Definitions: Insurance (n): contract that guarantees compensation for theft, damages, etc., for a fee
Ensure (v): to protect
Assure (v): 1. a guarantee; 2.to confirm confidently; 3. (Brit.) insure
Risk(n): hazard: a source of danger; a possibility of incurring loss or misfortune; 2 a venture undertaken with regard to possible loss or injury; 3. expose to a chance of loss or damage; 4. Gamble
In a strange circumstance reminiscent of the “Back-to-the-future” © movie franchise, I find myself looking at an old, possibly geriatric column written to deal with the problems brought about by the Affordable Care Act (ACA) of 2009 aka “ObamaCare”. As a piece of legislation this dog has more fleas than a kennel can shake a stick at. But, the progressive element wants to save the world from itself. Obama and his lackeys are digging their graves deeper and deeper with each mealy mouthed excuse as to whomever should be exempted from ObamaCare so as not to destroy their electoral base. Unions hate the act. (They finally read it “away from the fog of controversy” as Saint Nancy the Droid once said; and they find it wanting.) Maybe the union leadership came to understand their futures are in jeopardy because they backed the thing and are now caught in their lies. It does seem to be Richard Trumka wears brown a lot more lately to conceal the fecal disaster he’s suffered as he becomes more aware of his precarious perch on the tip of this spear.
So I decided to walk backward through time and see if this thing maintained any pertinence as it all pertained to what happening today. I think it does. As this is a re-visiting of an old column wrapped in new, different issues and terms, there’ll be a lot of cutting and pasting to get the point across (I know that could be seen as lazy but the facts (as I see them) haven’t changed. It’s the perceptions being appreciated by the leftist progressives I’m interested in bringing at least to the rim of the toilet they call an intellect; and no, I don’t care if they like me or not. I just want them to shut-up, read and understand what they’re about to suffer just like the rest of us.
I direct attention to the definitions at the masthead of this commentary. It addresses one of the key component elements of the Insurance Industry – the gradation, quantification and acceptance or denial of RISK.
The Insurance Industry was originally developed under the understanding there was a business entity taking a risk on the happenstance or non-happenstance of certain devastating circumstances in life. You remember, don’t you? LIFE INSURANCE – insurance taken out to protect your family in the event of untimely death. AUTO INSURANCE – insurance taken out to protect your interests in the event of an unpredicted traffic incident resulting in damages. None of this allows for the fact we all die some day and nobody goes out and gets into a crash for the heck of it unless there’s fraud involved. And that’s what the ACA accepts: potential fraud as it pertains to pre-existent detriments and pre-loaded risks they normally wouldn’t accept.
All insurance is issued with the knowledge there’s a risk something could happen. Actuaries study and analyze statistics, trends and the safety advances of other industries. They develop the odds of any particular event occurring to cause a pay-off to an insured when the event happens. They decide either for or against the issuance of coverage. At least that’s the way it once was. Doing this does NOT involve taking on risks known to have a pay-out before the fact. But, progressives, and the under-educated folks with their hands out to gather their next hand-out don’t seem to understand, the Insurance Industry is a PRIVATE COMMERCIAL operation. It was never meant to be governmentally subsidized. It was never meant to be plundered so the ill-advised risk takers of the world don’t suffer the consequences of their actions or inactions. It was never meant to be run by incompetent politicians.
Nobody goes into business with the express interest in failing; except in America where overly liberal laws allow for bankruptcy as a norm as opposed to the consequence of shaming you for your incompetence at running your personal business.
Insurance (believe it or not) is a necessary and vital element in the financial health of the United States and the world. The Insurance Industry is responsible for BILLIONS of dollars of investments causing safety improvements in industries few people would believe. For example the Auto Industry’s been subsidized and prodded by insurance companies to improve crash survival statistics and the physical construction of vehicle to make them safer.
Health insurers have forced improvements in hospital, hospice and care for the elderly and children resulting in numerous advances cutting mortality and morbidity during the treatment of injuries and disease. We need insurance companies. Arguably the failure of the Insurance Industry in America could have devastating, destabilizing economic consequences. We’re talking hundreds of billions of dollars controlled by these companies worldwide. This would have an effect if it was all paid out at one time. This is bad enough as a hypothetical question. But the entire picture must be inspected concerning the industry’s stance in this matter and the manner government influences or interferes with it.
There’d be a devastating impact to the industry if all claims were honored at once. But the industry wouldn’t go bankrupt (in my understanding). It would lose payable dividends for a period of time. And, I fear this is the case more than most people are admitting. Curtailed profits lead to diminished investment. Diminished investment leads to economic downturn and recession, if not depression. It’s about the Benjamins; the profit the industry’s investors enjoyed for years and now expect each quarter.
Obama’s demanding the insurance industry extend coverage to an already recognizable detriment i.e. “pre-existing conditions” is a problem. The Obama Administration’s stance this won’t cause deviation in the National Deficit is more a matter of asking whether they’re kidding themselves or us. But, the insurance industry is NOT a government protocol to be enforced. It’s capitalist and therefore profit oriented.
Back to the Benjamins.
Insurance was always looked at as a gamble on the part of the company issuing the policies. In response to accepting the risk, the company dictated the insured behave in a manner ensuring there was a lessening of the risk undertaken, or the insured must pay more for the coverage. For example, a man specializing in Bomb Disposal could be ordered to maintain certifications, training and protective equipment and its upkeep to cut the risk of him becoming fertilizer at a bomb disposal scene.
But insurance companies are being commanded to provide coverage for pre-existent losses. They’re being commanded to pay for care of people with diseases already diagnosed: Rheumatoid Arthritis, Heart Disease, Diabetes, Kidney Failure, Hemophilia; ad infinitum. These people may never have paid into the funds responsible for the coverage and as such are leeches on the back of the system. This means before the first premium is paid to offset the cost of diagnostic procedures, billions of dollars are to be considered lost by insurance companies. There’s a “high risk” insurance pool for people with existent diagnoses but few have voluntarily enrolled in Louisiana. Insurance Commissioner Jim Donelon said 20% of Louisiana residents lack coverage by choice. As noted in age demographics, younger people simply don’t buy insurance out of choice.
Consider this: NO premium paid; including “normal” co-payment by the insured will cover heart disease as a pre-existent condition. That’s an irrefutable fact. With guaranteed coverage the insurance company starts the procedure in debt and doesn’t make up the loss except by shifting costs and premiums upward; way upward. Therefore the cost will be spread among the other people already paying for their own coverage. The debt becomes redistributed and jeopardizes everybody’s wealth (or subsistence if you will). Sound familiar?
It’s the responsibility of the agents to sell the coverage. The nature of the industry requires prices be quoted and viable to ensure competitiveness. But that now becomes more difficult because the industry must increase their rates dramatically overall to overcome the losses projected by forced coverage of industrially detrimental risks. What they lose they must replace. That is an axiom of capitalism.
Obama and his people said approximately 129 Million people in America would be denied health insurance coverage in America. With a population of approximately 300 million living, that’s nearly HALF the total population. For the State of Louisiana estimates were made (by the same people) as many as 1.2 Million people went without coverage unless this program was enacted as is. This is nearly 50% of the state population without coverage. Obama allowed no changes. It was all or nothing. Some Republicans want to repeal the bill and start over anew.
We’ve discussed the element of insurance and its responsibility to offer financial protection against the unknown hazards of life. We understand this ensurance, or an act of protection, was based on recognizing the risk in the policy holders’ environs and the risks’ contribution to the balance sheet as it applies to what the costs are.
But ObamaCare doesn’t want ensurance as a form of insurance’s mandate. It wants insurance as an assurance, a guarantee anybody can receive the coverage and that the general populace will foot the bill for those not being covered, not choosing to be covered or rejecting coverage. ObamaCare requires participation by ALL. It mandates forced compliance with severe sanctions for non-participation, enslavement if you will, to a system shown to be detrimental to the people actually paying the cost. This is a program Congress rejected for itself but pressed against the people with their privilege of vote, and now that number of people is steadily climbing ever upward. All the exempted people are cronies of and adherents to Obama and the Democrat’s political ideology. All others are expected to foot the ever increasing fiscal load.
Now there’s a great deal of bluster, smoke and mirrors and theatrical sleight of hand being postured over by both sides of the aisle as it concerns Repeal v. Amendment of this act. Pro wants abject acceptance without change; the Con side of the argument wants total repeal without anything excepted. The American people see the drama and never get the facts on the matter because of political pandering to keep their jobs.
The Supreme Court said the ACA was a tax. Nobody’s challenged the courts to recognize this tax was written, advanced and passed in the Senate as opposed to the House of Representatives where the Constitution says tax can only be developed from. This Constitutional dilemma hasn’t been addressed because the Republicans are as progressively complicit in this matter as the Democrats. It’s a matter of whether the tree’s bark is removed from the ground up or if it’s removed from the top down. Neither group represents the American people’s best interests.
The tree remains in jeopardy of death from the abuse. None of this wrangling over the root cause helps us advance in this matter. Neither the insured nor the insurers are profiting now and the suffering will continue and grow.
Thanks for listening.