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Politics : View from the Center and Left
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To: Suma who wrote (236359)11/1/2013 10:21:24 AM
From: neolib  Read Replies (2) of 542085
 
The claim that high deductible policies are "bad" is just another example of how clueless Obama is (and many Dems as well) about the fundamental concept of insurance. Insurance provides two fundamental benefits:

1) Risk averaging of statistically unlikely events across a large number of individuals.
2) An accounting function of converting infrequent lump sum payments into budgeted monthly payments.

Those are the only benefits of insurance. Unfortunately the process has some huge negatives as well:

1) It introduces significant overhead (the billing process is complex) and profits get sucked out as well.
2) The indirection injected into the loop is disastrous for controlling costs.

What Obama is calling a "bad" policy is in fact the best sort of policy, because it uses insurance for what insurance is meant to be, and it curtails its use for the disastrous aspects of insurance. The fact that he is so clueless does not bode well for how this ends. His approach is not just going to screw up the start of things (which he appears not to have anticipated) but it will perpetuate spiraling healthcare costs in the future.

What I find amusing is that people on both the left and right think this will result in a single-payer system. The Dems have zero chance now of effecting any additional radical changes. They blew the one chance they had. The albatross is now hung on their necks and 2014 and 2016 will make that clear to those who can't figure this out. Too bad for a lot of issues that need addressing, but that is what stupidity does...

Who’s more at fault here, Obama for being played like a card, or insurers for selling bad policies in the first place?
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