Letters

From the February 2005 issue

(Page 2 of 2)

Richard Bellerose
San Francisco, CA

By endorsing mandatory health insurance, Ronald Bailey grabbed hold of an important plank in any effective platform of an improved health care system. But he may have promised more than it will likely deliver.

The best analogy is to the workers' compensation system in the United States, in which I have worked for some time. Coverage is not perfect, but almost all civilian workers enjoy adequate protections, including defined benefits and assurance that the employer has the financial means to honor its obligations. Gaming by workers, employers, and insurers is constrained. Except in pockets, there is no crisis of the uninsured or underinsured.

For a telling exception, look to asbestos-related diseases, which are almost entirely work-related. To sighs of relief from the state workers' comp systems, but ultimately great disturbance to the American judicial system and economy, asbestos lawyers in the 1970s won the ability to file much more open-ended product liability suits. Had asbestos been kept within workers' compensation and had personal injury law firms been less lubricated from asbestos settlements, we might today have a smaller personal injury suit problem in the nation.

But the history of workers' comp has not shown that open competition among private insurers is more successful than single payer or a mix of private and government insurance. Washington and Ohio, for example, are two of the handful of states with single-payer workers' comp systems. In numerous other states, large state-sponsored insurers compete against private insurers. At day's end, how insurance is organized does not seem to make much of a difference in employer and worker satisfaction or in relative costs.

Peter Rousmaniere
Woodstock, VT

Ronald Bailey replies: First, I want to stress that mandatory health insurance is a second-best proposal. A totally free market system would be preferable; it's just not likely politically. Mandatory health insurance is a way to stop creeping socialization and preserve private medicine.

Regarding my math, Edwin Krampitz must be thinking of low-deductible insurance. I got my figures from Golden Rule Health Insurance but found, with just a few clicks, quotes for 11 high-deductible policies for a family of four ranging from $155 per month to $290 per month, with many more offered for below $400 per month. (As for the $50,000 figure, I simply quoted Sen. Bill Frist as evidence that pressure to require people to buy insurance is building.)

Krampitz should also think about just how many small businesses are being bankrupted by our current dysfunctional health insurance system. And there is no need for fines or jail under my proposal. If he had read a bit more carefully, Krampitz would have found that I suggest that people have health savings accounts that could be used to pay for health insurance premiums while they are between jobs, and as a last resort that the federal government provide vouchers for our poorest citizens to purchase private health insurance.

Richard Bellerose's point that current group plans offered by companies cover costly individuals is well taken. Mandated catastrophic health insurance will have to be offered under some sort of community rating system so that the level of risk an individual consumer poses to an insurer does not affect the premium paid. With regard to his second objection, individuals would be required only to buy insurance to cover catastrophic health costs. If they want low-deductible policies, they will have to pay more based on their actual risks and/or save for their additional expenses in their health savings accounts. This is not a perfect system, just a hell of a lot better than the likely alternatives.

To Peter Rousmaniere: Don't get me started on tort reform.

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