We-Have–To-Pass-It-To-Find-Out-What’s-In-It Update
This is David Henderson on one consequence of the new health care law: the outlawing of “mini-med” insurance, which offers limited coverage in return for lower premiums:
Far from providing Americans with affordable health insurance, the Obamacare plan is mortally wounding one of the last sources of such insurance. The ironic effect of a law that Obama said would extend insurance to the uninsured is to make insurance for low-income Americans less affordable and, therefore, cause many of them to go without insurance…
The mini-meds cannot promise absolute coverage in the case of catastrophic health problems, and they were never intended to. That’s one problem with such plans. But which is worse: having insurance that doesn’t cover all catastrophic expenses or having no insurance at all?
Either you have gold plated insurance or you can’t have insurance at all? What idiocy!
If you think about insurance, not as providing access to health care, but as protecting assets, there is no reason for a person with low income and few assets to purchase insurance with limits.
I meant to say without limits.
About 1.4 million people have health policies that promise limited benefits in return for limited premiums. I’ve talked to entrepreneurs who have developed innovative plans, where they combine medical tourism with the limited benefits helping enrollees get the care they need despite limited benefits. Now, these people will either have to pay higher premiums for enhanced benefits most do not want.
Insightful comment by Bruce. Why should someone with no assets purchase a plan that covers an unlimited expense? It makes no sense from the individual’s point of view. And probably also makes no sense from society’s point of view.
Paul H:
Correct.
Actually, one could be considered overinsured (as in life insurance), and disallowed from buying such a comprehensive policy.
Don Levit
Thanks, John.