The latest from State Senator Tom McClintock:
Health Insurance in La La Land… The core of the governor’s socialized medicine proposal is a mandate that every Californian MUST carry health insurance and that every insurance company MUST cover anyone who applies, regardless of pre-existing medical conditions. It’s called “guaranteed issue,” and it sounds too good to be true. That’s because it is.
But if you are guaranteed health insurance AFTER you get sick, why would you pay for it when you are healthy? The governor’s advocates say that’s not a problem, since everybody will be required to carry health insurance, thus spreading the risk.
Wait a minute. We already have a law that requires every motorist to carry auto insurance – and yet despite severe legal penalties, this law is ignored by one driver in five.
Now just a few quick questions. Suppose we required every auto insurance company to provide accident coverage AFTER you’ve had your accident, just as the governor proposes to do with health insurance. Is it conceivable that a lot more than one person in five would ignore the mandate, save their money, and wait until they’ve actually had their accident to get their guaranteed coverage? And if they did, would insurance rates for the rest of us go up or go down? And as insurance rates increased, wouldn’t more and more of the remaining insured people decide to ignore the law. That’s precisely the spiral that Massachusetts has already encountered after just a little over a year, and that’s why Mitt Romney no longer talks much about it.
That’s the Catch-22 to guaranteed issue insurance, and there’s no way around it. If insurance is guaranteed AFTER an illness begins, then it’s not insurance. It’s a direct grant because the risk has now gone to 100 percent. And if you exempt from coverage an illness that develops BEFORE you take out insurance – then it’s not guaranteed issue.
Here’s the real problem with pre-existing medical conditions. I spoke to a fellow recently who had bursitis. He tried to get health insurance and was turned down because this constituted a pre-existing medical condition. He told the insurance company, “I don’t care about the bursitis – I can live with that. I’m worried about a heart attack or a stroke or a devastating accident or a brain tumor. Can’t you insure me for everything EXCEPT the bursitis?” The answer was, “We’d love to, but we can’t.”
Why not?
It’s against the law.