Saturday, March 20, 2010

The path to single payer (Wizbang)

Kim Priestap shows how ObamaCare could very plausibly lead to a single-payer system: The path to single payer

The bill the House that is supposed to come up for a vote this weekend will impose regulations on all health insurance companies that will make it impossible for them to stay in business. They will be required to provide insurance to people with preexisting conditions. The only way any insurance company can stay afloat when it is required to accept the sickest people is if everyone, the young and healthy specifically, buy insurance as well. Healthier people don't require as much health care, so their premiums will go to pay the claims for sicker people.

But here's the problem. The fine for not buying health insurance is less than the cost of insurance itself. Since there's no incentive for the healthiest among us to buy insurance since they will have to be accepted when they do get they get sick, many people will choose to pay the fine, which will go to the government and not the insurance companies.

Naturally, it won't be too long before the insurance companies find themselves paying out more in claims than they receive in premiums. No company can stay in business under those circumstances. If the insurance companies try to increase their rates in order to stop the bleeding, the government will have the authority to call the rate increases excessive and will deny them. The fates of the insurance companies will be sealed.

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