August 24, 2008 11:50 PM UTC

How Colorado Constitutional Amendment on Health Insurance will fail workers

• 2 Comments
• by: Another skeptic

The health insurance  initiative that we will vote on in November will reduce middle income workers’ access to health care, give employers incentives to buy the cheapest and least comprehensive insurance possible and give beneficiaries incentives to overuse health care providers’ services.

In an effort to give health insurance to a few thousand uninsured illegal immigrants and others who chose to not buy health insurance even though they can afford it, socialists want to ruin the health insurance markets that serve the non government middle class workers employed by thousands of small businesses in Colorado.

Because large, multi-state employers are covered by federal rules under ERISA, they probably won’t be affected by the amendment, and government agencies also are exempted.

So the amendment, as reproduced below and on another thread, will be an anti-small employer measure that will drive many small employers out of state. It will increase labor costs for businesses that serve local customers so much that they will have to raise prices, which will reduce demand. This will put them out of business.

There will be no large employers of plumbers or landscapers. Large locally-owned retailers and restaurants not protected by ERISA will go out of business. The large national chains will rule even more than they do today, because small restaurants and retailers won’t be able to compete with the big boxes.

Thus, Colorado will become a state that has thousands of small, relatively poor employers who can’t afford to buy health insurance for their workers, and the number of uninsured workers in the state will soar.

Colorado’s income taxes will shrink while its Medicaid bill explodes. Real estate values will plunge.

Employers are the most dishonest players in the health insurance markets. They buy insurance that fits their needs, not the needs of their workers who are covered by the insurance. They should be taken out of the health insurance business, and consumers should be allowed to buy insurance in the individual insurance markets.

Requiring Colorado employers to buy health insurance and pay 80% of the premiums goes against all of the reforms that health economists are proposing today.

Again, employers should be taken out of the health insurance market. Workers should be allowed to buy high-quality, high deductible catastrophic insurance  or comprehensive insurance, depending on their individual budgets and circumstances.

Where ever they have been tried, single payer, taxpayer funded health insurance schemes have failed, and care has been rationed by self-serving politicians and bureaucrats, not by the markets. No American with health problems (or anyone over 40) wants to live in Canada or the U.K., where patients die waiting for care and live with conditions that disable them because politicians won’t pay for the care that would extend their functionable lives.

Centralized planning fails. Ask the Soviets, where life expectancy for men fell to under 60 years under a so-called univesal health insurance scheme. And markets work better than the advocates of socialized medicine dare admit or, in their ignorance, know.

Now, there are supporters of the initiative. Idealistic and self-serving providers who would know that they would be sure to be paid under the initiative like it. Large employers that are protected by ERISA might like it or simply not care.

Power-hungry politicians and bureaucrats love the idea, as does the entitlement generation that thinks government owes them health insurance.

The proposed Colorado constitutional amendment summary is reproduced below, thanks to David.

An amendment to the Colorado Constitution concerning health care coverage for employees, and, in connection therewith, requiring employers that regularly employ twenty or more employees to provide major medical health care coverage to their employees; excluding the state and its political subdivisions from the definition of “employer”; allowing an employer to provide such health care coverage either directly through a carrier, company, or organization or acting as a self-insurer, or indirectly by paying premiums to a health insurance authority to be created pursuant to this measure that will contract with health insurance carriers, companies, and organizations to provide coverage to employees; providing that employees shall not be required to pay more than twenty percent of the premium for such coverage for themselves and more than thirty percent of such coverage for the employees’ dependents; financing the costs of administering the health insurance authority and health care coverage provided through the authority with premiums paid by employers to the authority and, if necessary, such revenue sources other than the state general fund as determined by the general assembly; directing the general assembly to enact such laws as are necessary to implement the measure; and setting the effective date of the measure to be no later than November 1, 2009.