Monday, February 1, 2010

They Think You're Stupid

Last night, as I was driving home, I was listening to Beyond the Beltway with Bruce DuMont, when a caller made the comment, and I'm paraphrasing here, "When flat screens and computers came out, they were very expensive, but as more company's started making them, and competition ensued, the prices came down. Why can't we do the same with health insurance? Why can't we allow insurance companies to compete across state lines?"

This is something that the right has been asking for quite awhile.

The gentleman representing the left responded first. Again, I'm paraphrasing, because I don't remember the exact wording, but his response was something like, "If we did that, we'd have a race to the bottom. Some states do not regulate the insurance industry as well as others (emphasis mine).

Basically, he was saying that you are too stupid to know what you are paying for, and if we don't regulate for you, you would all be suckered by unscrupulous insurance companies.

That is offensive. As someone that enjoys freedom and capitalism; the two are inextricably intertwined, it bothers me that the left has such little faith in the American consumer that they wouldn't be able to tell that some companies are not holding up to their end of the contract.

Yes, some companies will try to unfairly game the system. This is what private insurance rating organizations are for. It is up to the individual consumer to do their homework, to reduce their own risk; not up to the government to hold your hand for you.

Time and again, all through history, when the government gets involved, regulations, costs, and red tape all increase; without fail. When the private sector is involved, almost without fail, ways are found to reduce costs, to increase the individual entities ability to remain profitable and competitive. When word gets out that a company is cheating it's customers, that business either fixes it's reputation, or it goes out of business. When government does it, that's business as usual. Where else are you going to take your business if government runs it?

1 comment:

Nick Rowe said...

The charge is absolutely ridiculous. Suppose you are American Insurance based in Nevada and are currently prohibited from offering insurance in California.

After it becomes legal to sell insurance in California, you will either find it profitable to do so or you won't. If you do, then you will compete in CA. If you do not, then the staus quo is maintained.

Now suppose you are Leftist Insurance in CA and, despite state mandates you still make profit through higher premiums. If you could make additional profit by selling in Nevada, you will do so but you won't stop your CA operations which are already making money.

Competition will result in the highest benefit level at the lowest cost. Mandates raise costs for everyone.

BTW, I asked an additional question on my Prius post if you would please answer.