Aetna shows why we need a single-payer system
The best argument for a single-payer health plan is the recent decision by giant health insurer Aetna to bail out next year from 11 of the 15 states where it sells Obamacare plans.
Aetna鈥檚 decision聽follows similar moves by UnitedHealth Group, the nation鈥檚 largest insurer, and Humana, one of the other giants.聽
All claim they鈥檙e not making enough money because too many people with serious health problems are using the Obamacare exchanges, and not enough healthy people are signing up.
The problem isn鈥檛 Obamacare聽per se. It鈥檚 in the structure of private markets for health insurance 鈥� which creates powerful incentives to avoid sick people and attract healthy ones. Obamacare is just making the structural problem more obvious.聽
In a nutshell, the more sick people and the fewer healthy people a private for-profit insurer attracts, the less competitive that insurer becomes relative to other insurers that don鈥檛 attract as high a percentage of the sick but a higher percentage of the healthy. Eventually, insurers that take in too many sick and too few healthy people are driven out of business.聽
If insurers had no idea who鈥檇 be sick and who鈥檇 be healthy when they sign up for insurance (and keep them insured at the same price even after they become sick), this wouldn鈥檛 be a problem. But they do know 鈥� and they鈥檙e developing聽more and more sophisticated ways of finding out.聽
It鈥檚 not just people with pre-existing conditions who have caused insurers to run for the happy hills of healthy customers. It鈥檚 also聽people with genetic predispositions toward certain illnesses that are expensive to treat, like heart disease and cancer. And people who don鈥檛 exercise enough, or have unhealthy habits, or live in unhealthy places.聽
So health insurers spend lots of time, effort, and money trying to attract people who have high odds of staying healthy (the young and the fit) while doing whatever they can to fend off those who have high odds of getting sick (the older, infirm, and the unfit).聽
As a result we end up with the most bizarre health-insurance system imaginable: One ever more carefully designed to avoid sick people.
If this weren鈥檛 enough to convince rational people to do what most other advanced nations have done and create a single-payer system, consider that America鈥檚 giant health insurers are now busily consolidating into ever-larger behemoths. UnitedHealth is already humongous. Aetna, meanwhile, is trying to buy Humana.
Insurers say they鈥檙e doing this in order to reap economies of scale, but there鈥檚 little evidence that large size generates cost savings.聽
In reality, they鈥檙e聽becoming very big to get more bargaining leverage over everyone they do business with 鈥� hospitals, doctors, employers, the government, and consumers. That way they make even bigger profits. 聽
But these bigger profits come at the expense of hospitals, doctors, employers, the government, and, ultimately, taxpayers and consumers.
So the real choice in the future is becoming clear. Obamacare is only smoking it out. One alternative is a public single-payer system. The other is a hugely-expensive for-profit oligopoly with the market power to charge high prices even to healthy people 鈥� and to charge sick people (or those likely to be sick) an arm and a leg.
This story originally appeared on .
