Let Freedom Ring

Michelle Malkin tastes the delights of private sector health insurance:

After my husband quit his job earlier this year (to become a full-time stay-at-home dad), we had a choice. We could either buy health insurance from his former employer through a program called COBRA at a cost of more than $1,000 per month(!) or we could go it alone in Maryland’s individual market. Given our financial circumstances, that “choice” wasn’t much of a choice at all. We had to go on our own.

We discovered that the most generous plans in Maryland’s individual market cost $700 per month yet provide no more than $1,500 per year of prescription drug coverage–a drop in the bucket if someone in our family were to be diagnosed with a serious illness.

No doubt in some sense like the Frosts, the Malkins clearly aren't a "poor" family. Nevertheless, they can't afford any meaningful insurance against health care risk on the individual market. And yet, many people -- including people who aren't poor -- don't necessarily have jobs that provide health insurance. Or maybe they do have jobs that provide health insurance but might like to leave them in order to become successful right-wing pundits or stay-at-home dads or start small businesses but in many cases they can't do that. This is especially true if you've had health problems in the past, in which case you daren't go without insurance for even the smallest amount of time lest you become uninsurable in the future. And if you do have good insurance and become sick, your insurance company will then send its minions to work as hard as they possibly can -- deploying every bit of energy and ingenuity the private sector can muster -- to find a reason to deny your claim.

Comments

If only I believed in Hell I'd find solace in knowing people like Malkin had advanced booking in that special room where they jam pissed off scorpions up your asshole.

Posted by steve duncan | October 11, 2007 8:46 AM

Quitting your job and then complaining about things you can't afford seem awfully childish to me. If I quit my job, we would have to give up either our Central Park West apartment or spring vacation in Palm Beach, but I don't hear any bloggers advocating government subsidies for those activities.

(Although, in fairness, my liberal Upper West Side neighbors have campaigned tirelessly and successfully to ensure that our property taxes bear no relationship to the value of our home, which could be considered a subsidy. But the Palm Beach thing, we get no help with that.)

Posted by y81 | October 11, 2007 8:52 AM

so wha... is this the same person going after the Frost family for supporting S-Chip? So what could possibly be going on? No empathy (check), mean-spritedly not wanting anyone else to get a better "deal" (check), being a rabid ranter part of job description and public persona (check). Actually, none of those possibilities reflect very well on her...

Posted by JMS | October 11, 2007 9:05 AM

I like the reference to "a program called COBRA." Hmmm, what sort of "program" is that? It wouldn't be a federal government mandate on insurance companies passed by a Democratic congress, would it?

Granted the choice provided by COBRA isn't that desirable, but at least it's a choice. For some folks, it's the best or only choice to maintain coverage. Without the over-reaching arm of the nanny-state feds, Malkin's choices (albeit all bad) would have been reduced.

No mention of this in Malkin's post, of course.

Posted by JWR | October 11, 2007 9:08 AM

y81, I'd posit a farmer idling a large portion of his land rather than planting and cultivating a crop is akin to quitting his job (or at least going part-time). Yet the government pays him to do exactly that. And conservatives raise holy hell when proposals are made to alter the practice. Too bad the Frosts weren't engaged in some sort of commerce the government was seeking to manipulate by monetarily encouraging inactivity. Then they could work a real job full time whilst the taxpayers paid them for the other work they weren't doing. At least health insurance might be affordable under such a scheme.

Posted by steve duncan | October 11, 2007 9:11 AM

y81,

As a supporter of universal health care, I urge you to stick with your strategy of convincing people that Republicans are rich, cruel morons.

Posted by Yip | October 11, 2007 9:22 AM

JWR, COBRA was passed in 1996, so, no, it isn't a product of a Democratic congress.

I love MY's ritualistic incantation about the evil insurance companies' incentives. Matt favors giving government bureaucrats those same incentives, which is morally preferable for some reason. Denying care when done by the government is somehow a different sort of thing. MY isn't clear on why it's a morally better thing. I think, though no argument or explanation is offered, that there is one possibility: MY can picture himself deciding other people's care, but can't imagine himself working for the insurance industry. Maybe MY has a better explanation--maybe even an argument! I doubt it.

Posted by Thomas | October 11, 2007 9:27 AM

JWR, COBRA was passed in 1996, so, no, it isn't a product of a Democratic congress.

Apparently you meant to say 1986, so yeah.

The rest of your post is just incomprehensible.

Posted by Steve | October 11, 2007 9:34 AM

Thomas,

COBRA (Consolidated Omnibus Budget Reduction Act, as I recall) goes back to the 80's, since that's when I worked in HR and used to produce a report of people that were eligible.

ERISA and COBRA and other things I can't recall the name of were more or less honest attempts to meet situations as they then existed, even if they don't amount to real overall policy choices. It's a measure of the depravity of the Republican leadership of more recent times that there haven't been comparable measures, let alone any proposal for an overall ordering of the health/benefits system, in the last fifteen years.

Posted by Gene O'Grady | October 11, 2007 9:35 AM

Thomas,
The easy answer is that MY actually votes for those who control the bureaucracy. While it is imperfect it offers a lot more accountability than the current system where you have absolutely no control.

He even argues here (if you actually had any reading comprehension you would have acknowledged that fact) that the current system is a real disincentive to broader innovation since the risk of leaving a job is greatly increased by tying your insurance to your current employment. The moral economic argument is that it is better to allow more Americans the opportunity to innovate and create wealth than it is to protect one industry's ability to profit at the expense of said innovation while at the same time squeezing their customers at a time when they have little ability to protect their own interests.

So let's hear your argument why your job in insurance should be protected over the majority's right to life, liberty, and the pursuit of happiness.

Posted by Ricky | October 11, 2007 9:36 AM

Oops. Deficit reduction on the brain -- it's Consolidated Omnibus Budget Reconciliation Act. Still a lovely title.

Posted by Gene O'Grady | October 11, 2007 9:37 AM

Thomas -- I checked Wikipedia first, b/c I didn't know. It says 1986:

The Consolidated Omnibus Budget Reconciliation Act of 1985, or COBRA, is a law passed by the U.S. Congress that mandates an insurance program giving some employees the ability to continue health insurance coverage after leaving employment. . . . Although this statute became law on April 7, 1986, its official name is the Consolidated Omnibus Budget Reconciliation Act of 1985 (Pub.L. 99-272, 100 Stat. 82).

Wikipedia is wrong sometimes, of course -- any evidence of 1996?

Posted by JWR | October 11, 2007 9:37 AM

I was thinking of HIPAA, not COBRA, so my reference to 1986 was mistaken. (COBRA was passed by a Democratic House and Republican Senate.) JWR, my apologies.

Ricky, you're going to have to offer a little more actual argument as to why 1) incentives to deny care are morally wrong when the private sector has those incentives, but 2) incentives to deny care are morally right when the public sector hsa those incentives. Your argument ("who decides") suggests that the incentives to deny care are morally irrelevant. Which may be the case--just tell Matt, so he can stop bitching about private sector incentives to deny care.

Posted by Thomas | October 11, 2007 9:49 AM

is this the same person going after the Frost family for supporting S-Chip?

In a word, no.

Michelle Malkin's husband was/is a pundit who specializes in health care issues and is widely thought to be one of the weblog's ghostwriters in order to provide more material for her blog without diluting the Michelle Malkin "brand." That would explain why, when dealing with a policy issue regarding health insurance, the tone comes across as well-reasoned, but when dealing with a public political kerfluffle, you get pages and pages of angry vituperation and vindictiveness.

Posted by Tyro | October 11, 2007 10:03 AM

Are you not even going to tip your von dutch to your understudy in hackery mr.klein?

dont worry, though. He may be nimbler in smelling out the pitiful gotcha but that aside he is still clearly your inferior in the hack stakes. It requires real chutpaz to make the claim that "they can't afford any meaningful insurance against health care risk on the individual market" in reference to a post which

a) reveals that they purchased insurance on the individual market. Presumably they thought it meaningful, I cant imagine them paying the money if they didnt.

b) features absolutely no evidence that they couldnt afford any of the plans on the individual market. Her criticism of the most generous plans were that they she considered them not worth the money, not that she couldnt afford them.

I mean, either you dont care that your loyal readers may lose faith in you by writing easily debunked rubbish, or you have even less respect for their mental faculties than I do.

Posted by pimp hand strikes! | October 11, 2007 10:15 AM

incentives to deny care are morally right when the public sector hsa those incentives

What are the incentives for the public sector to deny care? How come I hear hundreds of stories about private insurance companies wrongfully denying claims, but few horror stories regarding Medicare?

Posted by Steve | October 11, 2007 10:18 AM

"Stay at home dad" isn't that code for loser dead-beat husband?

Posted by M McArdle | October 11, 2007 10:38 AM

What are the incentives for the public sector to deny care?

Indeed, isn't the typical knock against the public sector that it doesn't provide any incentives to cut costs?

Posted by TheF79 | October 11, 2007 10:46 AM

"After my husband quit his job earlier this year"

This is the definition of irresponsibility. At least according to the commenters on the reactionary web sites.

Posted by An Outhouse | October 11, 2007 10:49 AM

The last words in Malkin's post where: "are the high insurance cost caused by illegal immigration" with a link to a page with a lot of links, and titles like that (a single cut a paste from a long list):

Scientific Proof of the End of the World

Tribulation map

Israel intelligence chief warns country on brink of war

Perry Stone on Birth Pangs

Family of girl, 12, sues after 'Brokeback' shown in class

Hezbollah preparing for the next war

Near-term threat assessment for coordinated terrorist attack: "Extremely high"

Climate Momentum Shifting: Prominent Scientists Reverse Belief in Man-made Global Warming - Now Skeptics

We must attack Iran before it gets the bomb

I think it shows well what and who we are dealing with. Beliefs in end-of-the-world mesh with no-global-warming and bomb-Iran-while-we-still-can. I mean, with end of the World comming so soon, it stands to reason that global warming is the least of our worries, and, if we do not bomb Iran really soon, we may never be able to.

Hey, pimp: Mat, and Michelle did not spell out that paying 700 per months to have drug benefits capped at 1500 per year is worse than worthless because it is obvious for people who are: (a) at least semi-numerate, (b) aware that for many conditions a main cost of treatment is in new, expensive drugs. She did not quote the price for the high deductible plan they have chosen, but one can believe that it is crappy.

To now exactly how crappy, one would need to get seriously sick and see how they screw you with small print. The fact that the company was checking the weight and who knows what else is a good sign that they are in the bussiness of providing insurance only to people who do not need it, and thus they offer a bad deal, although not a very expensive one. The second mode is to provide insurance to people who need it, and screw them with high prices and arbitrary limitations on coverage, like "if you are too sick to take care for yourself, but to healthy for a hospital, then YOU have a problem, HA, HA!".

Posted by piotr | October 11, 2007 10:53 AM

Re: incentives for denying care. Private business has strong incentives to reduce their pay-outs as conservatives continually remind us. They are responsible to Boards of Directors, have to 'meet the payroll', etc. In the insurance game (particularly the insuring of people's health) they do it by selling policies on a selective basis and then being selective in writing checks based on those policies. They are 'cherry-picking' twice.

Gov't funded care (medicare/medicaid) has problems in the same domain. It is a frequent complaint of MDs that medicare reimbursment does not even pay their costs for certain procedures. Most of them will tell you, however, they find ways to deal with that problem more easily than to deal with private insurers who do similar things.

Posted by JohnMcC | October 11, 2007 11:09 AM

The awesomeness of this episode has reached a fever pitch. Malkin has a new post up on her site comparing Ezra Klein to Geraldo Rivera and an "overflowing vat of liquid radioactive waste."

She refuses his challenge to debate him on health care issues, but not because she's afraid he'll make her look bad, oh no! It's because she is unwilling to share the stage with such an disreputable and perverse slime artist as Ezra.

Equally entertaining is her insistence that even though health insurance is outrageously expensive and subject to refusal of coverage on trivial grounds when you have no access to a group discount, that MSAs should be good enough for everyone since they were good enough for her.

What's that you say? Not everyone in America can afford to sock hundreds of dollars away each month? A policy that works for the Malkins might not work for a family of six who makes $45K per year? I'm sorry, I can't hear you over the godawful din from that axe she's grinding.

Posted by LaFollette Progressive | October 11, 2007 11:13 AM

The easy answer is that MY actually votes for those who control the bureaucracy.

MY lives in the District of Columbia, so in this case the easy answer would be wrong.

Posted by Tyrone Slothrop | October 11, 2007 11:19 AM

"They are responsible to Boards of Directors, have to 'meet the payroll', etc. In the insurance game (particularly the insuring of people's health) they do it by selling policies on a selective basis and then being selective in writing checks based on those policies. They are 'cherry-picking' twice."

Did you know that in many insurance company's claims departments, claims managers are compensated based on how many claims the department denies or "reduces"? In other words, the bonus structure goes something like this: We will calculate your department's percentage savings (usually the amount of submitted claims, less paid claim amounts, sometimes plus investment income based on an average time-to-payment calculation). You then get $100,000 multiplied by percentage savings as your bonus.

Bonuses in the $30k-$40k range were not uncommon for more senior managers.

Does everyone see why this might be, well, a poorly designed incentive system if you need medical care?

In fact, insurers got sued so much for this sort of thing (basically, everyone who sued an insurance company for a claim denial asked for claims department comp guidelines in discovery), they outsourced claims handling to third parties. Now, when someone sues for a claim denial, they just say "not us, sue the bill handler." It usually doesn't work, but that little argument can take six months to a year to litigate.

God, I'm glad I don't represent insurance companies any more.

Posted by Joe | October 11, 2007 11:36 AM

Steve Duncan,

I'd posit a farmer idling a large portion of his land rather than planting and cultivating a crop is akin to quitting his job (or at least going part-time). Yet the government pays him to do exactly that. And conservatives raise holy hell when proposals are made to alter the practice.

I don't think you understand how the majority of the current Farm Bill works. Conservation payments (by putting land in the CRP) of the type you mention have been out of favor since the Freedom to Farm Act that Clinton and the Republicans brought you. So, unsurprisingly, conservatives don't actually mind making CRP and conservation of the land an unattractive option for farmers.

And the reason it's out of favor is that more land is in production because actual crop production with a subsidy provided in the form of crop insurance paying out a loan guarantee price provides more money to the farmer than CRP in almost every single case (except for the most marginal pieces of land).

Of course, that's a feature not a bug to the architects of that Farm Bill. Because essentially the subsidy (by encouraging overproduction) redounds to benefit large agri-business. A subsidy to mess up the enviroment with GMo products and dangerous chemicals. And it's a subsidy to large cattle, hog and chicken outfits (often owned by the same agribusiness) because they get to purchase feed on the free-market at the unsubisidized level while the taxpayer picks up the tab.

This may not change your point to y81, or your mind about helping farmers, but please realize that, currently, conservation and the CRP have very little to do with the larger Farm program.

Posted by keatssycamore | October 11, 2007 11:36 AM

Malkin's justification for not debating Klein is that he only excerpted part of her 2004 post. But he linked to her original post so that readers could, you know, read the whole thing. That evil, dastardly, bad faith liberal blogger who is so beyond the pale that debating him would offend Ms. Malkin's delicate sensibilities.

Posted by Led | October 11, 2007 12:16 PM

MY lives in the District of Columbia, so in this case the easy answer would be wrong

Why? DC residents can vote for president. The president is the head of the executive branch, i.e., the bureaucracy. So how is it wrong?

Posted by Lynn | October 11, 2007 12:25 PM

"Ricky, you're going to have to offer a little more actual argument as to why 1) incentives to deny care are morally wrong when the private sector has those incentives, but 2) incentives to deny care are morally right when the public sector hsa those incentives. Your argument ("who decides") suggests that the incentives to deny care are morally irrelevant. Which may be the case--just tell Matt, so he can stop bitching about private sector incentives to deny care."

Actually you need to offer a little more to your argument because this makes no sense within the realm of what MY posted and what it seemed like you were criticizing him on initially. Where did he say that the public sector denies care, much less that there were even incentives for such denial?

If you are actually trying to suggest that Medicare and Medicaid deny care at the same rate as private insurance companies then I have some ocean front property in Iowa you might be interested in.

Posted by Ricky | October 11, 2007 12:38 PM

MY said...
"Nevertheless, they can't afford any meaningful insurance against health care risk on the individual market."

Did he not read this part of Malkin's post?
"In the end, we decided to purchase a very high-deductible plan (sold by Golden Rule Insurance Co.) coupled with a tax-sheltered Medical Savings Account (MSA)."

High-deductible plans are often a good choice. They provide catastrophic coverage at decent rates for individuals/families with low health risks. The Frosts could have benefited from such a plan.

Posted by kwo | October 11, 2007 1:37 PM

Re: JWR, COBRA was passed in 1996, so, no, it isn't a product of a Democratic congress.

This is incorrect. COBRA passed back in 1986. You are thinking of HIPAA which did pass in 1996.

Re: Did you know that in many insurance company's claims departments, claims managers are compensated based on how many claims the department denies or "reduces"?

This is not true. I worked at a healthcare claims processing company; no such pay structure existed. The claims people were assessed on how many claims they could process and how accurately. (They were allowed only a 2% error rate; if they exceeded that more than two months in one year they were fired). Since denying a claim unfairly often results in an appeal, and that in turn raises the risk of having their work be tagged with an error, claim adjudicators are very careful not to deny claims they should pay. (Appeals are rather expensive for insurance companies to defend by the way since even if arbitration is used, they still have to pay legal staff to handle the job). Much as I agree with all that is said about the need for major health reform, I don't think propagating disinformation like this is a good tactic. The usual means for insurance companies to minimize their pay-outs is not by denying claims outright (though they will do so if given reason) but rather by "nickel-and-diming" the provider with all sorts of mandatory discounts and reductions, and if the provider is under network contract he has to accept this and cannot turn around and charge these back to the patient. Check out your next EOB from your insurer. Even if it's a simple office visit you will probably note some of the discounting I refer to here. The doctor gets paid considerably less than he asks for. That is the principle way that insurers save money-- and that applies to the public programs too.

Posted by JonF | October 11, 2007 1:47 PM

Ricky, every UHC plan adopted elsewhere, and most UHC plans proposed here, have incentives for reduced expenditures. (Medicare limits expenditure reimbursements, which creates its own set of perverse incentives, but it isn't designed to, and so it doesn't provide, reduced total expenditures. To the contrary.)

Posted by Thomas | October 11, 2007 2:46 PM