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Contributor
Ray
Haynes
Mr.
Haynes is an Assembly member representing Riverside and
Temecula.
He serves on the Appropriations and Budget Committees. [go to
Assembly Member Haynes
website at California Assembly][go to Haynes index]
 Oops,
Government Does It Again
Guess one big reason health insurance costs so much...
[Ray
Haynes] 9/21/04
Last week,
the Los Angeles Times reported that health
care premiums were going up—again. Since 1998, the cost
of health care insurance has increased over 40%, and
it keeps going up. We know that increased premiums increase
the number of uninsured. For each one-percent increase in the cost of
health
insurance, 40,000 people in California lose their insurance. That means
in
the last 6 years, about 2 million people have lost their insurance due
to increased health insurance costs.
So—what has caused the increase in health insurance premiums?
Government. Between 1999 and 2003, the California Legislature,
aided and abetted by Governor Davis imposed over 20 different mandates
and regulations on health insurance; including mandatory coverage
of mental health, granting unlimited rights to sue insurance companies
for bad faith, mandating coverage for a variety of different diseases,
eliminating mandatory arbitration for disputes, requiring a variety
of different appeals processes if there were coverage disputes,
and the like. When the laws imposing these mandates were passed
and signed by the Governor, we were told: (1) the coverage provided
was only a right and fair thing to do for everyone; and (2) the
mandate would only increase the premium one or two percent. Add
20 mandates and voila—a 40 percent increase in premiums,
and 2 million more uninsured souls in California.
This year
the legislature wanted to mandate pregnancy coverage. In the
late 1980’s and early ‘90’s,
I bought an individual policy to cover my family, and I was given
the choice
of whether I wished to buy pregnancy coverage. The cost for that
coverage was $280 per month, in addition to the $400 per month
I would pay for other medical coverage. I chose not to take the
coverage. About two years later, my wife got pregnant. It cost
us about $3500 to pay for the costs of the pregnancy. If I had
purchased the insurance, I would have paid over $6000. If the Legislature
had its way, I could only buy insurance with the coverage, increasing
my costs to $680 per month. Had that been the only choice available
to me in 1989, I would have remained uninsured.
We have heard
politicians whine about the uninsured, but the truth is, these
are the same
politicians who have increased the
ranks of the uninsured by their misguided policies. The biggest
problem in health care today is that almost all medical care is
paid for by third parties, that is, you get the health care, and
either the government or your boss pays for it. The reason? If
you pay for your own health care, the government taxes you on the
cost of the care, or the insurance to pay for it. If the government
or your boss pays for it, you are not taxed. So—everyone
tries to shift the cost to the nontaxable side of the ledger.
This means
that someone else is deciding whether or not to pay for health
care you need.
More often than not, when they are paying
for it, they decide you don’t need it. That can be really
when you really do.
To solve this problem, the Legislature decided to impose more
stupid government regulations on business to fix the problems created
by the stupid government regulations they put on business earlier.
That solution, SB 2, was referended by business, and is up for
a vote in November. If you think more government will solve the
problems in health care created by more government, you should
vote yes on SB 2, which is Proposition 72. If you think government
should just leave you alone, you should vote no. I would rather
have government just leave me alone. CRO
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