Uhh-ohh. The new health care bill

In case you live in a bomb shelter, the House of Reps pass the Senate health care bill last night.  There will be plenty of news everywhere about it in the next month so be sure to educate yourself.  I found a short little piece from The Atlantic here.  While I strongly disagree with the author that “this is the greatest progressive achievement over the last two decades”, I would agree that doing something is better than doing nothing at this point or as the author put it, “the most useful approach to health care is to servicey rather than debatey.”  Yes, you read that last quote correctly.

While I think this bill is a huge mistake and will eventually expose this administration for what it is, I do think that this policy’s downfall will ignite further reform that will be positive…because it will be based on experience not opinion.  What experience do I speak of you ask?  Well let me preface this by saying I have a health insurance background so I may be extra sensitive to this but you don’t need my background to think about health care reform logically.  If you are a 21 year old single male, healthy and insured your premium might be $140 per month for a solid policy.  If you are a 21 year old single male, very unhealthy (with diabetes and asthma for instance) you are most likely uninsurable on your own.  (You could be eligible for your employer’s plan with no discrimination or a state funded high risk plan).  The reason you are uninsurable is because the insurance company currently is not required to accept you onto their plan if you don’t fit their risk profile.  What do I mean by risk profile?  At each insurer, there are underwriters who look at your application including your health history and determine if they are going to offer you coverage or deny you coverage.  If they offer you coverage, they must determine at what rate (within a state mandated range).  Basically they run a bunch of number to determine if they charged you $200 per month (for instance) if they could recover their costs and hopefully still make a little bit of money on top of that assuming you don’t have any unforseen health issues above what they know if likely given your current conditions.  In most cases, if you have a “pre-exisiting” or “recurring” condition such as diabetes or asthma or you have a mental condition such as an anxiety disorder, you will be denied coverage.  This is because it is not worth the risk to the insurance company by accepting you as an insured knowing some of the issues you will have in exchange for the premium you are paying them.  The amount of money insurance companies continue to make is a topic for another discussion however at a very high level, they are businesses too and are working to maximize profit. 

What the heck am I talking about?  Well I had to set the table for this little gem from the Atlantic article, “On regulatory reform, the law bars insurers from rescinding coverage to the sick; discriminating based on pre-existing conditions; and capping lifetime coverage.”  I am still learning about the new bill myself, but if I understand correctly everyone must have insurance under this plan.  Insurance companies will no longer be able to deny coverage to those people with pre-existing conditions or charge them a higher premium and will also not be able to put a maximum dollar cap on the policy which helps limit their exposure over a period of time.  The caps I have seen are around $5 million per lifetime of policy.  Some are lower, some are higher.  My point is this…I am all for helping people get coverage and I think the insurance companies need to be reigned in a little bit as they make record profits in these times but who do you think is going to pay for all of this?  Yes, I have seen the Democratic numbers that claim it will get the cost of this program plus some back from squeezing the system.  Do you think that is a good idea…to squeeze the providers who give us access to the best healthcare in the world?  Are we biting the wrong hand?  We shall see.  All I know is a lot of people who vote for “change” will be quite surprised when that’s all they are left with in their pockets after this…”change.”  Oh by the way, that healthy male in my example above will now be underwritten with the unhealthy male who would have previously been denied coverage because the insurance company couldn’t charge him enough per month to justify insuring him.  So $140/mo for insured #1 plus  $300/mo for previously uninsured #2 divided by two insureds equals $220 per month each.  How you feeling now #1?  Still want to vote for “change”? 

This is just an example, it is a very complicated deal and as I said I’m glad we are getting the first part going so we can learn from our mistakes.  I just wish people would educate themselves and think about this stuff logically before they vote next time.  Sounds great in theory.  We will soon see what it actually feels like. 

Phase 2 of Obama health care reform