Health Care Insurance Can’t Work – The Government Pays In The End


When You Can’t Pay Premiums, You Lose Your Insurance Independent of Past Payments

The debate about health care reform assumed that insurance will be the foundation of any new system. Obamacare provides a subsidy for poor and middle-income people paid by taxpayer dollars. Clearly, the government is always the ultimate payer that pays for health care when you lose insurance through your employer or lack the funds to pay the entire premium.

The contractual nature of insurance policies makes them totally unsuitable for health care. Insurance is purchased for fixed terms (usually a year) for a fixed price, and coverage is provided only during the specified term. In addition, an insurance company is not required to renew a policy and may generally refuse renewal (not cancel) for any reason or no reason. That is not generally problem even when insurance is mandatory, since bad drivers should not drive and careless doctors should not practice medicine. But it is an insurmountable problem for health care insurance, whether mandatory or not. (Driving and medical practice are privileges that are licensed by state governments, but living and breathing in the United States are rights possessed by all citizens.)

Health care, unlike driving, is really a necessity; it cannot be avoided when you’re sick or injured. You may choose or be forced to purchase insurance for health care, but your coverage ends when you stop paying premiums. There is no credit for years and years and thousands of dollars of payments, even if your claims have been negligible. For example, a relatively healthy middle-aged person pays $4,000 a year for twenty years — $80,000 – and has only $3,000 worth of claims (after deductibles and co-payments) during that period. He then becomes very sick at the age of 55, cannot work, loses any insurance he may have had from his employer, and cannot afford to pay premiums for more than a few months. The insurance company then stops paying his bills; he gets no credit whatsoever for the $77,000 clear profit the company has made, nor for the interest the company has earned on that money. But he is not allowed to die. Taxpayers now pay for his care under Obamacare or Medicaid, and we pay heavily, since his care has become very expensive. In the end, the private insurance company keeps its profits while the government pays for the expensive care and protects the insurance company from losses. Therefore, insurance for health care cannot work in the long run and must be minimized in any type of reform.  Obamacare must be amended accordingly or it will banckrupt America!

Of course, the sick man in this example may qualify for Medicaid and eventually for Medicare, but both programs are very expensive forms of taxpayer-funded insurance and should not be expanded without a compelling reason.


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