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Wednesday, December 02, 2009

"Insurers stay rich-- and so do incumbents"

Sommerby reviews a New York Times analysis of the Senate Health Reform bill:
Meanwhile, in the year since Obama’s election, discussion of health reform has always focused on the claim that health reform would “bend the cost curve”—would at least slow the rate at which health care costs are growing. This has always been a fuzzy claim. But the evocative claim is hard to reconcile with the outcome Pear describes, in which:

1. For employers, premium costs continue to rise, just as if there were no bill.
2. For people who buy their own insurance, premium costs rise even more than they would rise in the absence of a bill.

Where are premiums coming down? Where does health reform “bend the curve?” When it comes to the cost of premiums, Pear seems to say this: Nowhere! The costs of premiums will continue to rise as if there were no bill—at an even faster rate for those who buy their own insurance! Yet Pear shows no sign of understanding the fact that this represents the failure of health reform—that the following system will continue:

1. Americans will continue paying higher and higher prices to insurers.
2. Insurers will continue to kick back some of that money to incumbent politicians.

According to Pear, how would health reform affect this cycle? Not by reducing the cost of insurance, whether compared to current or to projected prices. This bill would only affect this cycle in the following way: Pols will funnel tax money to many people, thus lowering what they themselves have to pay for those premiums. The bloated cash flow to insurers continues. So do re-election rates for American pols.


Couple this status-quo preserving health bill with Obama's Afghanistan surge and you start to get the dark side of that end of linear time thing I was just babbling about below.

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