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    Monday, October 27, 2003

    Just Asking: What kind of car does health economist Uwe Rinehardt drive?

    Consider what would happen if employers paid for their workers' car insurance and if that insurance covered routine maintenance. No doubt, the cars would spend a good deal more time in the shop, and the price of repairs and the cost of auto insurance would skyrocket.

    By the same token, some health policy experts say, Americans see doctors more often, have more procedures and take more medicine than they need because most, if not all, of the cost is covered by insurance.

    'When consumers don't have to pay any regard to price, they overconsume,' said Kate Sullivan, director of health policy at the United States Chamber of Commerce. 'You get more value for what you buy when you have a stake in it.'

    ...There is no conclusive evidence that people's health would deteriorate if they were charged more for care. Mr. Gruber said he was convinced that "the health gains" from generous health insurance "are not large enough to justify the additional costs in aggregate."

    But Mr. Reinhardt was skeptical and fell back on the auto insurance analogy. "When I was young and could not afford regular maintenance, my cars constantly broke down," he said. "Now my cars run forever."


    I'm betting it's a Volvo.

     

    posted by Sydney on 10/27/2003 09:39:00 AM 0 comments

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