Health care and the transfer of risk

Watching the current flap over health care generally, and health care insurance specifically, is interesting and frustrating. What seems to me to be missing is truth about both health care and health care insurance.

First of all, insurance must be understood for what it is — the transfer of risk. In the case of health care insurance, we transfer our risk of health care costs to the insurance company for a fee. The risk for a 20-year-old is less than for a 70-year-old, and the premium must reflect that difference. In addition, the risk for a 40-year-old woman is more than for a 40-year-old man, and the premium must reflect that fact — maybe uncomfortable, but true.

The level of risk determines the cost of the premium. If we want to socialize the premiums paid by overcharging the 20 year old and/or subsidizing the premium of the 70 year old, so be it. Just be honest.

It is said that, if enacted, the current plan would cause some 24 million people to be uninsured in 10 years or so. That is because some will choose to go without insurance as the "mandate" is lifted. What a concept — choice!

Another unfortunate fact is the medical needs and medical costs are not distributed uniformly across our life span, i.e. the older we are the more medical help we typically need. Former Colorado Gov. Richard Lamn in his book, Megatraumas, points out how dramatically the elderly cohort impacts the system. He states that 60 percent of all society's health care costs are being consumed by patients in their last six months of life. He further points out that we are not extending life but prolonging death. Harsh as it may sound, we need to ration some expensive care for people beyond a certain age. (By the way, I am 75.) I'll not be as blunt as Governor Lamn who said, 'People have a duty to die," but we must face reality.

Another thought — Gov. Lamn talks about two cities on a river, Upstream and Downstream. Frequently people in bad shape float to Downstream. Downstream got very good at rescuing them. As Downstream got better and better at rescuing people, more and more came. Nobody went Upstream to see where they were coming from and took no effort to save them. Alcohol, cigarettes, drugs, obesity, etc. — maybe we could save some of our health care costs through preventative measures.

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Dean Haagenson is a Hayden resident.