The hucksters of health care "reform"

The Health Insurance/Auto Insurance False Analogy

As of July 2009,
one of the argments for a government mandate that
all Americans be required to have health care insurance
is to claim that:

Such a mandate is merely analogous to
the requirement that
automobile drivers must have auto insurance
before they can drive an automobile.

For example,
Ceci Connally writes in a front page story in the 2009-07-22 Washington Post

Just as drivers must purchase auto insurance,
the medical system of the future would put
responsibility for health coverage first and foremost on every adult.

First problem with Ms. Connolly’s writing here, and throughout the article:
What she glibly and imprecisely calls “auto insurance”
is really automobile liability insurance (cf.).
Note that
nowhere in Ms. Connolly’s 1200 word article
does the word “liability” even appear!

After noting that fact, we see that
this analogy is only correct in that
both are examples of
the government mandating insurance on a class of citizens.
What the “analogy” fails to note is the crucial fact:

The reason why
automobile liability insurance
is required in order to drive a car.

That reason is quite simple:
Anyone driving an automobile may cause great damage to
the life and property of other people.

Take this all too conceivable example:
Suppose a person with essentially no net worth
gets into his or her jalopy, roars off down the road,
and rams into a vehicle carrying a family:
a father, mother, and three pre-school children.
As a result of this tragic event, both parents die.
The three children are left orphans,
deprived of the future earning-power of their now deceased parents
which would otherwise have paid for their future needs.
Who is going to pay for those future needs?
it should be the person who is directly responsible for making them orphans,
the driver of the vehicle which caused the accident.
But again, he may quite simply
not have the income or wealth to provide for their needs.

Precisely to account for this type of situation,
the government mandates that drivers carry liability insurance.
The driver who caused the accident would be found liable,
and his liability policy would pay the victims,
up to the lesser of their needs and its limits.

So, to repeat, the requirement to carry liability insurance is
to protect others from harm that the policy holder may cause.

Now, where is the analogy with health insurance?
Health insurance only covers the policy holders own personal needs,
or that of his family.
In general, if his health fails,
that only causes harm to himself and his dependents,
not to arbitrary people in the general public.

So where is the analogy?
There is none, except for the fact that they are both government mandates.
But that analogy is applicable to any government mandate,
and so can be used to argue for any new government mandate.
With that in view, the analogy becomes so broad as to be obviously specious.
(Obvious except to those terminally mentally ill people who keep arguing for ever-increasing government spending on social programs.)

Like Car Insurance, Health Coverage May Be Mandated
A Proposed Requirement That All Americans Have Policies
Has Broad Support Among Reformers

By Ceci Connolly
Washington Post, 2009-07-22

[Nowhere in this 1200 word, 31 paragraph article
does Ceci Connolly mention the crucial difference between
the existing mandate for automobile liability insurance and
the proposed mandate for health insurance:
That automobile liability insurance
protects other people from the damage the policy holder may cause to them,
while health insurance only protects the interests of the policy holder.

This is a crucial distinction,
and it really has to be considered journalistic malpractice that
neither Ceci nor her editors bothered to point it out.
But that really is not surprising:
Much of the media is obviously only interested in serving as cheerleaders
for ever-rising spending on “health care.”]

President Obama’s dream of dramatically remaking the nation’s health-care system is still a long way from reality. But if lawmakers can reach an accord, one thing is virtually certain: For the first time ever, every American would be required to carry health insurance.

The requirement, known as an individual mandate, is among the most far-reaching changes envisioned this year by those pushing for health-care reform. And it is one of the few common threads running through all three bills being considered in Congress, greatly increasing the likelihood it will survive the legislative process. Obama continued Tuesday to push lawmakers struggling with the large costs and scope of health legislation to move forward, pronouncing reform to be “closer than ever.”


Just as drivers must purchase auto insurance,
the medical system of the future
would put responsibility for health coverage
first and foremost on every adult.

[For why that “Just as” represents an invalid analogy, see the discussion above.]

For the vast majority of Americans who have health insurance, the change would mean little more than submitting a form with their tax returns proving that the plan they carry meets certain minimum standards. Many of the nation’s 47 million uninsured people, however, would be required to purchase a health policy or face financial penalties, though waivers or discounts would be provided for lower-income Americans.

The concept is modeled after a requirement instituted in Massachusetts three years ago as part of that state’s broad health-care overhaul. And like the Massachusetts law, the individual mandate proposed by congressional Democrats would be paired with a much more controversial new requirement that nearly every employer contribute to the total cost of care.

“Without an individual mandate, you’re never going to get to universal coverage,” said Bradley Herring, a health economist at Johns Hopkins University.

Bringing everyone into the insurance pool -- particularly young, healthy customers -- spreads the risk and lowers overall costs. “That will make it more affordable for everyone,” Herring said.

Some proponents of a European-style, nationalized single-payer approach say an individual mandate places an unfair financial burden on lower-income consumers. Some conservative analysts argue that such a requirement forces individuals into an overpriced, underperforming health system.

Yet in a nation that prides itself on having freedom of choice, it is striking that such a wide and diverse coalition has formed around the individual mandate. Labor unions, economists, the medical industry, big business, some prominent Republicans and Obama all support the requirement, which has its roots in the conservative philosophy of self-reliance.

In the debate over Massachusetts’s measure, then-Gov. Mitt Romney, a Republican with presidential aspirations, touted the approach as a “personal responsibility system.”

Hospitals, insurers and drug manufacturers -- salivating at the prospect of up to 50 million newly insured customers -- have lobbied ferociously for the federal provision.

Obama, after sparring last year with his Democratic presidential primary opponents over the concept, is a convert, as long as there are “hardship exemptions” for those least able to pay.

“I was opposed to this idea because my general attitude was, the reason people don’t have health insurance is not because they don’t want it, but because they can’t afford it. And if you make it affordable, then they will come,” he said in a recent interview with CBS. “I’ve been persuaded that there are enough young, uninsured people who are cheap to cover, but are opting out. To make sure that those folks are part of the overall pool is the best way to make sure that all of our premiums go down.”

Nearly one-third of the uninsured in the United States in 2007 were between the ages of 19 and 29, and 42 percent were between 30 and 54, according to the Kaiser Family Foundation. A fair number of young, healthy workers choose not to purchase insurance, believing they do not need it.

Advocates of universal coverage want to lure that group into the insurance pool because they tend to use fewer medical services and help keep premiums down. If only the sick buy coverage, premiums will be high. And visits to emergency rooms by uninsured patients increase premiums for the insured -- by $1,000 per person per year, according to some estimates.

The Massachusetts experience with an individual mandate has provided a model, as well as some unexpected results.

“Massachusetts changed everything in the policy community and the political arena,” said Karen Ignagni, president of the industry group America’s Health Insurance Plans.

The penalty for Massachusetts residents who do not carry health insurance was $220 in late 2007 and rose to about $1,020 this year. Still, relatively few residents have balked at the idea -- and an additional 432,000 people have signed up for health coverage.

Today, less than 3 percent of Bay State residents lack health insurance, compared with about 16 percent nationwide.

Out of the 3.9 million people who filed taxes in Massachusetts in 2008, 86,000 paid the penalty, and 71,000 were exempted because they did not meet the minimum income levels.

One of the great surprises is how many more people -- an additional 148,000 -- have enrolled in plans offered through the workplace, most likely nudged by the individual mandate.

“It’s worked out better than I would have guessed,” said MIT economist Jonathan Gruber, who serves on the board of the Massachusetts program. “We didn’t anticipate the increase in employer-sponsored insurance.”

Last year, the average price nationwide for health insurance purchased through an employer was $12,680 for a family plan and $4,700 for an individual, according to the Kaiser Family Foundation.

In Congress, lawmakers are weighing slightly different proposals. A bill being debated in the House this week would charge individuals a penalty of 2.5 percent of income above $9,000, up to the price of the average premium sold nationwide. The fines would begin in 2013.

A bill passed by the Senate Health, Education, Labor and Pensions Committee last week would set the penalty at $750 per person. Individuals earning less than 150 percent of the poverty level, or about $16,245, would be exempt.

Negotiations are continuing in the Senate Finance Committee, where Chairman Max Baucus (D-Mont.) has argued for months that an individual mandate is central to achieving Obama’s goal of near-universal coverage and cost controls.

Stuart Butler, a vice president at the conservative Heritage Foundation, agrees that bringing everyone -- especially young, healthy patients -- into the risk pool would be advantageous.

But he advocates beginning with a voluntary “opt out” approach similar to automatic enrollment programs for retirement accounts. If policies are reasonably priced, he expects that few will turn down the coverage.

The challenge, said Butler and experts in Massachusetts, is designing a basic benefits package that is affordable. Writing a law that requires individuals to purchase something they cannot afford is “inhumane,” Herring said.

When Massachusetts approved its individual mandate, proponents of the new law braced for a modern-day Tea Party. It never materialized.

“I don’t see people revolting over having to have a driver’s license or insurance to drive a car,” Gruber said. “And we haven’t seen it with the mandate.”


Next Big Issue? Social Security Pops Up Again
New York Times, 2010-03-23


Now that landmark legislation overhauling the health insurance system
is about to become law,
addressing Social Security’s solvency
could well become the next big thing
for President Obama and Congressional Democrats.

Central to the health care changes are
hundreds of billions of dollars in reductions in Medicare spending over time
and expansions of Medicaid.

As some administration officials acknowledge,

that effectively
takes those fast-growing entitlement programs off the table
for deficit reduction

just as Mr. Obama’s bipartisan commission to reduce the mounting national debt
gets to work.


[Note that the New York Times is front-paging, above the fold, that crucial fact
only after the bill was passed.
That is how the liberal media, notably the Times and Washington Post,
manipulated the news to ensure that this giant expansion of health care
would come into law:
They either withheld or down-played
the costs and drawbacks the bill would impose upon the nation,
while they highlighted
all the supposed benefits it would give the average American.

It’s exactly the same game they played in manipulating America into the Iraq War:
play-up and highlight all the supposed benefits of invading Iraq
(find and eliminate all those weapons of mass destruction!)
while ignoring or shoving to the margins the costs of invading Iraq.]

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