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Tuesday, January 10, 2012

You Can't Fire Your Insurance Company When You're Sick

Aaron Carroll (h/t Brad DeLong and Mark Thoma) takes down Mitt Romney on what he really meant by his "I like to fire people" quote. In context, Romney was talking about firing your insurance company (though as commenter "Tom" on Paul Krugman's blog points out, this is a telling way of talking about your relationship to your insurance company). Carroll:
The real issue, unfortunately, is that very, very few people have the luxury that Gov. Romney is endorsing. Let’s say that you are self-employed, and lucky enough to have found a company to provide you with health insurance. Then, let’s say you develop cancer. You suddenly find out that your insurance company stinks. So you fire them, right?
Of course not. You’re screwed. Now you have a pre-existing condition. There’s not an insurance company out there that wants to cover you. So you don’t fire them. You scream, and curse, and cry, but you’re stuck. Only healthy people have the luxury of picking and choosing.
 Moreover, most people are insured through their employer and only have whatever limited choice of insurance their employer gives them. The possibility of "firing" your insurance company and having a large choice of companies seeking your business exists only, as Carroll points out -- in Massachusetts, under Romneycare.. And it will be true in the U.S. under the Affordable Care Act. But of course Romney has pledged to repeal that.

As Krugman says, "It's as if Romney doesn’t understand his own health reform, which was in large part about ensuring not that you can fire your insurance company, but rather about ensuring that your insurance company can’t fire YOU." That's exactly right: the problem for too many Americans in the private (non-group) health insurance market isn't the lack of a wide choice, it's the unavailability of any choice, especially if they have a pre-existing condition. And until the recission provisions of the Affordable Care Act kicked in, people in the private market could indeed be fired by their insurance company. Now they can't, and in a few years individuals in the private market will not be getting denied insurance due to pre-existing conditions.

So Romney wasn't really talking about firing workers, though it seems like he does like to that. But Romney's vow to repeal the Affordable Care Act, even though it provides people the rights he signed into law in Massachusetts, is, as Krugman says, even worse.

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