The Biggest Dimwits Have Top Government Positions, Like Health And Human Services Secretary
Megan McArdle blogs at The Daily Beast that Kathleen Sebelius thinks insurance isn't really insurance unless it covers routine expenses. This is exactly backwards, says McArdle. She notes that insurance covers very large costs most people would have trouble paying, like replacing a house that burns down:
This is the magic of risk pooling. But notice that it's the catastrophe which makes insurance a good deal. You wouldn't get much value from buying "grocery insurance". At best, you'd be paying an extra administrative fee to route your routine expenses through an insurer, rather than paying them directly. At worst, you'll end up with bills skyrocketing as all sorts of perverse incentives appear. After all, if the insurer is paying all your grocery claims, why not load up on filet mignon instead of ground turkey?But insurers try very hard never to sell insurance for less than the cost of your expected claims. If you expect to buy $10,000 worth of groceries next year, it will not charge you less than that for a "grocery policy". And if we all drive up the costs of grocery insurance by consuming more, the insurer can do one of two things: raise everyone's "insurance premiums" to cover a filet mignon budget, or create a list of "approved groceries" that it will cover, and start hassling anyone who tries to file an excessively expensive claim.
Sound familiar?
This is why you should always have liability insurance, but should think twice about collision damage coverage. It's why high deductibles are a good idea--for small expenses, it's better to self insure. And it's why "catastrophic" health plans, which only cover the sort of extremely expensive events that most people would have difficulty financing, are a much better deal than the soup-to-nuts plans that most people get through their employers. Those plans are expensive, both because they're paying for a higher percentage of your expenses, and because they drive up utilization--which means that they drive up next year's premiums even more. Imagine what your car insurance would cost if it covered gasoline, routine maintenance, and those little air freshener trees you hang from the rearview mirror. Then stop asking why health insurance costs so much.
But Kathleen Sebelius, the Secretary of HHS, thinks that catastrophic insurance isn't really insurance at all.
At a White House briefing Tuesday, Health and Human Services Secretary Kathleen Sebelius said some of what passes for health insurance today is so skimpy it can't be compared to the comprehensive coverage available under the law. "Some of these folks have very high catastrophic plans that don't pay for anything unless you get hit by a bus," she said. "They're really mortgage protection, not health insurance."...The Secretary of Health and Human Services genuinely believes that health insurance should do more than just, well, protect your ability to keep paying the mortgage. Unfortunately, "more" is very expensive and inefficient.
Madam Secretary is confusing healthcare plans and health insurance plans.
Conan the Grammarian at March 27, 2013 9:06 AM
"Madam Secretary is confusing healthcare plans and health insurance plans" ConanTG
she's not confused, she is conflating them on purpose so that the average joe, will also continue to confuse the two... once the government is in the care business, they can control more things.
Once you must buy things from them, they have an incentive to get you to act the way they wish you to... after all, our Technocrat Elite, know MUCH better what you need than you do.
You can trace most of this back to our dalliance with HMO's and the idea that you could go in for $20 and get fixed up no matter what it was.
A whole generation of people were raised in the HMO thing, and they are the ones that think that your birth control should be "free"
SwissArmyD at March 27, 2013 9:44 AM
Today, people use the word "insurance plan" when they really mean "payment plan."
Trust at March 27, 2013 10:04 AM
Just a gentle reminder that many other countries do manage to provide comprehensive health care at vastly lower cost:
http://feeds.washingtonpost.com/c/34656/f/636581/s/2a04064f/l/0L0Swashingtonpost0N0Cblogs0Cezra0Eklein0Cpost0C210Egraphs0Ethat0Eshow0Eamericas0Ehealth0Ecare0Eprices0Eare0Eludicrous0C20A130C0A30C260C181e9530A0E96340E11e20E87640Ed42c128a0A1ef0Iblog0Bhtml0Dwprss0Frss0Iezra0Eklein/story01.htm
Factual Interjection at March 27, 2013 10:22 AM
"Unfortunately, "more" is very expensive and inefficient."
Are you kidding? To the target audience, "more" is free! Paying for it is someone else's job. After all, those medical people make more money than they really need, right?
Cousin Dave at March 27, 2013 10:54 AM
Just a gentle reminder that many other countries do manage to provide comprehensive health care at vastly lower cost
And a reminder the above is true, for certain values of "comprehensive", "health" and "care".
This all goes to us no longer being citizens, a free people, but being dependent serfs. Dependent upon our "betters" making choices for us.
Of course they'll be able to bend the cost curve down, because when you are no longer of benefit to the state, you will be downsized.
It's a scientific method called attrition.
I R A Darth Aggie at March 27, 2013 12:59 PM
Just a gentle reminder that many other countries do manage to provide comprehensive health care at vastly lower cost:
True enough, but you forgot to mention they pay twice as much in taxes, one third as much in UN dues, and not a damn thing in regards to real national defense in the last six decades because the US tax payer has been shouldering that burden.
Oh, and they have to wait months for treatment
But other than that they do indeed 'pay less'
lujlp at March 27, 2013 5:49 PM
Anyway:
http://www.reuters.com/article/2013/03/26/us-usa-healthcare-taxes-idUSBRE92P17620130326
Millions of Americans will be priced out of health insurance under President Barack Obama's healthcare overhaul because of a glitch in the law that adversely affects people with modest incomes who cannot afford family coverage offered by their employers, a leading healthcare advocacy group said on Tuesday.
Relying on insurance companies for health care is probably not a good idea, but marxist health care is even worse. Gotta get outta here before 2014.
Stinky the Clown at March 27, 2013 6:11 PM
...and this:
http://apps.npr.org/unfit-for-work/
Somewhere around 30 years ago, the economy started changing in some fundamental ways. There are now millions of Americans who do not have the skills or education to make it in this country.
Stinky the Clown at March 27, 2013 6:33 PM
You forget the bargaining power a large insurance company has. One of examinations years ago was priced at $150 or so. The insurance company only paid roughly $50 for it.
The Former Banker at March 27, 2013 7:12 PM
The next question is what is the waiting list like for an operation?
There were only 482 on the wait list for a surgical biopsy as of 28-Feb-2013 in British Columbia. Can I see the waiting list for surgical biopsy in New York, or Pennsylvania, or other U.S. states?
Jim P. at March 27, 2013 10:04 PM
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