HEALTH CARE CRISIS SOLUTION TO HIGH COSTS: ALLOW SALES OF INSURANCE POLICIES ACROSS STATE LINES TO LOWER COSTS! DUH, THAT'S CALLED COMPETITION

Imagine if you had to buy your supermarket items from one or two markets, the really big ones. Everyone else only had a store that sold apples or just bananas.

Well that is what we have now in health care thanks to our, you guessed it, government regulations!

No health insurer can compete selling its policies across state lines. so what happens is that a large insurer can dominate a state and not really allow competition to come in. Competitors are not going to start up a company with one or two or three policyholders!

Do you see? No competition dares to start, since it can not start from scratch with several policies and offer coverages.

If the companies can operate across state lines, the risk is immediately transferred across all its policies and the companies would instantly compete and rates would drop like a rock!

Simple, and no need for government help as rates would become more affordable due to competition!

Does nobody in Washington see that?

Study: Health Insurance Sales Across State Lines Would Reduce Uninsured
By Whitney Blair Wyckoff,

A study evaluating different scenarios that would allow people to purchase health insurance across state lines found that 12 million previously uninsured people would be able to get insurance if there were competition between states.

The study was presented during an American Enterprise Institute panel discussion on interstate competition for individual insurance as a way to increase access to the uninsured.

In the study, Stephen Parente and Roger Feldman, both health economists with the University of Minnesota, researched whether competition existed only within the five largest states, in all 50 states or within four geographic regions. They used data from the 2005 Medical Expenditure Panel Survey to assign people to states based on race, gender, income and age. They then ran simulations to figure out which scenario would provide the most coverage for individuals.

Because Alabama has the least number of regulations, consumers would decide to switch their policies to companies in Alabama, they said. However, they also said that competition among the states in the four regions would allow more than 11 million people to be insured, and it might be easier for populations to swallow if they know the insurance company they are using is closer to home.

State-specific mandates for programs like community rating or guaranteed issue can cause insurance premiums to increase drastically, they said.

Karen L. Pollitz, project director for the Georgetown University Institute for Health Care Research and Policy, said the study’s numbers are misleading. Just because more people would be carrying insurance cards in their pockets wouldn’t mean that they have adequate insurance, she said.

“It’s like saying a roller skate is cheaper than a car,” Pollitz said. “Good health insurance that will take care of you when you’re sick is expensive because health care is expensive.”

She added, “The regulations require that the insurance be meaningful.”

While Aparna Mathur, a research fellow at AEI, commended the pair for starting a discussion in an area where there is little literature, she questioned some of their methodology. In particular, important variables like health status, tobacco use and occupation weren’t factored into the demographic distributions, Mathur said during the July 31 session at AEI.

She also questioned whether high-risk people would be able to purchase cheaper policies in states without community rating or guaranteed issue laws. And Mathur said the information used to determined estimates of how much state regulations impact premiums of the study was not comparable.

Jay Webber, a Republican in the New Jersey state legislature, said because his state has one of the highest numbers of insurance mandates in the country, it is also one of the most expensive states in which to obtain insurance.

“We’re seeing a real affordability crisis in New Jersey,” Webber said, adding that the uninsurance rate is skyrocketing.

He said the state is getting “crunched,” and more businesses every year stop providing their employees with insurance because of the high costs.

“I think New Jersey could be a real battle ground for the issue of health care choice,” Webber said.

• Study Summary
Source: CQ HealthBeat News