ADAM SMITH, THE FREE MARKET AND HEALTH CARE

Like everyone I am appaled by Cigna’s refusal to approve a liver transplant for a 17 year old wtih leukimia.  The teen had just had a bone marrow transplant from a sibling and now expereinced liver failure.  The doctors at UCLA in a letter to Cigan said the teen had a 65% chance of survial with the trasplant. 

I am sickened by our appauling lack of health care in this country.  Those who are covered have poor care, those who are uncovered are left out in the cold begging for care from clinics or in long lines at medicade supported hospitals.

My family is in the same crisis.  I have worked independently for almost seven years now.  We have experienced the full boar of the non group medical plans.  As we became older it now has become impossilbe to purchase health insurance.  We could not afford the premiums even if we all were to be approved.  It is the underwriting or in plain English “our individual assessment of risk” that the insurance company puts a price on.     For my family it would be almost 1000 per month in premiums, if we were approvable.  There is no way that my family would consume 12,000 in care, in a year.  Barring an accident or a serious medical condition appearing out of nowhere.  It does not make economic sense to pay more for something then you would consume. 

 Now that 12,000 does not cover the medications that we are on and there is a heafty deductable for care.  So the actual price may far excede the 12,000 a year.  So does it make economic sense for me to purchase health insurance? 

No.

Enter Adam Smith. 

I am pretty confident I could tell you what Adam Smith would say about this.  The lack of health care in the country is causing a barrier to the free market in the free movement of labor.  People who would move to better paying jobs or jobs in a differnt area are hampered in doing so because they will loose their health care or when they move to the new company their conditions will no longer be covered.  Even worse is the entreprenure who is unable to use thier natural talents and skills to create a company that will over time create more value and employ more people thus added to the expansion of the labor and capital markets.

 In non ecomic terms: 

• people don’t change jobs because they are afraid of coverage loss
• people don’t open businesses because they are not going to be able to afford coverage or are unable to be approved for the coverage.

It is surprising that the free marketers are not up in arms about the burden of the health care costs on companies, the way is stagnates the labor pool,  and it forces people to work against their best internest. 

It violates all that adam smith beleived to be true.

It does not make any sense. 

The only thing that does is for us to offer government sponsored health insurance to all americans.