I, for one, am very much looking forward to purchasing insurance from the best provider in any of the 50 states, not just the few available to me in CA.
The reason premiums are high is that costs are high, and our population is obese, disease prone and litigious.
If we want to contain costs we have some options:
1) Public option/Medicare for all could save us 10-20% in parasitical insurance company costs/administrative overhead.
2) We find solutions for obesity. Obesity is the #1 driver of increased health costs in America.
3) We stop holding doctors/pharma financially responsible for bad outcomes outside of their control through the legal system.
Part of the initial law were "high risk corridors" to limit the losses for insurers that initially mispriced their ACA plans. The insurance companies had to make a ton of assumptions about the age, health, and wealth of the populations who would sign up for their plans. To make sure they didn't accidentally bankrupt themselves, the law provided funds to limit their losses for the first three years of the exchanges (2014-2016). In the first year, they had a shortfall as the population was older and sicker than expected, so CMS was going to cover the $2.5 billion gap but congress refused to let them pay these user fees.
The GOP knew that the premium changes would come during the election season, so they denied funding for the high risk corridors last year. To give themselves room against mispricing, the insurance companies predictably raised premiums beyond where they would otherwise have been. Other insurance companies decided they didn't want the risk, so they pulled out of the marketplaces.
The election season was rife with announcements about "20% premium increases" and "xx Insurance company exits the exchange market". Millions of people get to pay more for health insurance but at least their guy won the race.
Aragorn: Ride out with me. Ride out and meet them.
Theoden: For death and glory.
Aragorn: For Rohan. For your people.
Theoden: The Horn of Helm Hammerhand will sound in the deep, one last time!
Somebody is gouging us, but we will never know who, and everybody can point to somebody else, or to "society," but we just don't know.
Chances are, everybody who can make money while covering their tracks through a web of business entities, is gouging us.
One potential advantage of the government owning the whole system, is that it would facilitate figuring out what the costs actually are. This may be why other civilized countries pay half what we pay. It's a saying in business, that you can't manage what you can't measure.
"let insurance companies shop for the best state"
Meaning, when customers have the ability to buy across state lines, the true competition becomes not consumers shopping for insurance, but STATES competing for health insurance COMPANIES to set up shop in their state- offering whatever it takes-- handing over amazing liability protections, tax giveaways, dropping regulatory standards-- all to get them to create jobs in the state.
The result is that (A) one or two financially strapped state governments give the industry whatever they ask for, promising them minimum regulation/oversight and low/no taxes, then (B) the entire industry moves there, where they further consolodate power. (C) companies regulated in other states (with safer products and actual responsibility to their customers) can't compete fairly, so they either move to that state or go out of business, resulting in (D) fewer choices for customers, poor quality products, higher prices, and more abuse and negligence from the companies.
I've heard this expressed as a "race to the bottom", which I always thought was a really confusing way to say it without context.
What makes me think this is going to happen? Watch the Secret History of the Credit Card documentary on Frontline about how this exact same thing happened in that industry.
http://www.pbs.org/wgbh/pages/frontline/shows/credit/
The CC industry "state-shopped" to find a state (South Dakota I think it was) that would let them get away with just about anything. At that point, every major player moved there, and suddenly credit cards became super abusive to customers and there was no recourse (until very recently with the consumer financial protection bureau...)
In advanced Western countries, you see many different configurations for functioning health care systems. Some do insurance based models, others do single payer, others are hybrids. The issue is not about choosing which configuration of system, it is about rooting out the disgusting level of corruption that exists currently in the system.
The ACA did nothing to tackle this underlying issue.
The UK is doing OK with the NHS at half the US cost as a fraction of GDP. Singapore is doing at least as good at about a quarter of the costs.
American combines the worst of government and private healthcare. The UK does a decent job with government healthcare. And Singapore combines the best of government and private healthcare.
http://econlog.econlib.org/archives/2008/01/singapores_heal....
And medical coding to figure out what you're paying for and what a normal price should be is ridiculously hard to understand. Some of this is going to be their response to a litigious society, but you can't use that excuse for all of it.
Also, if someone doesn't have insurance, the fact that the hospital puts you on the hook for the full bill is ridiculous. Insurance isn't paying 100%, they are discounted crazy amounts, even only paying 20% in some cases. But you don't get this discount from the hospital. If you show up without insurance, you will be charged the full amount, less what you can negotiate on the spot. And most people don't know they can even try to negotiate it.
I agree that the insurance companies are a huge problem, but I don't think the hospitals and doctors' offices themselves should be absolved from their share of the blame.
And what happens with the majority of people who don't have insurance, they don't pay it. So the costs get eaten by the hospital and eventually by everyone else that can pay.
In that respect, we have socialized healthcare already. It's just a horrible implementation.
There's a lot of material out there about the likely effects of selling across state lines. To the point it is not even actually seen as a viable option, it's more something that Republicans say because it sounds reasonable at first. But it's not workable.
You say: "It's a race to the bottom in terms of regulation"
Consider your assumption that regulation is good. In point of fact pernicious and arbitrary regulation within states brought us as a nation to this desperate situation.
You say: "To the point it is not even actually seen as a viable option"
Check your prejudice at the door and look at reality. You may need to understand markets and human nature more clearly. You may "see" and understand other, better options.
There are substantial challenges. One is that insurance companies don't actually provide care, of course. Any company wishing to do business with people in a particular state would have to actually obtain a network in that state -- partner with an existing network, or negotiate deals and sign contracts with hospitals, urgent care centers, pharmacies, labs, and doctors. They'd presumably have to be licensed to do business in that state, and adhere to that state's own regulations and requirements for doing so. (Because the US is a federal system, the federal government itself is unlikely to be able to strip away all of each state's specific laws and regulations.) This process would have to be repeated for every state in which they plan to do business. Insurance companies would probably set up state-specific legal entities or subsidiaries to provide financial and legal compartmentalization. So selling insurance "across state lines", as a practical matter, may not differ much from the current system. State-specific legal work and shoe-leather network-building would still be required. There's nothing stopping a national company from setting up a state-specific entity and selling insurance this way right now.
Another issue is that if local regulations were somehow stripped, as some in congress wish, insurance companies, as profit-seeking entities, would all gravitate to the most favorable and least regulated business environment. After the Supreme Court ruling in Marquette v First of Omaha, credit card providers migrated to Delaware, South Dakota, or Arizona because those states have the weakest usury laws and allow them to charge rates of 29% or more to borrowers in any other state. A similarly deregulated and "efficient" market for health insurance would have all the companies set up entities in whichever state would allow them to offer plans that provide the least care reimbursement (known internally as "loss control") and charge the highest premium. This could lead to a situation where a few very large companies offer only high-deductible plans without guaranteed issue, excluding procedures that carry risk of being expensive or are politicized, with lifetime or annual caps, thin networks, and retroactive drops. Lip service would be paid in the form of seemingly cheap policies that actually provide little real coverage, but allow insurance companies and politicians to claim "all Americans now have access to affordable health insurance". As bad as the credit card system may be, lending is at least a business that can be conducted at a distance. Health care is the most local of concerns.
What's needed is not a guarantee of "access to efficient health insurance markets". What's needed is actual health care. In a moral society, everybody should have access to that actual care itself without risk of ruin. The US system forces people to make terrible decisions. People remainining in hated jobs, empowering employers and distorting the employer/employee market. Not taking medicine, or half-dosing, because, even with insurance, the costs are too high. Not visiting the doctor after an injured ankle because of fear of the costs, then suffering forever after due to a poorly healed fracture. Especially pernicious: seeing a doctor but not reporting problems because of fear they'd be labeled as pre-existing conditions for which future coverage would be denied. And employers themselves have higher costs because of the historical accident of employer-based insurance, reducing their competitiveness with foreign companies who have no such obligation.
It's a huge political problem, but this focus on insurance, and access to insurance, begs the question.
No. I don't buy auto insurance on that basis. It is required by my state in order for me to legally operate a motor vehicle. I buy what is "best" for me (and my family).
Only in our closed highly regulated environments that denigrate personal responsibility and individual liberty do we get this extraordinary markets dislocations that come with the bizarre healthcare system that we have today.
Your selection of the best auto insurance policy is qualitatively a different kind of choice. Many millions have no car or need of one. You could live without one. I mean that literally -- it will not end your life if you don't have a car. There are alternatives to owning one, even if one of those is moving somewhere where you don't need one. Likewise, you may never use your auto insurance, and auto insurance doesn't pay for maintenance. But everyone needs health care, including its "maintenance" form. There's nowhere to move that obviates the need for health care.
Insurance is not the right model.
AND, until we hit our $5K premium, it doesn't really pay anything. So we've got to pay $27K to get a real benefit. And it's not like we're young and healthy (nearly 50). Feels like we're getting shafted.
When this was done with credit card companies, they all moved to the state with the least regulation and started instituting consumer-hostile stuff like mandatory arbitration.
I'd really rather not have this happen with my health insurance.
