Healthy Caring

Shawn Tully (shawn_tully@fortune.com) has authored a terribly-biased article for Fortune Magazine entitled 5 painful health-care lessons from Massachusetts.

Shawn begins by saying, "The Massachusetts plan does not control costs". Shawn's analysis takes it as a foregone conclusion that the answer is "No". The reality is that by making health care easier to get in Massachusetts people are more likely to seek treatment when symptoms first appear rather than waiting until pain becomes unbearable. As the saying goes, an ounce of prevention is worth a pound of cure. I would suspect that any spikes in program costs come from people who newly gained the ability to treat their chronic issues. I also surmise that Shawn would believe that dying an early, painful death while on an extremely expensive life-support machine is preferable to extending life through early treatment of unhealthy conditions. Obviously the former option is cheaper in the short-term.

Shawn then argues, "Community rating, guaranteed issue and mandated benefits swell costs." What he's saying is that "healthy" participants will choose NOT to sign-up for coverage until they actually need an operation. Shawn goes on to say that since the new state health care plan has gone into effect, 75% of the previously uninsured have signed up for service. My feeling is that his statistics are enough to disprove his point here. However, assuming that the remaining 25% are "gaming the system", I'd like to point out that these people have lots of risk of sudden, unexpected conditions developing. If somebody wants to *choose* to live a life where they'll risk paying out of pocket for the costs of a broken leg, then power to them. I'd prefer to live in a world where people can get affordable health insurance by paying a few hundred dollars per month so that those unexpected things in life end up being much closer to "free" to handle.

Shawn points out, "Huge subsidies for low-to-medium earners could prove extremely expensive." The only thing I have to say to this argument is that medium-to-high earners ought to be subsidizing the less fortune in a civialized society. Clearly, Shawn would probably be happier living in an uncivilized caveman era.

Shawn's fourth observation is that, "The exchanges reward people for working less and earning less." Yes, earning $28k and keeping all leads to an overall lower marginal rate of costs than earning $40k and giving away $3k of that for compulsory payments. However, living on $28k is certainly not better than living on $37k. Give me a break. Shawn seems to be out of touch with the trouble that lower income people have prioritizing where they should be spending their money month-to-month.

Shawn concludes, "The generous plans and added mandates give employers an incentive to drop health insurance." I'm not sure what he's thinking. I'm well aware that my employer pays 90% of my health insurance each month and that would be heavily factored in if I ever wanted to jump ship and go work somewhere else. All else being equal, I'd require a pretty large salary bump in order to jump ship into a company that doesn't offer health insurance, and I'd immediately begin looking to find a new job if my employer decided to stop offering this benefit. No, the argument that companies will drop health insurance benefits to save a buck doesn't resonate with reality, unless driving out your most talented employees is a new business strategy that I'm unaware of which is sweeping its way throughout MBA programs throughout the country. The saying goes that people are a companies most valuable asset. I dare any company to defy that saying and tell their employees that their health is NOT important by dropping their health care plans. It wouldn't be a mass-exodus, but over the years the company will eventually start a precipitous decline.

In conclusion, biased one-sided ways of looking at health care as a broken industry are not productive to the overall conversation of what is better, or worse for society.