John H Wolfe: Paying for someone else’s health care

It seems that many who oppose the Affordable Care Act base a significant part of their opposition on “I do not want to pay for someone else’s coverage.” They refer to two provisions of the ACA. First, community rating which, in broad terms, charges everyone within the same geographic and age band the same premium so that those who use little health care are subsidizing those who use a large amount of health care, such as the chronically ill. The second objection is having to buy things they do not want such as birth control, mental health and substance abuse coverage.

Many of you, as well as myself, have been paying for other people’s coverages for years if you are part of an employer-provided group plan or if you have homeowners insurance or auto insurance.

Employers that provide group health insurance to employees are buying community-rated policies or at least modified community-rated policies. The difference is that they are rated on their pool of employees. So, the healthiest workers are paying a higher rate which subsidizes the higher cost of the less healthy. One may argue that you can opt out of the employer-based health insurance, but few opt out.

Medicare Part B premiums provide another example. The premiums are tiered based on income, not on your health status. Further, if one examines Medicare spending by geography you will find that per-capita Medicare spending in the highest cost 20 counties is more than double what it is in the lowest cost 20 counties ( kff.org/report-section/the-latest-on-geographic-variation-in-medicare-spending-findings/). Yet all Medicare Part B enrollees pay the same premium if they have the same level of adjusted gross income. In short, we in Colorado are paying higher Medicare Part B premiums to subsidize the beneficiaries in other states where Medicare spends more on average for each beneficiary.

Let’s look at homeowners and auto insurance. If you have a loan on your house or car you cannot opt out of carrying a minimum level of insurance on these assets. Further, you have to buy a standard policy. Yes, certain riders such as windshield coverage on the auto are optional but you must buy the basic policy. I have never filed a homeowners claim, and I have rarely filed an auto claim. Nevertheless, I pay a somewhat higher premium because of hail in the area and because of higher accident claims in my zip code. So, I am subsidizing others. Further, I know of people who sustain a loss and brow-beat the claim adjuster into re-siding their entire house when only a portion was damaged or repainting the entire car when only the front end was repaired. We all pay extra for these abuses of the system.

I recognize that this is not an entirely apples-to-apples comparison, but it is not that far off. So, I wonder why some get so aggravated at community-rated health premiums and policies that require a basic minimum level of coverage.

In my view, I am quite happy to allow people to buy any policy they want with one simple regulation: that the consumer be presented with a comparison checklist showing how the coverages and limitations of the policy they are buying compare to the basic Affordable Care Act policy. Further, that the consumer sign an affidavit stating that they understand any limits on the coverage they select and will have no recourse if a needed medical service is not covered.

John H Wolfe is a Longmont resident who holds an advanced degree in health systems and consulted with healthcare clients for over a decade.

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