Econoclasm continued: What ' s this pre-existing conditions deal?
Since I interrupted this series, I will remind you that previously, we discussed the problem of adverse selection -- that people who are unhealthy are more likely to buy health insurance in a hypothetical Free Market. ™ But sellers of health insurance must find ways of predicting
and limiting their losses. The problem of adverse selection would not exist if
we had a universal system, as all other wealthy countries and some
not-so-wealthy do. Everybody would pay into the system, preferably according to
their mea ns. That way people who are healthy today subsidize the costs for
people who are not. If that strikes you as unfair, consider that it is the
entire purpose of insurance. People whose houses don’t burn down subsidize the
people whose houses do burn. Consider also that while most people’s houses
n ever burn, just about everybody eventually needs medical services. Unfortunately, because advocates for universal health
insurance were largely thinking about this problem, they often used the term “compulsory” health insurance in the past, which is bad PR. It seems to imply
an infringement on liberty. That’s why the “individual mandate” that was
originally part of the Affordable Care Act didn’t sit well with many people,
and the Republican congress repealed it. Since we do not have universal health insurance, however,
adverse selection is potentially a problem. The major public insurance programs – Medicare and Medicaid, along with the Veterans Ad...
Source: Stayin' Alive - Category: American Health Source Type: blogs
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