Thursday, July 5, 2012

What to Do About Pre-existing Conditions

I am adamantly opposed to Obamacare or, worse yet, a fully socialized single payer system. Yet, I am not without compassion. How can we deal with problem of pre-existing conditions yet avoid a government solution? The market can deal with this issue. The following article explains how. The solution to raising insurance cost, preexisting conditions and health care inefficiency is less government; not more.

What to Do About Pre-existing Conditions

Most Americans worry about health coverage if they lose their job and get sick. There is a market solution.

But what about pre-existing conditions?

A truly effective insurance policy would combine coverage for this year's expenses with the right to buy insurance in the future at a set price. Today, employer-based group coverage provides the former but, crucially, not the latter. A "guaranteed renewable" individual insurance contract is the simplest way to deliver both. Once you sign up, you can keep insurance for life, and your premiums do not rise if you get sicker. Term life insurance, for example, is fully guaranteed renewable. Individual health insurance is mostly so. And insurers are getting more creative. UnitedHealth now lets you buy the right to future insurance—insurance against developing a pre-existing condition.
These market solutions can be refined. Insurance policies could separate current insurance and the right to buy future insurance. Then, if you are temporarily covered by an employer, you could keep the pre-existing-condition protection.(read more)
As we work to elect a President, Senators and Representatives who pledge to repeal Obamacare, there must be an alternative. While the public may not like Obamacare, I feel certain that the status quo is not acceptable. Even if we are successful in repealing Obamacare, unless there is a viable alternative, we will again be facing a liberal, government solution that may be worse than Obamacare. We must lower cost, expand coverage, and deal with the problem of pre-existing conditions. We need a ten-point plan (or six, or eight or twelve point plan) that fixes what is wrong with American health care.

Employers should no more provide your health insurance than they provide your car insurance or your housing or your food. Many people work at jobs they hate, just to get the insurance. We need to divorce insurance from employment, we need to remove the prohibition against purchasing insurance across state lines, we need health saving accounts, tort reform, and various other reforms. Unless Republicans can sell a market solution, we will have a government solution.

Like this article states, we need a vibrant, deregulated individual insurance market.


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