http://www.kaiserhealthnews.org/Stories/2009/November/06/health-insurance-across-state-lines.aspx
This article describes the issue in greater detail. It discusses some of the pros and cons of selling insurance across state lines.
Friday, February 5, 2010
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http://www.msnbc.msn.com/id/35257538/ns/health-health_care/
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ReplyDeleteI think it was mentioned in class that California regulates health insurance more tightly than, say, Arizona. If a national exchange is offered, then regulation would lie with the federal government, according to the article. They would set a minimum standard, which is more likely to fall below California's current standards. I think something like this would be great for those states who have lower standards than what the federal government would set, but I personally would appreciate insurers to be held to a higher standard. Besides the intention to lower the cost of health insurance, I also wonder how many people would benefit from being able to use their health insurance in a different state. Are there enough people to warrant this? I don't think this was a consideration when they proposed the national exchange, but I'm curious about it.
ReplyDeleteBeing able to buy insurance across state lines just seems like a weak Band-Aid solution for a very serious problem -- if health care costs continue to go up, even the cheap insurance plan you buy from the company across the country will eventually either go up in price or go down in coverage. It just doesn't seem like a sustainable idea at all, and I don't see any part of it that will actually perform the Holy Grail-like task of controlling skyrocketing costs. Not sure if a federal minimum standard of coverage will really help with that either, since insurance companies might just use such standards as an excuse to raise prices. With all this, I'm just not sure how an insurance exchange like this will help our end goal of getting more people to have access to health care services.
ReplyDeleteI'll have to agree with Beth on this one. There are definitely states where health insurance is less expensive than others, and if people buy all of their insurance from those places, it will raise the rates there. The consequence is that it'll make healthcare less affordable for people who live in those low-cost areas.
ReplyDeleteOn the other hand, buying insurance in another state could prove to be affordable for people who need basic coverage, not expensive 'Cadillac' plans that cover fertility treatments or hair restoration.
I always thought the United States was not so united. Each state has different laws regarding speed limit, legal age of consent, and so many other things. Without national, unifying laws the states are able to set their own guidelines. The minimum car insurance policy in one state doesn't necessarily meet the standards of another. If you get into an accident in CA with AZ insurance, then you may not be completely covered. The same idea applies to health insurance (as mentioned in the Kaiser Health News article). Shouldn't we be able to drive our cars across state lines and not have to worry about what that state covers? Instead of being able to buy health insurance from other states, I think we should be able to buy insurance that guarantees coverage anywhere in the country.
ReplyDeleteI think that if the exchange could be regulated then it would be a good thing for the United States, however I know that it is an idealistic view. Everyone has covered most of the important points. It sounds great in theory but what about the elderly or what about skyrocketing rates. It would be best if we could set an exchange rate and keep things equal across states, but is that really what the US is about? Some people might say that it is a "socialist" point of view. So I agree with Beth and think that this is a quick band-aid fix and we need to put some serious thought into this problem and the solution.
ReplyDeleteThis article also brings up a good point against state-based exchanges or continuing to only sell insurance plans on a state-by-state basis. Some states are dominated by only a few insurance companies. This would likely not change if we were to change to only state-based exchanges. I don't really see how that would help to drive down costs via competitive principles since that is essentially what they already have. So if insurance exchanges are to be utilized, either a national exchange or possibly regional exchanges based on the number of available insurance companies or options may work. For example, California may be able to stand on its own, but possible Utah, Montana, North & South Dakota and other nearby states could be an exchange in order to pool insurance options and actually introduce competition into these exchanges.
ReplyDeleteI think crossing state lines is a good way to increase competition between insurance companies. I agree that it is not an all inclusive solution to our health care crisis and that it should be coupled with the inability to deny people insurance. Nonetheless, crossing state lines could help reduce costs. My dad's business is based in Texas and due to lower insurance costs in Texas, he chose to insure my family under the state of Texas. My dad had this option to "shop" across state lines only because his business is based in Texas, but he did find a better deal. It is true that a few insurance companies may end up dominated the market even if state lines are opened up but there is also the possibility for the broader range of current options driving costs down. Dealing with the different prices in different states could be tricky, but then again individuals will have the choice to choose the plan that pays out the most. When it comes to the possible confusion among the public as to which insurance is best for them, perhaps a connector could be established like they have in Massachusetts.
ReplyDeleteI think a national insurance exchange seems ideal, like most of us have mentioned, but in reality it's not going to improve health care access. I think it would rather complicate the health care system since every state has different regulations and costs of care. Most notably, as the article mentioned, people will want to purchase the most inexpensive policies with the least coverage, which will end up hurting them in the long run if they develop an illness not covered by their curent policy. Many people will be left without coverage and like Tammi mentioned, it's gonna be a tricky process dealing with different plans in different states. So I'd have to say an exchange system isn't an ideal solution to our current problems and might end up hurting more than it helps.
ReplyDeleteThis exchange may help control costs in the short-term, but eventually I still think better approaches to control costs will be needed that don't rely on competition alone. Also, I think many people searching for the lowest cost health plans could get taken advantage of by insurance companies. Perhaps with appropriate federal regulation on the basic benefits required this exchange could be beneficial, but many flawed aspects of the current health care system would not be solved through this exchange alone. The uninsured will still be uninsured. Even if someone previously uninsured was able to buy health insurance through cheaper plans in different states, the issue of quality and true access to health services would still be a problem. If the health care system is really going to change in someway, I think it should be through a total redesigning of the system.
ReplyDeleteAs mentioned in the article, it does raise issues of regulation. I remember a while back a close relative living in California had purchased insurance from Texas which was marketed as a "gold plan". When she was diagnosed with kidney failure, the insurance company denied coverage for anything related to end stage renal failure. It wasnt a common plan and who really reads the fine print until its too late. The family was lucky that Medicare covered it, even though she was under 65. This saved them. I imagine, that a lot of this would happen if insurance was opened up accross state lines and prices attractive. This may not be a good solution even in the short run.
ReplyDeleteThe idea of a national exchange system does seem like it could potentially lower prices, but there are numerous things to consider, such as, whether there is a wide range in average premiums for comparable insurance between states. If this is the case, some states with higher average premiums may have their prices lowered, while the opposite could happen with states that happen to have lower than average premiums. For example, medical centers in rural areas like Idaho probably don't have the level of medical facilities and technology that we have in California. So, they don't have to pay for the newer technologies and procedures that we do. Also, there is a huge difference in population. Premiums paid by Californians have to cover the risk for many more people than in rural states. Therefore, the exchange may not result in universally lower prices for everyone.
ReplyDeleteIn addition to many of the comments made by others, after some consideration, the exchange system seems to be a fairly weak solution to try to lower healthcare costs.
I find the position taken by the Republicans who want a national exchange system without federal regulation perplexing, given that the regulation of interstate commerce is one of the few explicitly stated responsibilities of the Federal government.
ReplyDeleteAnyway, I think a possible effect would be similar to what is playing out regarding emissions standards. California's stingier emission standards make it less cost-effective for car companies to make two different emission-level cars for the two markets so, especially considering California's huge market, it makes more sense to make all cars that meets California's standards, essentially pulling the country with it. Perhaps national regulation could raise the standards of areas who have been deprived the services of other areas.
However, as long as the insurance exchange we create lacks a non-profit public plan run by the government to truly drive down costs, we will essentially have insurance companies competing between taking a 2% or 2.5% decrease in their quarterly profits.