Wednesday, April 1, 2015

Aaron Carroll on Underinsurance

Aaron Carroll has yotube vidieo discussing under insurance called 

His premise is that people need lower deductibles because they are forgoing car that they should get 
I disagree people may need time to adjust to paying out of pocket for healthcare. It takes time for people to adjust to changes like getting higher deductible insurance.

I think very high deductibles are good for most people. I for years before the PPACA had a $10,000 deductible (I would have gotten a higher deductible if once had been offered) and worked out well for me even though my income was not high and in that period my wife had bearst cancer and we paid the full $10,000 plus some expanses not cover. Most people can easily save for or get a loan to cover $10,000. Once people start hearing of others paying big out of pocket bills they will get prepared. People often pay more than $10,000 for a car. 

To address some of the comments on the post that ask why we cannot have single payer healthcare:

It might be good if we could have a cut down, evidence based medicine only program (medicaid for all) available to everyone, paid for though taxes and anyone who wants more can get private care, similar to what they have in the UK. Evidence based medicine only would probably be so cheap that Government could cover everyone for less than the cost of medicare. But our politicians are very corrupt and so I do not see anything like that happening. So the PPACA is OK for now but could be made better by: 

  1. Allowing bigger deductibles up to $30k for above median income folks. 
  2. Get rid of the employer mandates. 
  3. Stop making it cover cheap things like birth control. 
  4. Smooth the subsidies so it longer contributes to very high marginal tax rates. 

Keep in mind people are not all so honest and upright and will abuse a too generous system. For an example the Amish, who do not carry health insurance often go to Mexico for care and get good care from network of known providers for a 1/0th the price we pa here, but even folks in south Texas will not go over the border to save their fellow Texas tens for thousands of dollar if they have insurance with low deductibles.