Wednesday, October 13, 2010

The End of Private Health Insurance?

Tom Coburn thinks so and it gives him nightmares:

Sen. Tom Coburn intensified his attack on federal health-care reform Tuesday, telling a local Republican group that the measure signed into law earlier this year will soon force private health insurance companies out of business

"There will be no private health insurance in three or four years," Coburn told the Republican Women's Club of Tulsa County. "And that's by design. You're going to make insurance unaffordable for everyone - which is what they want. Because if there's no private insurance left, what's left? Government-centered, government-run, single-payer health care."

The 2,000-page bill's stated purpose is to cover most Americans without health insurance through a combination of expanded Medicare and government-subsidized private insurance, similar to what the state of Oklahoma does now on a limited basis.

Insurers, however, have blamed recent premium increases on new requirements that they cover pre-existing conditions and the children of policyholders up to age 26.

First, health care premia have been increasing steadily for decades, without any help from a frightening plot of government takeover. Indeed, it is partly those continuous increases which gave rise to attempts to reform the system. Because so many people couldn't afford to buy any health insurance whatsoever.

Second, a private health insurance market which cannot cope with people who have pre-existing conditions isn't of much use, especially when a pre-existing condition can be defined as almost anything. If the market is so weak and fragile that it cannot cover anyone but perfectly healthy people, well, then it has bigger problems than some looming government takeover.
Via Wonk Room.