Friday, September 18, 2009

Real health care reform: break down the state barriers

The Democrats don't want real health insurance competition. They just want a government takeover of the health insurance industry (i.e. a single payer system). If they did want real competition, they wouldn't need a "public option". All they'd have to do is break down the state insurance barriers that prevent health insurance from being sold across state lines.

Notice the question that the White House repeatedly ducks in this interview:

For more of my blog posts on the subject of health care, click here.


  1. There are no barriers that prevent health insurance from being sold across state lines unless we also say that auto insurance faces barriers. The supposed barriers are an over simplification. There are no federal regulations that restrict companies from selling insurance in multiple states. Anthem, Aetna, and others are national corporations that sell insurance in many, if not all, states.

    Like auto insurance, which enjoys interstate competition, there are minimum state requirements. Florida, a large state, has only two insurance competitors. It is the economics of health insurance that results in this duopoloy as two insurance companies are able to drive out competition in a single state. This demonstrates that taking the right of regulation away from the states will result in less national competition as two major companies take over the entire national market.

    There are no adequate studies that correlation state regulations to premiums. California, with higher standards, enjoys lower average premiums. Studies that do attempt to find a correlation are inadequate in the ignore the effects of market demand of product differences.

    If we are to believe in less federal authority then we believe that states have the right mandate minimum standards in accordance with their voting constituency. To eliminate the state right to regulate insurance companies requires federal intervention, more federal authority, and bigger federal government. Currently, the second amendment does not allow federal regulation of fire arms which is a basic right that the Consitution puts under the authority of the State and the People. We should no more put the regulation of insurance under federal authority then we should allow the federal government regulate our right to bear arms.

    The removal of state authority to regulate minumum standards is not the supposed barrier that many would claim. The removal of state rights to regulate means more federal regulation and more federal authority. There is no correlation between state regulations and premiums.

    The reasonable conclusion to be drawn is that the few major health insurance providers want to eliminate the state right to regulation minimum standards and reduce competition at a national level. And they continue to manipulate the public as they create inadequate and misleading statistics and hide their intent to put regulation under federal authority where they enjoy greater influence with fewer lobbiests.

  2. More recently we have learned that the health insurance companies enjoy a legal anti-trust exception. This alone makes it clear that the limited state minimum standards do not begin to create a situation of reducing competition. The lack of competition is clearly the result of the industries own monopolistic stranglehold.