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Tuesday, March 24, 2009

A Bad Deal on Health Care

This AP story reports that AHIP and Blue Cross Blue Shield are willing to "compromise" on health care reform - ending the practice of "charging higher premiums to sick people" in exchange for individual mandates.

In other words, they would adopt community rating - which drives up the cost of insurance for the young and healthy, and typically leads to a higher numbers of the uninsured - and require everyone to purchase insurance, which will drive up the costs of insurance.  The headline could read "Insurance Companies Willing to Charge Healthy More, If Everyone Required by Law to Buy Their Products"

These are two horrible ideas for health care reform.  Instead, we have several ideas to reduce the cost of health coverage, using free-market reforms.  And for the sick people who have trouble getting traditional insurance, high risk pools offer a better solution than community rating.

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