Saturday, November 06, 2010

A really dumb editorial cartoon

Does this liberal dupe think he's being clever?


Gee, when Obamacare mandates more and more get covered, no matter how non-essential and routine, why are the skyrocketing insurance premiums such a surprise?

Liberal saps can't admit that skyrocketing premiums are a *consequence* of the Obamacare passage.

Q: What do we insure against? A: Major financial catastrophe.

NOT out of pocket routine costs.

Imagine what your car insurance would cost if routine oil changes were paid by insurers, rather than out of pocket. There would be $200 oil changes rather than $40 ones, too. That is what happens when 3rd parties and other indirect agents pay for something. All cost containment goes out the window.

Imagine what your car insurance would cost if every sap could go without it and then immediately sign up right after an accident. That is what all the caterwauling about "pre existing conditions" comes down to....

Routine and minor medical expenses *should not* be covered by Medi-Cal, or private insurance for that matter.

And please don't give me this nonsense about the out-of-pocket costs for birth control being too much. Young women spend far more each month on their cell phone bills.

Mentalities like this are precisely why medical insurance and medical costs skyrocket.

4 comments:

Ulysses Benjamin Dover said...

Does it occur to you to do the aggregate math on the health care plan? Small businesses, which is what everybody says is the engine of growth, does extremely well under the reforms. Children, those with mild conditions and those with financial issues (exasperated by the drop in employment over the past 9 years) all can get coverage now. This is good. It keeps people out of the ER which is 900% more expensive than primary and urgent care. Would you rather pay for the ER care, or premiums for insurance? Those are the only choices. Unless of course you are one of those "let 'em die (or eat cake)" types.

freedomfan said...

Obviously, it would be nice if health care were more affordable than it is now. A system that is sensitive to costs is a system that better serves people with less money. How do we get there? Politicians like to pretend that they can ignore reality and declare something "fixed" because they passed a bill, almost as if legislation were some sort of magic that bends reality to fit the words written on paper. But policy decisions that ignore basic truths of the economics aren't going to work. And, as Curmudgeon points out, Obamacare ignores the fact that decoupling perceived costs from perceived benefits encourages people and providers to ignore cost containment. Quite simply, if the only cost I see when I choose a physician is the fixed $20 co-pay, then it doesn't matter to me whether the actual total cost for a doctor visit is $25 or $2500 dollars. I have no reason to care if the doctor down the street provides the same care for 20% less.

Similarly on the supply side, providers now have low incentives to keep costs down and to introduce innovations in the way they provide care. Every doctor's office has a standard rate they charge for a simple office visit, but how many people with insurance that covers office visits know what that cost is for their doctor? Providers aren't going to attract patients because they send a lower bill to that patient's insurance carrier for a standard service, so they don't spend as much time trying to keep costs down.

These problems are the central issue in rising health care costs and buffet-style insurance policies only make it worse. People interested in this issue should ask why non-covered sectors of health care do such a good job at cost containment. There is a reason why, despite substantial improvement in the treatment itself, laser eye surgery today is a fraction of the cost that it was ten years ago. That would not be the case if patients weren't paying for the procedure themselves.

(Anticipating the red herring that you can't shop for a doctor while you are having a heart attack, let me say that I am not against insurance. Catastrophic emergencies are exactly what insurance is for. But, people expect insurance to pay for every single doctor visit and that has driven the strongest force for cost containment - consumers searching for quality at an acceptable price - out of the system. Worse, this obliviousness toward cost innovation in the provision of everyday health care means that there is very little spillover benefit for the parts of the system where it's less reasonable for consumers to shop around. In other words, the emergency room might be a lot less costly if the same procedures developed to keep office procedures affordable were available in the ER. But, since almost no one cares about keeping costs down at the doctor's office, there is no chance better practices will find their way to the ER.)

Unfortunately, instead of increasing consumer awareness of costs, Obamacare introduces an even bigger cost-concealing buffet to the system. Where is there any mechanism for cost containment? Under a government-run system, any effort at cost containment will have to survive the political process, but we all know that process is an epic fail at cost containment. The incentive is to give voters whatever goodies they might want and conceal the real costs of those goodies. It's hard to get re-elected by saving money. What seems more likely: Politicians are going to finally enforce fiscal discipline or Politicians are going to give people whatever they ask for and then quietly send the bill to the treasury for their grand kids to pay? If you recognize the term "unfunded Medicare liability", then you know the answer.

Curmudgeon said...

Small businesses, which is what everybody says is the engine of growth, does extremely well under the reforms. Children, those with mild conditions and those with financial issues (exasperated by the drop in employment over the past 9 years) all can get coverage now.

Which the hard-pressed small businesses will have to pay for under the new plan. You have an interesting definition of "doing extremely well".

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