Business Columns & Blogs

Republicans should gladly pay for my preexisting condition

Health insurance – all insurance – isn’t intended to reflect where you are in life, says columnist David Lazarus. It’s intended to anticipate what could happen in the future. And we can’t predict that.
Health insurance – all insurance – isn’t intended to reflect where you are in life, says columnist David Lazarus. It’s intended to anticipate what could happen in the future. And we can’t predict that. Tribune News Service

It’s a question I encounter frequently when I discuss health care with conservatives, particularly after I note that I have a chronic and costly preexisting condition, Type 1 diabetes.

FBEE 2020 DAVID LAZARUS circle (2)

“Why should I pay for your health care?” they ask.

The question came up again the other day as I awaited an overpriced latte at a Hollywood coffee shop. A fellow patron recognized me (always flattering) and struck up a conversation about the latest Republican effort to repeal and replace Obamacare.

I totally get where conservatives are coming from, especially in this “America First” era where the interests of others are a secondary consideration. And it’s a fair question.

I’m the one with the disease, after all, and I’m the one facing thousands of dollars in annual medical costs. How is that anyone else’s problem?

The guy at the coffee shop was thrilled with the legislation that was on the table that day. (Ultimately, the Graham-Cassidy bill was pulled when it became clear it lacked the 51 votes in the Senate to move forward.) The government has no business telling him what to buy, he insisted, and he shouldn’t have to pay more to cover sick people. He knew I had diabetes and said he was sorry for me, but that wasn’t his lookout.

“The Greeks had a word for this – hubris,” said Gerald Kominski, director of the UCLA Center for Health Policy Research. “The idea that you shouldn’t have to pay for other people’s health insurance because you’re healthy, that’s just insane. Bad things can happen to anyone.”

He added: “I’m a good driver. But I still need to have automobile insurance. Just in case.”

Risk management

What conservatives overlook is that insurance isn’t about health care or car crashes or damage to the home. It’s about risk management. It’s about mitigating risk for the greatest number of people at the lowest possible cost.

“The healthy person is subsidizing the unhealthy one,” said Allen Goodman, a health care economist at Wayne State University. “That’s the straight economic argument.”

At its most efficient, a health care risk pool includes the entire population – young and old, sick and healthy. This is how other developed countries do it with variations of single-payer insurance systems that guarantee affordable coverage to all.

“If there is a 1 in a million chance of a bad thing happening, it makes sense for a million people to come together and pool their risk,” said Guy David, an associate professor of health care management at the University of Pennsylvania’s Wharton School.

I’m a good driver. But I still need to have automobile insurance. Just in case.

Gerald Kominski, director of the UCLA Center for Health Policy Research

The Graham-Cassidy bill seemed to envision what economists call a segmented insurance market that separates the healthy from the sick. For young and healthy people, this is beneficial because costs are lower.

For those with medical issues, a segmented market guarantees sky-high premiums and high deductibles because their costs aren’t offset by premiums from the more fortunate.

“It is clear that individuals who are healthy might benefit financially from a risk-segmentation approach when they are healthy,” said David Grabowski, a professor of health care policy at Harvard Medical School. “In the short run, they don’t have to pay for someone else’s health care.

Can’t predict the future

“However, we know that one’s health – and the health of one’s family members – can change quickly,” he said. “An approach that shares risks across the healthy and the sick protects the healthy should they become sick.”

There it is.

Health insurance – all insurance – isn’t intended to reflect where you are in life. It’s intended to anticipate what could happen in the future.

“If you end up in the unlucky situation of getting cancer, you will be relying on other people to cross-subsidize your care, and you will be glad of it,” said Ashley Hodgson, an associate professor of economics at St. Olaf College in Minnesota.

So to my new friend from the coffee shop as well as to all conservatives: that’s why you pay for my health care.

Because I’m gladly paying for yours.

And you want that.

David Lazarus is a Los Angeles Times columnist. He answers consumer questions. Contact him: david.lazarus@latimes.com or @Davidlaz. Read more by Lazarus at fblinks.com/laz.

  Comments