National Health Insurance in America…

No topic is more divisive than National Health Insurance. Everyone wants it in some form or another but there is no consensus - even among the strongest supporters.

No risk is greater to Americans’ personal economies than the cost of health care, long term care and end of life care. Entire estates, which have taken a lifetime to create, can be decimated by these expenses in a matter of months or just a year or two - and often are. 78% of bankruptcies among seniors can be traced to these causes. But it’s not just seniors that are at risk; half of all bankruptcies and business failures result from a money drain created by medical disabilities or expenses.

This is a problem that needs a solution.

There are hundreds of competing lobbyists that invade Washington every hour of every day promoting one solution or another and 535 gullible legislators soaking up their bad ideas and good booze. There is, however, a simple (relatively speaking) free enterprise solution that has been available for decades but which doesn’t make any business richer or bureaucracy stronger - so it’s ignored.

In the most simplistic terms it would work like this.

• ~ All individuals would be covered by individual health insurance, eliminating group insurance plans and employer involvement in individual choice. Employers could, voluntarily or by union agreement, continue to  subsidize individual employee premiums but would not choose the plans or options.
• ~ Individual health plans would not provide preventative or wellness care under the risk management insurance plan. These non-risk based services would be available as optional benefits and would tend to reduce the cost of the insurance benefit but raise the overall cost.
• ~ Insurance companies would be required to accept all applicants and to charge everyone in the same risk class the same rate. They could charge extra for risks that are related to individual choices like smoking, or obesity that is not caused by medical conditions.
• ~ The government, preferably at the state level, would help the indigent, unemployed and those below certain income levels pay the cost of the insurance.
• ~ Insurance companies would also contribute to a government regulated but privately owned and operated reinsurance fund that would compensate an insurance company that experienced claims above a certain level on a given individual - called stop loss coverage in the insurance business. This would correspond to FDIC, FNMA, and other non-governmental organizations that exist today and function in the free market.

Obviously this is an oversimplified discussion of a very complex problem  After 30+ years watching the health insurance industry and the federal and state governments wrestle unsuccessfully with this problem, however, it’s time for some new thinking…

• ~ that keeps the government out of the management of this problem
• ~ but allows government to play its legitimate role as a regulator
• ~ and allows the free enterprise system to do what it does best - deliver services in a competitive market

Pass this on to your friends and your congress persons. Maybe it will start a discussion that will solve a large problem for each of us.

You can find where this fits in a personal economy on the Four Pillars page and get much more detail on how to manage this problem in the current environment in the Money for Life book.

www.TheMoneyForLifeBook.com

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