3 ms·

1) Can we make the individual mandate in the individual market strong enough to really eliminate (or at least minimize) the adverse selection problem? I am unc

by harryh 10y ago

1) Can we make the individual mandate in the individual market strong enough to really eliminate (or at least minimize) the adverse selection problem? I am unconvinced that we can. Perhaps though. 2) Are you really convinced that the pre-existing rules you encountered were bogus? Are insurance companies just dumb when it comes to this sort of thing? I tend to assume, absent other evidence, that insurance companies will be profit seeking so would only turn people down if they expected to (probabilistically) lose money on the deal. Perhaps they're just not smart enough to discern differences at this level though? I don't have much experience in this area.

tptacek 10y ago
I think penalties need to be sharply increased, but the problem isn't so much free riders as it is that statistically the most attractive segment of the market is overwhelmingly likely to be employed at a firm that offers group coverage.
- harryh 10y ago
  I certainly agree that employer provided health care coverage should be taxable income (I assume that's the mechanism by which you would shift people). It's interesting to note that McCain proposed this as part of his campaign in 2004 and Obama pilloried him for it.
  - tptacek 10y ago
    Yep. Clinton wanted to tax employer-provided health care too. McCain and Clinton were right about that --- but Baucus, and I guess by extension Obama, was right about the individual mandate.
Broken_Hippo 10y ago
1.) It might be possible, but that would probably take time, a lot of work, and likely intervention with laws and money. I'm not all that hopeful that it could be done. Right now there are a lot of people with inadequate to no health coverage. They have issues and problems that are going to need taken care of, which means that the first 3-5 years are probably going to be more expensive than later on. Some are just things folks have been putting off - surgery for carpal tunnel, for example. A few folks will have much larger problems that they can't do much about without insurance. Maybe they don't take care of their diabetes well enough or should really be taking heart medicine or anti-depressants. Basically, gotta get everyone caught up to the healthiest they can be, and afterwards there would be a lot better maintenance, which in return would mean that the companies have a chance of not needing to worry about the adverse selection. It would probably also help to get rid of the networks and simplify the insurance end at the doctors offices to both reduce costs and get rid of some of the redunancies in addition to having some sort of care and coverage standards that spread across insurances, just so that people are able to get the care they need instead of going with not-quite-so-good-for-them alternatives because they happen to have a crappy prescription plan. Other changes I would make would be to require all insurers to sell directly to consumers and decouple insurance from employment - much like most folks get their car insurance. In addition, I'd require insurers to use the exchanges if they want to be in the business and make it so that insurers have a national license instead of needing certified in each and every state they sell in. This would not only standardize coverage, but reduce overhead. Unfortunately, this sort of thing requires planning on a rather large scale and fixing a lot of problems such as affordability of care. The current political climate hasn't been so keen on that sort of long-term planning nor cooporation, not to mention that the companies themselves might not be too keen on that last one either. 2.) I tend to think all pre-existing rules are bogus. Though they say they help with their risk, I'm skeptical. Most the plans I saw wanted folks to have continuous health care coverage to go around some of the rules (I've always gotten insurance through and employer when I lived in the US). Yet having coverage doesn't mean you take care of your condition. The opposite is also true. Obviously, some folks don't take care of x,y, or z because of lack of coverage as well. And things such as gall bladder surgery are more one-time events with few lasting needs after the surgery for most folks.

by harryh 10y ago

tptacek 10y ago

I think penalties need to be sharply increased, but the problem isn't so much free riders as it is that statistically the most attractive segment of the market is overwhelmingly likely to be employed at a firm that offers group coverage.

harryh 10y ago
I certainly agree that employer provided health care coverage should be taxable income (I assume that's the mechanism by which you would shift people). It's interesting to note that McCain proposed this as part of his campaign in 2004 and Obama pilloried him for it.
- tptacek 10y ago
  Yep. Clinton wanted to tax employer-provided health care too. McCain and Clinton were right about that --- but Baucus, and I guess by extension Obama, was right about the individual mandate.

Broken_Hippo 10y ago

1.) It might be possible, but that would probably take time, a lot of work, and likely intervention with laws and money. I'm not all that hopeful that it could be done. Right now there are a lot of people with inadequate to no health coverage. They have issues and problems that are going to need taken care of, which means that the first 3-5 years are probably going to be more expensive than later on. Some are just things folks have been putting off - surgery for carpal tunnel, for example. A few folks will have much larger problems that they can't do much about without insurance. Maybe they don't take care of their diabetes well enough or should really be taking heart medicine or anti-depressants. Basically, gotta get everyone caught up to the healthiest they can be, and afterwards there would be a lot better maintenance, which in return would mean that the companies have a chance of not needing to worry about the adverse selection. It would probably also help to get rid of the networks and simplify the insurance end at the doctors offices to both reduce costs and get rid of some of the redunancies in addition to having some sort of care and coverage standards that spread across insurances, just so that people are able to get the care they need instead of going with not-quite-so-good-for-them alternatives because they happen to have a crappy prescription plan. Other changes I would make would be to require all insurers to sell directly to consumers and decouple insurance from employment - much like most folks get their car insurance. In addition, I'd require insurers to use the exchanges if they want to be in the business and make it so that insurers have a national license instead of needing certified in each and every state they sell in. This would not only standardize coverage, but reduce overhead. Unfortunately, this sort of thing requires planning on a rather large scale and fixing a lot of problems such as affordability of care. The current political climate hasn't been so keen on that sort of long-term planning nor cooporation, not to mention that the companies themselves might not be too keen on that last one either. 2.) I tend to think all pre-existing rules are bogus. Though they say they help with their risk, I'm skeptical. Most the plans I saw wanted folks to have continuous health care coverage to go around some of the rules (I've always gotten insurance through and employer when I lived in the US). Yet having coverage doesn't mean you take care of your condition. The opposite is also true. Obviously, some folks don't take care of x,y, or z because of lack of coverage as well. And things such as gall bladder surgery are more one-time events with few lasting needs after the surgery for most folks.