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"Buy Health Insurance across State Lines" GOP pushing big time?

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Bravo Zulu Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 06:29 PM
Original message
"Buy Health Insurance across State Lines" GOP pushing big time?
Why Buying Health Insurance across State Lines might Not be a Good Idea

Recent proposals about buying health insurance across state lines have sent many of us scrambling to check policies, and wondering whether such changes might mean its time to find a new insurer. After all, wouldnt such a change open up the market and make it possible to get cheaper coverage?

Unfortunately, its by no means certain that such a change would be largely beneficial. In fact, its actually possible that the end result might be more expensive insurance overall, and that over time, more Americans would find health insurance too expensive.

What Does Buying Insurance Across State Lines Entail?
So what does selling coverage across state lines actually mean? Simply that an insurer could sell their product to any person in any state. Theoretically, this would mean consumers have a much greater range of insurers from which to choose, meaning increased competition and lower premium costs. However, there are some wider implications.

The fact is, such a change may end up benefiting only those who are young, fit, and healthy people who are low-risk in the eyes of insurers, and who can have their pick of policies. Anyone who is moderate or high risk will eventually find that getting affordable insurance, or perhaps even any insurance at all, becomes much harder.

This may seem counter-intuitive. After all, surely opening up the market will mean everyone has a better shot at getting affordable insurance. The problem is, however, to an insurance company risk is still risk. The perceived risk of an individual who is fifty years old, overweight, and a smoker wont decrease just because that individual can buy insurance anywhere in the country.

And if an insurance company can offer cheap premiums to entice low-risk people from all over the country, theyre that much less likely to continue offering any type of insurance to higher-risk individuals.

What this means is, its more likely that insurers will be encouraged to underwrite more and more aggressively, with cheaper premiums for those who qualify as low-risk. But those cheaper policies will provide increasingly skimpy coverage, meaning that people who prefer more comprehensive policies as well as high-risk individuals will find fewer companies are willing to offer the insurance they need.

Does this mean across-state-lines insurance cant work? Not necessarily, but more thought is needed to produce a workable solution. Federal regulation of insurance companies might be a good start and in fact, if insurance companies are allowed to sell across state lines, this might seem to be the most appropriate and logical solution.

http://www.individual-health-plans.com/blog/insurance-a... /

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tosh Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 06:34 PM
Response to Original message
1. I'm glad to see this being addressed.
It is obvious to me what the potential pitfalls this idea would present, but I've not heard or seen it covered by media at all.

The R's need to explain it to us in detail if they are going to keep throwing this at us.
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DJ13 Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 06:35 PM
Response to Original message
2. Before the early 80's banks were state regulated
Interest rates were kept lower than now (relative to the Fed Funds rate), and states protected consumers from predatory lending.

Then the USSC ruled it a violation of restraint of trade, and now look at the interest rates (30% CC with the Fed at 0%) and the lack of consumer protections and thats precisely what the GOP is advocating for insurance.
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MerryBlooms Donating Member (940 posts) Send PM | Profile | Ignore Fri Jan-29-10 06:48 PM
Response to Original message
3. For someone like me with a serious pre-existing
it's keeping me from moving out of state and moving on with my life. I can't afford to be without insurance for the usual 6mth waiting period with the established required residency in order to qualify, (which means my current insurance will be void) - and then that is if I'm not rejected by the new insurance for having a pre existing condition. So my life is on hold until something changes.
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ddeclue Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 06:51 PM
Response to Reply #3
4. That's why we need MEDICARE FOR EVERYONE.
Letting insurance companies sell across state lines is just a race to the bottom that will let the crooks move to unregulated states just like they've done with banks and credit cards already. Do. Not. Want!
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MerryBlooms Donating Member (940 posts) Send PM | Profile | Ignore Fri Jan-29-10 07:17 PM
Response to Reply #4
5. Medicare for ALLwould be great
if every time people float it would stop the 55+ which does nothing for me. If they open up Medicare truly for ALL, then yes, that's definitely the way to go. There are a lot of us miserably uninsured, paying high premiums, in medical debt and our houses with a medical lien - it's getting real damn desperate.
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MisterP Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 07:59 PM
Response to Original message
6. well, I don't see any WH discourse against this: it's all "competitive" this and "monopoly" that,
not "overcharging" this and "social services should be government" that

that's what America gets for coccooning and for lacking a real left-wing discourse, I'm afraid
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L0oniX Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 08:05 PM
Response to Original message
7. If this passes then this (see below) is what will happen ...I guarantee it.
They will all move to the state that has the most lenient laws and regulations ...just like the CC co's did with Delaware.
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Telly Savalas Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 08:37 PM
Response to Reply #7
8. Moreover, that is all that will happen.
Such a bill won't stimulate competition.

If a New York based health insurance company really wanted to sell insurance in California or vice versa, they would already be doing what is necessary to set up shop there. The regulatory obstacles are not that great.
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conservdem Donating Member (880 posts) Send PM | Profile | Ignore Fri Jan-29-10 08:45 PM
Response to Original message
9. Does anyone know the Whitehouse's position on this issue?
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Joe the Liberal Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jan-29-10 08:50 PM
Response to Original message
10. The general rule of thumb is.......
if the republicans support it then you oppose it, if the republicans oppose it then you support it. Doing this will put you on the right side of literally every issue.
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conservdem Donating Member (880 posts) Send PM | Profile | Ignore Sat Jan-30-10 02:59 PM
Response to Original message
11. kick
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