You can’t have it all

I’m sure everybody’s heard the old joke that goes along the lines of "Your ideal spouse: Rich, Educated, Beautiful. Choose Two" or "Computer software: Fast, Easy, Affordable. Choose Two". No matter how much we want everything, it’s almost impossible to find something that has every positive aspect you are looking for. The same goes for health care reform.

I think Atrios hits the nail on the head here:

Essentially we apparently need to come up with a bill which: lowers costs, preserves absurd industry profits, widens care, is affordable, has a nice round number from the CBO, is subsidized for low income people through tax credits, is mandated, is popular.

Any plan which does all of this is a very stupid plan at best.

He’s exactly right. You can’t have every single one of those in a workable system. The question is, what do we take off that list?

If you put it to a public vote, I’m guessing that "preserves absurd industry profits" would be the one that most people think aren’t necessary for reform ("has a nice round number from the CBO" would probably be second). You can’t simultaneously have a reform that lowers costs and lets the insurance industry protect their profits. Impossible. You’ve got to choose.

It’s not clear that insurance industry profits are doing any social good anyway. I have no problem against profits. In fact, they are a good thing. Why? Because profits lead to two benefits: more competition as people see profits in an industry and want to get a share of them, and more innovation in terms of productivity, features, service, and so forth as people try to minimize costs and maximize value better than those competitors.

As I’ve said before, usually these aspects of the free market do work to increase competition, quality, and value. But for the health insurance industry, not so much. There’s little competition. There are no great innovations in insurance coverage (aside from finding ways to drop people). There’s no increase in quality. Something’s not working.

I’m no economist, but I see insurance as creating little of value, if anything. It’s a necessary evil. And if it doesn’t work, as health insurance now does not work, something needs to be done, and that something won’t make everybody happy. You’ve got to choose what you are willing to give up.