Why free market principles fail in the health care arena.

[dhpgetsit]

Why free market principles fail in the health care arena.

Joe Six-pack Is a healthy 25 year old starting his own business in landscaping. He has no dependants and sees no need to buy health insurance. He has just finished a very nice patio and gotten paid, so he grabs his camping and fishing gear and heads out of town. While rounding a bend in the highway, he runs over some debris in the road, has a blow-out, skids off the pavement, rolls his truck and slams into a tree. Someone calls 911 and an ambulance is dispatched. Joe Six-pack is rescued and taken to the emergency room. He is stabilized but his leg is badly broken and he has to remain in traction for 2 weeks.

Who pays for his medical bills? Because Joe Six-pack is unable to pay his bills, the hospital is forced to raise its rates. This means the insurance companies have to pay Joe Six-pack's medical bills. The insurance companies in turn have to raise their premiums in response.

Sally Six-pack is trying to work her way through college. She has health insurance through her employment, but she needs to pay half of the premiums. And thanks to Joe Six-pack, the premiums have gone up. She figures she will get a better job when she gets her degree so rather than pay the additional premiums, she drops the health care.

Thanks to Sally Six-pack the insurance company has lost some revenue. Realizing that raising premiums will probably cost them some more customers, they look for another way to preserve profits. They look for areas where they are losing money and they find Freddy Fifth. Freddy has recently been diagnosed with cancer and his radiation treatments and drugs are costing the insurance company a fortune. But Freddy failed to disclose the fact that he was treated with a prescription drug for acne as a teenager. So Freddy's insurance policy is canceled! High fives all around the insurance company board room!

Freddy quickly burns through his life savings and still needs more treatment, so who ends up paying for it?

[Cronus Protagonist]

1. And CEO sixpack grabs a huge sum of money and shoves it into his pocket every day

And his bean counters squeeze the payments to professional health care services down to the bone, while delaying reimbursements to them as long as humanly possible. And that's assuming their Oxycontin addicted "nurse", denied enough claims so she can make a few more bucks in her bonus check to buy more hillbilly heroin so she can sleep at night like Josef Mengele after a successful dissection of four sets of poisoned twins.

I assert that these are more powerful and more important in the equation as to why "free market principles" fail in the health care arena. The "free market" has NO principles.

[Walk away]

2. Let's not forget about Senator Sixpack....

who needs that blood money to buy his job every election cycle with some left over to pay off his mistress.

[dhpgetsit]

3. The purpose of this tale

The purpose of this tale is to illustrate that bacause hospitals can't just kick dying people out onto the curb when they arrive without cash, SOCIETY ultimately ends up paying for health care.

Once you realize and accept this, Single-Payer becomes the only sensible solution.

[midnight]

6. Exactly!

[msongs]

4. there is no free market - customers/paitents dont have real choice to begin with nt

[HereSince1628]

5. This fails to recognize that Joe sixpack

might have had a medical rider on his vehicle insurance.

And it fails to recognize that if Joe had no insurance he will probably end up being sued by the health provider. If they don;t think that approach will be reasonably cost effective the unpaid debt is sold by the healthcare provider to a collection agency, who will hound him relentlessly for the money. And the for-profit health-provider gets to take the loss as an expense against its earnings. Uncle Sam and the states provide real relief if not profits.

In any case, Joe Sixpack will end up with a ruined credit score. He may not be able to get a truck to replace the old one without paying a big penalty. He won't be able to purchase auto insurance without paying a penalty for his credit score. If he wants renters insurance, well its the same thing. If he had a house, its sure to have a lien placed against it, so it can no longer be used as an asset to help him make credit purcahses. All the higher price penalties Joe must now live with, arguably, offset the increased costs we think Sally ends up paying for, at least everything that considers credit scores in the cost.

Our society including the insurance companies and lenders have figured out how to make Joe-Sixpack pay.

[dhpgetsit]

7. Joe probably ended up in bankruptcy court.

Society paid his medical bills one way or another.

[HereSince1628]

8. If Joe owned a home it seems likely that he would go Chapter 13

to protect it from seizure. By going 13 he would be setting up a court approved repayment plan to deal with his debts.

[LeftishBrit]

9. k&r & extremely shocking