Megan McArdle, economist-always-in-training, argues against health insurance using quite possibly the worst argument ever:
Ezra asks why, if I think thebenefits of health insurance are so minimal, I have health insurance. Revealed preference! Gotcha!
But the answer as to why I have health insurance is simple: my employer pays for it. If my employer didn’t pay for it, I wouldn’t have it. I’d buy a catastrophic policy from a reputable insurer to cover any amount that might bankrupt me, and self-insure for everything else. That would probably cost me a little more than what I pay The Atlantic for my first-dollar coverage, so I opt for the first-dollar coverage. It’s not like I get the money The Atlantic is spending on my benefits back if I choose to go without.
Okay, fine, fine, she gets insurance because she’s required to. But that doesn’t really explain why her preferred option is any better, particularly as she’s fond of talking of her many, many, many health ailments ad nauseum.
But do I think I would be noticeably more likely to die if I did give up my policy? Certainly not for the next twenty years, because I am unlikely to get cancer much before 65, and everything else that might kill me would be treated on an emergent basis, where insurance probably wouldn’t affect my outcomes nearly as much as the fact that I am an upper middle class professional with a (soon to be) husband who writes about health care policy for a living and a father who used to work for the New York City health and hospitals corporation, both of whom will no doubt be sitting on top of the doctors and the hospital bureaucracy to make sure I get excellent care.
So, her main argument against health insurance is that she as an individual happens to have really good connections who will scream and hold their breath until precious Megan gets what she needs (and left unsaid is that said connections will also help her pay for her healthcare).
Morbidity? Maybe. But we’re more likely to take out a second mortgage to cover physical therapy than we are to go without.
I’m pretty sure my life would be, on net, better if I had the cash wages and a catastrophic policy instead of the health benefits. As someone who’s moderately sickly, I’ve spent a lot of my life worrying over false positives from tests of dubious pertinence, and no time at all treating conditions we caught early.
This is incoherent – her life would be better not having a system which moderates the cost of her healthcare because she’s had a diversity of treatment experiences? This is like arguing that it’s okay to eat raw chicken off the floor because sometimes Panera has good soup and sometimes it doesn’t have enough salt in it.
But the system is not set up to facilitate real insurance; it’s set up to hide the cost of medical treatment from as many people as possible, because we have developed a social belief that no one should have to consider the cost of medical care, except maybe your friendly neighborhood bureaucrat.
No, actually, even people with health insurance consider the cost of health care. Because there’s no form of health insurance which makes things free – even (or especially) socialized healthcare. McArdle’s entire premise is that everyone else is as bad at economics on a micro and a macro level as she is, and so the communal subsidization of healthcare costs becomes a grave social evil because they don’t understand that the actual cost of their doctor visit was any higher than their co-pay. It’s not just that people are supposed to assume that the only cost of their going to the doctor is the $20 they pay because of a negotiated insurance agreement; it’s that they’re also too fucking stupid to read the numerous documents they get from both their insurer and doctor telling them otherwise.
All of this hints at the problems that plague many of the studies Ezra and others have been citing, showing marvelous results from insurance: as I said in the beginning, uninsured are not like the rest of us. Do I think that my risks would shoot up to match those found by the studies Ezra likes? No I do not, and I doubt that Ezra would try to argue otherwise.
Megan, you marvelous dumbass, you’re not like the rest of us. Saying that a chunk of 40 million people isn’t like a chunk of 260 million people doesn’t become the “Megan McArdle is really awesome” show. This isn’t even a clever diversion, which is the sad part – it’s just naked egotism masquerading as a policy argument.
I have immense resources at my disposal, most of them non-monetary. There are many ways in which I would like to even out those differences, but privilege cannot be transferred into someone else’s checking account. Indeed, as libertarians are fond of pointing out, government systems can frequently end up catering to privilege even more than the private sector; check out which post codes in Britain or Canada get the best medical services, or check out the massive disparities between the educations received by the poor children in New York City public schools, and the educations received by the middle class kids whose parents lightheartedly imagine that by siphoning an excess share of the system’s resources into their little darlings, they are somehow supporting the cause of educational equality.
Shorter this argument: “I gots a rich daddee! My daddee has a nice car and I am going to have a pony at my next birthday! You have dirty shoes, so we can’t be friends.”
But I digress.
From talking about yourself? Never.
If I suddenly lost my health insurance, I would still be a comfortably middle class person who would pay my doctor’s bills out of pocket, and wouldn’t miss an important checkup with the pulmonologist or the immunologist. I would be, well, pretty much like I was during the years that I was uninsured, and spending quite a large portion of my meager earnings on doctors bills. I might end up bankrupt. But outside of the kind of fluke that afflicts any system from time to time, I would not end up dead.
Is the argument now that Megan McArdle’s bankruptcy is a better fate than her having health insurance? Because if that’s so, I don’t think anyone who’s spent more than five minutes reading what she writes would necessarily argue with. But it’s not an argument about the efficacy of the health insurance system FOR 300 MILLION PEOPLE.
But now that the plane has been circling McArdle International Egoport for the past year (it feels like I’ve been reading this for that long), it’s time for it to zoom in and make its crash landing. Oh, I do so love completely preventable tragedies. You know, the kind you’d normally insure against if your father didn’t love you so much. And by “love you”, I of course mean “have money and power”.
Nonetheless, I’d like to see us move to a system of government reinsurance of at least basic medical expenses over a certain percentage of income.
But not because I’m sure it would make us all noticeably healthier. I have rather modest expectations along those lines. But as fond as I am of easy bankruptcy, I’d still like to see less of it, particularly in cases where no amount of planning could have enabled an individual to avoid it. Catastrophic medical bills fall into that category–and unfortunately, in many states regulations have made it impossible for people to obtain sensible catastrophic coverage.
Now, correct me if I’m wrong, but this seems to be a contention that “catastrophic medical coverage” is what prevents catastrophes from happening. Unless you’re in McArdle’s position (surprise!), a presumed system of catastrophic insurance means that the most likely situation which would produce bankruptcy (a sudden and completely debilitating illness or injury) would simply be hastened, because instead of distributing the initial cost of care for that condition over a number of months or years, it’s all forced onto the patient upfront. So, you have a $10,000 deductible that you now owe, plus the normal costs of insurance-covered care – catastrophic health insurance isn’t a catch-all that magically makes healthcare free once you pay the toll of Aetna’s leprechauns, it’s actually more of a presumption that you’ll never actually face the catastrophes you’re now insured against.
But now, at least, we have an alternative workable healthcare regime: lining up to brush Megan McArdle’s hair and tell her how awesome the paint colors in her room are.