The health-insurance conundrum

Health Overhaul GOP\'s Gamble
President Trump with Health and Human Services Secretary Tom Price.

The House bill to partially repeal and replace Obamacare, the American Health Care Act, may not be approved in the Senate. What to do about providing health care to the nation is a conundrum with which the president, Congress, the pundits, the media, and the general public are struggling.

The problem that makes a solution difficult to reach is this elephant in the room: We all want as much health care as we need, and we want someone else to pay for it.

If you don't believe me, just ask yourself why you want health insurance rather than paying your own medical bills as you incur them. I'm willing to bet that the answer is that you can't afford to. When you actually need medical care it is almost always too expensive. We all want those costs covered by insurance.

The whole idea behind any kind of insurance is to spread the risk over the entire group subject to the risk. If we limited health insurance to catastrophic health care, we really would be talking about insurance. But what we have gotten used to is not really insurance, but health maintenance. We want every medical expense covered with only a small co-pay, or in some cases, such as birth control, no co-pay at all.

Think about it. If we don't want to pay in full our physician's fees, our hospital charges, and our drug costs ourselves, we need someone else to pay them. But who is that someone else? The honest answer is that we really don't care who that someone else is. We just want to be sure that our medical expenses are covered by our medical insurance, and that our premiums for that insurance are low. We're willing to pay a little bit, but not the whole thing. That would be too expensive.

But somebody has to pay. Health-insurance companies are businesses, not charitable institutions. They have to receive enough money to pay for the part of our health-care expenses we don't pay, and a reasonable bit more in order to return some profit to their shareholders for their investment. If the premiums they charge do not cover their costs, they will go out of business. That is why the insurance companies did not want to cover preexisting conditions. Someone with a preexisting condition is someone who had not been paying into the system before asking for the benefits the system provides.

The person who wants his preexisting condition to be covered is like the person in the office who has not been participating in the office lottery pool until after the pool participants have a winning number. Now he wants to share in the big win by putting in his one dollar.

If we want everyone to be covered for almost all of their medical expenses, then someone has to pay the difference between the full cost and the co-pays. So a lot of people would have to pay for more health care than they consume. However, many healthy young people don't want to pay for older people who consume a disproportionate amount of the available care. That is why Obamacare had an insurance mandate, and a penalty for refusing to participate.

Cheap health insurance that covers almost everything is like getting free stuff. Obamacare promised a lot of people a lot of stuff: free birth control, coverage for preexisting conditions, and subsidies for insurance premiums. The problem is that someone has to pay for the free stuff.

One partial solution, of course, would be to limit the free stuff. But no group wants their free stuff taken away, and no group wants to pay for some other group's free stuff. Seniors don't want cuts to Medicare. The poor don't want cuts to Medicaid. Those who haven't been insured before don't want to see coverage for preexisting conditions removed. Women of child-bearing age don't want to see free birth control (a euphemism for recreational sex) disappear.

It is time we recognize the elephant in the room: We all want as much health care as we need, and we want someone else to pay for it.

Howard Lurie is a retired law school professor. hrlurie@gmail.com