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Shocking News! State Mandates Increase the Cost of Health Insurance!
Researchers at Brigham Young University, the National Bureau of Economic Research and the Brookings Institution have found that health insurance mandates raise the price for everybody. As the press release describing the study explains:
New research shows that the cost of health insurance for a typical family increases about $100 per month when state governments limit price adjustments based on factors like age, health or risky behaviors such as smoking.
The finding by Brigham Young University economist Mark Showalter is one of several examples of how one state's set of rules can result in widely different prices than what's found in the state next door. Perhaps the most eye-opening contrast exists in Trenton, New Jersey, where premiums cost about twice as much as those sold across the Delaware River in Pennsylvania...
Seven states prevent insurers from adjusting prices based on one or more factors like age, health status or risky behavior. The researchers found such rules - known as community ratings - increased family premiums between 21 and 33 percent.
The rule is intended to promote equity but may consequently make insurance too expensive for healthy people. The study found New Jersey's strict form of community ratings responsible for premiums set two to three times higher than if the requirement were not in place.
Who knew that 1,800
nearly 2,000 federal and state mandates would boost the price
of health insurance? Well, actually,
lots of analysts do. For example, Harvard business school
professor
Regina Herzlinger told
reason:
"It's like I'm shopping for a car and my state mandates that all cars have heated seats," says Herzlinger. Car buyers would not long stand for a heated car seat mandate that raises the price of a car by $1,000, and similarly individual health insurance shoppers would object to unnecessarily expensive insurance mandates.
It is very likely that legislators rarely consider the costs of such mandates to consumers, so the good news is that the study now quantifies them so that these trade-offs can be made explicitly. Whole press release for the study is available here.
|11.18.08 @ 11:45AM|#
What silly world do you live in Ron? People don't buy health
insurance. Health is a constitutional right provided by the
government. Or it soon will be. Just as soon as the messiah is
sworn into office.
doom
DoooM
DOOOOM
|11.18.08 @ 11:45AM|#
It is very likely that legislators rarely consider the costs
of such mandates to consumers
Good one, Ron!
Lefiti|11.18.08 @ 11:46AM|#
Oh God, we must resist this universal health care scam. We Americans are so much freer than Europeans and Canadians who are enslaved to state-controlled socialist doctors. They are forced to take preventative measures and don't have to pay through the nose for every procedure. The result? better health but far far less freedom. Preserve out right to go bankrupt just trying to stay alive!
|11.18.08 @ 11:52AM|#
Ron, having worked legislators on this issue, I can tell you
with a high degree of confidence that they know that the mandates
increase the cost of insurance, and they don't give a shit.
The likelihood that this study will cause one legislator to vote
against a mandate they would have otherwise voted for: zero.
|11.18.08 @ 12:00PM|#
The mandates should include: Minimum Deductible of $1000 per
person, Minimum 20% co-insurance, minimum Rx co-pay of $25, 6 month
waiting period for any major operation,etc.
That would take care of it. It seems the mandates are just going in
the wrong direction. perhaps the mandate should be that insurance
is actually insurance rather than resembling some kind of prepaid
service plan sold by network marketing companies.
If you really want to control costs, make insurance illegal,
dismantle the FED, allow competing currencies.
Soon doctor visits will go down to an average of $25- which can be
paid in silver pieces, fresh produce, blowjobs, or whatever.
|11.18.08 @ 12:01PM|#
Shocking News! State Mandates Increase the Cost of Health
Insurance!
Well, duh!
Here's another headline, subsidize something and you get more of
it.
Jay|11.18.08 @ 12:04PM|#
But, Ron, government needs to step in because the MARKET is not
working!
That always cracks me up when I hear it from my lefty
friends...
|11.18.08 @ 12:07PM|#
Profile in Courage: Conservative Republican Penna. state
legislator's wife has baby. Doc says there may be a complication, I
recommend we keep baby one extra night for observation.
But health insurance won't cover extra night.
Legislator, seeing he will have to pay out of pocket, rolls dice
and takes wife and baby home. Complications; has to rush baby back
to hospital. Later, legislator implores his colleagues to force
insurers to mandate three nights in hospital after a birth instead
of two. Legislation passes. Premiums go up as every women giving
birth demands an extra day in hospital whether needed or not.
Lefiti|11.18.08 @ 12:08PM|#
Don't submit to the gulag-like ensalvement of universal health care! Oh those French and Germans look sooo healthy, but the socialist doctors control their minds! Live free AND die!
Lefiti|11.18.08 @ 12:10PM|#
Let us bow our heads in prayer for the sick and infirm but free
among us:
Hail Market,
Full of grace,
Prosperity is with thee.
Blessed art thou among systems,
and blessed is the fruit
of thy womb, Capital.
Holy Market,
Mother of Goods,
pray for us consumers now,
and at the hour of our bankruptcy.
Amen.
Lefiti|11.18.08 @ 12:18PM|#
Don't let them take my medicaid fertitlity mandate away, I really need that benefit to get a seventh son of a seventh son and the 13th child all in one!
|11.18.08 @ 12:19PM|#
Profile in Courage: Conservative Republican Penna. state legislator's wife has baby. Doc says there may be a complication, I recommend we keep baby one extra night for observation.
But health insurance won't cover extra night.
Legislator, seeing he will have to pay out of pocket, rolls dice and takes wife and baby home. Complications; has to rush baby back to hospital. Later, legislator implores his colleagues to force insurers to mandate three nights in hospital after a birth instead of two. Legislation passes. Premiums go up as every women giving birth demands an extra day in hospital whether needed or not.
He should have gotten a job at Buick. I hear they have excellent
health insurance.
classwarrior|11.18.08 @ 12:23PM|#
When talking about costs to consumers, it's important to stipulate which ones. It's the healthy one who don't claim, but those who do get sick benefit from these mandates. The root of the problem is paying for the multiple bureaucracies (public and private) that manage the US healthcare "system".
|11.18.08 @ 12:37PM|#
The root of the problem is paying for the multiple
bureaucracies (public and private) that manage the US healthcare
"system".
The cost of payment processing and compliance is certainly
enormous.
I have no confidence whatsoever that federalizing the private side
will result in a reduction of this cost.
SpongePaul|11.18.08 @ 12:51PM|#
We need to end the mandates, and oppose any national healthcare. Been to an er latley, i have it is horrid. People are there who have NO BUISNESS being in an er, sniffles sprain cough etc. I had a dislocation and had to wait 1/2 hour to be called. ever sit for a half hour holding a limb that is dislocated siting amonst people with a cold or the flu. A federal healthcare system will make this WORSE! Hospitals will be swamped with idiots who have nothing wrong with them, because they can see a doc. leave a free market, and make er's for emergency ONLY! if you aint dying, go to the free clinic M-F 8-5 do not clog the ER for people who need it!!!!
Seward|11.18.08 @ 1:00PM|#
This is a pretty good example of the monolithic nature of government solutions to problems. Markets lead generally to more diverse, individually tailored solutions.
daveylee|11.18.08 @ 1:34PM|#
SpongePaul - All those sniffley, flu-ridden, non_ER worthy
people you experienced at your local ER, were most likely there
because they can't afford health insurance, or don't work for a
company who offers it. In a universal HC scenario, those people
WOULD be visiting their regular doctor or at worst, the urgent care
clinic, and the ER's would be free to handle the cases like
yours.
Sorry to hear about the dislocation. I've had 3 of those and a
fractured collarbone from when I played hockey. Not fun!!
|11.18.08 @ 1:43PM|#
In a universal HC scenario, those people WOULD be
visiting waiting for weeks or months to
visit their regular doctor or at worst,
best, going to the urgent care clinic on
the off-chance that it isn't fully booked by 10:00 am, and
the ER's would be absorbing the overflow pretty much like
they are now rather than being free to handle the cases
like yours.
Seward|11.18.08 @ 2:01PM|#
daveylee,
In a universal HC scenario, those people WOULD be visiting
their regular doctor or at worst, the urgent care clinic, and the
ER's would be free to handle the cases like yours.
Universal HC systems are very, very expensive, and they squeeze out
those costs one way or another; either by paying doctors low
salaries, or government deficit spending, or rationing care,
etc.
R.C. Dean,
Some commentary I've been exposed to lately makes me wonder whether
the insurance model is all that good of a way of paying for
healthcare. At least as the primary means by which people pay for
their general healthcare (leaving "catastrophic" problems out of
the mix for the moment).
SpongePaul|11.18.08 @ 2:06PM|#
Sorry to hear about the dislocation. I've had 3 of those and a
fractured collarbone from when I played hockey. Not fun!!
_____________________________________________
Thanks mate, hockey injury as well, killed it when a linemate lost
an edge in the corner. i jumped he put an arm up. clipped a skate
and sent me head first towards ice. stuck out arm to brace, arm
kept going, luckily another teamate was a nurse and i got carted
straight to a trauma bay, no er wait. Last week it redislocated
doing basically nothing and then i waited the half hour to be seen.
2 more hours later the xrays were taken and then i was repaired.
surgery round the corner now ;-( oh well.
My point was that the er's are so clogged when there are free
clinics to go to! the er should be just for emergencys. Mandates
and universal care will make them WORSE!! See Canada for
examples!
Tacos mmm...|11.18.08 @ 2:12PM|#
Some commentary I've been exposed to lately makes me wonder whether the insurance model is all that good of a way of paying for healthcare. At least as the primary means by which people pay for their general healthcare (leaving "catastrophic" problems out of the mix for the moment).
The insurance system is a horrific fit for our current health care
situation, as most medical problems are either self-limited (i.e.,
a cold) or chronic. An insurance system is good for acute or
unexpected developments, lousy for predictable, chronic conditions
like back pain, diabetes and high blood pressure.
|11.18.08 @ 2:15PM|#
Seward, tacos -
I agree completely. Insurance should only pay for unpredictable
costs that you can't afford, IOW, "catastrophic" insurance.
Tacos mmm...|11.18.08 @ 2:22PM|#
I agree completely. Insurance should only pay for unpredictable costs that you can't afford, IOW, "catastrophic" insurance.
The problem, then, becomes people who have chronic, uncontrolled
conditions and don't get regular medical care. They end up waiting
until, say, they have a catastrophic stroke or gangrenous leg
before coming into the ER. At which point, you can't ignore them
anymore and they put the medical system $60,000 into the
hole.
The point that many people arguing for government sponsored health
care are trying to make is that it's actually cheaper to treat many
chronic conditions for free, rather than wait for them to blow
up.
robc|11.18.08 @ 2:25PM|#
Tacos,
it's actually cheaper to treat many chronic conditions for
free, rather than wait for them to blow up.
Im sure private insurance companies have actuaries to figure that
out. In fact, I know they have, its why they will offer a discount
if you get a physical once a year and things like that.
stuartl|11.18.08 @ 2:26PM|#
The point that many people arguing for government sponsored
health care are trying to make is that it's actually cheaper to
treat many chronic conditions for free, rather than wait for them
to blow up.
So how about govt the helps the people with long term chronic
problems and leaves the rest of us alone?
Tacos mmm...|11.18.08 @ 2:30PM|#
So how about govt the helps the people with long term chronic problems and leaves the rest of us alone?
That's a little over half of the adult population you're talking
about there. If you're talking about senior citizens, it's more
like 90%.
Reformed Republican|11.18.08 @ 2:35PM|#
if you aint dying, go to the free clinic M-F 8-5 do not clog
the ER for people who need it!!!!
I had a dislocation
So you were dying from the dislocation?
stuartl|11.18.08 @ 2:48PM|#
That's a little over half of the adult population you're
talking about there. If you're talking about senior citizens, it's
more like 90%.
Are you saying that half the population has long term chronic
problems that require treatment they cannot afford?
Sam Grove|11.18.08 @ 2:55PM|#
No, no, no, universal health care is a way to deal with an aging
population.
When citizens are no longer productive, just start rationing their
access to medical care, if the get too expensive, let the
bureaucrats deny them further care.
Damn, I'm getting old!
|11.18.08 @ 3:04PM|#
The reason health care costs are skyrocketing is because of
universal health care for senior citizens. That's what happens when
you provide unlimited money (the US treasury) to spend on something
for which there is unlimited demand (not dying) to people who have
no incentives not to spend it.
If you think health care is expensive now, just wait until the
government guarentees everyone the maximum life-saving treatment
with no cost constraints. (Cause who wants to pull the plug on
anyone else?)
Either that or they'll be forced to start rationing, which is
pretty much what happens everywhere else. Which is why health care
stink in the UK and Canada.
Canada actually had to BAN people from buying private health
insurance to go to US hospitals. They have doctors and nurses
strikes every other year. The National Health Service in the UK is
a disgrace.
Naga Sadow as . . . Lefiti!|11.18.08 @ 3:10PM|#
Well, well, Libertards! It looks like the Messiah is gonna take office soon! Then FDR come again will show you all how a country should be run!
|11.18.08 @ 3:10PM|#
100% of the population is guarenteed to develop a long term
chronic problem called "old age".
IMO, the fairest thing would be to start an organ redistribution
program. Take the good kidneys from those undeserving rich fucks
and redistribute them to poor people that need them.
SpongePaul|11.18.08 @ 3:43PM|#
So you were dying from the dislocation?
_____________________________________________
no, but an arm locked in a heil hitler postion needs to be replaced
into socket before the pain makes one pass out or the limb needs to
be cut off for lack of adequate circulation
Gilbert Martin|11.18.08 @ 5:00PM|#
"100% of the population is guarenteed to develop a long term
chronic problem called "old age".
Not exactly.
Some won't make that far.
They'll get shot or stabbed to death or killed in car wrecks, etc.,
etc.
Tacos mmm...|11.18.08 @ 5:08PM|#
Are you saying that half the population has long term chronic problems that require treatment they cannot afford?
No, see stuartl at 2:26.
Canada actually had to BAN people from buying private health insurance to go to US hospitals. They have doctors and nurses strikes every other year. The National Health Service in the UK is a disgrace.
True, but the healthcare systems in France, Germany and Switzerland
are not. If you're going to talk about socialized medicine, you
need to at least acknowledge that there are numerous systems, and
that some of them work quite well.
|11.18.08 @ 6:34PM|#
Any time I see comments about the Canadian health care system on
here it makes me laugh. The only difference between the Canadian
and U.S. system from a users' perspective is who pays for it. If
you go to a Canadian hospital with a real emergency, you get in
right away and get high quality treatment. If you go with a cold,
you sit there.
The biggest difference between the two countries when it comes to
health care is Canadians are the biggest bitchers and moaners in
the world. They complain about everything, all the time. It's the
real national sport, not hockey.
I know, I'm a Canadian
|11.18.08 @ 7:19PM|#
It is very likely that legislators rarely consider the costs
of such mandates to consumers,
Having been in on some legislative sessions in Hawaii where such
proposals for mandates were passed, I can assure you some
legislators (usually with an R after their name) always consider
those costs, some (usually with a D after their name) never do, and
the swing votes come down to those who weigh those costs against
the votes to be picked up by pandering to special interests
pressing for their "little" mandate For Teh Childrunz.
|11.18.08 @ 7:21PM|#
I mean, there's always staff on both sides of the aisle whose job it is to price these things out, but the legislators don't always read the reports that the staff diligently crank out.
|11.19.08 @ 3:36PM|#
Mandate all they want.. you can always decide to earn just
enough income to keep you OUT of the requirement range.
I full well intend upon doing just that, and dragging my husband
off the money-wheel as well, if it comes down to this.
The Dirtiest Secret in America is that 'middle-class' (actually,
it's a debtor-class now..) life *styles* are a necessity.
Besides, if I enter into an insurance pool, I don't want any others
in it to be smokers or obese.
Diabetes, hypertension and the 'lifestyle' diseases add how much to
the burden of cost for healthcare?
If you can't quit that nicotine jones, and put better food into
your cake-hole, why should I fund your healthcare?
It's not like I need to see an MD, and it's not like I actually
enjoy things like tofu and exercising - but it's what I do to not
require an MD's services.
If I can do this, so can anyone. No excuses.
Deb.
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