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So you think that all the younger, healthy people who either didn't have insurance or had it but paid extremely low premiums aren't going to largely offset the

by zedpm 13y ago

So you think that all the younger, healthy people who either didn't have insurance or had it but paid extremely low premiums aren't going to largely offset the added costs? It's a complex issue and it's hard to find the information to do the math, but it seems like a lot of analyses only take into account the negatives without also accounting for the other side. More expensive people will now be in the risk pool? Less expensive people will also be joining. Further, right now we're all paying for people who get care and don't/can't pay, so we have to make sure we don't double count costs. In the same way, if people previously got coverage via Medicaid but will now have a subsidized insurance plan, we shouldn't double count those expenditures.

glenra 13y ago
> "So you think that all the younger, healthy people who either didn't have insurance or had it but paid extremely low premiums aren't going to largely offset the added costs?" Nope, I don't think that will happen at all. Because: competition. If young people are suddenly paying higher premiums than is actuarially appropriate, competing private firms that happen to mostly serve a lot of young people will have a windfall bonus, which they will in short order find ways to compete away until there aren't any excess profits to be had from the young people to subsidize the old people. Remember how under airline rate regulation, planes tended to fly half-empty and meals were free? Stuff like that. Firms will waste money on really expensive real estate next to universities, on gyms, on salaries of doctors and admins that specialize in young-people problems. Meanwhile firms will do everything they can to subtly discourage old people from joining up and to make the service old people get as mediocre as possible while still staying mostly within the letter of the law. Companies that used to be especially good at providing service to the old (albeit for a higher price) will tend to go broke, being replaced with companies that are really good at getting the laws bent in their favor and cutting corners. The cost to provide care to the young will rise through "improvements" the customers don't value as much as they cost; the cost to provide care to the old will decline through degradation that's not worth the money it saves. (Until eventually 3:1 is actually the correct relative valuation of the service provided.)

by zedpm 13y ago

glenra 13y ago

> "So you think that all the younger, healthy people who either didn't have insurance or had it but paid extremely low premiums aren't going to largely offset the added costs?" Nope, I don't think that will happen at all. Because: competition. If young people are suddenly paying higher premiums than is actuarially appropriate, competing private firms that happen to mostly serve a lot of young people will have a windfall bonus, which they will in short order find ways to compete away until there aren't any excess profits to be had from the young people to subsidize the old people. Remember how under airline rate regulation, planes tended to fly half-empty and meals were free? Stuff like that. Firms will waste money on really expensive real estate next to universities, on gyms, on salaries of doctors and admins that specialize in young-people problems. Meanwhile firms will do everything they can to subtly discourage old people from joining up and to make the service old people get as mediocre as possible while still staying mostly within the letter of the law. Companies that used to be especially good at providing service to the old (albeit for a higher price) will tend to go broke, being replaced with companies that are really good at getting the laws bent in their favor and cutting corners. The cost to provide care to the young will rise through "improvements" the customers don't value as much as they cost; the cost to provide care to the old will decline through degradation that's not worth the money it saves. (Until eventually 3:1 is actually the correct relative valuation of the service provided.)