Question 1

So, is health-insurance free if it is provided by the employer?

Accepted Answer

Agreed, it is not free.  And unfortunately, if you work at a company that likes to make money they are apt to purchase the cheapest insurance, which passes even more medical costs on to their employees (through higher deductibles and co-pays).   Another negative for the employee receiving health insurance throught their employer is that in most cases it removes their ability to purchase a better plan on the new health insurance exchanges.

Question 2

Is there any other country in the world where employers are expected to provide medical insurance?

Accepted Answer

Japan, Switzerland, France, and Germany all have private nonprofit insurance companies.  In these countries it is normal for employers to cover their employees, but if somebody becomes unemployed, they'll retain insurance one way or another.  In Germany an unemployed person gets insurance as a part of their unemployment benefits.  In Japan unemployed people are covered through their local government.

Question 3

So, at around 9:30 he talks about how insurance companies negotiate to get lower prices. How can they do this? What kind of bargaining power do they have over the hospitals?

Accepted Answer

In most major markets in the United States, 3-4 insurance companies represent the overwhelming majority of the population.  Suppose company A covers 40% of the people living in your city.  If hospital X wants to provide care for that 40% of the population they must negotiated with company A.  If company A does not agree to the charges proposed by hospital X  they will simply send their patients to a different hospital (hospital Y).  This gives the insurance companies tremendous negotiating power.  However, to counter this power, hospital systems are expanding by buying more and more hospitals in multiple markets.  This increases their negotiating strength.  Similarly, physicians are organizing into large groups, sometimes in association with the hospitals.  This increases their negotiating power.  The only folks without negotiating strength in this system are the patients which is why health care costs are so extremely high.

Question 4

This 45,000,000 number has been tossed around a lot without supporting evidence that I can find. Plus, the 45,000,000 don't seem to be signing up for the PPACA -- just 3,000,000 or so so far. What's the backup for this number?

Accepted Answer

The 45 million number is a fairly well documented and acknowledged number. A quick Google search resulted in a number of research and news publications that provided numbers in that range (links provided below).

In terms of how many people have signed up under the ACA (Obamacare), it is true that the majority of the uninsured have not signed up. However, the number of people that received insurance due to the affordable care act is certainly larger than the three million number you mentioned. The law provided insurance coverage to millions of people years ago by mandating insurance offered by employers to cover their employees' children up through the age of 26. There are also many people that are gaining health insurance through their employer as a result of the employer insurance mandate. Another couple million are gaining coverage through the Medicaid expansion.

Of the people remaining uninsured, many of them are expected to join a plan by next year after realizing they have to pay a tax penalty for not choosing to purchase health insurance. Approximately 8 million of those 45 million mentioned are actually illegal immigrants, who the law was not designed to cover. There are also roughly 4.8 million Americans that were supposed to be covered by the Medicaid expansion, but aren't because their state chose to opt out. The people are, unbelievably, too poor to qualify for the marketplace subsidies because they were supposed to be covered by Medicaid when the law was written. (source: Kaiser)

http://kff.org/uninsured/fact-sheet/key-facts-about-the-uninsured-population/
http://www.nytimes.com/2013/09/18/us/percentage-of-americans-lacking-health-coverage-falls-again.html?_r=0
http://www.pbs.org/healthcarecrisis/uninsured.html

Question 5

Has the number of uninsured dropped significantly after the passing of the Affordable Care Act?

Accepted Answer

A recent Gallup poll shows the rate of uninsured has dropped from 17.1% to 15.9%
Meaning ~1.2% of Americans have moved from being uninsured to insured. Another way of looking at it is that ~8% of the uninsured population now has coverage.

That is definitly statistically significant, but few would consider that significant compared to the media hype that has surrounded the law.

Question 6

You said that of the unemployed there are those that make under FPL 23k/4, those that make 23-60k/4 and those that make >60k a year for a family of 4. The ones that are under FPL would be covered by medicaid so they would not be uninsured.

Accepted Answer

The fact that one belongs to a family of 4 making less than the FPL or $23,000 does not guarantee eligibility for Medicaid.  Medicaid funds mostly children, young women with young children and the disabled.  Men, regardless of income are generally not covered unless they are disabled.  Eligibility rules vary by state and change often.  If a state is having budget troubles one year they might just stop accepting new applications for a period of time.  If you lose your job and insurance while the applications are closed, or if your child is born during that period of time, too bad.

Question 7

Wouldn't regulating the outlandish hospital fees help ease the costs on everyone? There doesn't seem to be a limit on what they can charge anyone, in the US at least. With a hospital, if you need help immediately, you have no choice but to go there and pay literally whatever amount they decide you should pay. There has to be an incredible amount of profit in the current health-care system.

Accepted Answer

Of course there is an incredible amount of profit in the system.  Why do you think the insurance companies, pharmaceutical companies, hospitals and many physicians are in the health care business?  If it were regulated, costs would be less but so would salaries and profits.  In all likelihood, many of the people currently in the system would look elsewhere for work (and profit).  However, experience in other countries shows us that those who leave the system would be replaced by those less interested in the big bucks.  You are suggesting a major change in the American outlook on free markets and capitalism versus regulated markets and market socialism.

Question 8

At 0:56, the narrator introduces the topic of employer-paid health insurance.  Why did the system of employer-paid health insurance develop in the United States, but in other major industrialized countries?

Accepted Answer

The Republican Party of the United States is relatively much more 'conservative' than the conservative parties of other OECD nations. The UK; Germany; and until recently, both France and the Canada were all run by 'conservative' governments, and universal health care remained sacrosanct in those countries.

Medicare and Medicaid itself happened because President Lyndon Johnson had very strong connections with the House of Representatives and the Senate, was able to 'bully' people into supporting his agenda, and had huge Democratic majorities in the House and the Senate.

The Affordable Care Act was barely able to pass even though the Democrats had a filibuster-proof Senate, a strong majority in the House of Representatives, and the Presidency.

Currently, even the 'Democratic Establishment' is trying to say Senator Bernie Sanders's proposal for 'Medicare for All' is untenable and would somehow be worse for the United States than simply trying to expand the Affordable Care Act.

Course: The Brookings Institution > Unit 1

The U.S. uninsured population

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