Is this good news ?

[Guest]

Wouldn't it work the same as a group plan? The healthy over pay and the unhealthy get covered?

And when you consider what you said about healthy people, why would they want to pay more?

I think you and several other posters to this thread are missing the BIG POINT, that IF everyone was made to carry insurance, then the pool of insureds would be a known risk. As it stands now WITHOUT mandated coverage for everyone, of course GI is punitive to carriers--- due to adverse selection. The healthy tend not to insure if it costs more than they think they can get away with by not having to pay a monthly premium. The sickly will use up every benefit to the max. Right now, about 80% of health care is consumed by only 5% of the population (don't quote me on this statistic, I can't remember exactly the percentages, but I think I am close)... but spread the risk over the whole population, and the Law of Large Numbers (which actuaries know and love) will bring down the cost per person per month (pppm).

 

[Crabcake Johnny]

If the gov't mandated that credit card companies extend credit to every citizen you'd see the interest rate for all cards around 25%.

How's the make people feel who pay their bills on time?

 

[Dave020]

I think you and several other posters to this thread are missing the BIG POINT, that IF everyone was made to carry insurance, then the pool of insureds would be a known risk. As it stands now WITHOUT mandated coverage for everyone, of course GI is punitive to carriers--- due to adverse selection. The healthy tend not to insure if it costs more than they think they can get away with by not having to pay a monthly premium. The sickly will use up every benefit to the max. Right now, about 80% of health care is consumed by only 5% of the population (don't quote me on this statistic, I can't remember exactly the percentages, but I think I am close)... but spread the risk over the whole population, and the Law of Large Numbers (which actuaries know and love) will bring down the cost per person per month (pppm).

Exactly. It is the mandate component that makes it work. Without the mandate of coverage, adverse selection creates chaos.

Auto is mandated. Everyone who drives is supposed to have it. Most do, a small portion do not. Those who do not face the penalty at the time of an accident. With health insurance, those who do not would face the penalty at the time they needed treatment (I think Mass has or tried to have tax penalty).

 

[moonlightandmargaritas]

With health insurance, those who do not would face the penalty at the time they needed treatment (I think Mass has or tried to have tax penalty).

Unless you collect the premiums through a payroll tax...

 

[Todd King]

...but spread the risk over the whole population, and the Law of Large Numbers (which actuaries know and love) will bring down the cost per person per month (pppm).

WAKE UP! You're having a bad dream!!

 

[somarco]

My decline rate runs about 32% on average,

Dang, Dave. Where are you prospecting? Under the bridges?

Nationally 16 - 17% of the population is uninsured . . . most by choice. About 5% of the population is uninsurable . . . but not without options.

36 states (believe that is the right count) have risk pools. About a dozen states or so have universal GI or mandated open enrollment.

If we have a problem, and I am not convinced we do, the issue is not underwriting. It is affordability.

Until someone comes up with a way to manage the cost of health CARE the cost of health INSURANCE will still be out of reach for some. No one, not here, not in other countries, have come up with a viable way to control the cost of health care.

Even the NHS has problems and are rationing care.

I got into the health insurance business right after Clinton did the GI in Kentucky. I wrote maybe 30 individuals that were moving out of KY into my state. On every one of them I reduced the premium by almost half. I look back and everyone was healthy or lied on the apps.

That was not a Clinton thing . . . it was a KY screw up. They mandated GI and then quickly repealed that law less than a year later.

Carriers pulled out of the state. Premiums rose to the point of absurdity. The KY legislatures had an epiphany and repealed the law.

Carriers seem to think that mandating coverage combined with GI will bring down rates.

Mandates don't work. If they did, why do I pay for uninsured motorist on my auto cover?

We all pay for uninsured health care patients. We pay higher taxes, we pay higher premiums, we pay higher prices for goods and services.

When we have mandated coverage and GI all you have done is rearrange the deck chairs.

about 80% of health care is consumed by only 5% of the population

More like the 20/80 rule.

80% of health care is consumed by 20% of the population. If you want a staggering statistic, look at the percent of health care that is consumed by people in the last 6 months of their life.

Estimates run as high as 50% of health care dollars are consumed by those in the last 6 months of life.

So if you want to really cut down on total health care expenditures, withdraw care from those who are terminal or have little likelihood of recovery.

Who wants to be the first to pull the plug?

 

[Dave020]

I think it's a combination of two things for me:

1 - I market mainly to HIPAA, so I tend to attract cases that are marginal for underwriting to begin with and,

2 - CA is a no rider, no restriction, no waiver, no exclusion state. It's all or nothing so we can only get rate ups on PPO, not any limitations on pre-ex.

The second one most certainly in a tight underwriting environment raises the number of declines.

 

[somarco]

CA is a no rider, no restriction, no waiver, no exclusion state. It's all or nothing

There's your problem.

Too much gov't intervention . . .

 

[retread]

WAKE UP! You're having a bad dream!!

You should know you are NEVER to wake a sleep-walker!
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If the gov't mandated that credit card companies extend credit to every citizen you'd see the interest rate for all cards around 25%.

How's the make people feel who pay their bills on time?

I paid my bills on time and still got a hike to over 30% when my promotional period expired! "Credit worthiness" is a scam!

This analogy breaks down from the get-go.
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Wouldn't it work the same as a group plan? The healthy over pay and the unhealthy get covered?

And when you consider what you said about healthy people, why would they want to pay more?

Rob, you should know that small groups are subject to adverse selection more than large groups, and that's why their premiums are higher. Also why some small groups get declined. The larger the group, the more money the insurance company makes and the less exposure to adverse selection. The employees that use their benefits to the max are what drive up the premiums. That's why I thought HSAs would be the answer to halt this rise. The problem is that with the economy going down the toilet, very few people will now choose to pay large deductibles. More will be out of work and face COBRA, state risk pools, or go self-insured.

I'm not for increased unfunded liabilities... I think the country is in debt too deep as it is, but I don't see how we can let people suffer from lack of proper health care. Doctors don't make that much anymore, and many of them are leaving medical practice. I do note that hospitals are building every where I turn.....

 

[wildcat]

Did you guys see what Tom Daschle wants with Healthcare:
Health Blog : Tom Daschle's Blueprint for Health Reform