Your insurer wants to know everything about you
theage.com.au
theage.com.au
It seems like a way to try to calculate and thereby eliminate risk, would be an overall beneficial thing. But then it also seems to make insurance less effective overall.
Let's not think about big "evil" insurance companies for a moment. Say there are 10 Amish guys who want to form a risk pool to provide emergency health care for their families. They were just about to finalize the contract when one of them proposes that they take a medical exam beforehand. It transpires that one of them has lung cancer. Why would the other nine allow the poor guy to partake in their risk pooling?
If you eliminate risk you also eliminate the need for insurance. This seems like a good thing. But then you also leave a bunch of people helpless.
It's an interesting ethical question.
One way to mitigate this would be with Singapore-style high deductible insurance - subsidies only kick in after you've spent 10-20% of your income on medicine.
See also "too big to fail", federally subsidized flood insurance, student loan guarantees, etc, all of which have the same problem.
Does it not work the exact same way with private insurance? If you require treatment, you increase premiums for everyone, not just yourself.
Anyway, I'm personally super happy with national insurance because I simply don't have to think about it. I know that if I need an operation, I will get one. I know that if I have an accident, and they need to send a helicopter to get me, I won't even see the bill for that. If I need to stay in hospital for the next year of my life, I won't see the bill. If I lose my job and become homeless I'm still going to be covered. I don't need to worry which hospital to go to, or which doctor/dentist can see me - they all can, there's no receipt produced, it's simply not a worry I have. Right now I pay about ~$100USD a month for the national health insurance, and it's an amount I am extremely happy to pay. Why would I care that other people are having accidents or smoking?
Of course insurance is not purely actuarial anymore, if it ever was.
Why would I care that other people are having accidents or smoking?
Because you are paying for the consequences of their actions. A quick google search suggests more than 20% of the (far more than $100/month) Americans pay is caused by gluttony alone: http://www.healthycommunitieshealthyfuture.org/learn-the-fac...
That's about 1/3 of what we spent on our overpriced military. And that ignores the costs inflicted by overweight but not obese people as well as various other unhealthy behaviors.
In a country where medical professionals have no other options and therefore take low salaries, this may be less of an issue. But in the US medicine is very expensive, so it costs us a lot.
https://en.wikipedia.org/wiki/Central_limit_theorem#Lyapunov...
Then there is also the issue that the working poor buy shittier food because it's cheaper and more convenient, so their business logic creates a paradox where the assumption that all behaviour’s can be modified and accounted for economically really stops making sense. Trying to hold poor people accountable for their poverty by increase their costs of living can't possibly work and a major health crisis currently is diabetes which is directly related to the cheapest and most sugar filled things eaten disproportionally by mostly poor peole (in the US anyway, thanks to cheap corn). This is true in other ways as well, for example commute time is related to housing cost, stress is related to driving time, stress is related to poor health. Increased commute time can lead to less sleep, less sleep leads to poor health. there are probably infinitely more... Live in a trailer? You're being exposed constantly to toxins being emitted by the fibre board that everything in your house is made from; by "insurance" logic people that live in trailers make bad health decisions and should be charged more so that the cost of living in trailers is the same as the cost of living some where non toxic. So then should we subsidize housing instead? or let that person become homeless.
tldr; being poor = 'bad health behaviour' and so poor people will be disproportionately punished for their existing poverty with additional poverty.
The poor don't buy overeat because it's cheaper. Those poor (mostly obese) diabetics you discuss could have saved money by consuming less food. That's fine - they can make their own choices, apparently they value twinkies over health. But it's not right to force the rest of us to pay for those choices.
In much the same way, it's not right to force third parties to live with pollution just so a factory owner can save money by not upgrading his machines.
I heard promiscuous straight people can catch AIDS too! No way that's really true though, right?
http://www.cdc.gov/hiv/basics/statistics.html
Simple division (63% of HIV infections / 2% of population) / (25% of HIV infections / 98% of population) suggests gay sex is about 120x as risky as straight sex.
We aren't talking about big "evil" insurance companies, we are talking only about the measure of success in a capitalist economy - and from that point of view insuring the 10th guy will constitute a loss.
On the other hand as a society we actually can afford to treat the 10th guy with cancer and if that we aren't doing so is an ethical failure not an economic one.
Whatever else may be said about health care and insurance, I feel it boils down to two questions: can we afford to cover everyone, and should we?
The question is, what amount or level of coverage is used to determine affordability. Should we, ethically, user resources to transplant a kidney in an 80 year old which might extend their life by 5 years or should we use those resources to treat more individuals with less severe issues that will likely extend their life for a longer period of time? Time and qualified doctors are limited resources. How do we determine how to allocate then? Where are we starting the line on what and when to treat certain conditions (and to determine affordability)?
If there is a scarcity and we can't heal everyone, those choices have to be made, but my original context was that the answer is that we can afford to help everyone. In that situation, I don't think there's an ethical reason to not help everyone.
The more we know about who is and is not going to need care the better we are able to see past the veil of ignorance and let our selfishness and greed make our decisions rather than our sense of fairness and community. Having the information certainly helps providers become more efficient, but that efficiency comes at the human cost of throwing anyone who gets sick under the bus.
I'm not so sure health insurance should be allowed to be privatized in the first place; it almost inevitably leads to disgusting moral hazard and disaster. But it currently is privatized so I'd say any information private insurers get is a net loss for society.
This is exactly why insurance should by law be a non-for-profit enterprise. Making it a capitalist enterprise will always lead to these sorts of games.
Because you were a human being who was up late.
> who determines a normal sleep schedule
Researchers and statisticians.
There's a lot of assumptions done on the advertisers' part here.
My advertisement for a beach vacation isn't "not based on strong science" just because I'm not aiming it at people with albinism.
If a friend knew and felt your sleep pattern was problematic I'm sure you wouldn't mind - in that case personal knowledge is reciprocal, voluntary, and not motivated by money.
Insurance is just a middle man taking their cut
But the same principle applies to government social programs. All money comes with strings attached.
1) The point of insuring is to reduce tail risk. If you have a 1/1000 years chance of your house getting flattened in an earthquake, you want to spread that bill over 1000 years. If you don't you might get away with it most years, but you'll have a new house to buy if you're unlucky.
To contrast, if your house is flooded every other year, someone insuring you will ask you for roughly half the likely damages each year. That's not smoothing it out by much, and you might as well save up for the inevitable.
2) If you're going to smooth out risk, you need to know what the risk is. For that, you'll need information. For instance if women are less likely than men to get themselves hurt while driving sports cars, you will want to know whether someone is a man or a woman. If old people are more likely to get cancer, you want to know how old someone is.
3) If you do not heed the above observation, there's something called adverse selection that will get you. Suppose you have a bunch of high risk people mixed with low risk people. You'll calculate a premium that's somewhere in between the two pools. The problem is the low risk people will look at it and conclude it's expensive for them, and they'll be less likely than you'd realised to sign up. So you then get a bunch of high risk people who think it's a great deal signing up, getting killed in accidents, and costing you more than you thought likely. It also means if you as a low risk person got into an accident anyway, you'd be without insurance.
So is it good that insurance companies want more and more info? For the most part, yes. It lets them price the premium more precisely, which helps everyone get insured. We'll be able to pay for unlikely events at a cost that reflects the likely average. And you wouldn't be paying for people who are more risky, and you wouldn't be receiving anything from people in lower risk groups.
One thing to look out for is how we treat expensive-to-insure people. Even if there's going to be a more accurate price for them, they may be very small groups whom the insurance companies decide aren't worth the effort. For instance if we know that 80% of people with the BRCA2 gene will get cancer by age 50, you're going to calculate a huge cost for them. You'd be collecting money from 5 people to hand it out to 4 of them, plus the expense of handling a claim.
One interesting thing about this new information fountain is you can lose money by having tests done. Say you have a parent with BRCA2, and people who aren't tested have a 40% chance. WTF do you do then? You will either pay a huge premium or barely anything.