Benefits in Risk Pooling Occurs to Fortune 500 Companies
By Ian
Lots of good stuff in the news today.
A group of Fortune 500 corporations are getting together to offer health insurance to their non-full time workers.
What I find most interesting about the move is that it appears to be a direct reaction to the long-term externalities of an uninsured populace: the shifting of costs from the uninsured to the insured. Long term concerns play as much of a role in evaluating costs as do short run concerns, so this seems only natural. The Christian Science Montior agrees, but responds to the possibility that others may be scratching their heads.
But so what if self-interest is at work? That's how many social problems are solved in a market economy. The big-business alliance would help solve this one by pooling workers, thus offering them lower insurance rates which they couldn't find as individuals. The alliance estimates it could cover as many as 4 million people - 10 percent of the uninsured.
The presence of uninsured does have direct consequences for the insured. But it would seem wrong to believe that the presence of uninsured indicates a complete and continuing market failure that can only be addressed by government intervention.