|
Read the rules in the OP before posting, please.In order to ensure that this thread continues to meet TL standards and follows the proper guidelines, we will be enforcing the rules in the OP more strictly. Be sure to give them a re-read to refresh your memory! The vast majority of you are contributing in a healthy way, keep it up! NOTE: When providing a source, explain why you feel it is relevant and what purpose it adds to the discussion if it's not obvious. Also take note that unsubstantiated tweets/posts meant only to rekindle old arguments can result in a mod action. |
Norway28558 Posts
that is not what kwark is saying. what kwark is saying is that only if you have the point of view that people who can't care for themselves when they encounter a crisis (like fatal/ chronic illness or house burning down or whatever) does the point of view that insurance sucks make sense.
|
On October 01 2013 23:44 Liquid`Drone wrote:
that is not what kwark is saying. what kwark is saying is that only if you have the point of view that people who can't care for themselves when they encounter a crisis (like fatal/ chronic illness or house burning down or whatever) does the point of view that insurance sucks makes sense.
Alright that's kind of what I was hoping for but it was unclear :p
|
United States41989 Posts
On October 01 2013 23:23 Clarity_nl wrote:Show nested quote +On October 01 2013 23:20 KwarK wrote:On October 01 2013 19:13 Frits wrote:On October 01 2013 16:10 MarlieChurphy wrote:
PS- I think the whole concept of insurance is dumb to begin with. You should just save up your own money in case of something and if you want to waste your money or think the investment is good enough, get insurance. This especially includes manditory car insurance. This is an entirely different topic though, don't lay into me about it.
Please tell me what you're gonna do if you get cancer, you're just gonna sit down and say: 'this is my life choice'? Right. Oh wait no you're gonna pay for it with the tons you have saved up. Your country is a disaster and you're the leading cause. In his plan he just dies of cancer and because he's generally unproductive the country as a whole is better off. The problem comes when people don't want him to die and pay for him. I agree that that's where the problem lies, but are you saying that you think that we should simply let people who can't care for themselves die?
No, not even Charlie.
|
On October 01 2013 23:48 KwarK wrote:Show nested quote +On October 01 2013 23:23 Clarity_nl wrote:On October 01 2013 23:20 KwarK wrote:On October 01 2013 19:13 Frits wrote:On October 01 2013 16:10 MarlieChurphy wrote:
PS- I think the whole concept of insurance is dumb to begin with. You should just save up your own money in case of something and if you want to waste your money or think the investment is good enough, get insurance. This especially includes manditory car insurance. This is an entirely different topic though, don't lay into me about it.
Please tell me what you're gonna do if you get cancer, you're just gonna sit down and say: 'this is my life choice'? Right. Oh wait no you're gonna pay for it with the tons you have saved up. Your country is a disaster and you're the leading cause. In his plan he just dies of cancer and because he's generally unproductive the country as a whole is better off. The problem comes when people don't want him to die and pay for him. I agree that that's where the problem lies, but are you saying that you think that we should simply let people who can't care for themselves die? No, not even Charlie.
You monster!
Oh wait... You saint, you!
It's a complex issue though, obamacare is by no means perfect, and not guaranteed to work, but it's something.
On October 01 2013 17:13 paralleluniverse wrote:Show nested quote +On October 01 2013 16:10 MarlieChurphy wrote:
PS- I think the whole concept of insurance is dumb to begin with. You should just save up your own money in case of something and if you want to waste your money or think the investment is good enough, get insurance. This especially includes mandatory car insurance. This is an entirely different topic though, don't lay into me about it.
Completely ridiculous notion. The whole POINT of insurance, any insurance, whether it's health, car, home, liability insurance, is to reduce your exposure to highly expensive and improbable events (such as being hospitalized, car destroyed in crash, house being burnt down, losing a massive lawsuit, respectively). You can't expect people to save for another house when most can barely afford one house, that's why home insurance is needed. The same is true of health insurance. It is generally better to have small and predictable payments (paying for insurance), then run the risk of a massive but rare spike in costs that could completely bankrupt you (e.g. being hospitalized in a serious car accident). Without insurance, you play a risky game, you could get lucky, nothing bad happens and you come out ahead with more money, or you could get unlucky and then get totally fucked up. Insurance chops off "tail risk", i.e. it puts a cap on the maximum loss you could possibly incur. As for MSI, that sounds like an awesome program. But know that it only applies to low income people in Orange County. Many people in the US don't have access to such programs and many are uninsured.
This guy put it well. Insurance only works if everyone is involved, otherwise the prices become ludicrous which will make no one want to get insurance.
|
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky
|
On October 01 2013 16:51 acker wrote:Show nested quote +On October 01 2013 14:23 JonnyBNoHo wrote:It sounds like the 44% number is relative to all spending and specifically for August. Also, the article made a point of: The BPC does not see it likely there will be an actual default on bond payments. That's still really bad news, you know -.- Furthermore, it's relative to all federal spending, not relative to all spending. Also, see below.
Yes, all federal government (i.e. the thing we're discussing) spending. Not just spending on creditors or whatever you wrote.
Show nested quote +On October 01 2013 14:23 JonnyBNoHo wrote:
The Treasury doesn't contradict me, so why do I need a source to contradict the Treasury? The Treasury wrote that meeting cash commitments =/= new spending. That doesn't contradict what I wrote. The Treasury does, in fact, contradict you. Read further. Show nested quote +Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. Your definition of "default" isn't particularly useful, as it's limited to bondholders. Even if you pay back everyone who physically holds US Treasuries, the Treasury would still be obligated to pay money to everyone it owes money to. That's still considered a default. What I fail to see is how you don't think this would be catastrophic for the US Economy. What you're arguing in full seriousness, paying back bondholders while failing to raise the debt ceiling, was so unrealistic that only Bachmann supported it (and for less than a week!).
Early on in this discussion I asked what definition of creditor / default you were using. You said that your definition was the same as mine. Apparently not!!
Anyways, yes, given enough time a failure to increase the debt ceiling will result in a default of some kind. How much that matters depends on what kind of default it is and how people react to it. We defaulted twice in the 70's (the Nixon shock and a delayed payment in '79) and no one gives enough of a shit to even mention that any more (or any of the other defaults).
Regardless, as I said to another poster, the longer this goes on the worse it will be. My point wasn't that this is somehow good or even OK, my point was that the Treasury has tools to avoid a default in the event that the debt ceiling isn't raised. Those tools have limits, but, they exists, and so we shouldn't be freaking out over a default.
|
On October 01 2013 16:10 MarlieChurphy wrote:Show nested quote +On October 01 2013 15:17 Thrax wrote:On October 01 2013 15:02 MarlieChurphy wrote:On October 01 2013 14:29 OuchyDathurts wrote:On October 01 2013 14:27 MarlieChurphy wrote:On October 01 2013 14:20 paralleluniverse wrote:On October 01 2013 14:15 MarlieChurphy wrote:I don't see any such button. On October 01 2013 13:36 paralleluniverse wrote:On October 01 2013 13:30 MarlieChurphy wrote:
Sorry, Can someone enlighten me on what exactly the Affordable Care Act is, and what it's supposed to do (and/or what it is actually doing?)
I actually got a phone survey call a few months back asking me tons of questions about it and I basically just answered I don't know/I don't care to most of the stuff. It seems pretty convoluted at the least. 3 basic parts: -No one can be denied healthcare or charged more due to preexisting conditions, lifetime caps, etc, and all healthcare plans have at least a minimum standard of benefits -Everyone must get healthcare or be fined. Nothing changes if you already have healthcare. -There are subsidies to buy healthcare on exchanges here for low income families that can't afford it. Some plans are as cheap as $100 a month. Currently I have no job and am broke, and don't have any conditions or care about insurance. What do/should I do? PS- I see a bunch of people on fb complaining right now they aren't going to be paid for the next 2 weeks or something. I think they all work for the TSA or airport or something? They aren't being very receptive to my questions, what are they bitching about? What you should do is go to https://www.healthcare.gov/ and after answering a few questions, it will tell you the price of health insurance and whether you are eligible for subsidies. And then decide for yourself whether you want to buy it. Shit happens, you might be in a car crash, randomly becomes sick etc, and then you'll need healthcare. Yea, in the past if something ever came up. I just went to the hospital and either a family member or myself after the fact just went to a hospital social worker or whatever and filled out a bunch of forms and I don't think I paid anything. What is the difference from that? Like I fail to see what ACA even does. There is/was already MSI and stuff like that anyways. Going to the hospital to get basic health care costs SIGNIFICANTLY more than if you were to just go to the doctor. You're not paying for your treatment so other tax payers have to pay for it, the hospital is going to get its money at the end of the day. If you can actually go to the doctor before something gets too far out of hand it costs less and has better results. "An ounce of prevention is worth a pound of cure" I don't just randomly or regularly go to the doctor at all. I only go when there is an emergency. Examples of the last 5 times I've been to the doctor/hospital over the course of like 10 years: Appendicitis, Back Sprain, Tonsilitis, Hairline Fractured Ankle, A silver nitrite? suture (had a small cut on my back that wouldn't stop bleeding). So again, I see no use for health insurance for me and it makes no difference to me. You can call me fortunate, or selfish but I still don't see how MSI or Medical or whatever is different than ACA. Do you think the care you received is free? It's basically sheer luck that you haven't had to pay for those services. Many (uninsured) people have been bankrupted by healthcare fees. You don't seem to understand the concept of insurance. The whole point of insurance is risk management. Insurance is there so next time you fracture your ankle, your costs are covered. Obviously, you always have the option to play the roulette. You can hope you don't get sick or hope you won't have to pay for any healthcare services you receive in case you do get sick. PS- I think the whole concept of insurance is dumb to begin with. You should just save up your own money in case of something and if you want to waste your money or think the investment is good enough, get insurance. This especially includes manditory car insurance. This is an entirely different topic though, don't lay into me about it. You can do that to an extent. What you still want insurance for is big events like an intestine transplant (costs $1.2mm source). So what you could do is get really cheap bronze level insurance and cover the rest out of pocket.
|
On October 02 2013 00:11 JonnyBNoHo wrote:Show nested quote +On October 01 2013 16:51 acker wrote:On October 01 2013 14:23 JonnyBNoHo wrote:It sounds like the 44% number is relative to all spending and specifically for August. Also, the article made a point of: The BPC does not see it likely there will be an actual default on bond payments. That's still really bad news, you know -.- Furthermore, it's relative to all federal spending, not relative to all spending. Also, see below. Yes, all federal government (i.e. the thing we're discussing) spending. Not just spending on creditors or whatever you wrote. Show nested quote +On October 01 2013 14:23 JonnyBNoHo wrote:
The Treasury doesn't contradict me, so why do I need a source to contradict the Treasury? The Treasury wrote that meeting cash commitments =/= new spending. That doesn't contradict what I wrote. The Treasury does, in fact, contradict you. Read further. Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. Your definition of "default" isn't particularly useful, as it's limited to bondholders. Even if you pay back everyone who physically holds US Treasuries, the Treasury would still be obligated to pay money to everyone it owes money to. That's still considered a default. What I fail to see is how you don't think this would be catastrophic for the US Economy. What you're arguing in full seriousness, paying back bondholders while failing to raise the debt ceiling, was so unrealistic that only Bachmann supported it (and for less than a week!). Early on in this discussion I asked what definition of creditor / default you were using. You said that your definition was the same as mine. Apparently not!! Anyways, yes, given enough time a failure to increase the debt ceiling will result in a default of some kind. How much that matters depends on what kind of default it is and how people react to it. We defaulted twice in the 70's (the Nixon shock and a delayed payment in '79) and no one gives enough of a shit to even mention that any more (or any of the other defaults). Regardless, as I said to another poster, the longer this goes on the worse it will be. My point wasn't that this is somehow good or even OK, my point was that the Treasury has tools to avoid a default in the event that the debt ceiling isn't raised. Those tools have limits, but, they exists, and so we shouldn't be freaking out over a default.
Are social security payments a legal obligation? Are payments to contractors and employees under contracts legal obligations?
The answer, obviously, is yes those are legal obligations. Your definition of "default" as strictly "default on treasury bill payments" is ridiculous. The word default includes any default on any legally obligated payment. If the FEDGOV defaults on a contract to pay, that is a default whether it is on a treasury bill or not.
|
The inherent problem with insurance in the US is that private insurance companies exist. People with little to no knowledge about medical and psychological disorders are allowed to determine what is and is not covered under the insurance policy and how much or how long it is covered. In the case of mental health, insurance is woefully inadequate and only pays for the bare minimum of services: usually 3-8 sessions or a deductible of $1000 followed by a co-pay applied to counseling for up to another 3-8 sessions. A full price counseling session usually runs $100+ and if you need to see a psychiatrist, then you are looking at $200+.
Thankfully, there are programs, at least in my state, that provide up to 3 months of free counseling to children and families covered by Medicaid. Ideally, insurance would cover up to 3 months of counseling for anyone that needs it. Unfortunately, the Affordable Care Act, provides little help with mental health expenses. Also, funding for mental health programs has been repeatedly cut by my state government which leads to fewer services being available.
|
On October 02 2013 00:26 CannonsNCarriers wrote:Show nested quote +On October 02 2013 00:11 JonnyBNoHo wrote:On October 01 2013 16:51 acker wrote:On October 01 2013 14:23 JonnyBNoHo wrote:It sounds like the 44% number is relative to all spending and specifically for August. Also, the article made a point of: The BPC does not see it likely there will be an actual default on bond payments. That's still really bad news, you know -.- Furthermore, it's relative to all federal spending, not relative to all spending. Also, see below. Yes, all federal government (i.e. the thing we're discussing) spending. Not just spending on creditors or whatever you wrote. On October 01 2013 14:23 JonnyBNoHo wrote:
The Treasury doesn't contradict me, so why do I need a source to contradict the Treasury? The Treasury wrote that meeting cash commitments =/= new spending. That doesn't contradict what I wrote. The Treasury does, in fact, contradict you. Read further. Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. Your definition of "default" isn't particularly useful, as it's limited to bondholders. Even if you pay back everyone who physically holds US Treasuries, the Treasury would still be obligated to pay money to everyone it owes money to. That's still considered a default. What I fail to see is how you don't think this would be catastrophic for the US Economy. What you're arguing in full seriousness, paying back bondholders while failing to raise the debt ceiling, was so unrealistic that only Bachmann supported it (and for less than a week!). Early on in this discussion I asked what definition of creditor / default you were using. You said that your definition was the same as mine. Apparently not!! Anyways, yes, given enough time a failure to increase the debt ceiling will result in a default of some kind. How much that matters depends on what kind of default it is and how people react to it. We defaulted twice in the 70's (the Nixon shock and a delayed payment in '79) and no one gives enough of a shit to even mention that any more (or any of the other defaults). Regardless, as I said to another poster, the longer this goes on the worse it will be. My point wasn't that this is somehow good or even OK, my point was that the Treasury has tools to avoid a default in the event that the debt ceiling isn't raised. Those tools have limits, but, they exists, and so we shouldn't be freaking out over a default. Are social security payments a legal obligation? Are payments to contractors and employees under contracts legal obligations? The answer, obviously, is yes those are legal obligations. Your definition of "default" as strictly "default on treasury bill payments" is ridiculous. The word default includes any default on any legally obligated payment. If the FEDGOV defaults on a contract to pay, that is a default whether it is on a treasury bill or not.
If the government is 10 days late on a $100 phone bill did it 'default'?
|
On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky
Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world).
Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens.
Without insurance:
4% chance: 30mil cost to the company, 0 cost to the insurance company.
96% chance: 0 cost to the company, 0 cost to the insurance company.
Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company,
With insurance:
4% chance: 1mil cost to the company, 22mil cost to the insurance company.
96% chance: 1mil cost to the company, 1mil profit to the insurance company.
Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company.
With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests.
There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame).
|
Cayman Islands24199 Posts
problem with insurance mechanics in healthcare is that it cuts out the incentive for consumers to limit their immediate service requests, as well as eliminate incentive for preventive care.
pre existing conditions isn't the only free rider problem. people being fat, doctors ordering too many tests on insurance tab etc. people are also not worried about learning different prices between providers
|
On October 02 2013 00:35 rasnj wrote:Show nested quote +On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world). Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens. Without insurance: 4% chance: 30mil cost to the company, 0 cost to the insurance company. 96% chance: 0 cost to the company, 0 cost to the insurance company. Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company, With insurance: 4% chance: 1mil cost to the company, 22mil cost to the insurance company. 96% chance: 1mil cost to the company, 1mil profit to the insurance company. Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company. With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests. There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame).
Companies that are destroyed by a single event are encouraged to be as risky as possible because there is a hard limit on what they can be charged: their worth. A good example is the BP oil spill. One of the reasons why BP took that risk is because the damage was more than their company worth.
Penalizing pre-existing conditions is wrong. The whole point is to pay for sick people. If we're failing to do that, then that's a failure of the system.
You are also forgetting that the profit motive encourages insurance companies to try to find loopholes to not cover people's medical issues. This not only hurts people directly, but also means that healthcare hire teams of highly trained lawyers to exploit these loopholes. This is money that the insurance company is not spending on care.
|
On October 02 2013 00:35 JonnyBNoHo wrote:Show nested quote +On October 02 2013 00:26 CannonsNCarriers wrote:On October 02 2013 00:11 JonnyBNoHo wrote:On October 01 2013 16:51 acker wrote:On October 01 2013 14:23 JonnyBNoHo wrote:It sounds like the 44% number is relative to all spending and specifically for August. Also, the article made a point of: The BPC does not see it likely there will be an actual default on bond payments. That's still really bad news, you know -.- Furthermore, it's relative to all federal spending, not relative to all spending. Also, see below. Yes, all federal government (i.e. the thing we're discussing) spending. Not just spending on creditors or whatever you wrote. On October 01 2013 14:23 JonnyBNoHo wrote:
The Treasury doesn't contradict me, so why do I need a source to contradict the Treasury? The Treasury wrote that meeting cash commitments =/= new spending. That doesn't contradict what I wrote. The Treasury does, in fact, contradict you. Read further. Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations – an unprecedented event in American history. Your definition of "default" isn't particularly useful, as it's limited to bondholders. Even if you pay back everyone who physically holds US Treasuries, the Treasury would still be obligated to pay money to everyone it owes money to. That's still considered a default. What I fail to see is how you don't think this would be catastrophic for the US Economy. What you're arguing in full seriousness, paying back bondholders while failing to raise the debt ceiling, was so unrealistic that only Bachmann supported it (and for less than a week!). Early on in this discussion I asked what definition of creditor / default you were using. You said that your definition was the same as mine. Apparently not!! Anyways, yes, given enough time a failure to increase the debt ceiling will result in a default of some kind. How much that matters depends on what kind of default it is and how people react to it. We defaulted twice in the 70's (the Nixon shock and a delayed payment in '79) and no one gives enough of a shit to even mention that any more (or any of the other defaults). Regardless, as I said to another poster, the longer this goes on the worse it will be. My point wasn't that this is somehow good or even OK, my point was that the Treasury has tools to avoid a default in the event that the debt ceiling isn't raised. Those tools have limits, but, they exists, and so we shouldn't be freaking out over a default. Are social security payments a legal obligation? Are payments to contractors and employees under contracts legal obligations? The answer, obviously, is yes those are legal obligations. Your definition of "default" as strictly "default on treasury bill payments" is ridiculous. The word default includes any default on any legally obligated payment. If the FEDGOV defaults on a contract to pay, that is a default whether it is on a treasury bill or not. If the government is 10 days late on a $100 phone bill did it 'default'?
Yes. When I don't pay my rent on time, I am in default on my contract.
When people don't pay their mortgages, the banks repossess their houses because they have defaulted on their mortgage contracts. This should feel obvious in your mind.
|
On October 02 2013 00:59 DoubleReed wrote:Show nested quote +On October 02 2013 00:35 rasnj wrote:On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world). Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens. Without insurance: 4% chance: 30mil cost to the company, 0 cost to the insurance company. 96% chance: 0 cost to the company, 0 cost to the insurance company. Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company, With insurance: 4% chance: 1mil cost to the company, 22mil cost to the insurance company. 96% chance: 1mil cost to the company, 1mil profit to the insurance company. Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company. With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests. There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame). Companies that are destroyed by a single event are encouraged to be as risky as possible because there is a hard limit on what they can be charged: their worth. A good example is the BP oil spill. One of the reasons why BP took that risk is because the damage was more than their company worth. Penalizing pre-existing conditions is wrong. The whole point is to pay for sick people. If we're failing to do that, then that's a failure of the system.You are also forgetting that the profit motive encourages insurance companies to try to find loopholes to not cover people's medical issues. This not only hurts people directly, but also means that healthcare hire teams of highly trained lawyers to exploit these loopholes. This is money that the insurance company is not spending on care.
It is no longer "insurance" if pre-existing conditions are covered. The whole purpose of insurance is to hedge against future risk, not pay for past loss.
|
On October 02 2013 01:04 xDaunt wrote:Show nested quote +On October 02 2013 00:59 DoubleReed wrote:On October 02 2013 00:35 rasnj wrote:On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world). Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens. Without insurance: 4% chance: 30mil cost to the company, 0 cost to the insurance company. 96% chance: 0 cost to the company, 0 cost to the insurance company. Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company, With insurance: 4% chance: 1mil cost to the company, 22mil cost to the insurance company. 96% chance: 1mil cost to the company, 1mil profit to the insurance company. Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company. With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests. There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame). Companies that are destroyed by a single event are encouraged to be as risky as possible because there is a hard limit on what they can be charged: their worth. A good example is the BP oil spill. One of the reasons why BP took that risk is because the damage was more than their company worth. Penalizing pre-existing conditions is wrong. The whole point is to pay for sick people. If we're failing to do that, then that's a failure of the system.You are also forgetting that the profit motive encourages insurance companies to try to find loopholes to not cover people's medical issues. This not only hurts people directly, but also means that healthcare hire teams of highly trained lawyers to exploit these loopholes. This is money that the insurance company is not spending on care. It is no longer "insurance" if pre-existing conditions are covered. The whole purpose of insurance is to hedge against future risk, not pay for past loss.
And yet a universal healthcare system cannot work without it. Ofc do not forget that it isnt just allowing pre-existing conditions. It also forces (or should anyway) everyone to have insurance. So aside from the initial introduction pre-existing conditions isnt a factor since everyone being born will have to be insured ect.
|
On October 02 2013 01:04 xDaunt wrote:Show nested quote +On October 02 2013 00:59 DoubleReed wrote:On October 02 2013 00:35 rasnj wrote:On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world). Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens. Without insurance: 4% chance: 30mil cost to the company, 0 cost to the insurance company. 96% chance: 0 cost to the company, 0 cost to the insurance company. Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company, With insurance: 4% chance: 1mil cost to the company, 22mil cost to the insurance company. 96% chance: 1mil cost to the company, 1mil profit to the insurance company. Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company. With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests. There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame). Companies that are destroyed by a single event are encouraged to be as risky as possible because there is a hard limit on what they can be charged: their worth. A good example is the BP oil spill. One of the reasons why BP took that risk is because the damage was more than their company worth. Penalizing pre-existing conditions is wrong. The whole point is to pay for sick people. If we're failing to do that, then that's a failure of the system.You are also forgetting that the profit motive encourages insurance companies to try to find loopholes to not cover people's medical issues. This not only hurts people directly, but also means that healthcare hire teams of highly trained lawyers to exploit these loopholes. This is money that the insurance company is not spending on care. It is no longer "insurance" if pre-existing conditions are covered. The whole purpose of insurance is to hedge against future risk, not pay for past loss.
Again, the purpose is for healthy people to pay for sick people. I don't care about semantic definitions of insurance. What matters is whether the system does what it is supposed to do.
People with treatable genetic conditions should not be told to fuck off. That's bullshit.
|
Of course if you pay for pre-existing conditions it's not just a hedge against risk. In Hungarian it's called the principle of solidarity. It's supposed to be good thing according to most people.
|
United States41989 Posts
On October 02 2013 01:04 xDaunt wrote:Show nested quote +On October 02 2013 00:59 DoubleReed wrote:On October 02 2013 00:35 rasnj wrote:On October 02 2013 00:02 DoubleReed wrote:
Insurance is just a way for healthy people to pay for sick people. Or whatever equivalents for different kinds of insurance. It only works because there is way more healthy people than sick people. It's inherently a socialist concept, which is why it fails so hard in free markets and why it works well with "regulated monopolies" and single payer systems.
Saying that insurance is bad is just a failure to understand the prisoner's dilemma. In a world without insurance, everybody loses, except maybe the luckiest of the lucky Insurance works great in free markets as a way to deal with future risk and uncertainty (maybe not if you deal with linear utility functions, rational actors and a strongly efficient market, but no one believes these things hold in the real world). Consider a company that know that a year from now an event will happen with probability 4% which will cause them to lose 23mil. They can find 16mil by taking their cash assets, selling non-essential assets, taking out mortgages, etc., but to get the last 7mil they would need to get 7mil from selling highly illiquid assets at "firesale" prices (say 50% of what the company considers them worth). Instead they might contact an insurance company that agrees that for 1mil they will pay the company 23mil if the 4% event happens. Without insurance: 4% chance: 30mil cost to the company, 0 cost to the insurance company. 96% chance: 0 cost to the company, 0 cost to the insurance company. Expected outcome (average): 1.2mil cost to the company, 0 cost to the insurance company, With insurance: 4% chance: 1mil cost to the company, 22mil cost to the insurance company. 96% chance: 1mil cost to the company, 1mil profit to the insurance company. Expected outcome (average): 1mil cost to the company, 80k profit to the insurance company. With insurance is better for all parties on average. If you add into consideration risk-adverseness and companies that may actually be destroyed by a single event, then it starts to make even more sense. Companies adversely affected by rare negative events in the real world often have to restructure, lay-off large parts of staff, make permanent decisions on how the company is owned, etc., and these may all hurt the company much more than the event itself suggests. There are part of health insurance that doesn't make sense in a free market however. In particular no rational insurance provider would insure a person with an expensive pre-existing condition at the same cost as a person with no pre-existing condition (or anywhere close). I still believe we should insure them, but that is just my view on what a society should provide its citizens (in particular I believe ordinary citizens should be given a way to get out of whatever shitty situation they are in, even if they are partly to blame). Companies that are destroyed by a single event are encouraged to be as risky as possible because there is a hard limit on what they can be charged: their worth. A good example is the BP oil spill. One of the reasons why BP took that risk is because the damage was more than their company worth. Penalizing pre-existing conditions is wrong. The whole point is to pay for sick people. If we're failing to do that, then that's a failure of the system.You are also forgetting that the profit motive encourages insurance companies to try to find loopholes to not cover people's medical issues. This not only hurts people directly, but also means that healthcare hire teams of highly trained lawyers to exploit these loopholes. This is money that the insurance company is not spending on care. It is no longer "insurance" if pre-existing conditions are covered. The whole purpose of insurance is to hedge against future risk, not pay for past loss.
A woman in perfect health whose mother and aunt got breast cancer would be expensive to provide insurance for unless they first got a double mastectomy out of pocket, in a private system it is likely they'd be forced to go without insurance. Universal healthcare allows them to live a normal life and be covered if stuff happens and also can offer the preventative treatment of a mastectomy which is a net saving overall.
Insurance doesn't solve the problem because society still wants her getting some kind of care if she needs it, whether it's cancer or a heart attack. If we accept that we're not letting people die on the streets, and we do, then we need to find a system that provides care to people. Insurance can work, and indeed we have health insurance companies in the UK where we also have a single payer public system, but does not always work for everyone.
|
I'm only pointing out that universal healthcare is a very distinct concept from insurance.
|
|
|
|
|
|
EPT
