From: jbugden@smtplink.alis.ca
Date: Wed, 18 Sep 1996 03:36:53 +0800
To: Black Unicorn <unicorn@schloss.li>
Subject: RE: Risk v. Charity (was: RE: Workers Paradise. /Politica...
Message-ID: <9608178429.AA842985398@smtplink.alis.ca>
MIME-Version: 1.0
Content-Type: text/plain


Subject: RE: Risk v. Charity (was: RE: Workers Paradise. /Political rant)

Black Unicorn <unicorn@schloss.li>
>On Mon, 16 Sep 1996 jbugden@smtplink.alis.ca wrote:
>> Specifically, that anyone can "save for a rainy day" and still not be
>> able to provide for events that can always happen: Heart attack,
>> stroke, car accident, pinched nerve that leaves you in excruciating
>> pain and unable to work for several years.
>
>Understand what it is you are saying.
>
>You are saying that everyone on the planet has a right to health
> insurance and disability insurance whether they can afford it or not.
> This is folly.  The result is serious moral hazard problems.

Almost, but not quite. I'm saying that within our two countries at least
(Canada, U.S.) everyone could have access to medically necessary procedures
because the *society as a whole* can afford it.

I understand moral hazard and risk pool seperation. I also understand that the
insurance bureacracy required to manage much of the U.S. health care system
absorbs much of the money going into the system. Managing risk pool seperation
proves to be expensive, or perhaps just very profitable.

> Social safety nets prevent rioting by the lower classes, revolution and
> general civil disorder because they appease the masses.  Indeed this
> is a form of health and life insurance for the middle and upper classes.

Absolutely. And it is a scheme that many of the lower classes pay into. Since it
is to our mutual benefit (yours and mine), I choose not complain about it.

> Spreading the risk, by itself, does NOT reduce cost.  
> You must properly PRICE risk.

Agreed. But there is a balance between accurately pricing the risk and
minimizing the cost of the bureacracy that polices this pricing. 

There are also many ways to modify behaviour, not all of them direct. We only
need a correlation here, not causation. For example, high taxes on smoking and
drinking or spot checks for drunk driving. All of these correlate with a
reduction in high risk behaviour and a reduction in health costs.

Yes, there are people who will engage in high risk behaviour. Yes, they will
still receive treatment. No, it is not worth tracking down all of these people.

You may also get better privacy because no insurance company is collecting
personal data in order to minimize their risk. A Suspicious Persons List is only
one manifestation of this type of intrusion. This privacy issue may only
increase as genetic screening becomes widespread. 

There is much potential for moral hazard when the PRICE for your insurance is
affected by the accuracy of your disclosure. How will they ever know...

Fact: Canada spends less than the U.S. per capita on health care, while covering
more people in percentage terms.

Ciao,
James, qui pete les bretelles du Canada.

And he brought the present unto Eglon king of Moab: and Eglon was a 
very fat man. [Judges 3:17]

"Of all tyrannies a tyranny sincerely exercised for the good of its victims  
 may be the most oppressive. It may be better to live under robber barons  
 than under omnipotent moral busybodies. The robber baron's cruelty may  
 sometimes sleep, his cupidity may at some point be satiated; but those who  
 torment us for own good will torment us without end, for they do so with 
 the approval of their own conscience."   -  C.S. Lewis, _God in the Dock_ 

"A foolish consistency is the hobgoblin of little minds." - Emerson