As the years have gone by, the insurance companies have competed with one another by presenting more and more complicated insurance packages, the packages growing steadily more intricate and unfathomable, with expanding this and overlapping that and conditional the other. Insurance companies, like the casinos in Las Vegas, are in business to make money, so the edge is always with the house. Except that my father is convinced that sooner or later one of the companies is going to come out with a package with a flaw in it, that the complexities are eventually going to reach the stage where even the company isn't going to be able to keep up with the implications of the math…
-- Donald E. Westlake, Somebody Owes Me Money
In a speech delivered yesterday by President Obama on the subject of health care…
(Aside: Editors in this business want timely material. No one looks to reach back through the mists of memory to resuscitate the extinct, the defunct or the antiquated. In other words, nothing older than thirty-six hours. This administration has been kind to writers in this respect. We simply begin every column with mention of an Obama health-care speech from yesterday, and amazingly, we are never wrong. For a guy who doesn't know the first thing about the subject, he sure talks about it an awful lot.)
….he slammed the insurance companies for "jacking up rates" as far as they can get away with, thus necessitating the ministration of his ministries. The image could not be clearer. He sees, or wants us to see, insurance companies as predators prying profits from our infirmity. This tactic plays right into our national weakness, our inability to process complex calculations. If we cannot add two and two to make four, he gets to fake more. If the statistics annoy us like static, then we are at the mercy of the state. If we cannot do the sums we must accept his summary; if we cannot find the quotient we are left with his quotations.
Various pundits have spluttered ineffectually about the lower markup in insurance than other industries, said to be a mere three percent. Most people, sad to say, don't really get this sort of thing. They see the price going up, whether at the gas pump or in the restaurant, they figure someone is lining their pockets at the expense of the little guy. Doctors, hospitals, health insurance, are viewed this way as well. The rate rises on the invoice and the patient's heart rate rises along with his voice. Somewhere someone is taking advantage of him somehow. Three percent, thirty percent, three hundred percent, those are just green-eyeshade esoterica.
Not being able to figure this out for themselves has left too many people at the mercy of the math media. For months I have been searching in vain for the magic bullet to bring this point out clearly, that profit is not the problem. Then yesterday, while writing a dialogue on health-care to be performed on stage, it hit me: NONPROFITS.
In every state in the union, customers have an option to buy health insurance from nonprofit organizations, including most of the Blue Shields. Some estimates put the market share of nonprofits at 45 percent. According to the Alliance for Advancing Nonprofit Health Care, the five largest health insurers in the country are all nonprofits. This leads to two critical points everyone can comprehend without being a math whiz (using the Talmudic style known as mimah nafshach, meaning "from whichever direction you prefer").
(1) If the profit motive is really the corruptive force skewing the medical economics, then let everyone buy a policy from a nonprofit without government interference.
(2) Conversely, if the extra expense in the system is attributable to profiteering, why can't the nonprofits charge appreciably less for the same degree of insurance?
I made a series of calls to insurance agents, although I considered them redundant. If nonprofits were much cheaper, we would all be their customers. But I checked nonetheless and confirmed my hunch: the price of health insurance is about the same whether purchased from for-profits or from not-for-profits.
With this obvious fact staring us in the face, how does the President sell his specious rhetoric to the masses? The answer, I guess, is not very well. We may be weak at figgerin' but a 40 percent approval rating after one year of pushing obsessively for health-care reform falls somewhere beneath the threshold for success. In fact, in a speech delivered yesterday by President Obama on the subject of health care…