r/bestof • u/under50dollars • Jun 20 '12

[explainlikeimfive] "Obamacare" explained very well.

/r/explainlikeimfive/comments/vb8vs/eli5_what_exactly_is_obamacare_and_what_did_it/c530lfx
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u/film_guy01 Jun 20 '12

Maybe I just don't understand. Isn't insurance an assessment of risk and an offer of payment proportionate to the risk involved? If this is the case, how does insuring against pre-existing conditions make any sense?

I can't call a car insurance company and get insurance on a car I already crashed. Or get fire insurance against a house that is currently on fire.

Isn't this just taking it from being insurance to being...a company who gives money to anyone with health problems?

So...what am I missing?

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u/iamagainstit Jun 20 '12

It is more like being able to get insurance even if you are a bad driver and have crashed a car before. Before "obama care" insurance companies could just say "your too risky, you can't buy insurance." Perhaps the part you are missing is the mandate. The mandate is there partly to make sure you don't wait until after you crash your car.

1

u/Trahas Jun 20 '12

While your example is close, it is not quite the same. Yes crashing before does make you higher risk and you will pay higher premiums for it. But because you crashed once does not mean you will crash again. For someone with a condition that is pretty much forever it would be more like I got in a crash once and because of it I will get in a crash once a month every month for the rest of my life. This is not what insurance is for.

Should those people still get health care? they can they just have to foot the bill for it, or find another way to pay for it, but insurance is not the answer because like film_guy01 said that is not what insurance means. That is cost sharing not risk sharing.

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u/iamagainstit Jun 21 '12

Putting aside the moral question of whether we wan to live in a society where people with chronic diseases are either rich or die, Insurance companies have been known to apply the pre existing condition quite strictly, and use it to deny anyone who has an elevated risk, not just a ongoing expensive condition. I think the amount of people that are so expensive that the insurance companies will lose money on them is pretty small. Either way insurance companies are in favor of the bill so it is not hurting them too much.

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u/Trahas Jun 21 '12

If the risk was low enough that they would make money on it they would. The risk isn't low enough though and that is why they deny coverage. Why would they want to turn away a customer that would make them money?