OUR VIEW: Improvement in health insurance market isn’t as great as we made it sound

Published 10:32 am Thursday, November 7, 2019

week ago, we editorialized about increasing choice in the health care marketplace in Kentucky. Our position was based on free market principles — that more choice and competition is almost always a good thing for the consumer.

We held up as proof of this the fact that one of the two main companies offering health insurance through the government marketplace had cut its rates by an average of 4.5% for next year.

After the editorial was published, a reader provided us with some additional information: While CareSource Kentucky may be cutting its premiums, it’s also cutting services and increasing charges when you need health care for some. In the case of this reader, the total cost next year for keeping the same plan will likely be more because the reader will have more out-of-pocket expenses.

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Clearly, this situation is a lot more complicated than our previous editorial made clear.

It’s difficult, if not impossible to comprehensively address any topic in 450 words, let alone what might be the most complicated topic we have in today’s America — health care.

But that’s not an excuse — it wouldn’t have been hard to include a statement making it clear while we are usually a fan of increased consumer choice, increased consumer choice alone is not a guarantee that something is better.

We didn’t do that, so we’re going to now.

We often promote free-market ideas in our editorials. We continue to believe markets with a large degree of freedom can be more efficient, more equitable and more likely to create economic mobility than markets that are overly-constrained.

Governments are often blamed for regulations that limit the free market, but that throwaway line is all but worthless these days. Do you know who has done a lot to constrain economic freedom? Global corporations and huge companies that have lobbied for rules friendly to their bottom line. But they are blamed much less often than the government.

Broadband internet is a great example. If you happen to live somewhere in the U.S. with access to broadband internet through a cable line, the full-price rate for that internet is often $70 a month or more. In many other countries around the globe, it can cost less than $20.

Why is that? In part, because government regulations require companies to share the cable lines running to everyone’s homes, forcing them to compete for the lowest price. In the U.S., cable companies have used government regulations to do the opposite: The government has protected these companies against sharing the cable lines and turned a blind eye to how the companies got together and agreed not to compete.

The health insurance market is far more convoluted and impossible to navigate. Last week, we latched onto news of increased choice optimistically, but short-sightedly. It will take a lot more than a handful of extra choices (some of them worse, we now know) to fix the chaotic leviathan that is our health care industry.

Editorials represent the opinion of the newspaper’s editorial board. The board is comprised of publisher Michael Caldwell and Bluegrass Newsmedia editors Whitney Leggett and Ben Kleppinger. To inquire about a meeting with the board, contact Caldwell at 759-0095.