Massachusetts Health Care

July/12/2009 17:25PM
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Massachusetts health care is the prototype of the one Obama says we need for the rest of the country. How is it working?

The plan, put in place by Mitt Romney in 2006 is not working. It has the mandatory requirement the government wants to make law. If you don’t qualify for the state plan, you must buy insurance or pay a penalty. The penalty is about $900.

Plus the state put in place in a law in 1991 a law that states insurers must provide insurance for anyone who applies regardless of pre-existing conditions at the same premium as healthy people pay. Guess what, since some people only apply for insurance when they get sick, Massachusetts has the highest insurance premiums in the country. People buy insurance when they need it, drive up the cost for everyone, then drop the insurance and pay the $900 penalty.

A study showed that only 40% of the new enrollees stayed with the state insurance, incurred an average of $2,400 per month in claims, then dropped the insurance. That’s 600% more than the average an insurer would expect for new enrollees.

Any type of health insurance is built on the premise that the younger and healthier subsidize the older and sicker with their premiums. That makes the whole insurance business work. It’s risk sharing.

Under the Massachusetts plan, the public can job the system. The young can not carry insurance and take the risk and get insurance if something happens. This drives premiums higher. The higher premiums are paid by individuals who aren’t jobbing the system and small businesses that provide insurance and are hurting both.

Now, congress says the rich will pay the higher costs that any Universal Health Insurance like Massachusetts has will deliver. All one trillion of it. But, like Massachusetts, it won’t just be the rich. Businesses, insurers, individuals who have health insurance, and Medicare and Medicaid will also pay more, lot’s more.

So, once again, our government wants to take a broken model and adopt it for an entire country.

Under the mantra that a rich nation like ours should provide health care for everyone, we will adopt a failed system. Those who are sick will want health insurance. They will need it and run up huge costs that will raise premiums and add cost to business and higher taxes. Even if they adopt a penalty for those who don’t apply for insurance, those individuals will weigh the penalty vs. the insurance premium and pay the lesser. If they made a bad bet there is no cost. They will just take the insurance if they need it and use it more than the average of the population will use insurance.

Premiums will go up across the board. We will be insuring the sick and the healthy will wait until they need insurance to buy it.

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