This is the whole point of health insurance! What a stupid idiot (I am overly nice to Paul Ryan. His budget plan was the most ridiculous thing I have ever read).
Insurance is about lowering variance, not about subsidizing high risk. The ACA tries to make insurance affordable for everyone, and in the process, some people pay less than their actuarial cost and others pay more. That is not just insurance, it's forcing people with a lower actuarial risk to subsidize those with a higher risk.
Insurance is about taking the chance element out of something that is inherently probablistic because the rare event would be catastrophic. By pooling risk, you make things more predictable. But everyone is still paying for their own, individual share of the risk pool.
I'm not arguing that we shouldnt, as a society, ensure that everyone can afford health insurance, but we shouldn't pretend that "it's just insurance" because it's something entirely different.
The idea of extending an insurance program into a mechanism for subsidizing those who can’t pay the premium does not mean it magically transforms the program into a totally different thing.
In the limited definition, it is still the case that the healthy pay the cost of sick.
The extension of the concept of insurance fits semantically, because it is based on the idea that there is an element of chance inherent in who gets sick; getting sick includes many factors that are outside the source of an individual’s contol (as well as factors that are within an individual’s control).
The ACA included a “tax,” among other methods to socialize the cost of covering the “premiums” for those that couldn’t cover them on their own.
The whole system relied on the same actuarial principles as the previous system to smooth out variance in costs to individuals.
Paul Ryan sounds like an idiot here, because he is a mealy mouthed politician, who doesn’t have the courage of his convictions.
Ryan is libertarian minded tool, whose real opposition to the ACA is not that the healthy pay for the costs of the sick. His opposition is to the elements of the program that force wealthier members of society to cover the medical costs of the poorer members.
It's not "just insurance." That's not "what insurance is." We're talking about a form of socialized medicine, not insurance. That's the correct terminology. Anyone arguing for anything between Obamacare and Medicare For All (which includes me, BTW) needs to own up to that terminology or something to that effect and stop selling the notion that what they're arguing for is just insurance.
Insurance, as a concept, doesn't shift the burden for risk from people who can't afford to pay to people who can. It's something different and you don't get to alter definition of insurance just because the correct terminology has a stigma. So when the comment I replied to says,
> This is the whole point of health insurance!
No, it's not. That's the whole point of socialized medicine. Words have meaning and we should be using the correct ones.
That statement is true, but health "insurance" covers lots of non-chance things, because it covers lots of things that are not a result of "getting sick". Some examples:
* Birth control.
* Basic childhood vaccination.
* Well-child checkups.
* Annual health checkups for adults.
* Basic screening tests for adults (mammograms, colon cancer screens, that sort of thing).
All these things should be provided, imo; insurance is the wrong vehicle for providing them. Politically, I _think_ (hope?) there would be a lot more support for "provide all children with basic health checkups" than there is for the ACA. Of course there would be less support for the "birth control" item, which is why people like to bundle these all together, and with things like emergency medicine and end-of-life medicine. Which are _also_ quite different in terms of their risk profiles, tradeoffs, and elements of chance.
It also covers some things that in an ideal world would not be chance but are in practie (e.g. routine births with no complications; they are more chance than they should be because as a society we suck at birth control, on both the organizational and personal level).
I really wish we separated our "health care" a bit more along some of these axes, because I suspect that the "right" answer is to have single-payer for some aspects of it, an insurance scheme (private or public or both) for other aspects, and "you're on your own" for still others, with expensive and invasive end-of-life interventions heading this last list.
This bizarre obsession with using the phrase "insurance" and insisting on a product that is not at all insurance is probably why the US health-care system is so fucked.
How does that make sense? If I knew I needed $5000 worth of medical treatment for asthma, and I pay an appropriate premium based on that, but then I get cancer..... well then someone else is going to have to pay for that, because my premiums certainly won't cover the cost of cancer treatment.
If you do get cancer, the other 99% of folks who didn’t get it are covering your costs.
Not true. Car liability insurance is very similar to health insurance. A lot of people never get anything out of it.
Although I suppose if the singularity happens, that will also solve the health care crisis in this country. (sarcasm)
In a pure contract between equally informed parties, it's exactly how insurance would be priced.
This is a serious misunderstanding of what insurance is. Insurance is a net benefit for society because it linearizes individual risk curves even if you have to pay in proportionally to your expected costs, not because it makes less risky people subsidize more risky people. Perhaps you should avoid calling people “stupid” for misunderstanding insurance.
But in your little group, there's still a 36% that no one will get cancer and that's offset by a small chance that multiple members of you group will get the disease. If even 4/20 members get cancer, that would now come pretty close to bankrupting everyone in the group. So what do you do? You increase the size of the group and lower the chances that no one will get cancer while also increasing the chances that only a proportional number of people (5%) in the group get the disease.
But then along comes Danny. We also know that Danny has a 10% chance of getting cancer. He also wants to join our group. If we just let him join, it won't be fair...after all he's twice as likely to need us all to pay for him. So we can either tell him to get lost, or we can just make sure that when the bills for someone's cancer show up, he pays twice as much as any other member. He's bringing twice the risk with him so he pays twice as much.
In poker, players learn to avoid being outcome-oriented when evaluating their decision making. Rather than looking at a decision they made and seeing whether they won or lost, it's more important to look at the decision and ask themselves if they'd made the same decision a million times, how many times would it lose and how many times would it win. Because any individual hand where a correct decision is made can still lose due to variance.
Insurance is the same concept. Actuaries use statistical analysis to determine an individual's risk so insurance companies can price that risk accordingly. Over a million lifetimes, your insurance premiums (less the insurance company's profits) would come very close to the overall insurance payouts. But since you've only got the one life, you'll be under- or over-paying. But you're still only paying for your own risk, you're not paying for anyone else's risk.
Where the ACA comes in is when Danny can't really afford the double stake. It forces us to let him join the group and pay less than double whenever someone gets cancer. That's a bad deal for all of us 5%ers, despite the fact that there's still a 90% chance that Danny doesn't get sick.
Now try to answer your question...do you see the difference between paying for your own portion of the risk pool vs lower risk individuals subsidizing higher risk individuals? If you were in one of those groups of 5%ers, would you just let Danny join without adjusting for his added risk or would you be looking for more 5%ers like yourself?
