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Originally Posted by flstf
The_Jazz,
I snipped a couple of paragraphs from your post although I did read it all and I have a couple of questions.
In the first paragraph you say:
What could be a larger group than the whole country? Isn't this a good argument for putting everyone in one group and providing universal healthcare and wouldn't it therefore be less expensive?
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Actually it is, assuming that the state is going to pay everyone's cost. It would allow for relatively accurate budgeting (most likely to within a few million dollars out of around several hundred billion). Over the long term - meaning several decades - I have no doubt it would end up being less expensive.
That said, it's not going to happen. For one thing, lots of folks don't want it to, particularly Congressmen who have large healthcare insurers employing people in their jurisdiction. All those folks would either immediately be out of work or become federal employees. Most likely, the group would become a combination of the two. Assuming I live as long as the actuaries say I'm going to (about another 50 years), it's possible that we'll make some great strides in that direction within my lifetime. It won't happen overnight, and it won't happen without the current uninsured being taken care of first. It's the necessary progression, especially given the current legislative climate. I don't see that happening until at least 2010, and as I mentioned in my first post, I have no idea where they're going to raise the money. Maybe they'll take Rod Blagoevich's worst idea ever and put a gross receipts tax on every business in the country.
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What are some of the very good reasons for not allowing individuals to pool together to reduce their healthcre costs?
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First, they don't have what's referred to as "insurable interest". Typically that means some sort of relationship linking them all together, whether it be through family, employer or some other commonality. What's being proposed here would just link the self-employed, with that being the sole link, which is technically illegal. Those laws are in place to prevent consumer fraud, and I can't say that they're necessarily misguided in this case.
Then there's the problem of who ISN'T going to be included in the group. There's the very real problem of discrimination based on real or perceived disadvantages to allowing someone to participate. The issue of pre-existing conditions, etc. would only increase it.
The big question is exactly how it would be set up, whether or not there would be an amount retained by the pool somehow to offset the risk and if people wanted multiple options. I can give you more details if you'd like, but I can't really do it without using some techical terms.
There's also the issue of fraud against the consumer, where the administrator of the purchasing group would take the money and run. My own company was the victim of that about 8 or 9 years of that. Given who's doing this, there's not much chance, but it exists.
Basically, my point was that both sides need to make sure that the other one has all the right legal controls in place