Public Health Insurance and the Profit Motive

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A caller on the Diane Rehm show on NPR yesterday gave an argument for why we need to go public with health care. Insurance companies that are motivated by profit will try to avoid giving people what they're obligated to give, so we need to prevent that by having insurance handled by those who have no such profit motive.

Some insurance companies do indeed function that way. Is that a reason to go public? We've had some pretty significant interaction with public health insurance for several years now, and they do the same thing. So it certainly isn't going to be any better on that score. Our Medicaid Services Coordinator for the boys' disability services says she's heard from people who have worked for Medicaid that they're told to try to find excuses to take so long with people's applications that they just give up. They tried to count my one intensive month of income during a summer course as if it was the rate of pay I get for the whole year, an error that I find very hard to attribute to carelessness during a time when the governor of New York has been trying to cut expenses of as many essential services as he can while ignoring all manner of worthless costs, and Medicaid and disability services were explicitly on the list of services getting cuts.

So the public health insurance does the same thing as some of the private companies who have a profit motive. Does that mean they're on par? I don't actually think so. The difference is that smart insurance companies know that such shadiness is actually not going to produce better profits in the long run, whereas government beaurocracy has no limits to its unfriendliness and unwillingness to help people, precisely because there's no profit motive to do so. I've been on the receiving end of that too many times to count, whereas insurance companies often bend over backwards to stay in your good graces so you won't find a competitor with better services.

So whatever arguments there may be for and against public health insurance, I don't see how this consideration should favor it.

2 Comments

The thing I find most disingenuous about her comment is that government requires insurance companies (not to mention hospitals) to do so many unprofitable things that you can't attribute problems with insurance solely to greed.

Public systems -- like Medicaid -- run into the same problem everyone else runs into, namely running out of money before you run out of patients. So they try to reduce costs by denying services or using outdated methods.

The Houston VA only last year started treating prostate cancer with a technique that everyone else had been using for nearly a decade. Up to that point, our veterans were getting the best treatment 1993 had to offer. That will be the norm under a public healthcare system.

Is this the broadcast you're referring to http://wamu.org/programs/dr/09/05/11.php#26275?

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