I'm not going to try to make a complete case for that in an SI post.
OK.
There is profit at every level...
Taking the profit out of the system, in general, would reduce costs. It's an approach. My comment was not to disagree with removing profit as a general approach. My point was that it's not the salient factor in the particular problem you mentioned, which was the generation of costly procedure assembly lines so the solution to that problem is not inevitably and exclusively to get rid of profit as you suggested.
People (not you, I don't think) have suggested that allowing insurance companies to compete across state lines would reduce costs. I, for one, don't see how. Currently, the different states all have different regulations that govern what kinds of plans can be offered, etc. How are those differences going to be resolved if plans are offered across state lines? Too, there are only so many different insurance companies, so I don't really see that there will be that much more competition.
Actually, I have suggested that option although not here. The object is not to sell insurance across state lines. That's just a means to an end. The object is to allow people to buy insurance without being encumbered by their own state's regulations, specifically in the Cadillac regulation states.
There are some states like New York that require insurance sold there to include a panoply of benefits, everything under the sun. The result is that insurance there is dramatically more expensive than insurance sold in states without those requirements. If folks could buy insurance that had only what they wanted, it would be more affordable. And young invincibles could buy catastropic insurance, which is quite cheap.
I understand why some states take the Cadillac route. It spreads the cost of some of the more obscure benefits needed/wanted by only a few over a large population, things like orthotics, chiropractic, artificial insemination, varicose veins, acupuncture etc. And is also attentive to lobbies for providers of those obscure benefits. But it makes insurance too costly for many and annoys the folks who would like to be able to buy something more affordable. So the idea is to cut costs by giving residents of those states a chance to buy policies that aren't bloated, to get around their states' "excessive" requirements. It springs from an entirely different philosophy, reducing costs through the marketplace. It is assumed that national insurance policies would produce an active market with lots of competitors. If the object is to get costs down, I think it has merit as part of the solution.
[The legislation currently on the table takes the Cadillac approach although probably to a lesser extent, at least for now. Only policies that have all the required stuff can be sold. Determining what will be included in the package will be political, of course, and one size fits all, and quite likely very distorted with reflexology in and mammograms for seventy somethings out as the conflicting padding vs cost cutting forces butt heads.] |
