A Gift To Insurance Companies

To the Editor:

Some thoughts in response to Brett Callentine's typically intelligent and forceful argument about what he regards as the un-constitutionality of the so-called "insurance mandate" in the health reform law requiring everyone to buy health insurance....

Arguably what congress is seeking to regulate is not the “inactivity” of not buying insurance, but the activity of using healthcare services without a means to pay for them.  This is not remotely an isolated or incidental or chance occurrence. The provision of uncompensated medical care to uninsured individuals is a daily occurrence in the United States, an enormous burden to hospitals and local economies, and a signal feature of the dysfunction of the health system generally. The American Hospital Association reported  in 2009 that U.S. community hospitals incurred $39.1 billion in uncompensated care costs—costs that are invariably passed on to the rest of us. Public “safety net” hospitals, like MetroHealth Hospital, absorb millions of dollars of uncompensated care which are built into their operating expenses, typically with some degree of taxpayer subsidy. In 2010 Metro posted some $257 million in uncompensated care, fractionally offset by a $40 million subsidy from the County.

A healthcare system can no more sustain itself with millions of uninsured people using uncompensated medical care than can a housing market when people sign onto mortgages they can't afford. And this is a real problem because healthcare--unlike owning a house--is not optional and health is not a commodity; it is (I believe) a public and social good and an attribute of human happiness, and a healthy population is conducive to the national welfare and essential to a vibrant economy.

Financing and rationing a public good through a for-profit market like the private insurance industry is, in my opinion, a very bad idea. But it's the way we have been doing it with mounting and predictable problems for more than half a century. And in the debates leading up to the passage of the new law, even so little as an option for a public program that would exist alongside the private insurance market was rejected.

So now we have a reform law which is, as Dennis Kucinich rightly described it, an enormous gift to the private insurance industry. The insurance reforms in the health care law--especially "guaranteed issue," which ensures that anyone who signs up and agrees to pay the premium will not be denied coverage simply because he or she is a "bad risk"--are dependent on having enough people in the insurance pool to spread the risk around. Without the mandate that everyone sign up, only the sick would enroll, costs would skyrocket, and the market would experience a "death spiral." If your heart's fondest desire is to see the private insurance industry flourish so as to ward off "government controlled healthcare" (or whatever) then the insurance mandate ought to be your ally.

Mr. Callentine needn't be pessimistic that the Supreme Court, which is going to hear this question, will decide in a way that will please him; at least two district courts that have heard the case have done so. If the mandate is struck down, those insurance reforms that many people regard as desirable will be undone and we will be back to starting from scratch. And  then the problems of diminishing access and increasing cost will continue to be his, and ours, to live with.

Mark Moran

I live in Lakewood.

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Volume 7, Issue 15, Posted 7:38 AM, 07.27.2011