So, I was reading an AP poll today... It was all about health care. One statistic jumped out at me.
"For example, when asked if everyone should be required to have at least some health insurance, 67% agreed, and 27% said no."
This looks like a clear mandate to have universally required health insurance. But, they ask the same people this question.
"Should there be a federal penalty for not carrying insurance?"
The results: 64% were opposed, 28% were in favor.
So, it appears the majority of people want to mandate health insurance, but have no penalties if you don't follow the law... Is there a disconnect here?
Monday, November 16, 2009
Wednesday, November 11, 2009
Infuriating
This really drives me nuts. I don't care if you're democrat or republican, you shouldn't sell your vote, especially on something as big as health care. Rep. Dennis Cardoza wanted to fund some medical centers in his district. Not only did he push to start a "grant" of $500 million for the project, but then he took the "competitive grant", and had it written just for his district. No need for competition here, is there? Unbelievable.
http://www.politico.com/news/stories/1109/29383.html
http://www.politico.com/news/stories/1109/29383.html
Monday, November 9, 2009
Pre-Existing Conditions
The house bill calls for insurance companies to cover pre-existing conditions.... I think. I can't find the wording of the bill anywhere. Does it require coverage immediately, or like Hippa (passed in 1996) where the insurance company doesn't have to cover the condition for the first 6 months -1 year (I don't know exactly how long). Here are two stories of the two sides of the issue.
Let's say my son has some heart problems. I'm working for ACME, and I get fired. I quickly find a job at XYZ Corp, but they have a different issurance company, and they won't cover his condition for 6 months. After two months, he has to get open heart surgery, and I can't afford it. I either don't get the surgery and he dies, I pay the huge bill, or I go bankrupt, and the hospital has to eat the cost.
On the other hand, lets say I work for ACME, but I don't want to have to pay for insurance, so I don't. I'm a young, healthy adult. Then one day, as I'm walking in the woods, a tree falls on me. It looks like I'm going to be in the hospital for a couple of months. I hurry and get health insurance, and they can't deny me because it's a "pre-existing" condition. After 3 months of recouperation, I get out of the hospital, and quickly drop my insurance and won't pick it up again until I need it.
So, what should we do? The current bill makes sure those "evil" insurance companies can't discriminate against those who have pre-existing conditions... To make sure no-one drops their insurance, they make it mandatory... (Is this the first ever "existing" tax in the US? ie, the first tax you have to pay just for being alive)
What would I do? I think that insurance is simply a contract between me and the insurance company. That contract can be written however we want. If the terms are bad for the insurance company, no one should force them to do something they don't want. If the terms are bad for the consumer, no one should force them to buy it. But, once that contract is in place, the rule of law says it must be enforced. If the company tries to get out of it, and break their contract, that's what we have courts for. Some companies will write in a lot of pre-existing stuff, and give you cheaper insurance. Others won't, and will have higher premiums. It's the same with car insurance... If I'm a bad driver, and get in lots of accidents, then my premiums will go up, and possibly companies won't insure me. That's how a free market works.
But what about those who have life-long problems, and no one will insure them? I would be fine having the government help with those very few cases (Most states already have a high-risk pool you can get into). The social security administration takes care of some things... Do we really need to distort the free market for everyone, to help take care of the few that really need it and can't afford it?
What say you?
Let's say my son has some heart problems. I'm working for ACME, and I get fired. I quickly find a job at XYZ Corp, but they have a different issurance company, and they won't cover his condition for 6 months. After two months, he has to get open heart surgery, and I can't afford it. I either don't get the surgery and he dies, I pay the huge bill, or I go bankrupt, and the hospital has to eat the cost.
On the other hand, lets say I work for ACME, but I don't want to have to pay for insurance, so I don't. I'm a young, healthy adult. Then one day, as I'm walking in the woods, a tree falls on me. It looks like I'm going to be in the hospital for a couple of months. I hurry and get health insurance, and they can't deny me because it's a "pre-existing" condition. After 3 months of recouperation, I get out of the hospital, and quickly drop my insurance and won't pick it up again until I need it.
So, what should we do? The current bill makes sure those "evil" insurance companies can't discriminate against those who have pre-existing conditions... To make sure no-one drops their insurance, they make it mandatory... (Is this the first ever "existing" tax in the US? ie, the first tax you have to pay just for being alive)
What would I do? I think that insurance is simply a contract between me and the insurance company. That contract can be written however we want. If the terms are bad for the insurance company, no one should force them to do something they don't want. If the terms are bad for the consumer, no one should force them to buy it. But, once that contract is in place, the rule of law says it must be enforced. If the company tries to get out of it, and break their contract, that's what we have courts for. Some companies will write in a lot of pre-existing stuff, and give you cheaper insurance. Others won't, and will have higher premiums. It's the same with car insurance... If I'm a bad driver, and get in lots of accidents, then my premiums will go up, and possibly companies won't insure me. That's how a free market works.
But what about those who have life-long problems, and no one will insure them? I would be fine having the government help with those very few cases (Most states already have a high-risk pool you can get into). The social security administration takes care of some things... Do we really need to distort the free market for everyone, to help take care of the few that really need it and can't afford it?
What say you?
Monday, April 21, 2008
Tuesday, April 8, 2008
Health Care
Well, it's been a while since I posted. I have decided to look at Health Care today, and what we should do about it.
One thing that I think almost all people would agree on in the United States is that our health care situation is not good, and something should be done. But what? The left want universal health coverage, but what will that cost? The right want free market solutions, but doesn't that leave the poor even worse off?
Let's talk about both situations. First, free market solutions.
While the libertarian in me wants the government out of the picture, is this really a good idea? The answer I will always give.... it depends.
What would happen if we completely got rid of government oversite, and even insurance companies. If I have to go to the doctor, it's just like anything else. I shop around, and find the best deal for me. The problem is that if something really bad happens (cancer for instance), most of us do not have the hundreds of thousands of dollars to pay for it. My son was born with heart problems, and he has racked up $250k of medical bills. I can't afford that, so my son would have died. Anyone want that to happen to them?
What about universal health care? Everyone gets covered, no matter what. That sounds great! The problem is in the details. Because it is "free", I can go to the doctor whenever I want, which costs more. Instead of deciding to wait a day, to see if I feel better, I can go as often as I want. And, what does the health care cover? As politically incorrect as it is to say, there is a price for a human life. There is a finite amount of resources, and we can't do everything for everyone. What if the time and money spent on my son could have saved 10 other people. Well, it's cold hearted to save my son rather than the 10 others, isn't it? And what about non-life threatening problems. I've mentioned before "The Undercover Economist". Great book. The author has a chapter about health care, which is interesting. He talks about the British health care. They have a finite amount of money to spend, so they have to decide what procedures to cover. How can you decide which is better, getting cataract surgery so that someone can see, vs getting a prostetic arm. Neither is life threatening, but will make the quality of life better for the recipient. What about spending millions of dollars to save someone who is 98 years old. Is it worth it???
In a free market, people can make individual choices on what is important to them. Sure, it's not really fair.... The rich can do what they want, while the poor suffer. But, on the whole, more people get what they want because they have to pay for it.
So, what do we have now? The worst of both worlds? The government has highly regulated the insurance industry. Insurance can only be sold at the state level, not federal. Because most insurance is given through someone's employement, you don't get to choose the best plan for you. You don't really have much of an incentive not to use the insurance (you only have a $25 co-pay). On the other hand, many poor people don't have access to the same quality of care that those with good insurance do. The government is already subsidizing lots of people, and spending lots of our money doing it...
So, what is to be done? Here's my solution to our health care problems in the US. I have taken a lot from "The Undercover Economist", so I can't claim most of these ideas as my own.
First, I think insurance is a good thing, but we need to drastically change how that happens. Currently, most people get insurance from their companies because it is tax free. The company would have to give you much more for you to buy the same health insurance, because you have to pay taxes on all your income. So, the first thing I would do is make the first, say $10k of money you spend on health insurance tax deductable. That way it doesn't cost any more for you to get your own health insurance plan. Just tell your employer you would rather have the money to make your own insurance decisions.
This will allow there to be much greater competition in the insurance business. No more catering to large companies. It will have to be more like car insurance, where you can shop around for the best deal. That way an insurance company can taylor a plan for you.
The next thing I would do, which is not what libertarians would like to hear, is get the government involved. I would have the government sponser all catastrophic health insurance. And catastrophic means catastrophic. If your bill is over, say $250k a year, the government picks up the rest. That way normal health insurance would have upper limits, and the premiums would go way down.
I would get rid of medicaid and medicare, and have the government help those people by helping them get normal health insurance.
How does that sound? Any comments? What else would we do to make the system better? I will try and post more frequently, and maybe come back to this subject, but I have to run now.
He points out that health care will not follow the normal economic models that would make free market solutions work. The problem is information. If I am healthy, it shouldn't cost too much to insure me. If I have cancer, than it will cost a lot to take care of me. I have information about myself, that the insurance company doesn't have, ie if I am sick or not.
One thing that I think almost all people would agree on in the United States is that our health care situation is not good, and something should be done. But what? The left want universal health coverage, but what will that cost? The right want free market solutions, but doesn't that leave the poor even worse off?
Let's talk about both situations. First, free market solutions.
While the libertarian in me wants the government out of the picture, is this really a good idea? The answer I will always give.... it depends.
What would happen if we completely got rid of government oversite, and even insurance companies. If I have to go to the doctor, it's just like anything else. I shop around, and find the best deal for me. The problem is that if something really bad happens (cancer for instance), most of us do not have the hundreds of thousands of dollars to pay for it. My son was born with heart problems, and he has racked up $250k of medical bills. I can't afford that, so my son would have died. Anyone want that to happen to them?
What about universal health care? Everyone gets covered, no matter what. That sounds great! The problem is in the details. Because it is "free", I can go to the doctor whenever I want, which costs more. Instead of deciding to wait a day, to see if I feel better, I can go as often as I want. And, what does the health care cover? As politically incorrect as it is to say, there is a price for a human life. There is a finite amount of resources, and we can't do everything for everyone. What if the time and money spent on my son could have saved 10 other people. Well, it's cold hearted to save my son rather than the 10 others, isn't it? And what about non-life threatening problems. I've mentioned before "The Undercover Economist". Great book. The author has a chapter about health care, which is interesting. He talks about the British health care. They have a finite amount of money to spend, so they have to decide what procedures to cover. How can you decide which is better, getting cataract surgery so that someone can see, vs getting a prostetic arm. Neither is life threatening, but will make the quality of life better for the recipient. What about spending millions of dollars to save someone who is 98 years old. Is it worth it???
In a free market, people can make individual choices on what is important to them. Sure, it's not really fair.... The rich can do what they want, while the poor suffer. But, on the whole, more people get what they want because they have to pay for it.
So, what do we have now? The worst of both worlds? The government has highly regulated the insurance industry. Insurance can only be sold at the state level, not federal. Because most insurance is given through someone's employement, you don't get to choose the best plan for you. You don't really have much of an incentive not to use the insurance (you only have a $25 co-pay). On the other hand, many poor people don't have access to the same quality of care that those with good insurance do. The government is already subsidizing lots of people, and spending lots of our money doing it...
So, what is to be done? Here's my solution to our health care problems in the US. I have taken a lot from "The Undercover Economist", so I can't claim most of these ideas as my own.
First, I think insurance is a good thing, but we need to drastically change how that happens. Currently, most people get insurance from their companies because it is tax free. The company would have to give you much more for you to buy the same health insurance, because you have to pay taxes on all your income. So, the first thing I would do is make the first, say $10k of money you spend on health insurance tax deductable. That way it doesn't cost any more for you to get your own health insurance plan. Just tell your employer you would rather have the money to make your own insurance decisions.
This will allow there to be much greater competition in the insurance business. No more catering to large companies. It will have to be more like car insurance, where you can shop around for the best deal. That way an insurance company can taylor a plan for you.
The next thing I would do, which is not what libertarians would like to hear, is get the government involved. I would have the government sponser all catastrophic health insurance. And catastrophic means catastrophic. If your bill is over, say $250k a year, the government picks up the rest. That way normal health insurance would have upper limits, and the premiums would go way down.
I would get rid of medicaid and medicare, and have the government help those people by helping them get normal health insurance.
How does that sound? Any comments? What else would we do to make the system better? I will try and post more frequently, and maybe come back to this subject, but I have to run now.
He points out that health care will not follow the normal economic models that would make free market solutions work. The problem is information. If I am healthy, it shouldn't cost too much to insure me. If I have cancer, than it will cost a lot to take care of me. I have information about myself, that the insurance company doesn't have, ie if I am sick or not.
Tuesday, March 18, 2008
A small economic example
I finally have the time to write another post here. I have decided to write about the general theory of economics. I have been reading "The Undercover Economist" and it has been very enlightening. I have read other economic books, but this one really explains the fundamental aspects of economics.
First of all, I think that most people don't really focus on what really happens with economics... Our economy is so big, so complex, that we lose sight of what is really happening. So, I want to use an example to explain my ideas, and then we can expand that out to the US and then global economy. I'm going to make this really confusing and add in my comments about the real economy with the simple example. I'll try and put the comments in red. I might forget....
Lets say we are on a deserted island with 20 people. We know we are there for life, and no one will ever come and find us. It's okay, because there are trees, water, fruit, etc.
We have slightly more than 20 people on the earth, but the ideas are the same. We are here, and we have to work together.
Economics is the utilization of scarce resources. That's all it is. Currently, on this island, our scarce resource is man power. We have to decide what is most important. Should we all work at building houses? Should some work at gathering food? We have a limited amount of time, and we can't do everything at once.
This is where socialism breaks down in real life. If there are only 20 of us, we can decide what is the best use of our time, all together. We can truly work together and get more done than if we were competing... but, with Billions of people, it's impossible to work like that. The best way is capitalism, but that's another post for another day.
So, say we all divide up, and get lots of stuff done. One person's job (Hannah) is to fetch water and carry it to our settlement. Well, that's a hard job, and takes Hannah all day, every day. Someone decides that if they make a sluce, we can have water run straight to the settlement, and Hannah won't have to waste the time getting the water. That seems like a great idea, right? Hannah can now do something else to be productive. (I bet you see where this is going...)
So, Hannah just lost her job because of innovation. Isn't that sad? I think we shouldn't allow that to happen. Let's start subsidizing Hannah so she can keep hauling water.... It doesn't make sense, does it? But that's what we do. We talk about people losing their jobs because of better technology, better business practices, more streamlined processes. GM can make more cars with less people, but we complain about the employees losing their jobs. What it really means is GM is more productive, so now those workers can do something else which will help society.
Then something horrible happens. There's a hurricane, and most of the trees are blown away. We do some math, and decide that we can only use 20 trees a year.... We now have a dilemma. What should we use the trees for.... We could make nicer huts, so we don't get as cold at night... We could make some boats so it's easier to fish. How about some plumbing fixtures, those would be useful. In our society, we all sit down together and decide what is best. 5 people want plumbing fixtures, 5 people want nicer huts, and 9 want fishing boats, and 1 thinks we should let the trees grow so that in the future we can have more. Somehow we come to an agreement on what we use the trees for.
Everything is a scarce resource, whether we think it is or not. We have a limited number of trees, apartments in NYC, oil, people, etc. We have to decide what to do with them. How do we decide? How can we decide who should get the apartments in NYC? Maybe the government should decide, isn't that what socialism says? We'll decide for you what is best for the country... But, how do we know it's actually best for the country? Maybe we should just divide it up evenly... But what if I would much rather have an apartment in DC rather than NYC? How do we determine what it's worth.... Why don't we let the people decide? It's hard enough making it "Fair" when there are only 20 people.... what about when there are 300 million? That's where capitalism comes into play. We let our desires chose for us. Sure, it's selfish, but we use that selfishness to better society.
Hannah is out of a job. Everyone wants her to work, and she does to. She looks around, and sees Aaron fishing. Aaron is a great fisherman. He can catch 30 fish a day, plenty for the entire settlement. But, Aaron is not very good at picking stawberries. He eats almost all of them before he puts them in the bag. Hannah is very good at picking stawberries, but can only catch 3 fish a day. Well, Hannah thinks she would really like to be a fisherman, that was her secret desire when she was carrying water. So, she decides she is going to fish. Well, the whole community tells her that it is better if she picks strawberries rather than fish, because it helps out society.
What if I wanted to be a cowboy. I like the outdoors. Of course, I don't know how to ride a horse, or raise cows. How does society allocate the scarce resource of my man power? The government can tell me what I should do.... But how do they do that? Do they ask me what I'd like to do? Then I'd be an inefficient cowboy, rather than the engineer that I am. How about they determine the benifit to society. And pay me that amount. If I would be a really bad cowboy, I would make much less than if I were an engineer. That would encourage me to do what I do best... If very few people have the ability to do a certain job, than because of the scarcity of people, it will be more valuable.
So, what has our little example shown us about economics? What drives economics is scarcity. We didn't have to worry about trees until there weren't enough. We had to worry about manpower. Who did what is very important. We had to focus the scarce resources to what people wanted most. How do you compare the benifits of having a bathroom to having a boat to go fishing.... Everyone has their own criteria. Some might want it one way, other's another way. With 20 people, you can probably get something to work, but not with 300 million. If you have a free, capitalistic society, than people will pay what it is worth to them. If having an ipod is more important to someone than having a nice toilet seat, then that's what they will buy, and that is what will be built, because it's not profitable to build the toilet seat.
If, on the other hand, you have the government decide.... Then you might have a beurocrate decide that an ipod is a want, while a toilet seat is a need, so everyone will get new toilet seats....
Throughout this blog, this idea of scarcity will come up quite often, because it is so vital to everything we do. It affects health care, global warming, national defense, pretty much everything. Please share comments or thoughts. I will answer comments in the comment section, so be sure to go back to other posts to see what is new.
First of all, I think that most people don't really focus on what really happens with economics... Our economy is so big, so complex, that we lose sight of what is really happening. So, I want to use an example to explain my ideas, and then we can expand that out to the US and then global economy. I'm going to make this really confusing and add in my comments about the real economy with the simple example. I'll try and put the comments in red. I might forget....
Lets say we are on a deserted island with 20 people. We know we are there for life, and no one will ever come and find us. It's okay, because there are trees, water, fruit, etc.
We have slightly more than 20 people on the earth, but the ideas are the same. We are here, and we have to work together.
Economics is the utilization of scarce resources. That's all it is. Currently, on this island, our scarce resource is man power. We have to decide what is most important. Should we all work at building houses? Should some work at gathering food? We have a limited amount of time, and we can't do everything at once.
This is where socialism breaks down in real life. If there are only 20 of us, we can decide what is the best use of our time, all together. We can truly work together and get more done than if we were competing... but, with Billions of people, it's impossible to work like that. The best way is capitalism, but that's another post for another day.
So, say we all divide up, and get lots of stuff done. One person's job (Hannah) is to fetch water and carry it to our settlement. Well, that's a hard job, and takes Hannah all day, every day. Someone decides that if they make a sluce, we can have water run straight to the settlement, and Hannah won't have to waste the time getting the water. That seems like a great idea, right? Hannah can now do something else to be productive. (I bet you see where this is going...)
So, Hannah just lost her job because of innovation. Isn't that sad? I think we shouldn't allow that to happen. Let's start subsidizing Hannah so she can keep hauling water.... It doesn't make sense, does it? But that's what we do. We talk about people losing their jobs because of better technology, better business practices, more streamlined processes. GM can make more cars with less people, but we complain about the employees losing their jobs. What it really means is GM is more productive, so now those workers can do something else which will help society.
Then something horrible happens. There's a hurricane, and most of the trees are blown away. We do some math, and decide that we can only use 20 trees a year.... We now have a dilemma. What should we use the trees for.... We could make nicer huts, so we don't get as cold at night... We could make some boats so it's easier to fish. How about some plumbing fixtures, those would be useful. In our society, we all sit down together and decide what is best. 5 people want plumbing fixtures, 5 people want nicer huts, and 9 want fishing boats, and 1 thinks we should let the trees grow so that in the future we can have more. Somehow we come to an agreement on what we use the trees for.
Everything is a scarce resource, whether we think it is or not. We have a limited number of trees, apartments in NYC, oil, people, etc. We have to decide what to do with them. How do we decide? How can we decide who should get the apartments in NYC? Maybe the government should decide, isn't that what socialism says? We'll decide for you what is best for the country... But, how do we know it's actually best for the country? Maybe we should just divide it up evenly... But what if I would much rather have an apartment in DC rather than NYC? How do we determine what it's worth.... Why don't we let the people decide? It's hard enough making it "Fair" when there are only 20 people.... what about when there are 300 million? That's where capitalism comes into play. We let our desires chose for us. Sure, it's selfish, but we use that selfishness to better society.
Hannah is out of a job. Everyone wants her to work, and she does to. She looks around, and sees Aaron fishing. Aaron is a great fisherman. He can catch 30 fish a day, plenty for the entire settlement. But, Aaron is not very good at picking stawberries. He eats almost all of them before he puts them in the bag. Hannah is very good at picking stawberries, but can only catch 3 fish a day. Well, Hannah thinks she would really like to be a fisherman, that was her secret desire when she was carrying water. So, she decides she is going to fish. Well, the whole community tells her that it is better if she picks strawberries rather than fish, because it helps out society.
What if I wanted to be a cowboy. I like the outdoors. Of course, I don't know how to ride a horse, or raise cows. How does society allocate the scarce resource of my man power? The government can tell me what I should do.... But how do they do that? Do they ask me what I'd like to do? Then I'd be an inefficient cowboy, rather than the engineer that I am. How about they determine the benifit to society. And pay me that amount. If I would be a really bad cowboy, I would make much less than if I were an engineer. That would encourage me to do what I do best... If very few people have the ability to do a certain job, than because of the scarcity of people, it will be more valuable.
So, what has our little example shown us about economics? What drives economics is scarcity. We didn't have to worry about trees until there weren't enough. We had to worry about manpower. Who did what is very important. We had to focus the scarce resources to what people wanted most. How do you compare the benifits of having a bathroom to having a boat to go fishing.... Everyone has their own criteria. Some might want it one way, other's another way. With 20 people, you can probably get something to work, but not with 300 million. If you have a free, capitalistic society, than people will pay what it is worth to them. If having an ipod is more important to someone than having a nice toilet seat, then that's what they will buy, and that is what will be built, because it's not profitable to build the toilet seat.
If, on the other hand, you have the government decide.... Then you might have a beurocrate decide that an ipod is a want, while a toilet seat is a need, so everyone will get new toilet seats....
Throughout this blog, this idea of scarcity will come up quite often, because it is so vital to everything we do. It affects health care, global warming, national defense, pretty much everything. Please share comments or thoughts. I will answer comments in the comment section, so be sure to go back to other posts to see what is new.
Friday, March 7, 2008
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