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Friday, March 26, 2010

The Beginning of the End of Health Insurance Companies

From Sonic Charmer:

Seems pretty clear that one major effect (whether intent or not) of this “healthcare” “reform” will be to eliminate health insurance companies from the market. It takes a true economic retard to sincerely believe in most of the claimed good effects of the bill. And it doesn’t take an economic genius to discern that companies cannot long survive (unaided) if they are forced by the government to sign money-losing contracts with anyone who asks them to.

Now as far as I’m concerned, the jury’s still out on exactly how insurance companies will be eliminated from the market. Will they just go bankrupt and fold? Some of them perhaps. More likely though I think is that they will just become de facto if not literal arms of the government (thus, the “market” as such will just disappear as everyone ends up under the government umbrella).

The trajectory is pretty clear: a couple years down the road, when insurance companies have been abiding by these “reform” diktats, and losing money, and ratcheting up premiums as much as they can, but it’s not enough, and people paying the higher premiums complain (to politicians), and politicians grandstand, and hearings are held, and pressure is put back on the insurance companies….sooner or later the insurance companies will go to the government hat in hand. Government (“to preserve our historic health reform and patients’ health rights”) gives them a “bailout”, which is another term for buying them out.

... So the obvious question is what can be done by people opposed to all this. Step 1, I think, involves rediscovering the concept of “insurance”, and resurrecting it – but with a new name. As my most devoted reader(s) know, the thing we have today that we call “insurance” is not insurance. Like the term “liberal”, the word “insurance” has by now been so misused and abused that it is unrecognizable as its former self.
Go read the whole thing over at Rhymes with Cars and Girls.

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