Comparison shopping is itself an annoying burden. Sometimes it is necessary if one has very specific criteria for a product, but the practice itself is a tiresome process that creates no value. I'm always surprised when people think that requiring everyone to do comparison shopping is a cost-less alternative.

I don't know why it has to just be accepted that health insurance companies need to offer 25 million different kinds of policies. Health insurance should be an on or off proposition, not some of this, a little of that and none of the other thing. They only do that to give themselves wiggle room so they can weasel out of paying claims. Let them argue with the doctors about whether the insured really needs the procedure and what it should cost, but don't let them write exclusions into the coverage in the first place.

Sure the insurance companies will hoot and holler about how they only do that to make insurance affordable to more people... because that's how caring they are. Hah. We've seen how that worked out.

You buy the wrong TV you waste a few hundred dollars. You get the wrong insurance plan you end up bankrupt or dead. And of course Ramesh most likely would make it harder for your survivors to get any money from a doctor's error.

And, the television market is regulated.

The FCC has requirements for the television, itself.

State commercial code has requirements for the merchant.

Digital broadcast has been anticipated for a very long time and scheduled for a fairly long time. And, legal requirements imposed on the sale of new televisions, that their tuners include a capability for digital reception.

We didn't take a chance on the tv market messing up on digital. And, we are going to take a chance on bone marrow transplants?

A couple of points:

Policies today aren't identical, in the group and in the individual markets alike. That is, companies provide the regulatory minimums, and then beyond that they customize. And that works.

Disclosures could be standardized in a way that pushed people to certain relatively standardized packages, with additions or deletions as disclosed.

In any case, it isn't enough to say that the market might lead to bad outcomes. You need to show that it would do a worse job than regulation does. And in this country we have regulations which unnecessarily increase the cost of health care and which insist on benefits for which there isn't supporting scientific evidence of efficacy. (In particular you can't defend state regulations which you intend to override for cost control in a nationalized scheme.)

No, Consumer Reports is the wrong model. Every day people are absorbing toxins they know nothing about through the pesticide laden food they are eating. They are breathing in pollutants every day. They are absorbing and reacting to drugs and antibiotics (that are now turning up in our drinking water because people excrete the prescription medication they don't absorb, (just like when you take a vitamin C pill and your urine becomes bright yellow) and are thus may be coming down with symptons, reactions and conditions that they certainly didn't plan on or could anticipate. If you live downstream from factory farms you will be affected by the massive wastes (which include yet more antibiotics) produced by the animals. If you live downwind of a nuclear facility you have absorbed radiation. And on and on. Who's responsible exactly? Who should be paying for this? Which people, exactly, deserve to be bankrupted and/or denied services, or have loved ones denied services when their illnesses spring from causes entirely outside their control? Who should get to decide that?

Treating healthcare as though it's just another consumer product is a mistake. It's a red herring. It creates a lot of discussion and study and complications that waste money and more importantly, distract attention away from the fact that health insurance companies PROVIDE NO HEALTH RELATED SERVICE. We pay them to step between us and our doctors and we gain NO benefit. THEY gain. WE don't.

We need a mechanism that pools our money so that we can protect ourselves against the unpredictability of accident or illness and it should be as simple as possible. It should start from the premise that we all need medical care sooner or later and that our ability to predict our needs is limited. What is the fairest, least wasteful way to accomplish the objective of pooling our risks and providing security for all? That's the discussion we should be having.

Bruce Wilder and Adagio make good points.

Even something as seemingly simple as the market for televisions is actually quite bewildering. Each company makes many different models with different features. And the features you need to compare are complex and hard to understand if you haven't bought a television in the past 10 years (like me).

Health care is so enormously much more complicated. Even with regulation, each company offers a wide array of plans, and you really have to get out your microscope to find the exact differences. Unless you're a health policy expert, it is easy to not know exactly what you're buying.

In any case, it isn't enough to say that the market might lead to bad outcomes. You need to show that it would do a worse job than regulation does.

True, as far as it goes, but I'd say that the burden of proof is more on the deregulators to demonstrate that removing regulations would do a better job than regulation does, not just say that it might lead to good outcomes and might not be a complete disaster.

Let me offer my experience with maternity riders. For individual insurance, companies assume that you only want a maternity rider if you plan to immediately get pregnant. The companies we dealt with either refused to offer a maternity rider or do so at a cost so high that they could recover the expenses of a pregnancy within a year. My wife's brother-in-law is a dentist and it was cheaper for him to pay for his kids out of his pocket than it was to buy maternity coverage for everyone at his office. Now, if every woman of child bearing age was covered for pregnancy, then cost for each woman would be small because women have few children during their child bearing age. But by making maternity coverage optional, it becomes too expensive for individuals who want to actually get it.

Standardized benefit packages? Does Ponnoru ever actually shop for anything in our economy? Almost every company in the American economy tries its hardest to make it impossible for consumers to figure out the difference between one product and another. That way consumers have no way to decide what to buy other than remembering which company's advertising or marketing spiel they heard most recently.

I'm in the individual health insurance market already and I can't even figure out the difference between the different plans Blue Cross offers me at the beginning of each year. The only way there would be standardized health care plans is if the government mandated them which of course a conservative like Ponnoru would never endorse.

"There would probably be various standard packages offered by insurers"

Um, does he have any knowledge of the current system at all?

Every insurer will tailor their packages to suit the interests of large customers. So, every employer of any size can (and often does) command a different package - oftentimes several for different types of employees, especially if they have unions to work with. If you look at other parties, folks like USAA and AARP who can command packages be built for their members as well.

For my public sector employer, I have about a dozen plans I can choose among, and that doesn't include the almost half a dozen other group plans I can pick among due to participation in other groups.

In other words, there is no such thing as a 'standard package'. As it stands, every package has the option to include Viagra and exclude birth control, or the reverse, or whatever they want so long as it falls within state guidelines.

(Disclaimer: I have a C-level health insurance exec in the family)

Ramesh seems to leave out one major cog in his plan. Sales and marketing. If you take out sales and marketing then he would have an argument. The reason people have such a hard time making a good decision with purchases is because marketing can sell a shitty product. If all we had to go on was Consumer Reports, and didn't see 100 ads for TV's everywhere, and 5 sales people attack the minute you walk into a store then we'd be able make a much more rational and better decision.

In a free market an insurance company will sell and they won't sell you what's best for you. They'll sell you what's best for them.

Consumer Reports can't even give me sufficient information to help me buy a dishwasher! They never review the models I'm interested in, and often the models they do review are discontinued before press time. Why would it work for the more vital and more complicated choice of health coverage?

Furthermore, we as a society ought to have the ability to decide that everyone, no matter the health plan, be covered for certain things. Some things are good for public health and a prosperous society. I assume Ponnuru thinks those would be featured in all "standard" plans due to market forces. The fact that states have found it necessary to pass mandates argues otherwise.

"It is hard to believe that the market would evolve in a way that consumers were asked procedure-by-procedure, condition-by-condition what they wanted covered."

You mean, like AFLAC does things today? Yeah, hard to believe...almost as hard as it is to believe that the one industrialized Western democracy without universal health care is the richest and most powerful nation in history, but, hey, there it is.

Despite the fact that people still buy below average televisions (approximately 50% of the population does this), TVs appear to improve in both picture, size, and cost every single year.

Year in and year out improvements will quickly dwarf any perceived short term problems associated with a private health care system.

One solution: If someone bought health insurance from the same company that offered life insurance, their provider would have a huge incentive to keep them alive as long as possible.

This and other safeguards we haven't even thought of yet would quickly expand into the marketplace if lack of coverage became a prevalent problem.

Ezra,

In recent weeks you've made several comments that seem to indicate that you're open to the idea of individually purchased health insurance. This is a bad idea, even if we were to disregard the problems with regard to the extent of protection provided under individual policies and the ability of insurers to exclude pre-existing conditions.

From a pure financial perspective, the problem with individual coverage is that it is much more expensive than group (employer based) coverage. There's a valid reason for this. With a group program, the insurer has a much better idea of the expected payouts than it does on individual policies due to the law of large numbers. Since a group program is less risky for the insurer, it doesn't need to charge as much. Also, an insurer has a much greater ability to recover money it spends on a large medical claim from a group program than it does from an individual policyholder. This pressures the insurer to charge more up-front for individual policies.

Hipporider identifies the key point: not only would markets in customized insurance packages likely not very well. Markets in customized insurance packages would actively promote perverse outcomes and obstruct covering exactly to those who needed it most.

For example: insurance companies are simply being rational by making maternity care riders very very expensive. After all, if they are voluntary, only people planning to get them will likely purchase them, making them likely to pay, thus undermining the risk-pooling function of insurance at all.

And it gets worse. Who, after all, is likely to purchase the bone-marrow-transplant coverage? If I were an insurance exec, I'd be pretty confident that (aside from the obsessive completers with too much money) only those with some reason to believe they might need this expensive prodedure would add it on. Perhaps they had multiple myeloma running in the family, or maybe someone told them they showed a number of risk factors. In any event, a prudent insurance executive would assume that the customer who really wanted such coverage had a reason -- and I suspect that data would also confirm this. The people who bought such specialized coverage would use it quite a bit more than the average consumer.

Thus, bone-marrow-transplant coverage would get very expensive indeed, denying it exactly to the people who needed it most.

Once again: until Ponnuru answers the question about what we do for those who need insurance and don't have it, or now in his refined version, what we do for those who need a specific coverage but don't have it, I won't take him seriously.

Either he says (a) we let them die: too bad they didn't cough up the bucks when they had the chance, or (b) we treat them anyway, and see if we can recover some of it before they declare bankruptcy.

If (a), he's a monster.
If (b), we're providing universal care, just badly and inefficiently.

There's no way to talk about insurance without risk pooling and adverse selection. NONE!

Consumer Reports' latest issue surveyed a number of health plans.

They attempted to evaluate the coverage, failed, then ran them by health law experts, who concluded that there was no way to figure out what the hell was actually covered. Also, a significant fraction of plans included booby traps like refusing to cover the first day in the hospital, when most of the expensive care typically takes place.

Consumer Reports concluded that it was impossible for an organization as sophisticated as theirs to compare and evaluate health plans, which aren't products. They're legal contracts written in an intentionally confusing way in order to give the insurers the most leeway for denying coverage.

CR also concluded that is was completely hopeless for individuals to do so.

Ponnuru is totally full of crap on this one.

It is this kind of thinking that gutted the defined pension plans and gave us IRAs and 401Ks. How has that turned out for most people? We have 29 years worth of empirical data to clearly understand what the 'free market' did to our retirement.

There are substantial, optimized, classified profiles provided, you only need to choose a best fit one and leave the remaining jobs to FLV Converter for Mac OS. And all the profiles can be modified to fit your devices better.

FLV Converter for Mac

Theo is right about the current complexity and variety of insurance "products" making it impossible to compare in any kind of straightforward and general way.

Unless Ponnuru can explain the market or regulatory mechanisms that will generate standardization where none currently exists, he is full of it and his proposals are worthless.

That said, I think Theo misses something in the rush to condemn insurers. He forgets that health insurers have profit margins of about 5%. It is a low-margin business. Insurers do not look for new ways to stick it to consumers. If that was what they were doing (or doing successfully) then they would have margins of 15%, 20% or more. If you think supermarkets instead of pharma or investment banking, you'll be closer to the mark for the amount of money health insurers siphon from the system.

The things that people believe of insurers are generally not true for group insurance, which is roughly 90% of the business for most insurers. But those accusations can be true for the individual market. It is there that you are far more likely to get 'bait and switch' and other unscrupulous sales tactics. Unscrupulous things really happen in the individual market, and way too often to let that market survive in anything like its current form.