Sunday, February 24, 2013

PF March 2013 Health Insurance - Background

Resolved: The U.S. government should not require its citizens to have health insurance.

For part 1 of this analysis, click here.

My Approach to the Analysis

Since the topic has more or less already been debated in Lincoln-Douglas last November and December, it was tempting to simply resurrect the old analysis and simply recycle it.  However, I was not satisfied with this idea because our state tournament is coming up and I felt the topic deserved a fresh look.  The November 2012 LD resolution, reversed the advocacy with Aff supporting universal health care.  In this resolution, Pro rejects the idea government should require citizens to have health insurance.  Besides the obvious reversal of the advocacy between the LD and PF versions of the resolution, there is also another significant difference.  The LD version debated universal health care which can be provided in number of ways, insurance being just one.  The PF version of the resolution, limits the debate to health insurance

About Insurance

I guess it makes sense we should understand insurance and how it works.  Basically, when you take out an insurance policy, you are making a bet with the provider the event being covered will occur and the provider is betting it will not.  With a health insurance policy you are betting you will get sick, the provider is betting you will not.  As long as you continue to lose the bet (you stay healthy) you pay, when you win the bet (you get sick), the provider pays.  Insurance is a game of risk management.  There is a risk that you will get sick or injured and if you are engaged in a life-style that increases the risk, you will pay more than if you are considered healthy and a low-risk.  In the case of health insurance, there is a very good chance the insurance provider will lose the bet eventually and need to pay.  Because the cost of health care is incredibly high, the insurance provider runs the risk of having to pay out more money than it collected from you.  The insurance provider can prevent going bankrupt by charging enough to cover the potential risk.  Another way the insurance provider protects itself is to cover the risks for many individuals.  Each of them pays as they remain healthy and the insurance provider collects enough to cover the expenses when a member becomes sick. Let's look at a practical example.  Let us assume there are 100 students in a school and on average one student a year will suffer an injury requiring care that costs $4800 to cover.  Without insurance, each family would need to keep $4800 in reserve on the chance their child will be the one injured.  However, if each of the families got together and pool their resources, each family could pay $4 per month which would be used to pay for an injured student.  In this way, each family pays a total of $48 per year instead of holding $4800 on the chance their student will be the injured one.  In this example, the school can reduce the amount families pay be reducing the risk a student will be injured (by safety rules, perhaps rubberizing the playground, etc).

To understand a little about how the costs can be minimized by spreading the risks over many people, consider the following example.  Let say, each year a given city of 100,000 has medical expenses of 1,000,000 dollars per year on average treating 1000 individuals who get sick or injured.  If 10,000 of them decided to pool their money to cover the risk, each must pay $100 per year to cover the $1,000,000 on the outside chance all 1000 injuries or illnesses will come from that group of individuals.  If 20,000 people decided to pool their resources, doubling the number of participants, cuts their cost in half to 50 dollars per year.

What it all means is the cost of health insurance can be kept low by decreasing the risk or spreading the risk over more individuals.  The idea of spreading the risk over many individuals as a way to minimize cost is one of the objectives behind requiring everyone to have insurance rather than only a few.  It should also be obvious that as the cost to the individual decreases, more people can join the group since the insurance becomes more affordable to those in lower income brackets.

The "Free-Rider" Program

It is well known by most people that thanks to a 1986 federal law called the Emergency Medical Treatment and Active labor Act (EMTALA), publicly funded hospitals are required to provide medical treatment to everyone, regardless of their citizenship and ability to pay.  In most cases the hospital will attempt to recover the cost of treatment from the patient through the normal billing and collections process.  Sometimes, the cost of treatment is unrecoverable.  The U.S. federal government does not provide any compensation to hospitals which treat those who cannot pay.  Some hospitals receive compensation through the state in which they are situated.  To compensate for unrecoverable costs, hospitals raise the cost of care for those who can pay.  However, because the health insurance providers have become increasingly vigilant to the practice of cost shifting, hospitals and physicians are being forced to "eat" the losses.

Obamacare (PPACA)

In 2010, the Patient Protection and Affordable Care Act (commonly called Obamacare) was signed into law.  This law was designed specifically to reduce the number of uninsured in America, which basically amounts to reducing the cost of medical care by spreading the risk over more people.  PPACA provides a number of important benefits such as requiring coverage for pre-existing conditions and coverage without regard to gender or geographical location.  The PPACA requires everyone to obtain some kind of insurance in one of four ways; through your or your domestic partner's employer provided insurance; through government programs such as Medicare; through private insurance; or through a state run Exchange (health benefit exchanges to be established in all 50 states which will help individuals find affordable private or public coverage). Citizens who fail to get insurance will be required to pay a penalty in the form of higher taxes.  There are several exceptions allowed for uncommon situations or religous exemptions.  No doubt, a lot of debate will flow around this particular law and there will be literally hundreds of opinions and countless statistics, most politically charged, which will say it increases the deficit and reduces the deficit, increases unemployment, does not increase unemployment, increases taxes, reduces taxes, etc.  I and I am sure many judges will hate that debate since in my opinion, while the effects of PPACA may be significant one way or the other, it is merely an implementation of a national health insurance coverage plan which may or may not be ideal.  The resolution, thankfully, does not mention PPACA or Obamacare.  It mentions health insurance.  To be sure, I do not see PPACA as a national health insurance per se.  I do see it as a plan to reduce the number of uninsured through a variety of mechanisms and incentives.  The topic of this debate is, should citizens be required to have health insurance without mention of where or how the insurance is obtained.  Specific provisions of PPACA not withstanding, there may be valid reasons why the US should not require its citizens to have health insurance.  Those reasons may be philosophical or legal and they may be practical due to the economic impact on the economy, but they needn't be specific to PPACA and indeed, I would think the more broadly your arguments can be applied, the better chance you will have of winning.

The Status-Quo

In the status-quo, a large number of people remain uninsured due to the high cost of health insurance or for personal reasons.  Most ordinary citizens would probably not have insurance if it was not provided or subsidized by their employers as a benefit of employment.  Since federal law requires public hospitals to provide emergency care only, many of the uninsured lack "routine" care (wellness care) such as yearly examinations, care during pregnancy, and screenings for certain common diseases such as diabetes or colon cancer.

Young 2012:
The number of uninsured Americans declined from 2010 to 2011 to 48.6 million people, according to a U.S. Census Bureau report on income, poverty and health insurance released Wednesday. In 2011, 15.7 percent of Americans had no health insurance compared to 16.3 percent in 2010.
The uninsured rate for people aged 19 to 25 also decreased from 29.8 percent in 2010 to 27.7 percent in 2011, when 8.3 million of them had no health insurance, the data also show. One reason may be that young adults are benefiting from a provision in the 2010 health care reform law enabling them to remain on their parents' health insurance plans until they turn 26.
Enrollment in Medicaid, the government health program for the poor, rose from 48.5 million to 50.8 million between 2010 and 2011 amid a sluggish economy. The rates of people covered by private insurance, including job-based health benefits, remained statistically the same, according to the Census Bureau. "The increase in public coverage and no statistical change in private coverage may account for the increase in overall coverage," David Johnson, chief of the Census Bureau's Social, Economic and Housing Statistics Division, said during a conference call with reporters.

O'Neill & O'Neill (undated):
Many people believe that the number of uninsured signifies that almost 50 million Americans are without healthcare simply because they cannot afford a health insurance policy and as a consequence, suffer from poor health, and premature death. However this line of reasoning is based on a distorted characterization of the facts. Although it is important that we be concerned about the provision of resources to those who are too More careful analysis of the statistics on the uninsured shows that many uninsured individuals and families appear to have enough disposable income to purchase health insurance, yet choose not to do so, and instead self-insure. We call this group the “voluntarily uninsured” and find that they account for 43 percent of the uninsured population. The remaining group—the “involuntarily uninsured”—makes up only 57 percent of the Census count of the uninsured. A second important point is that while the uninsured receive fewer medical services than those with private insurance, they nonetheless receive significant amounts of healthcare from a variety of sources—government programs, private charitable groups, care donated by physicians and hospitals, and care paid for by out-of-pocket expenditures. Third, although the involuntarily uninsured by some estimates appear to have a significantly shorter life expectancy than those who are privately insured or voluntarily uninsured, it is difficult to establish cause and effect.

For the Con position and more, click here.


Census: Uninsured Rate Falls As Young Adults Gain Coverage And Government Programs Grow
jeffery Young, Huffington Post
Posted: 09/12/2012 1:30 pm Updated: 09/13/2012 1:58 am

Definitions of Health Insurance Terms

WHO ARE THE UNINSURED?, An Analysis of America’s Uninsured Population, Their Characteristics and Their Health
June E. O’Neill
Baruch College and City University of New York
Dave M. O’Neill
Baruch College and City University of New York

Kaiser Commission on Medicaid and the Uninsured
October 2011
The Uninsured and Their Health Care Needs: How Have They Changed Since the Recession?
By Emily Carrier, Tracy Yee, and Rachel L. Garfield


  1. As pro, is there any way to use a constitutionality argument? Considering the fact that the ACA has already been upheld by the Supreme Court, is there any argument that I can make that would sidestep the obvious counter-argument?


    1. The Supreme Court does over-rule itself from time-to-time demonstrating that sometimes it makes mistakes or circumstances change. In any case, the constitutionality of the Affordable Care Act is currently being reviewed in a District Court based on the claim it violates freedom of religion by forcing religious employers to pay into a system that supports abortions.

  2. Would that constitutionality argument create enough offense to be worth a contention? And even though SCOTUS does overrule itself at times, does the current ruling in National Federation of Independent Business v Sibelius make the ACA, at least in the current moment, constitutional?


  3. I think the NFIB v Sibelius decision closes the door on the legality of the individual mandate. However, there are other ways to argue against the principle of mandated insurance and there may be other reasons (e.g. the religious freedom argument) to take out the ACA in partiular.


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