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Charles Wheelan, Ph.D. The Naked Economist

Charles Wheelan, Ph.D., The Naked Economist

Putting the Insurance Back in Insurance

by Charles Wheelan, Ph.D.

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Posted on Tuesday, May 20, 2008, 12:00AM

Barack Obama will soon send Hillary Clinton packing back to the Senate. Once she's gone, he needs to borrow one of the key tenets of her health care plan. She's right about health insurance: It needs to be mandatory.

The Massachusetts Remedy

That's not just a Democratic idea. Mitt Romney came to the same conclusion. As governor of Massachusetts, he implemented one of the most innovative state-level health care reforms. A key piece of that reform is mandatory health coverage.

Obviously, many people can't afford health insurance -- that's the reason they don't have it in the first place. But Romney's plan in Massachusetts provided government subsidies to make insurance more affordable for low-income residents. Any sensible program at the federal level would do the same.

That would leave no excuses: Everyone would have to have some kind of health insurance -- through an employer, through Medicaid or Medicare, or through some other approved plan. In the Massachusetts case, the state created a program to connect individuals with affordable insurance options. Those who can't prove that they're insured pay a steep penalty when they file their state income tax.

Spreading the Risk Around

So what's the economic rationale for such a heavy-handed approach from politicians as far from each other on the political spectrum as Hillary Clinton and Mitt Romney? Mandatory insurance is pretty much the only way to keep the American employer-based insurance model from collapsing completely. (And even that might not be enough.)

But health insurance is like any other kind of insurance: It pools risk. I buy homeowners insurance not because I think my house is going to burn down, but because in the highly unlikely event that it does, I would be protected from a financial disaster.

So I pay the insurance company a small but predictable amount to make that risk go away. If the insurance company is doing its job right, then the company will make more money from the houses that don't burn down than it pays out in claims for the houses that do burn down.

Too Smart for Our Own Good?

That's the point of insurance, whether it protects against natural disaster, fire, kidnapping (yes, there's kidnapping insurance), or anything else.

But health insurance is quickly becoming different than all other kinds of insurance: It's getting easier and easier to predict in advance who will get sick and who won't -- even decades in advance, thanks to our greater understanding of the human genome. Researchers have already identified some 1,800 disease-related genes. There are now home DNA kits that enable you to test yourself for many of them.

That may be great for medicine, but it's a disaster for the insurance market. How well would the homeowners insurance market work if we had an increasingly better idea of whose house would burn down and whose wouldn't?

A Policy Dilemma

Our ability to predict disease creates a dilemma for policymakers: If insurers are privy to such information -- if you and your family have to spit in a cup or donate a strand of hair before you get your insurance -- then the people who are most likely to become sick with expensive illnesses will soon be priced out of the market. Of course, those are the people who need insurance most.

The alternative doesn't work, either. Suppose we forbid insurance companies access to such information, and generally make it more difficult for insurance companies to screen out those with preexisting conditions or those with a genetic predisposition to get sick in the future. Such a policy would go a long way toward making insurance more affordable and accessible for those who need it most.

That seems eminently sensible -- until you think about it for six or seven seconds. If insurance companies are not allowed to screen out the worst risks, but each of us can look decades ahead into our relative long-term health, then those who are most likely to get sick will load up on the most insurance. Those with a better genetic draw will buy less or none.

An Insurance Anomaly

Imagine a world in which you could buy homeowner's insurance after you saw smoke coming from the basement. The first call would be 911; the second call would be to Allstate. (Or maybe the other way around.)

In the health insurance case, after your home DNA test generates bad news, the instructions on the box might say something like, "If you scored 81-90, now would be a good time to buy a generous health insurance policy with a low deductible." That would be great for patients, but not so good for health insurance companies. And once all the health insurance companies were bankrupt, it wouldn't be so good for patients, either.

The American health care system is a complete anomaly in the developed world. There's no other major industrialized country that depends so heavily on the private delivery of health care funded through a system of private health insurance.

Re-insuring Insurance

For better or for worse, that's the system we've got. Starting over from scratch is politically untenable, so if we're going to make the system we've got work better, we have to put the insurance back in insurance. We have to return to a system that really pools risk. The best way to do that is by mandating that everyone buy insurance -- those who are sick, those who aren't sick, those who'll get sick with expensive illnesses, and those who will die at home in their sleep after 95 healthy years.

This would accomplish two crucial objectives:

1. It would guarantee access to health insurance, and therefore reasonable health care, because everyone would have it from birth. There would be no preexisting conditions because there would be no "preexisting." Again, this is dependent on providing sufficient subsidies and insurance options for those who are too wealthy to be eligible for Medicaid but don't have an employer option and can't afford to buy private insurance.

2. It would bolster the financial health of the insurance system by including more "good risks" in the system, namely the healthy young people who are most likely to roll the dice and go without insurance.

Fair Is Fair

Is mandatory health insurance fair? In one sense, it's not: The healthy end up subsidizing the unhealthy. That's ultimately true with homeowners insurance, too, but buying into that arrangement is a voluntary decision. (And auto insurance, which is mandatory in many states, isn't a very good comparison, as that policy is designed primarily to protect against damage done to other drivers.)

But being diagnosed with a potentially terminal illness at age seven in a family with no way to pay for the treatment isn't really fair, either. Nor is paying 20 times as much for health insurance as someone else because you were born with a nasty strand of DNA on your 11th chromosome.

If you believe in pooling risk, which is the point of health insurance, then the only way to keep the system solvent in the long run is to get everyone in the pool. Mitt Romney realized that. So does Hillary Clinton. Once Obama has finally finished her off, he should borrow one of her better ideas.

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266 Comments

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  • David - Friday, October 10, 2008, 4:32AM ET  Report Abuse

    • Overall: 5/5

    Great Article. I see this problem first hand everyday because I sell insurance and financial products. I agree that the system needs to be fixed. Uninsured individuals have a terrible time trying to get insured. It's really not fair at all. I acutally hate presenting health insurance plans because I think they are all crooks. However, what I hate even more is how much we really need them. I also agree that making everyone participate spreads out the risk and makes insurance affordable for everyone. In fact, this is the only good idea that I have heard. I think it is worth trying. The current system has got to go.

  • Lou - Wednesday, August 20, 2008, 2:04AM ET  Report Abuse

    • Overall: 1/5

    So, let me get this straight, the good Dr. Wheelan thinks health insurance should be manditory like auto insurance? Yeah, that's it - more government intruding into our lives, that's just what we need. Unbelievable!

  • Yahoo! Finance User - Tuesday, August 5, 2008, 9:44AM ET  Report Abuse

    • Overall: 5/5

    This is a pretty concise article that does a good job of explaining the issues facing us with regard to health insurance. We need to come up with a solution beyond "status quo".

  • Andrew S - Saturday, June 28, 2008, 8:16AM ET  Report Abuse

    • Overall: 4/5

    A fairly well-reasoned article. What many people don't realize is that the reason health care is so expensive in the US is because Medicaid and Medicare pay for well over 50% of all health care expenses. These two programs pay providers (hospitals, MD's, nurses, etc) less than what it costs to provide these services. I.e., if a hospital stay for a Medicaid patient costs the hospital $30,000, Medicaid will pay the hospital $19,000. Who makes up the difference? We do! That extra $11,000 in cost is passed on to people who CAN pay it. Most insurance companies spend millions on keeping costs low while providing payment quality health care. As a healthcare analyst, this comprises a large part of my job. We're a non-profit health care insurance provider, and I can assure anyone who reads this that our motives aren't profit, but to stay in business, to keep the lights on and to keep cash in the kitty for claim checks. By the way, I've worked in the insurance industry for about a decade. I have an MBA in Finance and several insurance designations - nearly a decade of post secondary education. I work a forty to sixty hour workweek, and I love my job - fascinating research, , intelligent people, and great benefits for my family. This year, I'll earn an income of approximately $50,000. Our CEO (an attorney with 30 years of high-level experience in finance and health insurance) made less than 3 million, most of it performance-based. Comparing this with the salaries for CEO's of investment banks, Fortune 500 companies, or media/sports celebrities, I think we're getting an awfully fair deal. Most of our senior people would make a lot more money elsewhere, as would (possibly) me, but we wouldn't be doing something as meaningful.

  • Yahoo! Finance User - Friday, June 27, 2008, 12:38AM ET  Report Abuse

    • Overall: 2/5

    The only reason this article gets two stars is that it screams out for the thing it seeks to traipse so deftly around: universal health care. Where did we get the idea that public health is a "market?" Health is as much a public issue as law enforcement, defense, and firefighting. Especially with medicine being better able to predict disease we see the vast benefits of a public health system that emphasizes preventive care. We've tried the alternative. It's an abject failure. How do we feel about ten million children without access to health care?

  • Yahoo! Finance User - Sunday, June 22, 2008, 7:18PM ET  Report Abuse

    • Overall: 4/5

    My rating is based solely on the fact that this is an idea that can be tried and tested. I'm no expert on this subject. If this is a viable solution, how has Massachusetts fared? Has anyone done an analysis of this state vs. the next best covered state? Other ideas should also be tried and tested. I'm sure if in another state, the people made it mandatory for the government to "deregulate" medical insurance and completely remove state laws and take government out of the picture, we could compare that to Massachusetts. Then we can see what solution is the best one and use it. Most Americans are reasonable people and if the facts support one way or another (regardless of your political views), then that's what the people would do. So, for this important problem of health care access, we should probably do some more experiments and gather facts and even have some options. Then we can decide for ourselves even if it means that we don't need insurance companies or politicians for us to get health education and care when we want it and need it.

  • Joe S - Monday, June 16, 2008, 1:13PM ET  Report Abuse

    • Overall: 2/5

    Like all socialist planning, you'll end up chasing the adverse, unintended effects of your interventions one step behind. If you want the insurance back in insurance, you'll get the central planners out of the business entirely (politically untenable though it may seem).

  • Cubert - Friday, June 13, 2008, 2:34AM ET  Report Abuse

    • Overall: 1/5

    Dr. Wheelan, as usual, at his worst. He must have slept through economics beside George Bush at Yale.The truth is pretty simple. Insurance companies are in the business of maximizing profit - pure and simple. They are not altruistic nor very moral in their approach of the of our nations vast medical problems. They offer no solutions simply because there are legions of insurance underwriters, agents, administrators, not including the public officials in each hospital who purportedly work to help Joe Blue Collar in his quest for simple healthcare. We are at a point of some very major implosions. Shall it be all our money to bil Iraq, any kind of relief for the middle class, continued relief for corporate executives that make horrible decisions, bureaucrats that cannot face hard reality. All these and more (NAFTA, free trade theories borne out of Yale and Harvard and some misguided notions of Malteus' THEORIES" of free trade - over 200 years old and unproven) They all need to be approached very aggressively by our current and future politicians. If these forces are not met by many bold and fearless actions, I have a very grave view of America's future Cubert Wood

  • Yahoo! Finance User - Friday, June 6, 2008, 6:05PM ET  Report Abuse

    • Overall: 3/5

    The principle of pooling risk is sound, but you're making a huge assumption about healthcare prices. You assume that if everyone is forced to buy, prices will stay reasonable. But what force is stopping insurance companies from increasing rates as they do now? In fact, there's even more incentive to continue raising costs to consumers if they're forced to buy. I think the employer-sponsor system should collapse. Insurance prices keep increasing because employers are big enough to pay. If that system went away, health insurance companies would have to compete the same way that car insurance companies compete. They would have to convince individuals to buy with good plans and reasonable pricing.

  • busy - Friday, June 6, 2008, 3:21AM ET  Report Abuse

    • Overall: 5/5

    These tub a lubs and smokers are great citizens. They die sooner and put less strain on the economy. Old people are an economic liability. Economically I says, morally who knows. There is a reason the chinese gov't pushes tobacco.

  • Yahoo! Finance User - Tuesday, June 3, 2008, 12:02PM ET  Report Abuse

    • Overall: 1/5

    Rick Cain, do you have any idea how health care works in this country? Prices are NOT set by some "evil" cartel, they are set by the government, Medicare specifically in the amount that they will reimburse doctors and hospitals are procedures. Insurance companies follow those same payout limits. Educate yourself before you make such absurd comments. Health care is expense here due to so many unhealthy Americans who use a disproportionate amount of care - 5% of Americans are responsible for 49% of medical costs!

  • Kevin - Monday, June 2, 2008, 2:11AM ET  Report Abuse

    • Overall: 1/5

    Your comparisons to other kinds of insurance are lacking. In the case of home or auto insurance, people with lower risk pay less in premiums; safe drivers and responsible homeowners. It should be the same way in healthcare. Someone who expends effort into being healthy should not pay the same premium as someone who has diabetes and asthma because they have chosen not to exert any effort and have become grossly obese.

  • Yahoo! Finance User - Sunday, June 1, 2008, 9:06PM ET  Report Abuse

    • Overall: 5/5

    Why can't individuals join the same health care plan as our President and Congressman have? If that is socialism, why does President Bush, our Congressman and Veterans all choose to join?

  • Yahoo! Finance User - Saturday, May 31, 2008, 12:20AM ET  Report Abuse

    • Overall: 5/5

    Americans believe health care is good here because its expensive. How wrong they are! Health care is expensive because its run by a cartel of doctors and medical providers that conspire together to set their own "competitive" prices. Before we set a national health plan, we need to break the cartel.

  • Yahoo! Finance User - Friday, May 30, 2008, 4:40PM ET  Report Abuse

    • Overall: 2/5

    Charlie, using your logic, the US Government should make having a job mandatory. That's best for the economy and pools the risk that people won't have money to provide themselves with the basic needs.

  • sigmaseek.blogspot.com - Wednesday, May 28, 2008, 4:54PM ET  Report Abuse

    • Overall: 1/5

    Your logic is the same as that of bond traders saying that you can pool a bunch of crappy mortgages together and reduce the risk of the entire mortgage security. We're seeing how well that turned out. Government regulation and coercion is tyranny that reduces the efficiency of the free market to provide any good or service, including health insurance. Let the free market determine the best way to provide low cost health care (maybe charity hospitals, low cost clinics, or charity subsidized health care). Get the government out of the life of people and business and we will all be better off.

  • Michael - Tuesday, May 27, 2008, 10:45PM ET  Report Abuse

    • Overall: 2/5

    Not what I expected based on the title. I thought “Putting the Insurance Back in Insurance” meant raising deductibles and reducing coverage for minor medical expenses. “We insure our houses against loss from fire, not against the cost of having to cut the lawn. We insure our cars against liability to others or major damage, not against having to pay for gasoline. Yet in medicine, it has become common to rely on insurance to pay for regular medical examinations and often for prescriptions.” For more detail see Milton Friedman's paper at: http://www.hoover.org/publications/digest/3459466.html Professor Wheelan’s desire for mandatory coverage involves more 3rd party intervention, when less intervention is the key. Making coverage mandatory makes decisions surrounding health insurance and medical care mindless. People should be educated to make the right decisions, not removed from the health care and insurance equation with the idea that 3rd party payers are best equipped to make health care decisions. Further, the government doesn’t have any business making citizens obtain insurance. Every American who cares about their well-being, and has access to adequate information can make the decision to insure on his or her own. Health care and health insurance are not public goods (like national defense or public parks) that the government must provide. The reasons for mandatory coverage discussed in Professor Wheelan's article solve one problem, but risk the creation of others. The ideas are short cited and sound more like the ideas of a politician than an economist. Limits on consumer choice erode the economic freedom that helps make America an economic superpower. Improvements in the medical insurance and medicine will be stifled if consumer choice is limited further by making insurance coverage mandatory.

  • aircav - Tuesday, May 27, 2008, 3:45PM ET  Report Abuse

    • Overall: 1/5

    If the state of higher education is on display here by a PHD who hasn't got the brains God gave a Hammer then healthcare is the least of our worries! I'd say its time to move to a new undiscovered country, but that is to late, we no longer have the same options that our Founding Fathers had. But to stand and fight, What? Fools who hide behind PhDs? Legislators whose mantra of "its for the Children" is using children like any other terrorist who use human shields? The undereducated, left as derelicts by a failing school system which has been dumb-ing students down for over 50 years? By the looters of society that want everything handed to them? One day the productive may go on strike leaving all of them to their own devices....

  • Yahoo! Finance User - Tuesday, May 27, 2008, 11:48AM ET  Report Abuse

    • Overall: 1/5

    yes lets have a cuban style healthcare system...not!

  • Mark - Tuesday, May 27, 2008, 10:19AM ET  Report Abuse

    • Overall: 5/5

    Shared-risk beginning at an early age is as intuitive as you can get without being overly naive on the economics of healthcare and health insurance finance. This ideology could mitigate health-based moral hazard of the insured while preserving the scientific benefit of better understanding our DNA and related health hazards. The final solution will need to be compulsory for everyone, will require financial incentives/penalties for personal health habits, and would provide for core health-based coverage while eliminating the "free-rides" on cosmetic procedures (e.g. Botox, plastic surgery), lifestyle drugs (ED, etc.), experimental treatments (aggressive cancers, million $$$ drugs), and infertility treatments (above and beyond a basic procedure). The only downside here would be the reduction to the billions of $$$ in annual managed care profits. How about redirecting that savings to pay for the program over time?

  • Yahoo! Finance User - Tuesday, May 27, 2008, 1:20AM ET  Report Abuse

    • Overall: 1/5

    How do bad ideas creep into our lives? People with special interests get the government to mandate it. These socialist programs have been failing all over the world for decades. Of course, people with big government agendas tend to have a bad case of tunnel vision. Unfortunately, the health care system can't fix that problem.

  • Yahoo! Finance User - Tuesday, May 27, 2008, 12:23AM ET  Report Abuse

    • Overall: 2/5

    The question to ask is, "why can't people afford health insurance". Nothing is going to be solved until medical services drop in price. As long as routine test cost hundreds of dollars, health care (as well as health insurance) will continue to be unaffordable. Do due the skyrocketing cost, employers don't even want to pay the bill for insurance. If cost keep rising, it is only a matter of time before your employers don't give you health insurance. Health insurance can vanish just like pensions did. It is obvious to me that consumers are being gouged for essential procedures. Look at the cost of cosmetic procedures vs. essential procedures. They know you need it, so they can charge whatever they want.

  • Jayme - Monday, May 26, 2008, 8:47PM ET  Report Abuse

    • Overall: 3/5

    If we are going to share risk shouldn't we also share in the responsibility of staying healthy as a whole? I our commercials ar loaded with remedy for foods that are bad for us and are then are followed up with ED drugs, probably caused by bad dietary habits, are promoting negative behaviors from a health stand point? If we subsidize people's healthcare shouldn't there be a requirement that each must workout so many times a week and limit his/her calorie intake, as to not bring upon oneself undo harm? Also, if everyone is insured does that not lay the grounds for abuses of the health system? Will doctors continue to give people tests they probably don't need in the name of not wanting to get sued, but more likely because he needs to pay for that equipment required for the test. Also if people are not feeling the true cost of their medical expenditures, aren't they more likely to go to the doctor when its really not needed? I just don't see the benefit of this without forced behavioral changes. We could solve healthcare's problem overnight if we as a whole share the responsibility of being healthy as well as sharing the risk. Otherwise we are subsidizing McDonalds and other companies that produce things that cause the people harm, and then there is a further subsidy going to big pharma in terms of the profits they make by the systemic abuses as well as the remedies for our unhealthy habits like acid reflux, etc.. and a final subsidy is going the individual who has no self control because he figures he won't have to bare the brunt of his habits but rather the system will incur the costs. This is absurd in and of itself if we lived healthier we can easily afford to bare the cost of accidents and the true unfortunate, but if 60% of the population is overweight then we are straining our system unnecessarily . What we should be discussing is how our leaders are going to provide all these promises and benefits in our current and short-term future population distributions. If we have such a small ratio of workers to retirees then the whole economy will be healthcare based. So what we should be telling the people is pull yourselves together and get in shape, eat better, and make your own needs a reality don't wait for some lying politician to provide it for you. Until there are some restrictions on living habits I can't support universal healthcare without universal responsibilty.

  • RobertM - Monday, May 26, 2008, 2:34PM ET  Report Abuse

    • Overall: 1/5

    Ignores the basic issue, which is the cost of healthcare not the finance mechanism. Healthcare in the US is perhaps the most non-competetive major 'industry'. AMA controls number of doctors, which keeps supply-demand in favor of doctors. Hospital beds are also limited. Big Pharm to a large degree controls what drugs are prescribed and prevents reimportation. No one except insurance companies have an incentive to try to reduce costs. And lets face it, when you are in the hospital unconscious with tubes in every orifice, you are hardly in a position to negotiate rates. What we need is true competition and a dual-system where you pay for routine care through a HSA and have insurance only for catastrophic care. Then require doctors and drug retailers to post/advertise costs, so people can make economic decisions. I would like to be able to pick up the newspaper and see adds for "complete check-up with such as such blood work, $50 guaranteed no more than 15 minute wait". Mitt and Hillary care are just throwing more money down the rat hole without serious cost reduction.

  • Yahoo! Finance User - Monday, May 26, 2008, 2:15PM ET  Report Abuse

    • Overall: 3/5

    Let's not blast this guy because he doesn't have a perfect answer. This is a hugely complex problem because the model we have doesn't fit modern reality. Medicine has solved many of the easier but deadly problems like blood pressure regulation, so more of us are living longer and requiring treatment of more expensive illnesses near the end of life. The home insurance metaphor doesn't work too well because most people are able to avoid accidents, and want to. But if someone throws paint on your house, or drives a car into it (things beyond your control), your insurance will pay. Same with health insurance. But we shouldn't be funding the repair of "dripping faucets" or even predictable, regular maintenance of our bodies this was. About 40 years ago, HMOs were invented. The idea was to provide a fixed-cost health system that emphasized preventive care. Kinda like hiring a property manager for your house, who would to those furnace inspections and paint jobs most of us put off too long. The idea is great, but people got turned off when it became hard to get your "handyman" to give you a referral to the plumber, or the heating specialist, or it took six weeks to get an MRI. We need catastrophic care insurance -- that covers not just hospitalization, but expensive drugs and outpatient procedures like dialysis, chemo, radiation. We need access to preventive care and minor health issues for the poor and disabled, to keep them from developing greater, more expensive problems and to keep them out of emergency rooms, thus driving up costs. Most of us should fund our preventive maintenance and minor repairs ourselves through something like an HSA, and there should be an incentive to have one and keep it adequately funded. Health care providers (I am one) should be required to provide the same service at the same price to anyone. It's stupid to charge insurers $22 for blood tests, and try to soak the uninsured for ten times that. People will try to get around this by describing the care rendered differently, but the alternative is auditing every claim. More work to be done here. There needs to be a better way to fund medical education that doesn't leave a new doctor with crushing debt. Why do you think that so many doctors you meet come from overseas? Americans smart enough to be doctors are smart enough to see it isn't an economically rewarding career, and only the truly devoted will pursue it. Nothing in all of this will prevent the existence of a private, independently funded system that those blessed with good circumstances can purchase. The insurance coverage should go toward the cost of the "non-network" provider if it's paid for by the insured. You know, it's a huge problem. I've noticed that there aren't many little problems any more, but Congress likes to tackle stuff like flag-burning and such because no one has a good idea for stuff like health care, energy independence, or global defense, or because the interests already heavily invested in those areas pretty much buy them off. It's pretty much the same in private life ... I've noticed that when folks aren't sure what to do, most often we do nothing. We know that this country CAN DO THINGS when we collectively decide to do them. It's just a matter of will.

  • Yahoo! Finance User - Monday, May 26, 2008, 12:46PM ET  Report Abuse

    • Overall: 1/5

    after spending 32 years in the health insurance business, i can assure you this "plan" solves nothing. solutions are complex however, mandates never work. as for universal health care, it too is rapidly failing in canada, england, spain, etc, etc. the solution is complex and requires changes in current law (ie-emergency rooms should only treat immediate and life threatening issues for US citizens only and then should be allowed to sue for payment of the bills). this would prevent the insured from subsidizing the uninsured, half of whom have incomes over $50,000 per year and choose to be uninsured. there are a number of ways to bring personal responsibility back into health care and that is where you start to fix the problem.

  • timothy - Monday, May 26, 2008, 12:35PM ET  Report Abuse

    • Overall: 1/5

    Just another governement hand out to big insurance, wealthy doctors, and private health care corporations.

  • john - Monday, May 26, 2008, 7:49AM ET  Report Abuse

    • Overall: 1/5

    another condescending expert's opinion that we can solve all problems we've, largely, created over 75 yrs in 1 quik pen stroke.

  • Yahoo! Finance User - Saturday, May 24, 2008, 10:17PM ET  Report Abuse

    • Overall: 1/5

    The title was promising, but what a horrible solution. I rarely comment, but had to this time. Title -- Put the Insurance Back In Insurance. Real health care "insurance" would insure us against large losses, not pay our every bill. If all our insurance was like "health insurance" our auto insurers would buy our tires and our homeowners insureres would pay our plumbers. If health insurance were truly insurance, it would cost a lot less. Only in health care does the term "insurance" for routine bill paying not seem ridiculous. The real problems with health care: 1. Different patients pay different amounts for the same treatment by the same provider, the same drug, the same test, etc. Uninsured pay the most by a wide margin. How dumb is that. I hate mandates, but why shouldn't the same checkup cost the same whether I am insured or not? (I am insured by the way). 2. Government programs refuse to charge more to people who damage their own health. Smoke, drink too much, get fat (the root cause of type II diabetes and all its complications), etc. -- no problem. The rest of us who eat right, exercise, and don't smoke will subsidize your poor choices. This sounds like a good idea to the author, Clinton, and Obama, but not to me. Those who make bad choices need to pay more. 3. It is more profitable for drug companies and others to treat a disease than cure it. Cure the disease and people pay you once. Treat it and they pay you for the rest of their lives. This incentive is perverse. 4. Government mandated coverages help a few, but make insurance less affordable for everyone else. Let people buy the insurance they want without taking mandated coverages they will never use. 5. Uninsured, insured, medicare, etc. all have to coexist. Government tax breaks and programs distort the market for the rest. 6. Government payer programs cause research dollars to be spent unwisely. I have no doubt new government solutions will make my private health insurance cost more with no added benefit I will use. 300 million consumers are smarter than the government.

  • Yahoo! Finance User - Saturday, May 24, 2008, 9:47AM ET  Report Abuse

    • Overall: 1/5

    What the author of this story proposes would violate the separation of church and state. Not everyone believes modern medicine is the best way to stay healthy and live a long time. You can't force someone who doesn't believe in medicine to buy health insurance when the last time they went to the doctor was when they were born.

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