Friday, May 8, 2009

Shock: businesses prefer regulation to death

Faced with being driven to government-imposed extinction or government-enforced market protection, health insurers are acting rationally. And the Lexington Herald Leader is surprised.

This is really simple. "A market that offers real choices and price competition" is best for consumers and taxpayers, but not necessarily for insurers or a power-hungry government. A ban on "overcharging" higher risk classes of insureds works out for insurers, though, because they and their competitors will be mandated to spread the higher cost among their customers. Insurers aren't seeing light, they are following political winds. Can't blame them for that. They want to stay in business. Given the alternative, the market versus mandate debate isn't even interesting to them any more. They just want to survive under the new regime.

As has happened every time government expands its role into healthcare financing, (see England, Canada, China, Medicare, etc.) consumers and taxpayers take the hit. The insurance industry will only become increasingly willing to go along with ObamaCare as they continue to receive assurances that their ox won't be getting gored yet.

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