Making health care unaffordable

LA Times:

Spurred by heart-wrenching stories of sick people denied health coverage, the state of New York did what many of President Obama's critics say he should do now -- it passed a relatively simple law requiring insurers to accept all applicants.

Other states have taken similar steps, making narrowly targeted changes instead of trying to overhaul their whole healthcare systems.

But two decades later, New York's experience offers a cautionary tale: Making isolated changes to the complex medical insurance system can have unwelcome consequences.

Premiums in New York are now the highest in the nation by some measures, with individual health coverage costing about $9,000 a year on average. And nearly one in seven New Yorkers still lacks health coverage, a greater proportion than before the law was passed.

The state has become a victim of a dangerous dynamic in insurance markets. Laws allowing consumers to buy insurance at any time often saddle companies with a lot of high-cost customers.

That in turn drives up premiums, pushing away younger, healthier people who are vital to a functioning insurance system.

"You basically can't have a functioning insurance market if people can buy insurance on the way to the hospital," said Mark Hall, a Wake Forest University economist who studied New York's experience.

...

Of course that is what Obama care does. It does punish the young with penalties if they don't buy, but they are much less than the cost of the insurance. The Democrats' bill will definitely drive up the cost of health care for everyone.