Working Up

by Dwayne Phillips

Just a thought on health insurance from an engineer.

I see that President Obama doesn’t like what existing health insurance companies are doing with their rates and policies. It seems that the president wants health insurance companies to be non-profit and insure everyone regardless of pre-existing conditions.

Health insurance seems to be a pretty simple concept (at least from the perspective of a little-knowing engineer).

• A group of people pay into a fund.
• When someone is sick, money is pulled from the fund to pay the bill.
• If a lot of people become sick in one year, everyone has to pay more into the fund to cover the expenses.
• If few people become sick in one year, fewer funds are withdrawn from the fund and people don’t have to pay as much that year.
• There are expenses to managing the fund and collecting the contributions.
• A non-profit health insurance group manages the money closely so that money in equals money out.
• A good non-profit health insurance group operates efficiently by employing smart, well-meaning people and keeps costs really low.

I think it is legal to start such a non-profit health insurance company. A good, efficient non-profit health insurance company would offer better and less expensive services than the existing for-profit companies and people would flock to it.

Perhaps President Obama could start such a non-profit health insurance company himself. At least he could use his position of influence and leadership to inspire others to start such non-profit health insurance companies. Pardon my ignorance, but I think that is what a President of these United States should do – state his beliefs and inspire others to follow those beliefs.

History shows us that it is incredibly difficult to pass legislation that requires people to be good. There are also many unintended consequences of such laws. Just a thought.

I invite comments on this thought. Perhaps the discussion can lead to someone beneficial.