October 12, 2004

$5,741 for health insurance

In this week's issue of the student newspaper at my school, the Res Gestae, there's an article by one Ryan B. Parker.

Mr. Parker points out that the health insurance plan offered by the University of Michigan costs $5,741 per year for a married law student and his or her spouse. That comes out to $17,223 over three years of law school.

Now, I might be wrong, but I think these figures apply to a policy that covers students for only 8 months out of the year, leaving them uninsured over the summer.

Mr. Parker did some investigations, and found that some of our classmates had "wives and kids on Medicaid." Two of the six students Mr. Parker spoke with claimed to be uninsured.

Fortunately, most law students are young and healthy, which makes it all the more ridiculous to expect them to spend this kind of money for insurance that they'll probably never need. It makes far more sense for them to buy high-deductible, low-premium insurance, or to go without insurance altogether. I can't blame anyone who refuses to spend that kind of money for health insurance.

When young, healthy people do what makes sense for them, however, it burdens those people who aren't young and healthy and who have to have health insurance. The insured risk pools get smaller, and the people who are left are mostly old and sick. The costs go up, which drives more of the healthy people out, and forces costs up. Meanwhile, the unlucky young, uninsured law student who comes down with some nasty neurological disease, or gets hit in the face by a drunk 1L at Bar Night, can find themselves in the hospital with no way to pay the bills. Either he gets less care, or these costs are shifted to the hospital's insured patients, and their premiums go up, too.

Our emotional and political attachment to the free market makes it hard for us to recognize that everyone, eventually, pays more in a system based upon competing private health insurance carriers. If people act rationally, costs will go up and up and up, even if we ignore the bans on reimporting drugs from Canada and even if the Bush Medicare fiasco had enabled Medicare to negotiate drug prices with Big Pharma, instead of mandating that the government pay whatever Merck asked.

Mr. Parker says, "I'm not pointing a finger at a guilty party; to be honest, it's such a complicated issue that I wouldn't know where to start if I were."

I agree that it's too damned complicated. I don't have all the answers. But we're going to have to start making changes soon, because $17,223 is too much money for twenty-somethings to have to pay, and choosing to go without health insurance at all isn't a civilized alternative.

Posted by Carey at October 12, 2004 10:13 PM