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How on earth did you get that from what I wrote? I said that health insurance is a necessity, pretty clearly I thought, because incidental care is so outrageou

by jbooth 17y ago

How on earth did you get that from what I wrote? I said that health insurance is a necessity, pretty clearly I thought, because incidental care is so outrageously expensive in order to finance an inefficient and broken system. The fact that it shouldn't be so expensive just to take care of incidental medical needs doesn't change how things work -- it just highlights how much need there is for reform. So, yes, health insurance is effectively a necessity unless you're a big time gambler (everyone loses eventually), and yes, it's still going up by 15% a year, so yes, nothing's changed in my opinion that some sort of reform is neccessary. On your final point, I must be completely missing what you're proposing. How does increasing the cost of medicine make it less expensive? You're saying reduce total spending by making healthcare inaccessible? I think you're mixing up unit costs and aggregate costs. Yes, increasing unit costs to infinity would reduce aggregate costs to zero.. so? Where's that take us, nobody gets a checkup and every hospital visit is an emergency room visit? Aren't those like 100X more expensive? Trust me, I wish that this particular not-quite-market was functioning properly and there was no need to have this discussion. But it's broken, and the only way I can see to fix it is by government action. What else can we do, community-organized boycott?

yummyfajitas 17y ago
You agreed that much of the medical spending which insurance pays for is not a necessity. So while health care costs are increasing quickly, they do not meet your criteria for being a necessity. Increasing the marginal cost of medicine to the consumer is not the same thing as increasing unit costs. Consider a $100 pill; if a customer has gold plated plans with no copay, the marginal cost of the pill is $0. If the customer has a plan with a $101 deductible, the marginal cost is $100. In both cases the unit cost is $100. Switching a customer from first dollar to high deductible coverage will cause the consumer to consume less medicine, but will have no (direct) effect whatsoever on the unit cost. This lowers aggregate costs directly (since consumers consume less), which in turn reduces demand and indirectly lowers unit costs. Also, note that you originally claimed health insurance costs went up 15% / year. Now you claim health care unit costs go up 15% / year. Which is it?
- jbooth 17y ago
  Sigh. How many ways can I put this? Having health insurance is a necessity if I don't want to continually be one bad day away from bankruptcy. The unit cost of insuring a person has increased 15% a year all decade. If "much of what it pays for" isn't a necessity then that's just more evidence of how broken the system is. Your high deductible approach is one way to tackle the problem however it has the problem of disincentivizong preventative care, so we might get a lot more 20k emergency room trips instead of 300$ physicals -- and have a less healthy population, to boot. But it might also be a component of a plan that worked. I'd note that "most capitalistic" does not always mean "most effective" -- just usually, for normal markets. Otherwise we'd all take capitalist cabs to work every day instead of the socialist subway :)

by jbooth 17y ago

yummyfajitas 17y ago

You agreed that much of the medical spending which insurance pays for is not a necessity. So while health care costs are increasing quickly, they do not meet your criteria for being a necessity. Increasing the marginal cost of medicine to the consumer is not the same thing as increasing unit costs. Consider a $100 pill; if a customer has gold plated plans with no copay, the marginal cost of the pill is $0. If the customer has a plan with a $101 deductible, the marginal cost is $100. In both cases the unit cost is $100. Switching a customer from first dollar to high deductible coverage will cause the consumer to consume less medicine, but will have no (direct) effect whatsoever on the unit cost. This lowers aggregate costs directly (since consumers consume less), which in turn reduces demand and indirectly lowers unit costs. Also, note that you originally claimed health insurance costs went up 15% / year. Now you claim health care unit costs go up 15% / year. Which is it?

jbooth 17y ago
Sigh. How many ways can I put this? Having health insurance is a necessity if I don't want to continually be one bad day away from bankruptcy. The unit cost of insuring a person has increased 15% a year all decade. If "much of what it pays for" isn't a necessity then that's just more evidence of how broken the system is. Your high deductible approach is one way to tackle the problem however it has the problem of disincentivizong preventative care, so we might get a lot more 20k emergency room trips instead of 300$ physicals -- and have a less healthy population, to boot. But it might also be a component of a plan that worked. I'd note that "most capitalistic" does not always mean "most effective" -- just usually, for normal markets. Otherwise we'd all take capitalist cabs to work every day instead of the socialist subway :)