Monday, July 25, 2005

Now combine this with MSAs, and we're good to go...

An interesting idea on the op-ed page of the Wall Street Journal about how to lower health insurance costs....In fact, it's on the table in Congress right now.

The best part: it relies on exploiting the PRIVATE market.

As the article points out:

A 2004 study by eHealthInsurance.com found that a typical insurance policy ($2,000 deductible, 20% co-insurance) for a family of four could be had for as little in as $172 per month in a reasonably regulated locality like Kansas City, Missouri. But in New York that family's only option--managed care--would run $840 per month, and in New Jersey family policies run a whopping $1,200-plus.
The reason?
New York requires every insurance policy sold there to cover podiatry. Acupuncture coverage is mandated in 11 states, massage therapy in four, osteopathy in 24, and chiropractors in 47. There are an estimated 1,800 or so such insurance "mandates" across the country, and the costs add up. "It is always the providers asking for the mandate; it is never the consumer," says health policy guru John Goodman, who has testified before legislatures considering such rules.

What's more, states like New Jersey and New York add two more ultra-expensive requirements: "Guaranteed issue" allows people to wait till they are sick and then buy insurance; "community rating" prevents insurers from charging different prices to people of different ages and health status. These may sound like compassionate ideas, until you realize they make insurance so expensive that millions of people are exposed to financial ruin because they aren't allowed to buy basic policies focused on catastrophic costs.

1 comment:

Adam Scavone said...

This one merits some phone calls: the Congressional switchboard is at 202-224-3121.