Goodbye Small Medical Insurance Companies?

Steven Horwitz

Yes, I argue in my new NBR blog post.  Snippets:

"The support for the bill coming from the major insurers should be one piece of evidence that they expect it to be good for them, particularly due to the provision that requires Americans to buy health insurance. In addition, as is the case with almost all regulation, larger firms are better able to absorb the fixed cost of compliance than are smaller firms. Given that this bill authorizes the hiring of over 16,000 new IRS agents to enforce its tax code provisions, such compliance costs are sure to be high, which will have a higher relative burden for the smaller firms."

and

"The irony, of course, is that the very same progressives who have supported this bill will be summarily outraged by the decline of small health and dental insurers and the oligopolistic behavior of the remaining large ones. Not that they will accept it, but they have no one to blame but themselves for supporting this bill as its changes will be the cause of those problems."

Comments

[Bronc]

Hey Baptists - Meet the bootleggers!

[Jeffrey Ellis]

"they have no one to blame but themselves" -- ha. Steve, you know darn well they will blame the larger companies for squeezing the smaller ones out of the market. Unless, of course, they can come up with an even more politically advantageous and/or ideologically motivated spin-doctoring of the real story than that.

[Quietman]

great post.

[Roger Koppl]

But, Steve, Obama has been blasting big insurance companies. Why only a few days ago (15 March) he said most emphatically, "We can't have a system that works better for the insurance companies than it does for the American people." http://www.reuters.com/article/idUSTRE62E3VR20100315
On March 8 he lamented, "we allow the insurance industry to run wild in this country." http://www.whitehouse.gov/the-press-office/remarks-president-health-insurance-reform-arcadia-university

Everyone knows it's the Republicans who are curry favor with big business, not the Democrats, right?

[HCC Medical]

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