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Here is one source: https://www.factcheck.org/2017/07/selling-insurance-across-s...

Why should we trust them vs a random HN commenter?




Many fact checking sites are actually heavily opinionated. To the point where even demonstrably true facts are labeled as "half-true" due to opinionated objections. Frequently, the veneer of calling oneself a "fact-checking" site lets them get away with some pretty significant bending of the truth.

It looks like this article isn't much different. It doesn't actually refute the claim that less regulation would result in lower healthcare premiums:

> In states with unregulated markets, “you could create a situation where you are selling very low-priced policies to healthy people without much [insurance] protection whatsoever,” Blumberg, who was a health policy adviser to President Bill Clinton’s administration, said in a phone interview. “But that ignores the fact that … what you’re doing is driving up the premiums to impossible levels” in states that want to have insurance regulations.

So removal of regulations would actually make healthcare premiums cheaper in the de-regulated areas. Potentially this makes the insurance more expensive in places that do have regulations, but it's actually agreeing with the claim that deregulation can make insurance cheaper.

> It’s a “risk-segmentation strategy,” she said, where eventually the healthy people are pulled into one set of plans and those with health problems are left in another. Premiums would go up so much in states with regulated plans that it would become impossible for them to sustain those regulations.

> Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms, said that the lion’s share of a premium is the money a plan has to pay for medical claims, as well as utilization. Selling insurance across state lines wouldn’t change the price of medical services — as Antos said — but if insurance companies could deny coverage or charge more for health conditions, a carrier could “push down on utilization by screening out sick people” and then, “they can charge a lower premium.”

Again, the article does admit that premiums would likely go down with less regulation.

It looks like your article isn't actually disproving the claim that insurance premiums would go down with less regulation. In fact it repeatedly does say that premiums would indeed go down, but that it would result in other changes like different coverage from what people are used to, and potentially making it harder for unhealthy people to get insurance.


I agree that everyone is biased. But there has just been an incredible amount of debate on this issue. For OP to state that he's discovered the solution is a bit disingenuous.

Here's another source. There really is a lot: https://www.naic.org/documents/topics_interstate_sales_myths...


This hardly qualifies as a source, it's just a page of "Myth vs. Reality" bullet points with no data backing it up, nor any references to sources. I'm going to go out on a limb and say that the National Association of Insurance Commissioners is going to have more than a little conflict on interest here. Maybe what they're saying is true, but I'd need actual data if I wanted to believe them.

What they're saying breaches some of the most widely understood patterns of markets: that deliberate interference with markets through regulation drives up prices. Sometimes there are justifiable reasons for doing so, like making sure products are safe. If you mandate that all cars need airbags, prices are going to go up because now every car has the cost of a few airbags on top of whatever it cost previously. This claim that regulating the insurance market somehow keeps prices low goes into the same bucket of dubious claims like San Francisco progressives claiming that constructing new housing actually drives prices up and other claims of that sort.


To be clear, the NAIC isn't an industry group - it's made up of insurance regulators. I suppose the argument could be made that they have a conflict of interest in that they'd benefit from increased regulation from an "empire-building" perspective. But I've never gotten the impression that that motivates their decisions in practice. (I'm a former actuary and still work in the insurance industry.)

It's likely true that health insurance premiums would be lower, on average, in an unregulated free market. It's also true that people with pre-existing conditions would be denied coverage or charged substantially higher premiums in an unregulated free market. The current approach to subsidizing coverage for those with pre-existing conditions is less efficient than a tax-and-spend approach would be (see, e.g., [0]), but it's more politically viable since it doesn't show up in government bugets.

[0] https://johnhcochrane.blogspot.com/2018/06/cross-subsidies.h...


> To be clear, the NAIC isn't an industry group - it's made up of insurance regulators. I suppose the argument could be made that they have a conflict of interest in that they'd benefit from increased regulation from an "empire-building" perspective.

Having 50 different markets to regulate sure seems like it'd result in a lot more demand fore insurance regulators than one market to regulate.

> It's likely true that health insurance premiums would be lower, on average, in an unregulated free market. It's also true that people with pre-existing conditions would be denied coverage or charged substantially higher premiums in an unregulated free market. The current approach to subsidizing coverage for those with pre-existing conditions is less efficient than a tax-and-spend approach would be (see, e.g., [0]), but it's more politically viable since it doesn't show up in government bugets.

Sure, there may be people who find the reasons for regulating the market to be more compelling enough to justify regulation. But that doesn't excuse the mental gymnastics required to convince oneself that this sort of regulation will somehow not only reduce costs but actually make things cheaper. This kind of thinking led us to having the poorest and unhealthiest patients subsidized by the rest of the nation - effectively a levying a flat tax on most insurance customers - and patting ourselves on the back as though this was a progressive change.

Also, your source is pretty dubious. I'm very skeptical of how analyzing the cost of helicopter ambulances specifically is supposed to be a good means of trying to back up the claim whether subsidy is less efficient than paying through taxes. Contrary to popular belief, most universal healthcare programs (e.g. most the ones in Western Europe, the UK being the notable exceptions) still leave the actual healthcare up to the private market.




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