POLICY/HEALTH PLANS: The individual market is screwed

Whenever you hear some “free-marketeer” complaining that people with incomes over $50K don’t buy health insurance and so uninsurance is voluntary, think about this woman, featured in the NY Times, who would love to buy health insurance but has cancer and so cannot—unless she comes up with $27,000 a year out of her $60K income.

The individual market is corrupt and evil, and inherently unfair. And the organizations that make their living there (hello HealthMarkets, Assurant, Golden Rule et al) are the kinds that you find on the bottom of your shoe. (I’m awaiting Jon Cohn’s book coming out next month to tell you more…).

It is of course not strictly speaking the insurers’ fault. They live in a world where they’re selected against by both sick people and the competition—so it is a collective race to the bottom. Just to remind you for the one millionth time, individual choices of health benefit plans can only be effective and fair within a universal single pool system that needs its rules and boundaries set very carefully, and has risk adjustment built in the back end. And don’t let the libertarians tell you that if you take away all the rules and regs natural pooling will sort it out, unless they’re prepared to move to N.Carolina, get cancer and see how they get on.

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