Sometimes I really hate being right. Look at my past commentaries. On September 21, 2004 (“Oops, Government Does It Again”) and June 6, 2003 (“We’re From the Government and We’re Here to Heal You”) both predicted massive increases in health care premiums and huge increases in the uninsured from continued regulation of health care financing, principally regulation of health insurance.
Last week, the Insurance Commissioner, an advocate for socialized medicine, wrote a report, which he called “Priced Out,” showing that insurance premiums have increased 61 per cent, and the number of uninsured has increased to 6.6 million Californians. He blames insurance companies for this.
He is particularly upset at one insurance company who offers an insurance product to young people (18 to 30 year olds) with reduced benefits, high deductibles and low premiums. The product is wildly popular, giving young, healthy people protection against major medical problems at a price they can afford. These younger workers, who just last year were among the ranks of the uninsured, are now insured, and the Insurance Commissioner is mad.
I thought being insured was good. Well, the report says that those bad insurance companies are giving these workers a choice, buy cheap insurance without pregnancy coverage if you want. That is wrong, complains the Commissioner because those insurance companies should require young, 25 year old single men to pay for insurance coverage for pregnancy because young women get pregnant. Those insurance companies are cherry picking their customers, he claims, by getting these young, single (and usually healthy) men to buy this cheap policy.
Who is he kidding? One of the choices that every worker has is the choice to not be insured. If government raises the price of health insurance, these young men will simply choose to spend the money on their cars, and run the risk of getting really sick and not being able to pay. Then, if the bills get too high, they will just file bankruptcy, and you and I will eat the bill in our insurance coverage.
Those are the choices. Forcing coverage on people doesn’t result in more coverage; it will actually result in no coverage at all. More government regulation will continue to drive more people to the ranks of the uninsured because it will price them out of the market.
The recommendations of the Insurance Commissioner to mandate gold-plated health insurance policies for everyone are tantamount to a government order that everyone own a Rolls Royce. Sure the Rolls-Royce is a good car, but not everyone can afford one. If the government ordered that every car look and work like a Rolls, many people would have to go without a car, because the government-mandated car would be too expensive. Those who can’t afford the Commissioner’s mandated gold-plated health insurance policy will simply go without insurance.
The Insurance Commissioner is correct when he says that the number of uninsured in California has increased because the price of insurance has increased 61 per cent in the last six years in California. It is not greedy insurance companies that have caused the increase, however. It is the number of health insurance policy mandates (well in excess of twenty) enacted by government that have increased the price, and thus increased the number of uninsured. In California, we are all required to buy a Cadillac health policy, or have no health insurance at all. Many have chosen, for financial reasons, to have none at all.
The prescription for this problem by the Insurance Commissioner is more government. Government created the problem with more mandates, more regulation, and more bureaucrats. When will those in government learn that more government cannot fix a problem that more government created?
[This piece originally appeared at The One Republic.]
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