This is just too funny not to comment on. John Derbyshire:
"My health insurer has just notified me, in a brief form letter, that my monthly premiums are to rise from $472.33 to $857.00 on January 1st. That's an increase of 81 percent. ***E*I*G*H*T*Y*-*O*N*E* *P*E*R*C*E*N*T*** Can they do that? I called them. They sound pretty confident they can. Ye gods!"
"You see, John, there is this thing called the "market." People who want to buy health insurance--that's you, John--look for people who want to sell health insurance, and when you find one and agree on a price you make a "transaction." This is a voluntary exchange. Both sides to do it. The health insurer has just told a customer that they want to charge you not $5,668 for next year but rather $10,284. If the customer doesn't like that price, the customer should look for another health insurer.
Now we liberals have lots of reasons and arguments for why we would not expect free markets in health insurance to work very well, and Derbyshire has just encountered one of them: it looks as if his particular health plan is entering an adverse-selection death spiral."
Me: When Derbyshire asks "Can they do that?", what sort of restrictions does he think might make the answer "no, they can't"? Is he hoping for government intervention? The hand of God? Is he under the misapprehension that something prevents price increases that are unduly sudden or onerous?
Seriously: John Derbyshire writes for one of the most respected conservative magazines out there. He advocates free markets. Was he somehow unaware that his own principles leave him with no grounds for complaint when something like this happens? Or that all sorts of other people face this sort of thing all the time?
Maybe he'll cancel his insurance and then get sick, in which case he can write all sorts of breathless Corner posts asking: can they really charge me hundreds of thousands of dollars to save my life? Can my prescription medications -- the ones I need in order to keep my illness under control -- really cost hundreds of dollars a month? I called the pharmaceutical company, and they seem pretty sure that they can. Ye Gods!
One can only imagine what he'd write if he were trying to manage all these costs while making the minimum wage.
Later, Derbyshire tries to put a conservative spin on this. A reader writes that health insurance needs reform, and he replies:
"Can't really talk about this, I'm still in shock. But yes, anyone who says right now that our entire health-care financing system is nuts to the fourth power, won't be getting any argument from me. And from a social-libertarian point of view, the thing is pernicious, as it strongly discourages individuality & enterprise. As is the case with the tax code, the message you get loud and clear is that the govt. wants us all to be employees so we can be tax-farmed more easily. Strike out on your own, step off that corporate hamster-wheel, and you get socked with sudden 81 percent hikes in your health-care premiums. Hoo-ee."
As Derbyshire ought to know, the fact that health insurance is linked to employment is not a result of deliberate government design, but of a peculiar historical accident. It remains in place because of a political stalemate: though most people who study it believe that our health insurance system is broken, so far it has been a lot easier to shoot down any given proposal for reform than to enact one. Again, though, this is not something that a conservative who writes for the National Review ought to be discovering now, for the very first time.
Liberals have been saying for ages that the present system of health insurance isn't just unfair; it's also deeply inefficient. And this is not just because it creates huge administrative costs and an incentive for insurance companies to expend resources trying to remove sick people from their rolls. It's because it does discourage people both from striking out on their own and from switching to what they would otherwise regard as better jobs, if switching jobs would require that they sacrifice their health insurance. Moreover, insofar as people who don't have health insurance suffer from untreated illnesses, it prevents them from being as productive and successful as they would otherwise be. And yet, somehow, our plans have never gotten enacted into law.
Now: why might that be? Who could have been standing in the way of reforming a system that "strongly discourages individuality & enterprise"? Why: it's conservatives! Conservatives like John Derbyshire! Who'da thunk it?
John Derbyshire: meet your principles. Principles, Derbyshire.