Reply to Private business and health insurance

Forum Index » Political Discussion

Reply to "Private business and health insurance"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous]Insurance companies should operate across state lines. Increase market size. Will reduce costs. Only thing about trump I agree with. In addition to term limits[/quote]

No. Allowing insurance companies to operate across state lines will not increase the "size" of the market and it will not reduce costs.

Insurers reduce costs in large part by negotiating with providers. The only way to negotiate lower prices with providers is to have leverage, or market [i]share.[/i] That means covering a lot of people. Then you can say to GW Hospital, " if you want to be in my network and have all my enrollees use your hospital, then you have to agree to a 10% across the board reduction in payment. Otherwise, you are out of network and my enrollees go elsewhere."

Having many more insurers, each enrolling a relatively small number of people, means each insurer has less market share and less leverage. GW says to a small insurer, "Nope, we don't need your enrollees. Go ahead and try to get cheaper prices from Georgetown." Small insurer finds that no one cares if they are in that network. Small insurer goes back to GW and agrees to higher prices.

But we don't need to theorize--some states have already allowed insurers to operate across state lines. Hasn't lowered health care costs. This is one of those truthy things that [i]sounds[/i] smart but is espoused by no one who actually knows anything about the market for health insurance. Well, no one who is being honest, that is.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics