An interesting comment from Rabbi Josh Yuter who was one of 1,000 Rabbis listening in on a conference call with President Obama on the hot button issue of heath care reform.

“Obama’s approach to insurance is fundamentally flawed - This requires some explanation. One of Obama’s positions, stated repeatedly, is that he wants a system where people are not discriminated against for having pre-existing conditions. If he’s truly advocating a marketplace for insurance, this is simply an untenable position. The point of insurance is risk management where one pays a certain amount of money to avoid incurring a financial disaster in the future. Insurance companies, responsible for paying out policies, profit through the pooling of risk i.e the individuals with limited risk pay premiums to cover those with higher risks of the company having to pay. If there is no discrimination for pre-existing conditions, the principle of calculating appropriate risks is eliminated since every participant would be treated as an equal. Worse, if there is no disadvantage to pre-existing conditions, then there is no incentive for the individual to purchase insurance until after the health problem materializes. At that point there is no risk from the purchaser because he knows he needs treatment, but the insurer is forced to burden the entirety of the costs. Based on Obama’s position on pre-existing conditions, I’m forced to conclude that either he really is advocated a government controlled health care (or at least mandating individuals purchasing health care), or he simply doesn’t understand how insurance works.”

References

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