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Universal health care is basically a special case of “people in the pool having similar risk,” because the idea is to have only one pool with everyone in it. Th

Universal health care is basically a special case of “people in the pool having similar risk,” because the idea is to have only one pool with everyone in it. The “with everyone in it” part solves the adverse selection problem.

choeger 5y ago
But health care is, or rather shouldn't be, an insurance. Otherwise the company would say: "Sorry to hear you got cancer, here's your cheque. Please don't bother us anymore, as we terminate our contract. All the best." Health care is more like a flatrate plan where some people receive much more intensive service.
- nicoburns 5y ago
  Arguably a taxpayer funded service is still a form of insurance. In the UK we pay "national insurance" which is a form of income taxation (but gets accounted for separately), much if which gies towards paying for our health service.
- LeegleechN 5y ago
  A fixed rate plan for something with unknown and highly variable costs is just about the definition of insurance.
  - choeger 5y ago
    I don't think so. At least every insurance I ever bought had very precise definitions of the monetary obligations for each party. I think the highest would be my car's mandatory insurance (capped at, I think 20M€ per damaged person). My health "insurance" doesn't have such a cap. In fact, they are forced by law to pay for everything that I would ever need from a certain catalog of services. Also, the rates are not negotiable in my case but a fixed percentage of my income. It's similar for the pension "insurance" which is more like a perpetual pyramid scheme than an insurance.
    - jorams 5y ago
      You can put scare quotes around insurance, but they're really just counterexamples to your claim. Many forms of insurance include a cap to reduce the insurer's risk, but that doesn't mean such a cap is necessary for it to be called insurance. The height of the premium can be defined by law, but it's still an insurance premium. Pensions can be hard to understand because longevity risk is a bit counterintuitive, but depending on how they work in your country they can definitely be a form of insurance.
    - tharkun__ 5y ago
      Your health insurance does have a catalog. It doesn't just pay for everything and anything. Depending on your country this catalog is also shrinking and pushed into private insurance. Since there is such variability between countries and their systems these discussions become 'hard' to have because something that is normal for one guy works the opposite in the other guy's country. In Germany I had dental covered by the state. Like you said, fixed percentage of my income covered all that (and all the other health insurance needs with a catalog of services). No need to think about it. Except someone actually decided on that catalog based on monetary concerns and calculations. Also while there is a fixed health insurance cost as a percentage of your salary, there are different actual insurance companies and they add a variable premium to this which they 'compete on' for clients. This is the public system which must cover you and you can go fully private (and never be admitted back into the public system if you do) which gives you "better service" (like private rooms being standard at the hospital and such). Then they added private insurance on top for some stuff that wasn't covered by the public dental plan any longer. In Canada just a regular filling needs to be paid out of pocket and I really want private/employer extra insurance. Different for kids where I pay out of pocket for a white filling but Amalgam would be covered. I don't even know if this is the same in other provinces maybe. Pension: Germany has a pyramid scheme and it collapsed a while back. Not enough payers any longer and suddenly they had to tax people's pensions. People who they told need not worry about their pension ever. Suddenly they were told they would need to pay tax on their pensions and oh btw. you should really have started paying into private pension like a decade or so ago. From after tax income. They do have various private insurance schemes that lower your taxable income but the fees are sky high and returns meager. It's a way to shuffle money into insurance companies. Thank's government! And other than that, you can get ~800 EUR of tax free interest/dividends per year. Everything else is taxed at 25%. This is way different in Canada again where Old Age Security and your pension are not covering you and everyone knows. People either work longer because they can't afford extra insurance or have an RRSP (kinda like a 401k) they pay into. You know you will be taxed on this later but you aren't now. And all your money grows tax free in that account. Never pay a single dollar of taxes on those dividends over the years. And a non pension tax free savings account on top of that. Sure it's after tax income in there but you can take it out any time. No need for any insurance company fees either if you don't want to. Sure you can buy mutual funds and such but you arent forced to just to be tax exempt.
nly 5y ago
Making everyone more healthy (resulting in everyone in the pool having the same baseline risk) is a net good for both society and the insurers. Really the issue is people with incurable conditions. Universal health care is there for them. Private insurance fucks them over.
- oceanplexian 5y ago
  I don't think in a free market private insurance would necessarily fuck people over. For example the idea of creating a catastrophic insurance plan for healthy, fit young people would be wildly profitable and beneficial for those who would sign up for it, but the government wouldn't allow it to exist because it "discriminates" against those who are unhealthy or made different lifestyle choices.
  - perl4ever 5y ago
    >wildly profitable and beneficial How could it be both? And if it was beneficial, how could you describe the people to whom it was beneficial as "healthy and fit"? Aren't they really just people who the screening failed to identify as unhealthy?
  - curryst 5y ago
    It depends on your definition of "fuck people over". The insurance plan for healthy, fit, young people would likely be cheap. However, they were subsidizing older and/or less fit people. The rates for the "not young, fit and healthy" plan are going to go up. Drastically. I would also be unsurprised to see that the "healthy, fit, and young" group ends up becoming the "average" group, and that they use the other group to lump together people they don't want to insure, with rates so high people can't afford to pay them. I.e. they keep you in the healthy, fit and young group until you get cancer, and then they move you over to the $7,000/month group. The current system just averages that out. Your rates are higher than they have to be when you're young, but your rates are lower than they have to be when you're old. It negates the risk by lumping everyone together. Your form of insurance doesn't do much to reduce risk because you can always be moved to another category. The insurer really just becomes a middleman between you and your medical providers then, if the goal is to allow people to pay for what they use. It's basically an HSA.

choeger 5y ago

But health care is, or rather shouldn't be, an insurance. Otherwise the company would say: "Sorry to hear you got cancer, here's your cheque. Please don't bother us anymore, as we terminate our contract. All the best." Health care is more like a flatrate plan where some people receive much more intensive service.

nicoburns 5y ago
Arguably a taxpayer funded service is still a form of insurance. In the UK we pay "national insurance" which is a form of income taxation (but gets accounted for separately), much if which gies towards paying for our health service.
LeegleechN 5y ago
A fixed rate plan for something with unknown and highly variable costs is just about the definition of insurance.
- choeger 5y ago
  I don't think so. At least every insurance I ever bought had very precise definitions of the monetary obligations for each party. I think the highest would be my car's mandatory insurance (capped at, I think 20M€ per damaged person). My health "insurance" doesn't have such a cap. In fact, they are forced by law to pay for everything that I would ever need from a certain catalog of services. Also, the rates are not negotiable in my case but a fixed percentage of my income. It's similar for the pension "insurance" which is more like a perpetual pyramid scheme than an insurance.
  - jorams 5y ago
    You can put scare quotes around insurance, but they're really just counterexamples to your claim. Many forms of insurance include a cap to reduce the insurer's risk, but that doesn't mean such a cap is necessary for it to be called insurance. The height of the premium can be defined by law, but it's still an insurance premium. Pensions can be hard to understand because longevity risk is a bit counterintuitive, but depending on how they work in your country they can definitely be a form of insurance.
  - tharkun__ 5y ago
    Your health insurance does have a catalog. It doesn't just pay for everything and anything. Depending on your country this catalog is also shrinking and pushed into private insurance. Since there is such variability between countries and their systems these discussions become 'hard' to have because something that is normal for one guy works the opposite in the other guy's country. In Germany I had dental covered by the state. Like you said, fixed percentage of my income covered all that (and all the other health insurance needs with a catalog of services). No need to think about it. Except someone actually decided on that catalog based on monetary concerns and calculations. Also while there is a fixed health insurance cost as a percentage of your salary, there are different actual insurance companies and they add a variable premium to this which they 'compete on' for clients. This is the public system which must cover you and you can go fully private (and never be admitted back into the public system if you do) which gives you "better service" (like private rooms being standard at the hospital and such). Then they added private insurance on top for some stuff that wasn't covered by the public dental plan any longer. In Canada just a regular filling needs to be paid out of pocket and I really want private/employer extra insurance. Different for kids where I pay out of pocket for a white filling but Amalgam would be covered. I don't even know if this is the same in other provinces maybe. Pension: Germany has a pyramid scheme and it collapsed a while back. Not enough payers any longer and suddenly they had to tax people's pensions. People who they told need not worry about their pension ever. Suddenly they were told they would need to pay tax on their pensions and oh btw. you should really have started paying into private pension like a decade or so ago. From after tax income. They do have various private insurance schemes that lower your taxable income but the fees are sky high and returns meager. It's a way to shuffle money into insurance companies. Thank's government! And other than that, you can get ~800 EUR of tax free interest/dividends per year. Everything else is taxed at 25%. This is way different in Canada again where Old Age Security and your pension are not covering you and everyone knows. People either work longer because they can't afford extra insurance or have an RRSP (kinda like a 401k) they pay into. You know you will be taxed on this later but you aren't now. And all your money grows tax free in that account. Never pay a single dollar of taxes on those dividends over the years. And a non pension tax free savings account on top of that. Sure it's after tax income in there but you can take it out any time. No need for any insurance company fees either if you don't want to. Sure you can buy mutual funds and such but you arent forced to just to be tax exempt.

nly 5y ago

Making everyone more healthy (resulting in everyone in the pool having the same baseline risk) is a net good for both society and the insurers. Really the issue is people with incurable conditions. Universal health care is there for them. Private insurance fucks them over.

oceanplexian 5y ago
I don't think in a free market private insurance would necessarily fuck people over. For example the idea of creating a catastrophic insurance plan for healthy, fit young people would be wildly profitable and beneficial for those who would sign up for it, but the government wouldn't allow it to exist because it "discriminates" against those who are unhealthy or made different lifestyle choices.
- perl4ever 5y ago
  >wildly profitable and beneficial How could it be both? And if it was beneficial, how could you describe the people to whom it was beneficial as "healthy and fit"? Aren't they really just people who the screening failed to identify as unhealthy?
- curryst 5y ago
  It depends on your definition of "fuck people over". The insurance plan for healthy, fit, young people would likely be cheap. However, they were subsidizing older and/or less fit people. The rates for the "not young, fit and healthy" plan are going to go up. Drastically. I would also be unsurprised to see that the "healthy, fit, and young" group ends up becoming the "average" group, and that they use the other group to lump together people they don't want to insure, with rates so high people can't afford to pay them. I.e. they keep you in the healthy, fit and young group until you get cancer, and then they move you over to the $7,000/month group. The current system just averages that out. Your rates are higher than they have to be when you're young, but your rates are lower than they have to be when you're old. It negates the risk by lumping everyone together. Your form of insurance doesn't do much to reduce risk because you can always be moved to another category. The insurer really just becomes a middleman between you and your medical providers then, if the goal is to allow people to pay for what they use. It's basically an HSA.