Friday, February 19, 2010

Krugman: Health Insurance "Death Spiral"

"Bear in mind that private health insurance only works if insurers can sell policies to both sick and healthy customers. If too many healthy people decide that they’d rather take their chances and remain uninsured, the risk pool deteriorates, forcing insurers to raise premiums. This, in turn, leads more healthy people to drop coverage, worsening the risk pool even further, and so on."

This article is about WellPoint and Anthem Blue Cross in California, but it pretty much embodies the entire US system. Health Insurance rates are going up, as high as 39% in this example, and the only thing that drives the current system is profit margins as a value for Corporations and their investors.

The Death Spiral is on us. The risk pool is skewing with not enough healthy people buying ever-increasing health insurance. The well will run dry. They will drink our milkshake.

We need to cover everyone, we need to reform. This is not a race to the bottom.

Posted via web from liberalsarecool.com

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