Daily News Updates - Health Insurance News

Health Insurance Fear vs. Other Fears, Pt.6 – Can it Work?

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One effect is that by mandating part of the system, the HCA can save money by spending less, much like a single-payer health insurance does. By caping spending, this induces providers to use available funds more cost-effectively. This makes the cost-effective HCA more and more attractive for businesses to choose to adopt.  As such the HCA will expand.  As time goes on, more and more Americans are found within the cost-controlled structure.  Lewin's estimates, the starting membership of HCA will be about 128.6 million members. Most of these will be either small businesses or individuals.  Still about 122 million Americans will be with either employer-provided health insurance or private health insurance.  It is estimated that there would be 177.4 million members the HCA by 2017. Meanwhile, private insurance is expected to reduce to only to 93.5 million.  If these conditions were to occur, it is estimated that the effect of the slower spending of the HCA would save $1 trillion.

There is a down side, though.  Since the HCA would be competing with the conventional private health insurance/care open market, it may have an edge with its more attractive terms.  It is hoped that the HCA will take a lead over the private health insurance/care market.  The risk, tho is that "The combined effect of increased market share and a constrained rate of growth in Health Care for America spending would result in pressure on providers to shift costs to the private insurance market," according to Lewin.  This could have the effect of increasing the cost of private insurance premiums and create a runaway condition caused by the ever-increasing difference in the cost of HCA premiums compared to those of the private insurance market.

Continued…