsidized by their employer) would be OK with paying a premium so that others could not be denied for pre-existing condition. They may not be thrilled about it, but they could swallow it.
