My previous comment here outlines the market failure inherent in insurance schemes. Because it pools risk, the cost to supply insurance will always be higher than the price demanded.
Okay. Except that the insurance schemes actually appear to work - the expenses generally pay out, and we don't see insurers going under except in very catastrophic situations.
In a normal market, ignoring the people who demand a lower price has no cost for the supplier. In an insurance market, those low-price consumers are critical to making the entire scheme work.
Which is why a) the employer-subsidized market continues to enjoy success, and why b) there's no need for the individual market to go after them.
I think you're still assuming that the individual market would not adjust itself to take on the subsidized folks if that market was opened to them. I'm not sure I'd go along with that.
Further, they strain emergency services and increase the cost of health care. For every 20,000 dollar service they get and can't keep up with the payments, that's spread out among the rest of us who pay our bills.
This is a different problem, though, and one of the ones that is created by government mandates. The ER can't turn anyone away, after all.
Credits & Style Info
Talk Politics. A place to discuss politics without egomaniacal mods
![[community profile]](https://www.dreamwidth.org/img/silk/identity/community.png){kind=small}
Re: No such things as a free organ transplant
Date: 13/12/10 22:37 (UTC)Okay. Except that the insurance schemes actually appear to work - the expenses generally pay out, and we don't see insurers going under except in very catastrophic situations.
In a normal market, ignoring the people who demand a lower price has no cost for the supplier. In an insurance market, those low-price consumers are critical to making the entire scheme work.
Which is why a) the employer-subsidized market continues to enjoy success, and why b) there's no need for the individual market to go after them.
I think you're still assuming that the individual market would not adjust itself to take on the subsidized folks if that market was opened to them. I'm not sure I'd go along with that.
Further, they strain emergency services and increase the cost of health care. For every 20,000 dollar service they get and can't keep up with the payments, that's spread out among the rest of us who pay our bills.
This is a different problem, though, and one of the ones that is created by government mandates. The ER can't turn anyone away, after all.