Healthcare vs. car insurance
I was going through some web sites this morning, and this sentence jumped out at me: If healthcare reform passes, conservatives are planning to mount a constitutional challenge to the individual mandate on the grounds that the federal government doesn't have the right to force you to buy a product from a private corporation.
For those of you wondering, the writer was Kevin Drum and the source in Mother Jones. Yes, it's liberal. Yes, it has a bias - what media outlet today doesn't?
Back to health care reform. Or conservatives challenging health care reform because the government doesn't have the right to force you to buy a product from a private corporation. Two words for conservatives: Car insurance.
You read that right. Car insurance. I don't know about you, but I buy mine from a private entity. And I am legally obligated to have insurance if I want to drive a car.
Last time I checked (which was literally two seconds ago), the auto insurance industry hasn't collapsed. In fact, we have lots of insurers out there spending money trying to get you to switch to their products.
And guess what? "Overall customer satisfaction with auto insurance companies is up significantly in 2009, driven primarily by low premiums, according to the J.D. Power and Associates 2009 National Auto Insurance StudySM released today."
What?! That's right folks, people are happier with their car insurance and it costs them less now.
Nuff said.
For those of you wondering, the writer was Kevin Drum and the source in Mother Jones. Yes, it's liberal. Yes, it has a bias - what media outlet today doesn't?
Back to health care reform. Or conservatives challenging health care reform because the government doesn't have the right to force you to buy a product from a private corporation. Two words for conservatives: Car insurance.
You read that right. Car insurance. I don't know about you, but I buy mine from a private entity. And I am legally obligated to have insurance if I want to drive a car.
Last time I checked (which was literally two seconds ago), the auto insurance industry hasn't collapsed. In fact, we have lots of insurers out there spending money trying to get you to switch to their products.
And guess what? "Overall customer satisfaction with auto insurance companies is up significantly in 2009, driven primarily by low premiums, according to the J.D. Power and Associates 2009 National Auto Insurance StudySM released today."
What?! That's right folks, people are happier with their car insurance and it costs them less now.
Nuff said.
Posted by Anna at 1/15/2010 9:14 AM 
Categories: Health
Tags: car insurance healthcare reform constitutional challenge auto insurance private insurers
Categories: Health
Tags: car insurance healthcare reform constitutional challenge auto insurance private insurers
While I too have become rather disgusted with the Republican party in recent years (they are a party with NO principles anymore...Bush pretty much made sure of that), I have to agree with them on this one issue (hey, even stopped clocks are right twice per day...).
Your argument about car insurance isn't quite relevant because:
1. Car insurance only applies to people who own a car and drive it on public roads. If you walk, use public transit, or never leave your own property out in the country, you have no obligation to buy insurance.
2. In contrast, the Dems proposal to require health insurance applies to everyone. It's basically a tax in which the government is in bed with a private business. Not to be dramatic, but it's a mild form of fascism, or at least corporatism. Not a good precedent!
Personally, I view full UK-style socialization a lesser of two evils, if those are our only two choices. At least the UK model is honest about what it is. The US proposal tries to pass this off as "free market" when it is really quite the opposite.
Of course, I'd rather see a REAL free market in health care with NO tax writeoffs or subsidies that mask the true cost. But that's never going to happen, alas.
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Hmm, too bad about my car insurance argument. I still like it, though. Points out that we've done something similar and it's worked well.
Actually, I would prefer a UK-based system as well. I lived in Australia years ago and was very impressed by their healthcare system. All children are covered - for everything. It cost less per capita than our system - and contrary to the scary comments being made - no one waited in line to see their doctor or have surgery. As an economist, can you answer what the financial fall out would be switching from private to public system?
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I can speak on behalf of the difference in New Jersey.
While on the surface, these laws seem quite similar, health care and automobile insurance, there are several key discrepancies.
New Jersey mandates coverage for automobile insurance (C. 17:28-1.4) in accordance with the Tenth Amendment of the US constitution. Which means that our mandatory coverage of auto insurance is instituted at the state level and not the federal level. Our drivers insurance is much like Massachusetts mandatory health care act (legal because it is regulated at the state level). With regards to the health care legislation, Article 1, Section 8, of the United States constitution, also known as the enumerated powers clause, outlines the specific powers that Congress may enact. Of these powers, absent is the right to require citizens to purchase any item or insurance package. This is the difference between the two issues.
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Hi, Max. Thanks so much for the comment. You are absolutely right about the difference. My question is this: Are people angry because the federal government has overstepped its authority or are they angry because they don't believe health insurance is a right and responsibility that must be offered to and paid for by the people of this country? If you ever use the system, then you have an obligation to pay for such services. That's one of our basic capitalist principles. As far as I can see, the government has simply decided to enforce that code of ethics, which really ticked people off. But I don't understand why. Doesn't everyone want to be healthy and know they won't have to file bankruptcy if someone in their immediate family becomes seriously ill?
We know that having everyone in a health insurance pool dramatically lowers costs - both the healthy who rarely use such services and the sick are in a group plan together, making the average premiums and cost of health insurance lower for everyone just as it did when car insurance became mandatory in states.
How is that not a good thing?
The argument I've heard against health care coverage for all is that young, healthy people don't want to waste their money on something they rarely use. Heck, young people barely make enough to cover their bills. But how do you predict a car accident or appendicitis? When you need a doctor, you NEED one. Same with car insurance. By making sure everyone has it, there is no need to worry when you are mailed a huge hospital bill. You have insurance.
I've searched online and haven't found a state that doesn't have mandatory car insurance laws. So while the states may mandate car insurance, it's still required in all states, thus making it a federal - or universal - law by default. The end result is the same. Everyone has to be covered to drive.
There are parts of the monster bill I don't like. And I think that this legislation is so big and sweeping, it's bound to have major problems. I just don't think they're going to be the problems that are currently being warned against. They'll be something knew and equally annoying.
But I do get peace of mind knowing that if my children were to get sick - terribly sick - the new federal law says insurance companies must cover their medical costs. If they didn't, as an insurance broker we talked to Monday said, "You wouldn't have a house anymore."
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Healthcare insurance is vital for everybody in my opinion, whereas Car-Auto insurance would be required only to those with vehicles and whom use them.
For more information on both the above types of insurances and quotes visit our website.
Interesting read and ideas though.
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Haha. Good point. And now that it has passed, it's an even more compelling argument for the bill. Hopefully there'll be healthy competition between health insurers now that everyone has to be insured (and not only people with cars now... literally EVERYONE).
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Hehe. Great point. I like it. It's simple and it throws back their argument in their faces. I just hope the Obama administration will hold its ground against the conservatives, otherwise all of this will have been for nothing.
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Excellent point. I don't know how to explain that compulsory, state-financed health insurance is necessary for any country that cares about its citizens. America's carelessness has gone on for way too long, and I am happy to see things change.
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President Obama's dream of dramatically remaking the nation's health-care system is still a long way from reality. But if lawmakers can reach an accord, one thing is virtually certain: For the first time ever, every American would be required to carry health insurance.
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Great, great argument. I am pro-healthcare, of course, but then I have family in Canada and I have seen first-hand the difference in the health of the population. Go Obama!
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Yep, as others pointed out, the car insurance argument doesn't work - it's apples and oranges. I am pretty certain that any government mandate on requiring individual health insurance will be shot down in federal court as unconstitutional.
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This argument should be written down in big letters and posted everywhere on American highways so that people will understand and support the reform. Just the easiest, greatest argument to be made for universal health care.
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Yup, that's right. And people are willing to spend at least 5 times more on their car than on their health (or so I've read somewhere). I do believe that this health care reform is the best thing to happen to this country in a long, long time.
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Thanks for taking the time to share this, I feel strongly about it and love learning more on this topic. If possible, as you gain expertise, would you mind updating your blog with more information? It is extremely helpful for me.
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I was just thinking about Healthcare and you've really helped out. Thanks!
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The health care reform still requires a bit of fine-tuning. It's a big project for a country who's never had something like this before. I hope they look at countries like Canada and Sweden and see what they have done right. It might help.
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I did not read through all the comments, however there is a distinct difference between the reason for state required car insurance and what this administration is trying to pull off with health care. Car insurance is required to ensure those that are responsible for injuring others (third party) have adequate insurance to compensate injured third parties. With the healthcare initiative, they are trying to fool the American people it is the same concept (even Obama compares healthcare to auto ins, which tells you it is a very deliberate lie). Healthcare should be the choice of the individual, there is no third party at risk of uncompensated damages. If they control illegal immigrants getting free healthcare in this country, we wouldn't be having this conversation.
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