Health Insurance is Bad Business

 A recent Facebook post by a friend got me thinking about health insurance. I wrote a lengthy comment on it, which I've decided to copy here...

Private medical insurance should be illegal. More, it simply shouldn't be a thing at all.

The basic idea of insurance is that a group of people pay into a common pool. In the event of a disater, the pool pays out to those impacted. The key part of this is "in the event of disaster." So, with car insurance, we all pay in and if we are in an accident, the insurance pays for (some of) the damage. That works for everyone, because more people pay in than have accidents. So, the insurance company makes money because it takes in more than it pays out. Yeah, they still play games with trying to avoid paying out because people are greedy but the general system works.

Health insurance isn't like that. Medical expenses are not occasional accidents. Medical expenses are regular occurances. You go to the doctor at least a few times a year. Everyone gets sick at least a couple of times a year. Because we live longer now, everyone ends up with chronic medical conditions that need regular medications and care. So the model of "everyone pays into the pool and only a few people draw on the pool" doesn't work! Everyone pays in and everyone draws! It simply does not work as a for profit model. It's a bad business. It's only profitable because the system has been rigged to make it profitable.

This has been me, stating the obvious. 

Onward