The health reform debate in Washington has been confusing and contentious. There are many theories floating around about why that is, but it boils down to one central issue. There are no easy, everyone wins, answers in addressing the rising cost in health care. As a result, the American people have been fed a steady diet of concepts that are easy to understand, and half truths. Instead of debating the nuances of building a better health delivery and payment system, the choices are "government between you and your doctor", or "heartless, greedy insurance companies leaving people to die". Case in point, the concept of requiring all health plans to tighten the age bands on insurance premiums.
Insurance companies set premium rates based on risk. For instance, we all know how expensive auto insurance can be for a 16 year old boy. Put him into a brand new Ford Mustang, the premium climbs even higher. As that 16 year old gets older, holds a clean driving record, the price drops every year. Health insurance on the individual market often works the same way, only in reverse. Young, healthy adults have access to affordable health insurance, although they will see the cost go up as they get older.
Some States already have limits on how much premiums can increase, although most States do not. Even if there is never a significant claim against a health insurance policy, the premium could increase to five times the initial amount just based on increasing age. That really rubs a lot of policy holders the wrong way, and makes buying a policy for an individual in their 50's rather expensive. President Obama spoke to this point when talking about folks who are discouraged from starting a small business, or retiring early because of health care premiums.
How is it fair that an insurance company can push a premium up on a policy holder who has been faithfully paying for years at the very time of their life they may actually need to make a claim? The solution for this in health reform is to tighten the age bands. An insurance company can only charge it's oldest customers 3 times the amount it does for it's youngest customers. The House bill even had only 2 times the amount. Sounds reasonable, but there is a reason that this is not a major talking point in defending the health reform bill. The young and healthy will be paying more.
Is this the right thing to do? Tough to say, good arguments can be made for both sides. Why should we have our young adults paying more for health insurance that they most likely will not even need? They have enough financial pressures. Low paying, entry level positions, school loans, and maybe saving up to buy that first car or house. Access to health care is not the only factor in good health. A young person's limited budget may be better spent on fresh vegetables, fruit, or a gym membership. No question we all need health coverage for that "what if", but how much should we expect a young person to spend on insurance to cover that "what if", when it most likely will be a "never happened"? As it stands now, we have young people forgoing insurance. Could we actually exasperate this problem by driving the cost even higher?
Instead of having the debate though, many in Washington have decided to side step the discussion. Supporters of reform try to insinuate that the higher premium charged for those in their 50's is pure profit for insurance companies, and opponents of reform don't want to acknowledge the fact that many older Americans are simply getting priced out of coverage. Neither one of these approaches really acknowledges the whole truth.
The best way to view health reform is to look at the merits of the individual pieces. Just think of the progress that could have been made in the last year if lawmakers spent their time explaining how the different parts of the legislation actually worked. Instead of having a confused, uncertain electorate, Washington would have a clear idea of what the American people do, and do not support. Perhaps lawmakers already do know what Americans want, and it comes in a perfect silver bullet that does not exist. I suspect it will be back to the games.
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