The thread wherein I (sorta') defend Fox News

In its continuing quest to demonize every single aspect of Obamacare, Fox News went after sex-neutral premiums:


(Rest of the story and video - clicky poppy)

Now, there are a number of things wrong with Dr. Samadi's position. First, he's an idiot. Second, it's not at all clear that he understands how insurance works. For instance, it's unlikely that he really gets the difference between cost of services (something that hospitals are responsible for) and the risk of someone incurring those costs (something that insurance actuaries care about).

But, at its core, his argument is sound: women pay more for health insurance because they're worse risks than men. And that, by the way, is how insurance works. It's not that insurance companies hate women. For instance, drivers with lots of speeding tickets pay more for auto insurance, but that's because they're worse risks, not because insurance companies want to discriminate against them. Indeed, it used to be the case (and may still be) that male drivers under 25 paid more for auto insurance than female drivers in the same age cohort because, on average, they tended to get into more accidents. That may or may not have something to do with the fact that the average male driver has a penis rather than a vagina, but, from the insurance company's perspective, that's immaterial.

Obamacare's solution is to make men and women pay the same for health insurance. Dr. Samadi, whose own solution to the dilemma is to make everyone pay cash for their routine health care (no, seriously, watch the video!), sees this as fundamentally an economic issue - and viewed that way, he may have a point. The government, however, views this as a political issue, and that's where the disconnect occurs. Economic solutions emphasize values like efficiency, whereas political solutions emphasize values like fairness. Criticizing the sex-neutral policy embedded in Obamacare for its failure as an economic solution, therefore, misses the point. The real question, then, isn't whether it's an efficient allocation of resources, but whether it's fair.

No doubt the government's intention, in leveling premiums, was for women to pay less, but corporations have their own idea of what constitutes "fairness." Back in the olden days ("come along, kiddies, gather around as Unca Joe tells you a story of the dinosaur times!") department stores would charge women for clothing alterations but would alter men's garments for free. There were a number of reasons for that practice, but the bottom line was that women's alterations, on the whole, cost more than men's alterations. People complained that this practice was discriminatory, and the department stores responded by charging everyone for alterations. Non-discrimination for corporations, in other words, has a different meaning than it does for most of the people demanding non-discrimination from corporations, but then that should be expected - corporations aren't politicians, and they solve these types of problems economically rather than politically.

And that, undoubtedly, will be the result of Obamacare's attempt at sex-equity in health insurance premiums. We won't see women pay less, we'll just see men pay more, and the additional amount paid by men will, in effect, act as a subsidy for women's health insurance (a point made, albeit badly, by Dr. Samadi). Now that may be justifiable both in economic and political terms - men, after all, tend to earn more than women and so, presumably, can afford to subsidize women's health insurance premiums - but I doubt that anyone who pushed for this change was seeking this sort of solution.

In the end, this just highlights one of the major problems with Obamacare, just not the problem that Fox News continually whines about. Too much of the implementation of the ACA is placed in the hands of insurance companies. If the health insurance crisis is a political crisis, however, it should be addressed politically rather than economically. It was the government's responsibility to see that the health insurance crisis was handled fairly rather than handing that responsibility off to the corporations. We shouldn't be surprised, then, if those corporations handle that responsibility under their own definition of what constitutes "fairness."