Should you trust the Colorado Trust?

Should you trust the Colorado Trust?  Its CEO, Dr. Ned Calonge, repeats a common health care falsehood: that the cost-shift from the uninsured’s outstanding medical bills justifies mandatory insurance (Nov. 19). While the cost-shift increases premiums, the amount is small compared to cost-shifting from mandatory insurance and Medicaid.

In Colorado, the cost-shift from the uninsured is just $85 per insured person. This is according to research done for Colorado’s 208 Commission, which Dr. Calonge himself praises.

Key findings include that “the uninsured pay for about half of their care out-of-pocket” while only “20 percent is uncompensated care from providers.” An Urban Institute study provides further evidence that uninsured cost-shifting is small — at most “only 1.7% of private insurance premiums.”

By outlawing affordable plans, mandatory insurance increases premiums by much more. Consider the federal health control bill, HR 3590. It requires that all plans include at least ten mandated benefits, such as maternity care and substance abuse treatment, whether you want them or not. A typical mandated benefit increases premiums by about 0.75%, concludes a 2008 MIT study.

By underpaying doctors, Medicaid is also guilty of large cost-shifting. But Dr. Calonge withholds this information when noting that HR 3590 expands Medicaid eligibility. A Milliman actuarial study concluded that the cost-shift from Medicaid and Medicare adds $1788 to the annual insurance premium for a family of four. The uninsured pay more of their medical bills than Medicaid does for its participants, reported Reuters in 2008. What’s more, a CDC study found that people “with Medicaid coverage were more likely to have had multiple visits to [emergency departments] … than those with private insurance and the uninsured.”

Dr. Calonge wants to “promote an honest debate” about health care. But the cost-shift argument for mandatory insurance has no place in one.

This letter to the editor was published in the Northern Colorado Business Report on December 3, 2010.

This is a shorter version of my article, Amendment 63 vs. Cost-Shift Hypocrisy, published in the Huffington Post.

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