View Poll Results: Answer according to the hypothetical

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  • Increase it at the 4 year mark

    1 20.00%
  • Increase slowly in the time between now and then.

    2 40.00%
  • Increase quickly in the time between now and then.

    1 20.00%
  • Other

    1 20.00%
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Thread: Products, regulation, and the economy

  1. #1
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    Products, regulation, and the economy

    Alright, wanting to throw this out there to get some insight into what people think because there's an aspect of this bill that makes zero sense to me. The Democrats and Obama have repeatedly told us this is going to bring premiums down, however I see it as nothing but an attempt to be able to continue to demonize the insurance industry for simply being smart businessmen. Here's what I mean...

    Say you are a businessman, and you produce a product. Doesn't matter what the product is, be it tangable or a service, but you produce it.

    You currently sell it for "X" amount of money

    The government then passes regulation and legislation that is going to cause the basic cost associated with what determines the price of your product up substantially, but it is not going to happen for another 4 years. At this time however there will also be mechanisms in place where they could exert control over how much you sell your product for.

    So, as this businessman do you:

    1. Not raise your prices at all currently, or in the next four years, until such time that the regulations come into play. At that point you raise it to cover the increase in cost and hope the government doesn't lower it on you.

    2. Raise your prices slowly and steadily over the next few so that by the time regulations come into place you're already at the threshold to afford it with a little backlog of funds incase the government chooses to lower your price.

    3. Raise your prices at a relatively fast pace over the next few years above what would be needed to cover the regulations, with the belief that its likely the government will require you to sell your product at a lower price and hoping that by being more expensive at that point the lower price will actually be higher than it would be if you were right on the money with cost.

    To me, personally, option 2 would be my prefered method if I was running a business, with 3 being more prefered over 1. One seems suicidal, placing all trust in the government not meddling and that your customers won't have an issue with an enormous price increase.

    This is my issue with Health Care currently.

    Soon, Insurance Companies are going to have to be insuring people with preconditions. To me, this is like Las Vegas having to give the Indianapolis Colts the same odds at winning the Super Bowl as the Cleveland Browns. People with previous conditions are more likely to incur expenses, and typically more costly expenses, at a lot quicker rate meaning that they're far more likely that they get out more than they put in. This raises the general operating costs of Insurance Companies. This is just one of numerous potential things that will likely end up raising the operating costs associated with the cost of medical care for Insurance Companies.

    This is especially true if one could hold off on getting insurance until they discover they have cancer, and then are legally required to be given insurance at that point, as an example.

    If the costs to be able to provide Insurance go up, then premiums will have to raise to cover the business expense. If they don't then the Insurance Companies can not function and would have to close up shop (which of course would set the stage to say "oh, well the government needs to take over", but that's a different story). So, IF the Insurance Agency's are to survive, prices MUST go up.

    Which then begs the question, should we expect the prices to rise only in the future or start rising now? And IF they start rising is that the fault of the "greedy" Insurance Companies or of the government for putting into place the situation that makes them HAVE to raise their premiums if they want to remain in business.

    So, there's my question to you all, with the reasoning behind it (So its not a baiting question)....

    In the hypothetical above, if you're the business owner, would you raise prices in 4 years, slowly raise prices in the intermediate years, or quickly raise prices in the intermediate years.

  2. #2
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    Re: Products, regulation, and the economy

    Quote Originally Posted by Zyphlin View Post
    Alright, wanting to throw this out there to get some insight into what people think because there's an aspect of this bill that makes zero sense to me. The Democrats and Obama have repeatedly told us this is going to bring premiums down, however I see it as nothing but an attempt to be able to continue to demonize the insurance industry for simply being smart businessmen. Here's what I mean..
    Zyphlin, I think alot of you, but I could not make it past there in your post. Yeah, the democrats spent months, alot of political capital, doing something extremely controversial, just do they could continue to demonize the insurance industry..
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    Re: Products, regulation, and the economy

    And like all politicians trying to "fix" a problem they are going to talk up the problems with the current situation. The "problem" before this bill was passed was insurance companies. Of course they're going to go after them.
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    Re: Products, regulation, and the economy

    Quote Originally Posted by Redress View Post
    Zyphlin, I think alot of you, but I could not make it past there in your post. Yeah, the democrats spent months, alot of political capital, doing something extremely controversial, just do they could continue to demonize the insurance industry..
    No, I don't think they did it JUST so they can demonize the insurance industry. I'm sure many did it because they think its best for the country. I'm sure many did it with hopes that its the first step towards gettin to a true single payer plan (Like DisneyDude has stated he hopes it is). I'm sure others did it because they think its most likely to get them re-elected next year. I'm sure there are other reasons as well, and I'm sure most are a mix of those things.

    That said...

    I think an offshoot of the "get elected next year" thing is that politics has shown us time and time again that its easier to win when you have something you can paint as an enemy and rally people against. The "Greedy Insurance Companies" have proven to be that target during the entire time of this health care debate.

    We have been told by Obama and others that this plan is going to reduce premiums, and yet every time I look at the facts behind this bill and the economics of it I just don't see HOW that's goign to actually happen.

    So, that means a couple things. The democrats could honestly believe its going to happen. Definitely a possability. The democrats don't know one way or another, but know they need to say it to get people on board. Definitely a possability. The Democrats know its possible, but unlikely, but helps to get people on board and sets the Insurance Industry up to continue to be "bad guys" they can campaign against. Also definitely a possability.

    This puts the insurance companies in a bad spot, where if they adapt to the cost of this bill then they will be demonized but if they don't adapt to the cost of the bill then they'll be unprofitable. It also puts democrats into a strategically sound position where if the Insurance Companies raise the prices then they can claim it is greed and use that as a reason why they need to get to a single payer system, and if they don't raise it and start failing as businesses then they can use it to say they need to get to a single payer system. (Which I'm sure is the goal of many, like Disneydude has stated)

    I am in no way suggesting that the only reason this entire bill has came into affect was to give them a way to insult insurance companies. But I'm also not going to discount that the benefits of being able to create a scape goat to campaign against, and the need to get re-elected, isn't PART of what is playing into some peoples minds.

  5. #5
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    Re: Products, regulation, and the economy

    I agree that prices will raise for the reasons you mention, although there will be offsets. Early treatment and preventative medicine instead of last minute uninsured emergency room stops should lower the hospitals required rates. Administrative costs will be significantly lowered when no more effort is spent to deny coverage wherever possible. Still, I think the whole timeline of events is a huge mistake. Plenty of folks are going to be trying to grab as much cash as possible during the 4 year grace period, long termed consequences be damned.

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    Re: Products, regulation, and the economy

    Quote Originally Posted by Zyphlin View Post
    This puts the insurance companies in a bad spot, where if they adapt to the cost of this bill then they will be demonized but if they don't adapt to the cost of the bill then they'll be unprofitable. It also puts democrats into a strategically sound position where if the Insurance Companies raise the prices then they can claim it is greed and use that as a reason why they need to get to a single payer system, and if they don't raise it and start failing as businesses then they can use it to say they need to get to a single payer system. (Which I'm sure is the goal of many, like Disneydude has stated)

    Personally, I would be ok with a public option that would actually require the insurance companies to compete or fail. It would reign in the insurance corporations and they would not be able to "profit" off the backs of the American people the way that they have operated for decades.

    As you say Zyph...my preference would be for single payer, but I could live with a public option. I have yet to hear a good argument for why a public option is not a good idea.
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    Re: Products, regulation, and the economy

    So any actual comment on the theoritical that is the topic of the thread along with your comments on the public option?

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    Re: Products, regulation, and the economy

    In my mind in four years the insurance companies will have two options:

    1. Raise prices to continue their extremely high profit rates
    2. Lower prices to stay competitive and in turn bring in less profits

    If a company wants to stay in business, I would assume they would take the second option.

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    Re: Products, regulation, and the economy

    The greatest shortcoming in the Healthcare bill was not opening up insurance companies to compete across state lines. Without minimal competition they only have to make sure their rates are competitive with the few other insurance companies in their market. That said, I would wait until the costs increase before raising my rates.

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    Re: Products, regulation, and the economy

    Stay competitive with what? If all insurance companies actually want to make a profit, the point of a business, and all insurance companies are going to have increase in the cost of medical care because of the regulations, then there is no competition they have to compete with if they all increase rates to match the rise in cost.

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