I don’t want private health insurance

Proponents of a private health care market often promoting compulsory private health insurance as some form of free market solution. It would only be a free market solution if you were free to go without insurance. Given an end to public health care I would not willingly take our private health insurance. It is a rip off and I’d rather pay my own way. I’m also unconvinced that making us pay for private health care via compulsory health insurance is hugely different from making us pay for public health care via compulsory taxation. The choice between compulsory private insurance and compulsory public insurance is only a marginal improvement.

The Rudd government has been criticised for lifting the threshold at which the tax system essentially compels private health insurance via the medicare surcharge. However if anybody really needs health insurance it is not high income earners. My family has been paying private health insurance for years but we still always use the public system and we always fib so that we get admitted as public patients. We do occassionally use private services (including a rather expensive private heart specialist) however these are still costs we could pay for ourselves. Rudd should not have just lifted the threshold at which the medicare surcharge applies, he should have abolished it outright.

If we must mandate a method of payment for healthcare under a system with less public sector provision then we should use some methodology similar to HECS. And yes I know that I’m guilty of repetition having essentially said this all before

22 thoughts on “I don’t want private health insurance

  1. I agree the Medicare levy should be abolished.

    But in contrast to you I do believe that compulsory private health insurance (to replace public health insurance) is an important step in the right direction. I have a paper directly related to this being released by the CIS in about two weeks.

    It’s not a fully free-market. But it’s an improvement.

  2. I also agree that the Medicare levy should be abolished. However I was in this instance referring specifically to the surcharge. The stick that compells high income earners to take out private health insurance that they may not want or need or use.

  3. Compulsory private health insurance is a reasonable interim measure, as long as interim is not permanent.

    The constant challenge in the health arena is to deal with the phase between now and then.

    In an ideal health system individuals would be at the centre of knowledge, decision-making and responsibility in relation to their own health.

    How to get to here from is the big challenge.

  4. Personally I think compulsory private insurance would be a reasonable first step if it entailed abolishing public funding. However if it means keeping both in tandum in a protracted transition process then I think it is probably a backward step.

    In general I tend to think it is better to save than to insure. And I would probably also prefer to borrow rather than insure. So in part this explains my preference for a HECS style reform approach to Medicare rather than an insurance style reform approach. Most health insurance is about time shifting the cost and much less about aggregating and sharing risk. The cost of insuring for the really expensive events that will probably never happen to you would be quite small and possibly even worth considering, however most insurance these days is preoccupied with protecting you from a bill that might abount to a few hundred dollars. I don’t see merit in being insured against a possible bill for a few hundred dollars or even a few thousand dollars when I could simply save.

  5. In short I think the free market would entail most people paying for health costs out of their own pockets with savings and borrowings being the primary funding vehicle and insurance playing second fiddle. As such I’d rather a transitionary arrangement that at least looks something like such an end point. It seems silly to build up a bunch of private insurance firms if ultimately that isn’t how people would pay for most medical expenses in a truely free market.

  6. My family has been paying private health insurance for years but we still always use the public system and we always fib so that we get admitted as public patients.

    i don’t understand why you do that? What advantage are you getting.

  7. If you go private you get lumbered with extra charges not covered by insurance. If you go public it is free so long as you say that you don’t have insurance. If you forget to fib you often pay extra even in the public system. Plus public or private it is typically the same doctor anyway. I have a child with a heart condition and the specialist charges about $800 an hour in his private practice. However he also does work through a public clinic (which we only found out about because my wife is good at sniffing out a bargain). Private insurance fails to cover the full cost of the former whilst the latter costs us nothing. The same situation was essentially true for one of my other kids when they needed a minor operation. Many doctors will in fact help you to game the system if you ask. Mean while the private insurers get my money without having to provide anything in return simply because the government creates a free ride for them. In a free market I might have insurance but I’d want an excess of about $50,000 and a annual premium close to zero. Why insure when you know how to save and you have a good credit rating?

  8. In a free market I might have insurance but I’d want an excess of about $50,000 and a annual premium close to zero.

    I have a hospital-only policy with an excess of $1000 that’s relatively cheap. I treat it strictly as insurance, not as an investment on which I expect a return.

    It’s no value if you have an accident or acute illness as you usually end up in the public system anyway. But if you need a period of hospital recuperation, or elective surgery, it can be invaluable. If you’ve ever had to spend more than a couple of days in a major public hospital, you soon wish you didn’t. Private hospitals are much more civilised.

    Also, elective surgery in the public system is subject to long waiting lists. If you have something that needs fixing, the delay can be mighty uncomfortable. With insurance, you can generally get it done in a private hospital quite fast.

    [By the way, someone is using my name. I didn’t make that comment above.]

  9. A policy with a $1000 excess does not qualify for ellimination of the medicare surcharge. Or at least it didn’t when I last checked. At the time the excess had to be no more than $500.

    If I needed to spend more than a few days in hospital then I might upgrade to private. However I don’t need insurance to do that. Just money in the bank or a morgage with a redraw fascility. Clearly people without money might feel differently but then it would make more sense to impose private health insurance on those that have no money rather than those that do.

    I can see some sense in permanent disability insurance but thats somewhat different.

  10. David – if somebody is using your name they are very good at it because they are also using your IP address. Spoofing an IP address is close to impossible. Are you sure you’re not suffering short term memory loss?

  11. You can say this as many times as you like, Terje! I also prefer to save rather than insure. I think it’s strange in today’s “buy now, pay later” world that the “pay now, maybe use later” model works so well. It’s about as strange as picking a private health insurer based on whether you get free acupuncture, instead of choosing on quality of care.

  12. Pat – I feel pretty sure that the insurance industry would do less well if there were not as many insurance compulsions imposed by government.

  13. Totally. The Lifetime Health Cover loading must be a big factor in choosing private health insurance. Thankfully, I’m not that close to 31 yet…

  14. Scott – call it what you want. However I have no problem saying “no” when the hospital asks if I have a contract with a third party because:-

    a) It is none of their business
    b) I know that saying yes will cost me more

    In the past I have said “none of your business” however simply saying “no” usually causes less stress for everybody concerned.

    If on the way into every supermarket they routinely asked you what your annual income was, and if you knew that being frank with them would mean they charge you double, then would you be entirely candid?

  15. As a Pansecessionist, owners of lands should decide what happens on them, so we could simply shed Medicare by making it a fully-private enterprise, forced to compete along with everyone else. No-one should be forced to take out any form of insurance, but local governments (the road-owners) could offer citizenship as an insurance policy, giving citizens first right to call on emergency services like police and fire-fighters, etc (in exchange for cash or labour). This could also include something like healthcare as an added option.
    It should never be compulsory.

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  17. I am not rich and still don’t want insurance at all. Why should I pay for it. Its a big hassle, figuring out all miles of stupid red tape. I would rather spend the time researching and treating my illness myself. I want complete personal control of my resources, I am not yielding my choice to a bunch of stupid accountants who think we are all mindless sheeple creatures to be taxed and sheared.

    Modern thinking seems so lame to worry about this and have such faith in modern medicine, its really a joke. A hundred years from now, medicine today will look as stupid as it did in 1910. Use your brain, spend some time researching when you are sick. You will likely do a better job than most of the doctors will be able to do in the 5 minutes the insurance company pays you to see them. Our health care system is not about helping people. Its about making money. Its more profitable to make people sick that well. The 2.5 billion dollar investment the insurance companies spent on health reform will pay big dividends now that everyone has to buy insurance. Its just sad.

    Real reform would just have the government pay for major trauma, and as humane people we should (and did) do that for everyone regardless of their “status”. The chronic stuff you have to fix yourself. We should look at how Mexico dispenses drugs through pharmacists, its much better it helps poor people and there is much more freedom in drug choices than here. We want to lower cost we have to start cutting out the middlemen.

    Everyone is so comfortable with telling everyone else how to live their lives, it scary. Where are the real live and let live liberals, who think its ok to be eccentric? Are there no liberals left in the democratic party? Is the only form of choice left to us sexual preference?

  18. Hey Ron, I had a lecturer at uni who I consider one of the smartest people I ever met in my life (so much so, I sought him out to be my thesis supervisor so I could have further contact; a fascinating guy). He was well accomplished across a variety of different areas: competitive gliding, classical piano, distance running and also ran a decent sized farm, a commercial orchard and an engineering consultancy, all of which were profitable as far as I’m aware.

    Anyways, we heard he had fell ill and we joked that he would develop his own treatment and treat himself. Apparently what he did: he started studying medicine, over a period of time diagnosed himself, and then negotiated his treatment out with the doctor! He’s still there.

  19. Use your brain, spend some time researching when you are sick. You will likely do a better job than most of the doctors will be able to do in the 5 minutes the insurance company pays you to see them.

    There is more truth to that than we would like to admit. It is an indication of how difficult modern medicine can be. Yesterday my sister-in-law rang me regarding a health problem with her mother. They had approached the doctor a number of times but he was dismissive of their concerns. It took me about 5 minutes of data mining to uncover the problem, it was arising from a prescription drug. I rang my sister-in-law today to advise discontinuation of the drug. She said the doctor had finally agreed to that. After months of heedless suffering by this elderly woman finally something was done. 5 minutes of data mining could have prevented all that suffering.

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