Health Care BS

Andrew Sullivan raises an issue that many opponents of Obamacare have difficulty handling: the plight of patients with pre-existing conditions. He begins, however, with a paean to the U.S. health care system:

Only 15 years ago, the retrovirus, HIV, was killing thousands in America …  I was told in 1993 that I had a few years to live. I write this 16 years later with a stronger immune system than I have ever measured before.

America’s much-maligned healthcare system did this.

Without this vast and free market in medical care and pharmaceuticals, without the potential for making large amounts of money from affluent and insured patients, the innovation of treatments and regimens would never have occurred at the pace it did.

Then, he describes what he sees as the catch:

This miraculous process was possible for me only because I had insurance through my employer. When I quit my job … my employer compassionately allowed me to stay on staff at a low salary solely to protect me from going without insurance at all. You see: once without insurance in America, I would never have been able to get it again. I would have had a “pre-existing condition” and no insurance company would have accepted me.

Sullivan is right about the power of the profit motive in U.S. health care. He is wrong, however, about the solution to the pre-existing problem. We don’t need Obamacare to handle that.

There are two problems with his reasoning. First, all of the Democrat health care “reform” bills circulating through Congress contain provisions that would reduce the very innovation incentives that saved Sully’s life.

Second, and more to the point, we don’t need a massive new government intervention in our health care system to fix the pre-existing problem. That can be done through the free market.

One solution, as John Cochrane points out in a Cato policy analysis, is health status insurance, which  would cover the risk of premium reclassification, while allowing competition to benefit patients:

With health-status insurance, you can always obtain medical insurance, no matter how sick you get, with no change in out-of-pocket costs … People would have complete freedom to change jobs, move, or change medical insurers.

Another solution, as I point out in this AmSpec piece, involves expanding high risk pools. A high risk pool is a non-profit association that provides a safety net for medically uninsurable patients.

Some combination of health status insurance and high risk pools would relieve the plight of patients with pre-existing conditions, without putting government apparatchiks in charge of our health care.

UPDATE:

I knew I was forgetting something when I posted this last night. For one of the best recent pieces on how the market can deal with pre-existing conditions, go to this article by Paul Hsieh, MD. Dr. Hsieh’s blog post on the subject can be found at WeStandFirm.