Insurance and Health Care

Tim: uncertainty and risk are two different things, and your response conflates them. Let’s leave that aside for now, as perhaps the original poster really meant risk, rather than uncertainty.

But suppose that tests did exist that could establish the risk for any given individual with a very high confidence level. If you take that a step further, you realize that your analogy with men under 30 for automobile insurance breaks down very quickly because private insurance for many who would have very expensive conditions would be, for all practical purposes, unobtainable at any rate a non-millionaire could afford. Therefore, the social utility of health insurance in spreading out health care expenses among many members of society, in that scenario, has broken down.

It is just one more point that shows that as technology moves forward, the case for a single payer health care system will be easier to make. Of course, there are many other reasons, such as the inefficiency of the present system, that make this case also, without having to resort to any what-if scenarios.

EF, did you even read my post. This part directly addresses the point you made:

if you’re inclined to have the state do something about this, it doesn’t by any means follow that the state needs to run the entire insurance/payment system. Rather, the state can take a variety of actions targeted at the losers of the genetic lottery while leaving the market free to work for the majority of individuals with average or below-average risks. This can take several forms. One would be premium subsidies at the front end: say, the state picks up a percentage of the premium for people with above-average premiums. Another would be to directly subsidize treatments for the most expensive-to-treat diseases, which would have the effect of reducing premiums for people with those diseases.

A single-payer health care system is one way to deal with folks who are unable to obtain health insurance due to a bad genetic test. But it’s not necessarily the best way, and it’s certainly not the only way.

Tim: uncertainty and risk are two different things, and your response conflates them. Let’s leave that aside for now, as perhaps the original poster really meant risk, rather than uncertainty.

But suppose that tests did exist that could establish the risk for any given individual with a very high confidence level. If you take that a step further, you realize that your analogy with men under 30 for automobile insurance breaks down very quickly because private insurance for many who would have very expensive conditions would be, for all practical purposes, unobtainable at any rate a non-millionaire could afford. Therefore, the social utility of health insurance in spreading out health care expenses among many members of society, in that scenario, has broken down.

It is just one more point that shows that as technology moves forward, the case for a single payer health care system will be easier to make. Of course, there are many other reasons, such as the inefficiency of the present system, that make this case also, without having to resort to any what-if scenarios.

EF, did you even read my post. This part directly addresses the point you made:

if you’re inclined to have the state do something about this, it doesn’t by any means follow that the state needs to run the entire insurance/payment system. Rather, the state can take a variety of actions targeted at the losers of the genetic lottery while leaving the market free to work for the majority of individuals with average or below-average risks. This can take several forms. One would be premium subsidies at the front end: say, the state picks up a percentage of the premium for people with above-average premiums. Another would be to directly subsidize treatments for the most expensive-to-treat diseases, which would have the effect of reducing premiums for people with those diseases.

A single-payer health care system is one way to deal with folks who are unable to obtain health insurance due to a bad genetic test. But it’s not necessarily the best way, and it’s certainly not the only way.

Tim:

Perhaps I scanned some parts a little too quickly; the analogy about automobile insurance still doesn’t work for medical insurance though, and it is certain that if this were the only reason for a single payer system, it wouldn’t be enough to justify it. But there are plenty of other reasons.

Your other solutions, which you cite above seem rather complex, and are in reality state interventions intended to maintain a market in insurance. Those interventions which you propose do not have the benefit of the much more simple solution, which is to make discrimination on the basis of genetic testing illegal. That is a widely popular measure, and the ones your proposing will be a much tougher sell.

Note the wide margins that this bill passed by:

WASHINGTON (AP) — People learning through genetic testing that they might be susceptible to devastating diseases wouldn’t also have to worry about losing their jobs or their health insurance under anti-discrimination legislation the Senate passed Thursday. The 95-0 Senate vote sends the Genetic Information Nondiscrimination Act back to the House, which could approve it early next week. President Bush supports the legislation. The bill, described by Sen. Edward Kennedy as ”the first major new civil rights bill of the new century,” would bar health insurance companies from using genetic information to set premiums or determine enrollment eligibility. Similarly, employers could not use genetic information in hiring, firing or promotion decisions.

The moral connectivity of those who proposed this solution is obviously quite high, and I can’t see how any of the solutions which you propose could ever establish the connectivity to become reality.

Of course, this popular solution will make the market for health care insurance much more dis functional.

The market is not a universal tool to solve all problems, just a very powerful tool that can solve most problems.

Tim:

Perhaps I scanned some parts a little too quickly; the analogy about automobile insurance still doesn’t work for medical insurance though, and it is certain that if this were the only reason for a single payer system, it wouldn’t be enough to justify it. But there are plenty of other reasons.

Your other solutions, which you cite above seem rather complex, and are in reality state interventions intended to maintain a market in insurance. Those interventions which you propose do not have the benefit of the much more simple solution, which is to make discrimination on the basis of genetic testing illegal. That is a widely popular measure, and the ones your proposing will be a much tougher sell.

Note the wide margins that this bill passed by:

WASHINGTON (AP) — People learning through genetic testing that they might be susceptible to devastating diseases wouldn’t also have to worry about losing their jobs or their health insurance under anti-discrimination legislation the Senate passed Thursday.

The 95-0 Senate vote sends the Genetic Information Nondiscrimination Act back to the House, which could approve it early next week. President Bush supports the legislation.

The bill, described by Sen. Edward Kennedy as ”the first major new civil rights bill of the new century,” would bar health insurance companies from using genetic information to set premiums or determine enrollment eligibility. Similarly, employers could not use genetic information in hiring, firing or promotion decisions.

The moral connectivity of those who proposed this solution is obviously quite high, and I can’t see how any of the solutions which you propose could ever establish the connectivity to become reality.

Of course, this popular solution will make the market for health care insurance much more dis functional.

The market is not a universal tool to solve all problems, just a very powerful tool that can solve most problems.

It’s just being irresponsible. Take a look at your company policy, see what the holes are, and get a supplemental to take care of the rest. Jesus, it’s like people can’t even take care of themselves anymore. I interned with an insurance company, and all the time you’d have people who didn’t get adequate policies, or didn’t get policies call up in a fit of hysteria trying to take care of something after it’s too late. Take some preventative action and some personal responsibility. If you have to cut out a latte a month or cancel your cable, then do it. Take care of the necessities first.

It’s just being irresponsible. Take a look at your company policy, see what the holes are, and get a supplemental to take care of the rest. Jesus, it’s like people can’t even take care of themselves anymore. I interned with an insurance company, and all the time you’d have people who didn’t get adequate policies, or didn’t get policies call up in a fit of hysteria trying to take care of something after it’s too late. Take some preventative action and some personal responsibility. If you have to cut out a latte a month or cancel your cable, then do it. Take care of the necessities first.

Tim:

As a society, we believe that discrimination based on intrinsic factors beyond our control is wrong. Certainly, you could devise solutions for housing discrimination that leave “the market free to work for the majority of individuals with average or below-average risks.” For instance, the government could guarantee the property values in white neighborhoods to insure against the risk that minorities would trigger declines in home prices. We opt instead for a blanket anti-discrimination policy because we believe that racial discrimination is wrong.

As a molecular biologist, I see no difference between genes and race. I have also seen no evidence that GINA will (to quote enigma) “make the market for health care insurance much more disfunctional.” No health insurance company currently uses genetic information to assign risk. GINA will simply preserve this status quo in the future. There is simply no evidence to suggest that people’s decision to purchase health insurance is based on perceived genetic risk. Most of us already have access to excellent indicators of future health problems: our family history. You can learn a great deal about your chances of developing heart disease, diabetes or cancer by just looking at your relatives. Most states already forbid using family history in underwriting decisions, and the industry has not collapsed.

Most people miss an important point in this debate. GINA will save health insurance companies money. Without GINA, many people will avoid genetic testing due to the threat of discrimination. Once this threat is eliminated, patients will feel more comfortable with the technology, and they will learn a great deal about potential future health risks. Armed with this information, patients and their doctors can discuss changes in behavior which will help mitigate these risks. Because preventative care is infinitely less expensive than disease treatment, the insurers will save a bundle.

Tim:

As a society, we believe that discrimination based on intrinsic factors beyond our control is wrong. Certainly, you could devise solutions for housing discrimination that leave “the market free to work for the majority of individuals with average or below-average risks.” For instance, the government could guarantee the property values in white neighborhoods to insure against the risk that minorities would trigger declines in home prices. We opt instead for a blanket anti-discrimination policy because we believe that racial discrimination is wrong.

As a molecular biologist, I see no difference between genes and race. I have also seen no evidence that GINA will (to quote enigma) “make the market for health care insurance much more disfunctional.” No health insurance company currently uses genetic information to assign risk. GINA will simply preserve this status quo in the future. There is simply no evidence to suggest that people’s decision to purchase health insurance is based on perceived genetic risk. Most of us already have access to excellent indicators of future health problems: our family history. You can learn a great deal about your chances of developing heart disease, diabetes or cancer by just looking at your relatives. Most states already forbid using family history in underwriting decisions, and the industry has not collapsed.

Most people miss an important point in this debate. GINA will save health insurance companies money. Without GINA, many people will avoid genetic testing due to the threat of discrimination. Once this threat is eliminated, patients will feel more comfortable with the technology, and they will learn a great deal about potential future health risks. Armed with this information, patients and their doctors can discuss changes in behavior which will help mitigate these risks. Because preventative care is infinitely less expensive than disease treatment, the insurers will save a bundle.

As a molecular biologist, I see no difference between genes and race. I have also seen no evidence that GINA will (to quote enigma) “make the market for health care insurance much more disfunctional.”

I should have explained myself better; I was taking as a given the conjecture:

“But suppose that tests did exist that could establish the risk for any given individual with a very high confidence level.”

I recall for example a Robert Heinlein short story in which a scientist built a machine that could predict exactly when an individual would die. IF such a machine were to be built I think it is (fairly) obvious that the market for life insurance would change dramatically.

Perhaps it is very unlikely that a genetic test would reach such a high confidence level; that probably is the case, knowing the many overstatements of the promise of genetic engineering that have been made (mainly by those who haven’t much technical background in this area) but my subsequent statements were based on that assumption; it was not my intention to delve into the accuracy of that assumption at this time.

As a molecular biologist, I see no difference between genes and race. I have also seen no evidence that GINA will (to quote enigma) “make the market for health care insurance much more disfunctional.”

I should have explained myself better; I was taking as a given the conjecture:

“But suppose that tests did exist that could establish the risk for any given individual with a very high confidence level.”

I recall for example a Robert Heinlein short story in which a scientist built a machine that could predict exactly when an individual would die. IF such a machine were to be built I think it is (fairly) obvious that the market for life insurance would change dramatically.

Perhaps it is very unlikely that a genetic test would reach such a high confidence level; that probably is the case, knowing the many overstatements of the promise of genetic engineering that have been made (mainly by those who haven’t much technical background in this area) but my subsequent statements were based on that assumption; it was not my intention to delve into the accuracy of that assumption at this time.

Another awesome post on insurance and health care. I am amazed the way bloggers are still posting articles related to health care.

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