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  • Could the Senate Bill Eliminate Private Insurance?

    The Senate health care bill no longer contains an explicit “public option,” but it does include heavy regulation of private health plans, including minimum amount they must spend on medical claims, and taxes that will not count toward those limits, limits on deductibles and co-payments, and authority for federal regulators to define what services plans must cover. It’s entirely possible – in fact, even likely – that a combination of three particular regulations could combine to make it impossible for private health plans to legally operate, by making it impossible to meet all the requirements at the same time. By forcing private health insurers out of business, it would appear to “prove” that the public option is “necessary.”

    There is an implicit maximum legal premium in the Senate bill. It results from the combination of the 40% excise tax on “excessive” premiums (over $8,500 for a single plan) and the 85% medical loss ratio (the percent of premiums that must be spent paying claims). A little algebra shows that if the premium exceeds 1.6 times the threshold, then it’s impossible to both required medical loss ratio and pay the excise tax.

    This implies a maximum legal premium of $13,600. At that amount, the entire premium would be taken up by claims and the excise tax – leaving nothing for administrative cost – and even nothing to pay the “annual fee” tax on health insurance, let alone profit.

    Of course, in the real world it would become impossible at a much lower premium, since (a) there are always some administrative costs, and (b) there is the “annual fee” tax on health insurers based on market share that is in addition to the high-premium tax, not to mention state premium taxes and other non-avoidable expenses.

    Suppose, for the sake of the argument, that the “annual fee” tax based on market share works out to $50 per person ($10bil after 2016, for about 200 million people) and administrative costs are $500 per person (similar to the current values for both Medicare and private plans), and the “high cost” premium threshold is $8500 for a single-person policy. Also, assume there are no state premium taxes, no other taxes or required expenses, and no profits.

    In that case, the premium minus the excise tax minus $500 minus $50 has to be no more than 85% of the premium. This implies a maximum attainable premium of $11,400, of which $9690 would be spent on claims.

    If you add in a fairly typical 2% state premium tax to the above assumptions about admin costs and “annual fee” tax, and still assume no other cost, the maximum premium drops to $10,555.55 – and the maximum possible amount for medical claims is $8972

    Every increase in taxes or administrative expenses DECREASES the amount legally “left over” to pay medical claims. Each increase of $1 in taxes or other expenses requires a reduction of $6.67 in medical claims.

    It should be obvious that it would be very easy for regulators to design a plan with a minimum benefit package that is high enough (say, above $8972 in average claims) that makes it literally impossible for health plans to break even, let alone make a profit.

    And if adding benefits doesn’t to the trick, they could add “exchange participation fees” or something similar, to “cover their costs” that would burden private insurers even more “efficiently” — because every dollar of fees would bring plans $6.67 closer to insolvency.

    That, of course, would appear to “prove” that the public option is “necessary” – because the apparently “greedy” health insurance companies would refuse to do business deprived of their “unconscionable profits” (which is to say, profits that are equal to or greater than zero).

    Posted in Obamacare [slideshow_deploy]

    23 Responses to Could the Senate Bill Eliminate Private Insurance?

    1. Linda Templet, Kentu says:

      Are we not a Republican form of government where the supreme power rests in all the citizens entitled to vote and is exercised by representatives elected directly or indirectly, by them and respoinsible to them? Hey I never got to vote for Obamacare, did you? Why the rush?? Do they want to hurry up and pass this health care before the people realizes that we have a Republican form of government? We tell the representatives what we want. What gives them the right to put our personal choices concerning health care under a LAW? This Issue is to become a LAW isn't it? Sounds unconstitutional to me.

    2. Rob Cooper, Seattle says:

      This article only makes sense if EVERY INSURED had claims in excess of 85% of the premium cost

    3. John Cooper, North C says:

      Allow me to paraphrase Adolph Hitler:

      "Let them them own insurance companies as much as they please. The decisive factor is that the State…is supreme over them, regardless whether they are owners or workers…"

      –Hermann Rauschning, Gespraeche mit Hitler (Conversations with Hitler), published in the U.S. as 'The Voice of Destruction' in 1940

    4. Bob, Portland, OR says:

      The folks who own stock in these Health Ins. Companies will tell you.

      Watch the stocks.

      My opinion is that in 2 years Obama will have to bail them out to keep them running, maybe even nationalize them and transfer the employees to the Govi sector. No all of the mind you.

      Make no mistake, they have a plan. I wouldn't be surprised if Harry becomes the boss of the new govi health care.

      Amazing isn't it, just how corrupt and dishonest these politicians are. They are all being promised something in return for this.

      The constitution needs to be reserrected and this must be undone. It's not about Health Care.

    5. Robert Book Robert Book, Heritag says:

      No, it only requires that the total claims for all insured exceed 85% of the total premiums for all insured (for a particular plan).

      Lots of people could have lower claims if other people have higher claim.

      The 85% rule is a requirement of the bill that just passed the Senate.

    6. A Responsible Americ says:

      This has been one of my own concerns. Why in the world would anyone bother to go into the business of insurance if they will not be allowed by the federal government to structure its own offerings or to make a profit? Insurance is, by definition, a betting game. It's gambling, pure and simple. You are betting with your premium dollars that you will get sick and need medical care; the insurance company takes your money betting that you won't. In the end, though, the insurance company will, when you have just one single serious health issue, use up every penny you've given them, and every penny paid by every person on your block. Have more than one illness and everyone's premiums paid to that provider are subsidizing your health care. What the Democrats are doing is forcing me to give you $1 today and dictating you must give me $10 tomorrow. No person in their right mind would do such a thing in the real world.

      Even with the lamest plans that include high out-of-pocket expenses, health insurance is, in terms of overall and real dollars spent, a GREAT deal for consumers. Can regulations surrounding the selling of health insurance be better? Sure. But allowing the federal government, a group who could today cut untold amounts of wasted taxpayer money from Medicare but flat-out refuses to do so, to "manage" what you will get, when you get it, how you get it, and what you'll pay for it when it comes to health care, is as insane as Reid's backroom bribing Senators with YOUR hard-earned tax dollars for his 60 votes and then saying that's just how compromise works.

      In the real world, there is no free lunch. by Democratic definition there will be no "free" or even "less expensive" health care, either. By driving out private health insurers, the government is also going to drive out medical practioners. The result will be that they will decide they must fund their own cadre of Josef Mengeles to take care of you, the great unwashed masses.

      And won't THAT be fun?

    7. Bill, Kansas City, M says:

      We need to contact our Representatives and Senators and tell them to knock this junk off. Luckily, it still has to go to a Conference Committee, so there is still time to kill both versions of obamacare. Also, let them know we want term limits, so this doesn't happen again.

    8. Peggie Potter Colch says:

      I have never seen such blatant corruption. Somewhere we have ceased to be citizens & have become "subjects". They've finally brought debtor's prison to our shores. Our "representatives" obviously aren't representing us anymore. Anyone who votes these

      oppressive crooks back into office is as criminal

      as they are ! Once these "law-makers" are through with taxing us to death, we'll be lucky if we can still feed our families. Outrageous !!!

    9. Freedom of Speech, T says:

      Dear Linda, KY,

      I don't believe our founders, in their wildest dreams, ever foresaw the abuse of power, by so many, that would occur.

      They knew that many human beings were corrupt, greedy, and without honor.

      They went to great lengths to write the Constitution and the Bill of Rights.

      They could not forsee that, enough politicians, would start a movement that made the Constitution a "living, breathing, document" that was to be probed for loopholes to increased power.

      Woodrow Wilson got the 16th Amendment passed (love those income taxes) and the rest is history.

      He also enabled this so-called "progessive" movement to spring forth. The problem is, how do you define progressive when it is used as a march to socialism/marxism?

      They did not create a Republic, believing our own citizens would try to morph it into a Socialist/Marxist Entity.

      In fact, most, including George Washington, feared "political parties" for the exact abuse of power we are now seeing.

      It is our "representatives" who let us down.

      But, WE are responsible for continuing to NOT demand accountability until a major issue comes up for vote.

    10. Nick Psaki, Jacksonv says:

      Rob Cooper, you need to read again. The author clearly references the *average* cost per claim. Some will be lower, some higher, but the insurance companies have to have the capability to meet at least the average. And remember, if pre-existing conditions are excluded as a reason to deny coverage, then adverse selection is virtually guaranteed to drive claims upwards. Healthy people will choose to pay the small fine when they are well, and then sign up for insurance when they are sick. This will drive the average cost per claim way up. This one fact alone is what is killing the Massachusetts health insurance market.

    11. Dexter, San Francisc says:

      One positive note can be found in all this, those that think we are fools seemed to have missed the fact that they have now indelibly marked themselves for the low-lifes they are.

      What a calm person would suggest is to remove them from office at the next opportunity, instead (or failing that for election fraud as well) removal can be more abrupt; on any time-table the laws that they make need no more by obeyed than what they have demonstrated wrt the Constitution.

      There are no rules, once the rule of law is ignored. The Dems are giving us all the opportunity to participate in the resurrection the Republic, perhaps at the cost of their own blood.

    12. fc, nc says:

      So long as citizens are concerned with the common welfare of our country we will be okay. But, so many citizens are concerned with only their individual welfare. One need only look at Detroit, Michigan. They have subscribed to the democrate or progressive mind set for decades and look at what it has gotten them. And yet, they continue down that road. The unions play an intraga role in this party of deception. How else can institution that converts an infinite quantity into a limited quantity to drive up its cost be anything but a scam? On top of this the unions control the limited quantity and force their product to cost more than anyone wants to pay for it. Then they kill the jobs and become unemployed. Anyone except a lunatic would engage in this kind of craziness. I think the entire population of democrates, progressives, and left wingers must have a marginal mental illness to consider these practices.

    13. joan, connecticut says:

      Is this even constitutional?? The Democratic Senators sold us out as did the House. There were only a few, that listened to what taxpaying citizen wanted,while others put their careers ahead of the people who elected them to office. The bribes, that Harry Reid gave certain senators for a yes vote, is a disgrace, and only places a greater burden on the states that didn't get a slice of the tainted pie. I am presently a registered Democrat, but not for long.I am going to do anything and everything to vote the floor flushing politicians out of office.We need TERM LIMITS to make sure that Public Office is never again allowed to become an elitist group, similar to the ones, now in office who think they know what is best for America. The recent vote by the Senate proves how wrong they are. The patriots in the Tea Party has my vote.

    14. Drew Page, IL says:

      Medical insurance plans, purchased by employers for employees, have for years been regulated by the states in which those employer's headquarters were domociled. Annually, over the past 45 years or more, the states have dictated that benefits provided under these plans be expanded to cover more types of medical care, a wider variety of providers (osteopaths, podiatrists, accupuncturists, even Christian Scientist practioners). States have also dictated expanded eligibility rules of these plans (requiring such plans to cover dependent children to specific ages, to remove age limitations for physically or mentally handicapped children and to extend eligibility under these plans for employees who are laid-off or terminated). All of these expansions of coverage and eligibility mean more claims will be paid that previously wouldn't have been.

      In an attempt to avoid such state mandated expansions of benefits and eligibility many employers decided to self-insure their plans, thus making them exempt from such mandates. However, once a health insurance plan became self-insured it fell under the jurisdiction and regulation of the federal government. As self-insurance grew in popularity with employers, the federal government began issuing rules and regulations with which employers had to comply, further expanding the benefits and eligibility for those beneits. These additional rules and regulations also result in additional plan costs.

      It should be remembered that while all employers are required to provide employees with Workers Compensation benefits for accidents or illnesses that are work related, there is no state or federal law that REQUIRES employers to provide employees health insurance plans for accidents or illnesses that are not work related.

      So when employers provide health insurance plans for their employees to attract and retain employees, they are under no legal obligation to do so. But then, enter the state and federal governments saying "So you want to provide health coverage for your employees? Well, LET US TELL YOU just exactly how much you will have to provide, to whom and for how long you will have to provide it." Sounds fair doesn't it?

      Employers thought they were just hiring employees. According to state and federal governments, it turns out they were really adopting them.

      As the state and federal mandates continually increased benefits and eligibility for benefits, so too did the costs of these plans increase. As the premiums increased proportionally with these expansions of benefits and eligibility, who was branded the guilty party? The "greedy insurance companies" that's who.

      Politicians pandered to the public covered by these health plans saying, "Look what 'we' did for you, we made those nasty insurance companies increase benefits and cover more people". Now, these same politicians point with outrage at the insurance companies who raised their prices to cover these mandates.

      I find it interesting that so many are so quick to attack the insurance companies over the costs of health insurance. I don't recall many people saying "the greedy doctors", or "the greedy hospitals" or "the greedy trial lawyers" are the ones to blame.

      Insurance companies don't insure anyone's health. You can have all the insurance in the world and that won't keep you from getting sick. Insurance insures your bank account.

    15. Cornu Ammonis, US says:

      It's remarkable how many conservatives believe the process behind this law was "undemocratic" or "unrepresentative". Guess what – the majority of Americans DON'T AGREE with you. They voted Republicans out in a landslide in 2008 – that's why this bill passed, with 60 Senate votes to 39 Republican seats. Such an accomplishment was more of a victory than any partisan bill Bush helped to pass in 8 years. Nationally, Democrats are more than 60% of the electorate today, and the Republicans … are looking at Sarah Palin as their savior, which says more than statistics can.

      So, US Constitution bases our government on the will of the MAJORITY, and there is a LARGE MAJORITY in favor for health care coverage for everyone. There is no invisible "majority of tax-fearing Americans" who oppose this. Instead, there is a majority of Americans who are tired of being uninsured, or have compassion for those who are uninsured, and that's why this bill passed.

      But here's the good news for you: if it does turn out to be a disaster, you'll regain the majority again, and THEN you'll have the ability to repeal it, require credit cards at ER's before treatment, cut all taxes, etc. Get a majority of people to agree with you, and 60 Senators (or start with 41) to back you up.

      However, if this program does well as I anticipate it will, the GOP will have two choices: either continue the nonsense "it's the end of the republic" talk and become even more irrelevant and unimportant in US politics; or, accept some more modern doctrines (e.g. you won't find a single economist who can defend Reagan/Bush's supply-side economics today), get rid of your loons, and become a legitimate second party again.

      As a Democrat, but someone who wants the best for America above all, I actually want to see a stronger, rational conservative party to challenge our ideas with legitimate concerns. The one right now, though, is obstructionist and going down the wrong road of extremism, and I don't see it finding its "secret majority" any time soon.

    16. Freedom of Speech, T says:


      Believe what you want.

      The Republicans are not obstructionists.

      I KNOW Obama continues to "campaign" but try to forget the election for just one time.

      The MAJORITY of Americans which includes Democrats and Independents did NOT want this mess to pass – period. You can ignore that truth if you want. Many of us understand that some Democrats and virtually all of the media will never admit they were wrong. They have no humility and no shame.

      These policies are designed to expand government and control the populace. You refuse to see that even though it is right in front of you.

      Obama and the dems did not receive a "mandate" to ignore the majority of the poopulation, including millions of their own constituents!

      PLEASE get off the "only the democrats have compassion" nonsense. It is silly and a patent lie.

    17. Drew Page, IL says:

      The author of the above piece is right about one thing, the majority of those in the House and Senate are the ones who voted for two different versions of national health care. As for the author's assertion that the "majority of the American people" don't agree with conservatives that the process behind the passage of the House and Senate bills was undemocratic and/or unrepresentative, we will let the elections in 2010 determine what the majority of Americans think.

      The author states that the GOP has only two choices facing it, either to continue its current positions (which he brands as nonsense), making itself even more irrelevant in U.S. politics or, to accept more modern doctrines (i.e., those which he espouses). How kind of the author to share his vision of our destiny.

      How very amusing that the author, a confessed Democrat, identifies the Republican party as obstructionist and going down the wrong road of extremeism. As the author so correctly points out in his initial statements, the Democrat party is the one that holds the 60 vote majority in the Senate and also the majority in the House. Correct me, Cornu, if I am wrong about this, but it seems to me that all the arguments and fighting done both in the Senate and House have been among the Democrats. The Republicans aren't in a position to stop any legislation proposed by the Democrat majority. If there has been any obstructionism, it has been generated by members of your own party, wrangling with each other. Senate majority leader, Harry Reid, has been holding closed door, late night meetings with Democrat Senators. Republican Senators were not allowed in, so I'm not sure how much obstruction they could have caused. Perhaps you would be kind enough to explain that.

      It's also interesting that you feel compelled to lash out at Reagan, Bush and even Sarah Palin. Reagan is dead. Bush (both of them) are retired and out of office and aren't taking part in the current debate over national health care.

      Sarah Palin is not in office, though she continues to campaign for conservative candidates. For someone who thinks that the Republican party is irrelevant to American politics, why are you so concerned about what Sarah Palin does or says? Why the need to disparage Sarah Palin? What has she ever done to hurt you or your family? For some reason, liberals have a fixation on lashing out at Ms. Palin. For the party that feels the only thing that can't be tolerated is intolerance, there seems to be this irrational hatred of this woman. Why are the liberals so afraid of this woman? In my opinion, the only reason for such hated is fear.

    18. Mary M. says:

      To my fellow Democrat Cornu Ammonis, there is something I would like to say. I have been a Democrat all of my life. Never have I been so disgusted with the Democratic Party, and the democrat politicians who are now running the show in Washington DC. Now that they control the executive and legislative branches, it is absurd what they are doing.

      Under President Obama, this year alone, the deficit has almost quadrupled. In addition,
      –the president has taken over 2 car companies and an insurance company (completely uncalled for),
      –the democrats have passed bills without reading them (no excuse),
      –the president has gone on apology tours,
      –the president has put KSM on trial in NYC, despite that most Americans, especially most 911 families are oppose to the move,
      –and now this out highly flawed Obamacare that they are rushing through and most Americans, including doctors are oppose to it (57% oppose and 37% support-Fox News poll-12/10/09). By the way, 18 medical specialty groups are opposed to Obamacare, according to the Wall Street Journal-12/21/09.

      Cornu, please research the polls. You will see that most Americans oppose Obamacare and/or these 2,000 page bills. And a CNN poll reported that 61% oppoe to the senate bill, while only 36% approved it.

      For health care, Obama promised transparency, every meeting would be on C-SPAN, and work in a bi-partisan manner. He has broken all the promises just mentioned. Instead, we witnessed backroom deals (such as with AARP and SIEU who got kickbacks if they supported his health care ajenda), meetings behind closed doors, refusal to work with Republicans who had 3 dozen health care proposals, midnight votes, buying votes/bribes (such as giving extra money to LA and NE), and passing bills without reading them.

      The senate bill is unconstitutional, for the government cannot for Americans to have health insurance.

      Obamacare will add to the deficit, and the quality of care will be lowered at the rate it is going.

      The democrats have made fools of themselves and if they loose control of the house and senate, they deserve it.

      This is NOT the hope & change I was wanting.

    19. MinnesotaMan says:

      Symantics! Do you want to purchase insurance or do you want to purchase health care? Insurance premiums have soared because 1.) under medicare and medicaid, the government is only paying 82% and 79% respectively, the fees charged by providers for their services. This "managed" underpayment forces providers to recover this loss of revenue by increasing fees for basic services which results in higher premiums to those who are not covered by these programs, the privately insured. 2.) Manage your own risk ( health ) through your own lifestyle choices and behaviors. More than 60% of the American population is either overweight or morbidly obese. Adult onset diabetes and orthopedic anomalies are on a spiraling increase in direct correlation to the weight distribution of our population. 3.) Trade premium dollars for higher deductible plans. Just like your auto insurance, the lower the deductible the higher the premium. 4.) Start an HSA account to pay your higher dedeuctibles. 5.) Phase out the deductiblity of employer paid plans and make it deductible for individuals to purchase health insurance. No more need to feel enslaved to your job because of fear of losing insurance. Owning your own insurance means that it is portable. No more need for Cobra! Change jobs, lose your job, seek a new career path, you still have insurance. 6.) Allow employers to make, match, and deduct contributions to your HSA plan.

      7.) Health care costs will continue to soar if we continue to have a disenfranchised consumer base with a third party payor system. Until individuals accept responsibility for and share a portion of each and every payment to providers, there will be no accountability for health care fees, charges, billing errors, and fraud. 8.) Tort Reform. Your health care provider prescribes more tests, procedures, and conservative treatment plans for a given condition because of the need to practice "defensive medicine" in anticipation of litigation from an undesireable outcome. If you are responsible for any portion of payment for these procedures (through higher deductible plans) you will become engaged with your provider and authorize only those tests and procedures that you alone will determine with your doctor to be medically necessary to provide for your own care.

      Imagine the the inevitable run away costs that will result in the decision to have overregulated, nationalized health care, expanded coverage of medicare and medicaid, and an expansion of the entitlement mentality. If someone else pays the bills, everyone will want and demand more, while the expectation will be that someone else pays. In the end, each of us will pay higher costs than we currently pay and have fewer choices for our own care. Rationing of resources will be inevitable. In our current system, the so called uninsured are consuming approximately 38% of our health care resources. This means that the minimum needs of the uninsured are largely being met at the expense of higher premiums for the rest of us. The statist has demanded that health care reform must take place on behalf of the uninsured, escalating premiums, and containment of spiraling costs. Is there any example or evidence where adding another layer of beauracracy (government control) has lowered administrative costs. This issue is no longer about health care, it is about the left having greater control over all of us, diminishing our liberties, and redistribution of wealth.

    20. Cornu Ammonis, US says:

      Apologies for not responding sooner, with the holidays. I'm very happy to see some debate here though, as I read and comment on this site to see why those who have different views to mine disagree with my views.

      Drew Page, I should have been more clear about I meant by "irrational" or "outdated" doctrines held by leading Republicans. What I meant was not just supply-side economics, but combining large tax cuts with big government spending like under Reagan and George W Bush. I think it's generally accepted now that the wealth of the nation does not increase fast enough due to tax cuts to make up for the lowered tax revenue in addition to additional spending – which is why Reagan and especially Bush helped to build some of the largest yearly government deficits in history. The trickle-down effects have also not been operative, in that almost all of the growth in real income and wealth in the last three decades has been for the richest 5% and especially the richest 1%, with almost no increase or even a decline for the lower 50% of the population. Certainly, I don't believe that everyone reading the Heritage Foundation site agrees with big-government conservatism, but the overall result of Republican rule has been that.

      As to what seems like "rational" views for Republicans, I didn't mean that they should be only Democratic ones. As examples, I don't agree with small-government conservatism, with lower taxes and lower spending, but on the other hand I think it's a perfectly rational viewpoint. Moving for stronger states-rights would be rational if it allowed states more control over gun or abortion laws, and also their gay marriage laws, rather than trying also to pass a constitutional amendment on marriage like many Republican members of Congress support. Republican attempts to reduce entitlement health care spending would be rational if they also targeted Medicare for cuts, but instead we saw Bush contribute massive, unfundable spending to Medicare because the institution has turned out to be highly popular. In international relations, we see the same kind of contradictions between classic conservative disdain for entangling internationalism and nation-building, and then a neo-conservative adventure in Iraq (while undercutting the true war on terrorism in Afghanistan). In Iraq, the US is now completely stuck for the foreseeable future spending hundred of billions a year for military occupation and grants to the Iraqi government.

      The list can go on for Republican policies of late that lack internal logic and the ability to achieve overall Republican goals, which is what I meant about "rational" perspectives that still are very different from mine. Growing up in New York, I also know a number of older conservative Republicans have the same dismay over the death of small-government conservativism – like a retired judge who was a life-long Rockefeller Republican, elected three terms on a Republican ticket, who voted Dem in 2004 for the first time in is life. A similar story is why Perot received 15% of the vote in 1992, and I think contributed greatly to McCain losing last year, burdened with Bush's legacy.

      Back on topic, I was originally to the fact that a significant majority (55 to 60%) of Americans support universalizing health insurance in general, not for the current compromised Senate bill. As a purist, I do believe that the Democrats needed to pass something at least as strong as the House version of the bill (with a government insurance plan) for the law to be very effective. Unfortunately, the voters in Nebraska and Mr. "Joe-mentum" (the most hilarious line from the 2004 presidential races) needed to be assuaged and hence resulted in a lot of pork and weakening of the overall plan. Still, I think the bill is in total a good plan, and much better than the status quo. I do think that the Democrats will lose a few seats in 2010, since nearly every president's party loses seats in the midterm election, and Obama is especially vulnerable because of the economic crisis (for which neither Bush or Obama should be blamed, as presidents don't have nearly as much control over markets as TV news would have us believe).

      Finally, I'm quite interested in why Republicans have such a huge problem with the concept of rationing in publicly-funded health care, as the last poster worried about. To be frank, the major cause of increased medical spending in the US is for major, new procedures at the end of life that on average have marginal benefits in terms of actually increasing life span or quality of life. At the same time, much less money can be spent on preventive and regular care and have greater results in terms of quality of life and increases in life span for uninsured or underinsured Americans. What we have in US society instead is de facto extreme rationing between those who do get covered by government or (quality) private health insurance, and those who are not, resulting in much higher spending nationally and lower average quality of care and life span.

      The British National Health Service has an honest and close to universally accepted system on how it rations spending, which I do not think Americans would reject if got over this rationing taboo. The NHS calculates for each procedure or medicine the "quality-adjusted of life years" (QALY) it adds, which is determined by the average number of years of life it adds multiplied by the percent improvement in quality of life if successful (for example, a fully healthy person is at 100%, while someone with depression might be at 70%, and death is rated at 0%) multiplied by the probability of success. As long as the cost of an added QALY is less than ~30,000 pounds (~$48,000), the amount on average the government can afford to spend on each citizen, the NHS covers it. Something on the order of 99.99% of procedures or prescriptions end up covered under this relatively low ceiling, which, of course, the lower costs for procedures due to lack of an insurance middle man and somewhat lower salaries for doctors contribute to. So yes, under this single-payer system some highly experimental and uncertain procedures for very sick patients are not covered – say a 20-hour surgery that costs $200,000 in Britain (probably $1 million+ in the US), but has only a small probability of adding a year of two of life with limited mobility, would not be covered. But at the same time, what IS covered for 100% of the people are routine exams like mammograms and prescription treatment for chronic diseases like diabetes (preventing the need for, say, a kidney transplant). In the US, way fewer than 100% of the population have easy access to these preventive and detection-based types of care, which results in more cases of massive interventions after an illness goes critical and expensive emergency room visits for uninsured people, etc.

      Also, if the wealthy want greater choices for heroic interventions in a US program, like in the UK they can buy private insurance on top of the government plan to account for these rarer possibilities. I do not see a good counterargument against a government plan that covers nearly all procedures for everyone, with the option for buying individual plans on top for all remaining expensive procedures, hence retaining the element of "choice" while still raising the average level of care and quality of life greatly for all of society. I strongly *disagree* with the idea that the total taxes for the universal government care would be higher than the total amount of spending for private health care in the US, from employer and individual paid premiums to all the additional administrative fees (and profits) necessitated by private insurance systems covering the majority of the people. The only other counterargument than cost I can see from conservatives is that they should not have to pay anything for the health care benefiting "another American", and I do not see this is a ethnically defensible or "republican" national viewpoint. After all, our taxes pay collectively for a postal service, space program, or Social Security that may benefit us less than others who are paying into the system – and not to mention tax money going to Iraqis, which I would much rather see go to the health care of an American.

    21. Pingback: Reid’s Bill Could be the End of Private Insurance | thelobbyist

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