Mandatory Health Insurance: Raising the fixed cost for health prior to the receipt of benefits
Repeat with me: Health insurance does not equal health care. Health insurance does not equal health care.
Now onto the news that universal healthcare has now been launched in Massachusetts, administered by the Commonwealth Connector. As Michael Cannon at Cato notes, this strangely enough has been timed to honor Canada Day. Michael Moore would be so proud.
So lets take a look at what has actually emerged as the Universal Solution for Boston’s uninsured (thanks to David Hyman of Cato for a great paper discussing this plan). First off (and not surprising), the plan has come in overbudget.
Originally promised by Mitt Romney at around $200/month, initial versions of the plan came in at an average of $300/month, with even high-deductible versions starting at $210. And that is just the average. The plan allows for different rates by age, so coverage for older individuals could start over $500/month for those in their 50′s for a high-deductible plan. This means, a healthy 50 year old who had low risk and no need to go to the doctor would see $6000+ annually evaporate under the state mandate. And those with care (under a high deductible policy) would need to shell out substantial additional dollars before getting anything back from the insurance companies. Does this strike anyone else as insane (outside of the fact that it already works this way today)? But it does make me ask why I should subsidize the nimwit who spent his 20s -40s eating Big Macs when he has a heart attack–when I’m spending quite a bit more time and money to eat well and get back to the gym (to eliminate my 20 lb gain while at McKinsey).
Even for the young (18-26 year olds not expected to use the system), plans were reported as starting at $119/month for limited coverage. Again $1500/yr goes up in smoke for young people who could use it for many other things. I’m older than that, and I still got cheaper coverage in California– and will continue to escalate the deductible as my HSA balances grow.
