Blogs > Liberty and Power > Do the Uninsured Drive Up Premiums?

Dec 30, 2008

Do the Uninsured Drive Up Premiums?




Is rationing in our future under Obama? Sally Pipes thinks that it will be and that Americans will not tolerate it. I'm not sure that she is right about her second point. Americans appear willing to tolerate anything as long as scapegoats can be found. Pipes disagrees with the view that the uninsured are responsible for high premiums:

One of the great myths in health care is that the uninsured are responsible for driving up private premiums by shifting costs. Uncompensated care certainly shifts some costs to private payers. Yet these costs are actually quite manageable in the aggregate, akin to what retailers lose due to shoplifting. The major cost shift is from government programs -- Medicare and Medicaid -- to private plans. The government pays doctors to treat Medicare and Medicaid patients. But the rates it pays, on average, are less than the cost for providing care to these patients. This is why Medicaid patients, and increasingly Medicare patients, struggle to find doctors. Putting more people on these programs will destabilize the remaining private system and create a coalition for price and wage controls.



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