Earlier this month I wrote about Jon Caldara’s proposed ballot initiative that would allow Colorado to opt out of provisions in the current health care reform bill that require everyone purchase health insurance. In a “free our health care” rally yesterday at the capital, Caldara drummed up support for his initiative, and urged the people of Colorado to reject health care reform provisions that would make health insurance mandatory.
In an interview last week, Caldara noted
“It’s amazing that the federal government doesn’t force me to buy home insurance, doesn’t force me to buy life insurance or catastrophic insurance or an umbrella policy. Yet of my own wisdom I purchase these things.”
While it’s nice to see that Mr. Caldara is so responsible with his own finances, not everyone is. And health insurance is quite a bit different from things like home insurance and life insurance. Mortgage companies require home owners to have hazard insurance on their properties, so all of us who don’t own our homes outright are required to carry home insurance. For those who have paid off their mortgages, home insurance is optional, but most people carry it anyway (and it’s worth noting that the policies are quite a bit less expensive than health insurance – our family pays about $600/year for insurance on our home, as opposed to about $4000 for health insurance, so affordability isn’t as much of an obstacle when it comes to home insurance). For those who choose to go without home insurance, the worst case scenario in terms of loss of property is pretty easy to estimate – a total loss such as a fire would set one back by the value of the home.
This is not the case with health insurance. Since none of us know what the future holds in terms of our health, it’s hard to estimate what our potential medical expenses might be. My father was very healthy for the first 54 years of his life, and then was stricken with an autoimmune disease that destroyed his kidneys. He has since racked up more than a million dollars in medical expenses. A serious car crash can easily turn into a six or seven figure medical bill – and that can happen to the healthiest person on the planet.
Denver Health Medical Center treats a large number of uninsured patients in the metro area, and the costs for the hospital are staggering. All of the rest of us are paying those costs via higher taxes and higher health insurance premiums – there is no such thing as free health care. So while people who choose to not have life insurance might be putting their own family’s financial security at risk, people who choose to not have health insurance are putting everyone’s financial security at risk by driving up the cost of health care for people who do have health insurance.
The provisions in the health care reform bills that make health insurance mandatory are very much tied to income – people who have very low incomes would qualify for Medicaid (currently only available to select groups of low income people, such as pregnant women and children), and those with slightly higher incomes would qualify for subsidized health insurance premiums. The provisions are not intended to make health insurance an insurmountable financial obstacle, but rather to truly spread the cost of care across the entire population. And this is fair, since none of us really know when we might be in need of significant medical care.
In a medical emergency, EMTs aren’t checking health insurance benefits. They transport victims to the nearest hospital where significant expenses can be incurred long before a person’s insurance status is known. And if it turns out that the person is uninsured, the burden of cost is likely to be passed on to taxpayers and insured patients. This is far different from situations that require claims on home insurance, life insurance, and umbrella policies. If a person doesn’t have home insurance and his house burns down, nobody else is likely to go in and start rebuilding his home without knowing whether he has the means to pay them.
The decision to not carry health insurance (despite being able to afford it) is one that has ramifications for more than just the person who opts to be uninsured. In addition, there is no way to keep health insurance premiums affordable unless a large number of healthy people are paying premiums to offset the cost of care for those who are not as healthy. And if that seems unfair to the healthy folks, it’s wise to remember that even the healthiest among us never really knows when we might need significant medical care.