Just to illustrate the trouble with a highly-regulated insurance industry, here’s what it would cost me, a healthy male with no prescriptions or preconditions, to get an individual insurance plan in New York:
Jesus. Those bills alone would be enough to send me to the emergency room!
“BUT OBAMACARE WILL MAKE IT CHEAPER!!! IT WILL SOLVE THIS PROBLEM!!!!”
No. No, it’s wont. That’s because New York State’s absurdly over-regulated health care industry is already veeeery close to Obamacare. All insurance companies in New York must provide “guaranteed issue” plans. That is to say, no one can be denied coverage.
New York also required “community rating” to price all their plans. That is to say, they must give everyone the same monthly premiums, regardless of their health condition, age, gender, or other risk factors.
It’s basically Obamacare without the mandate.
“THE MANDATE WILL FIX EVERYTHING!!!! IT MAKES IT CHEAPER FOR EVERYONE!!!”
About 13 percent of New Yorkers are uninsured (source PDF). Let’s assume ALL of them are in perfect health and will never file insurance claims or visit doctors. Now let’s force them to buy individual insurance plans. What’s that do? Lower premiums 15%?*
Great. So, instead of $1707/month, it only costs them $1451/month. Again, that’s only assuming those new mandate people never even use health care.
So, are the people of New York going to be able to afford that? Well, 48% of the current uninsured make less than $34,340/year (source: PDF). Do you think they can afford a new, government-mandated expense of $14,510/year? My guess is, as mentioned in the previous post, they will opt to pay the “tax” and not get coverage. Until they NEED the coverage, of course (which they can now get even after the fact).
So, things in New York probably won’t change much. But at least the the rest of the country can look forward to having the same rate of uninsured PLUS the new high premiums you see above!!!
YES WE CAN! YES WE CAN!
*The fixed cost of service to current members requires a $1707 premium. Increasing the customer base (without increasing cost) from 87% of the public to 100% represents a 15% increase in revenue, or a 15% decrease in price to customers meeting the current fixed cost of service.