Health Insurance and Costs

First I’m going to apologize for the fact that this post is likely to ramble a bit and cover a couple of different topics that have been bouncing around in my head. This is what happens when I leave things too long and things build up on each other….

First, health insurance, or more specifically why it SEEMS to cost so much to so many people. I say seems there because when most people really consider what it IS as opposed to what it is NOT the additional cost usually makes some sense. I say this because many people get the terminology confused they consider health insurance in the same terms as the other insurances that they pay for. The problem with this, of course, is that on those terms health insurance is NOT insurance.

‘But it says insurance right in the name, how can it not be insurance?’

The thing about insurance is that, technically, it is supposed to protect the holder against ‘unexpected’ or ‘unwanted’ circumstances. Heath ‘insurance’ no longer just does this, and hasn’t for a long time. Health insurance now covers things like ‘planned pregnancy’ and ‘hip and knee replacements’ … these are either expected or desired circumstances not the realm of ‘insurance’. Does your car insurance pay for oil changes and tune ups? Does your home owners insurance pay for replacement of carpets from normal wear and tear? Strangely neither of mine will.

How did we get to this point? A combination of factors including government regulation ‘your policies must have coverage for ‘x’ condition on it’, and free market competition ‘we’ll give you coverage for ‘x’ AND ‘y’ for a slight additional fee (or at ‘no charge’).’

Now, while competition has ‘helped’ us get into this condition it is largely government regulation that is not only making it a problem, but also preventing competition from allowing us to get out of it.

How? Not only because the government has, over the years, added more and more things that all policies MUST cover. (For example it is impossible for me to get a policy that doesn’t cover pregnancy costs … a condition that, as a guy, I will only have to worry about in the freakiest of circumstances.) The government has also, due to concern with the rising health care costs, in many instances, regulated pricing as well. In these situations the competition in the free market becomes tangled in red tape and can not operate in a way that provides the consumer with the best product at the best cost.

In addition to that, the government in most states prohibits writing policies across state lines, again limiting competition and narrowing the options of consumers.

The politicians claim that our current health care problems come from a failure of the free market, and offer that as proof that we need a socialized system. But that’s like tying the arms of a baseball player behind his back and saying that his failure to hit home runs is proof that we need to come up with a new game.

Now at the moment it is technically possible to get around some of the government regulations by opting into to a health savings account. In that system you get a high deductable heath ‘insurance’ plan and are allowed to put ‘pre-tax’ money into a special savings account. You can then use money from that account to pay for medical expenses without paying tax on it (or the interest) and the ‘insurance’ plan only kicks in once you go beyond the deductable.

This type of plan, however, is on the chopping block. That is to say that the current ‘health insurance reform’ bills in DC eliminate the provisions for these plans, or downright disallow these types of plans completely, again removing choices from the consumer. I’ll never understand why DC really seems to have this idea that less choices is better for the consumer when history says otherwise.

But then again I really don’t think that there are too many students of history up on ‘the Hill’ these days. In fact I often wonder how many of them up there could tell you anything about recent history (10-15 years ago) much less give any historical perspective on current policy.

But then again, they don’t want to look at history … because history is not really on their side in their goals. Not our history, nor the history of other countries. So why the push to socialize medicine, or anything else for that matter?

For many of the hacks in DC one needs not look past the motivation of ‘power’. Look, for example, at the power that the ruling class in the USSR had for decades. Power and control over all aspects of people’s lives with the people in question having little to no say in the matter. The USSR had completely socialized medicine (and everything else) and look how well that worked out for the people. The ‘people’ had trouble getting anything at all. The political class, however, had whatever they wanted … until the country ran out of money and collapsed around them that is…

What about the people outside the government that are supporting and pushing for these changes as well? For some it’s nothing more than pure ‘sheepizim’ … following what they perceive to be the majority in the hopes that the leaders know what they’re doing, usually a result of either ignorance or indifference due to laziness.

For others it’s something else … almost a spiritual belief in a higher duty of mankind; an honest belief that it is the duty of all men to ensure the wellbeing of all others. The belief that altruism – the act of benefitting others without personal reward or return – is real.

As my wife said a couple of weeks ago, and I agree, given human nature altruism does not and can not ever truly exist.

Human beings are animals, though most people do not like to consider that aspect of humanity. We are intelligent and capable of rationalized discussion and logic, but still a product of our instincts and the collective experience of our past. I hold that the result of this is that humans are incapable of acting without reward of some form.

Any act undertaken by man has a reward … it may not be a monetary or material reward … but there is a reward. Most people that act in what is commonly perceived to be an altruistic manner are receiving one of two possible rewards: pleasure of giving or a sense of superiority to those who are receiving. In some cases they are likely receiving a mixture of the two. Typically speaking the less that the person giving knows about the person that he is giving to and/or the more they publicize their act of giving the more likely it is that latter of those two rewards.

Keep in mind, I’m not saying that people do not and can not act charitably … many do … I am saying that it is impossible for them to do so without receiving reward for their action. They are not acting without reward, nor are they, psychologically, acting without desire for reward; they are simply acting in pursuit of a psychological reward.

Don’t get me wrong … the ‘ideal’ of everyone helping each other simply for the sake of helping each other is a great ideal; but as a matter of practicality it fails to account for human nature. It assumes that not only does everyone act in a selfless manner, but that no one would take advantage and act in a ‘selfish’ manner.

The problem, of course, is that humans are, by nature, selfish. Our instincts and psychological make up are to provide for our ‘self’, for our own needs first and foremost, and also by instinct we will use the least amount of energy or effort to do so. This is a survival instinct, part of self preservation, and deeply rooted in our psyche; it is not something that is easily, or ever, overcome. We can not just ‘flip a switch’ and become ‘a better people’ because psychologically we wouldn’t consider it ‘better’.

One must understand, however, that in serving our ‘self’ by achieving and becoming better we CAN help others both by serving as a role model for success and through the efforts of our enterprise (employing workers, buying goods, providing services and in general being part of the free market and economy in general) … it is when these ‘selfish’ and ‘greedy’ capitalists succeed that the market and the economy that is tied to it flourishes … not when those same ‘producers’ are tied down and burdened by regulation and taxation.

This, in turn, brings to mind the subject of taxation – the governmental punishment of success and achievement in order to ‘spread the wealth’ in the name of ‘fairness’. Let’s not lie, life isn’t fair and it never will be and any government effort to make it so can only be achieved through tyranny; by using force to take from those that have earned it in order to give it to those that have not in order to make it ‘fair’.

I’ve quoted it before but I think it bears repeating here:

“A government big enough to give you what you want, is also big enough to take everything you have.” - Thomas Jefferson.

Some time ago in a political discussion online someone from England responded that maybe Americans should be more ‘caring’ toward the poor in reference to paying more taxes to cover more social programs and government hand outs.

I’m sorry … but it is not ‘caring’ to have money taken from you by force in the form of taxes and given to other people that have worked less (if at all) for it. I am all for being caring and generous; I believe that people should help those that need it when they can afford to do so. However, I also believe that it should be the choice of private individuals to ‘give’ their money where and how they choose, not a decision by the government to take it and dole it out as they see fit.

Long before welfare there were social networks, private charities, and similar organizations that performed the same task. Because of welfare and other social government programs and regulations these have slowly withered and either gone away completely, or moved into a secondary role and been largely forgotten by a majority of Americans. If the government programs were to stop tomorrow, however, these would return quickly to fill the ‘need’ and in the end people would likely be better off for it in the long run as the people running it would likely care a good deal more about the people they were helping than the government bureaucrats do currently.

While I’m on the subject of things I’ve heard people say during political discussions, I was listening to talk radio on the way to work the other day and heard a caller say ‘(Atlas Shrugged) is too draconian. If you were to tax the producers at 70% they won’t just pack up and quit, they’ll keep producing because you’re still leaving them with plenty to live off of.’

Now, I got to work just as he finished making the comment so I didn’t hear the host’s response to the statement, but it certainly sparked a response in me.

Yeah … you’re right … they’ll just keep producing. That’s exactly why government tax revenues have dropped by record amounts. That’s exactly why New York, New Jersey, Michigan, and other states are experiencing ‘brain drain’ as the achievers move out of their states to areas with more favorable tax policies. That is exactly why companies are moving jobs and factories OUT of the US in greater numbers than they have in the past.

And keep in mind as well that they may, in fact, not pack up completely … but why should they work as hard as they have been to earn $1,000,000 to be allowed to keep 300,000? They could work half as much they would only get to keep 150,000 but they would only be paying 350,000 instead of 700,000 and lets face it $150,000 is still plenty to live off.

But let’s be ‘fair’ about this. Would you consider it ‘right’ for the government to take 70% of what you make? If the answer is ‘no’ for ANY reason then claiming ‘fairness’ just went out the window pal. You’re not looking for ‘fair’ you’re looking to leach off of someone else’s sweat and tears, and there is no worse depravity in the human spirit. You are worse than a thief that breaks in and steals everything a person owns, because at least they had to put forth some effort to take it. You are worse because not only are you not willing to put forth the effort to steal it yourself, you are too cowardly to take the risk, instead relying on the power of government to force people to give up part of their lives so that you can live more comfortably without giving any part of yours.

You want to prove me wrong? Then stop flapping your yap trying to take your living from those that earn more than you and get off your backside and earn it for yourself. Maybe if more people did that instead of turning to the government looking for a ‘leg up’ the economy in this country wouldn’t be where it is now … but that wouldn’t get the DC crowd the power and control that they so desperately need to make their lives meaningful. That would, in fact, threaten their power and control over the people of this country … it would signal a return to the system that made this the richest, most successful, country in the world. It would, in fact signal the return of freedom and power to the people of this country.

It’s a shame that the people of this country are more concerned about American Idol than they are about their own lives and freedom.

Postal ObamaCare

Okay ... so President Obama, in an effort to defend his stance that a 'public option' insurance plan can compete successfully with private insurance, toted out the US Postal Service. Basically saying that the fears of the government insurance plan would run private insurance companies out of business were unfounded because the Post Office hasn't run UPS or FedEx out of business.

Now the million dollar question is: Did President Obama not really look into that comparison very deeply, or was he intentionally misleading people, counting on the American people not looking into it?

There was a time when I was willing to chalk things like this up to naivete ... that time is past.

You see ... the problem with the comparison is that the Post Office and UPS/FedEx (et al.) technically don't compete. By federal law the US Post Office is the only entity allowed to deliver first class mail ... or 'non-urgent' mail of any kind technically.

Secondly, I thought that his health care plan was supposed to be government provided or at least government subsidized ... last time I checked the government did not provide postage, nor do they subsidize the cost of postage. So in that respect the Post Office analogy falls apart as well.

In fact ... if you take those two points and put them together you ultimately have the primary argument for the fact that government insurance option WILL be detrimental to private insurance options. Private companies can not compete against an entity that does not need to post a profit, can make and alter the rules at will (and in fact the 'rules' that they make typically only apply to competition), and can use tax money seized from private individuals in order to artificially lower the cost of its 'product'.

So why didn't he choose Medicare or Medicaid or even Veteran Services? Oh ... because of course while all of those are great indications of life under government health care, they do not play well with the public because the public knows what a cluster and hassle they are to deal with.

The fact of the matter is, even the Post Office image is not exactly a shining example of government competence either. As another columnist wrote:

'if you have an urgent piece of mail you need delivered, life or death, who are you going to call? Everyone saying the government…please raise your hands.(crickets)'

Seriously people ... I'm fairly certain that I've asked this before ... but can ANYONE name one single thing that the government does efficiently? how about anything that they do marginally okay with?

The Post Office is in trouble ... it is loosing money like never before, but it is not FedEx/UPS killing it. It is the inefficiency of the Post Office, and the lack of innovation and client service that is killing them. If the government were to open your mailbox to any real competition the Post Office would be out of business in a month ... but mail is an essential service, and private industry can't be trusted with essential services because the private sector can not be relied upon to do things correctly.

Just as private individuals can not be relied upon to spend money correctly ... the government should do it for them ....