Insurance or Redistribution?

By James Kwak

Mark Thoma makes an important point about the “individual mandate” that applies equally well to health care and to Social Security:

“I don’t see anything wrong with asking people to pay the expected value of their health care — a mandate to get insurance to cover the catastrophic things that society would cover in any case — to avoid this type of gaming of the system. Yes, it’s true that many healthy people will pay, remain healthy, and seem to get nothing. But that’s the wrong way to look at it. They have insurance whether they pay for it or not. Society will not let them die of a standard, treatable illness so insurance services are present. In fact, it’s the knowledge that society is providing these services that motivates many people to take a chance and go without.”

This is the relatively common argument that, since people already have guaranteed access to a basic level of emergency care, they should have to pay for it.

There’s a slightly different point in there that I emphasized above and that I want to focus on. Health insurance, like any kind of insurance, can be framed after the fact as redistribution. You pay health insurance premiums, you stay healthy, and therefore you “lose”—your money goes to pay for other people’s losses. But this is true of any kind of insurance. It’s equally true of homeowner’s insurance: if your house doesn’t burn down, you are the victim of redistribution from you to the people whose houses do burn down.

The other way to think of insurance is, well, as insurance. We want and value insurance in the current period, before we know if we’ll be “winners” or “losers” in the future period. The insurance itself has value to us. In fact, whenever you buy insurance, you are hoping that you will end up as a loser.

The framing of the health care individual mandate as a transfer from the healthy to the sick is the exact same as the framing of tax-funded social insurance programs as a transfer from the rich to the poor. At the time you enter the system, you probably don’t know which category you will fall into. You might have some knowledge of the probabilities, but you could turn out to be very wrong: there are plenty of people who are healthy in their twenties but get very sick later. In either case, the framing as redistribution and the focus on winners and losers is a way of making something that all people value—protection from risk, backed by the federal government’s balance sheet—seem like a from of zero-sum redistribution brokered by that evil, meddling federal government.

34 responses to “Insurance or Redistribution?

  1. Oh for crying out loud already, increase taxes on everyone, get rid of loopholes, and provide BASIC health care services for USA citizens from the Defense Budget – how’s that?

    Everyone inhabits a skin suit – so it’s not car or house insurance…and the amount of fraud is ridiculous in FOR PROFIT INSURANCE operations – up to and including exorbitant CEO packages…

    FOR PROFIT HEALTH INSURANCE is a *failed* product so it’s ridiculous to force people to buy a *failed* product – that’s it in a nutshell.

    Why do I suggest basic health care to be part of the Defense Budget? Well, that’s where *health care* is going to come from when there are pandemics and bio-attacks – so the securing of the health of the country’s citizens (and visitors in the disaster mix) is still DEFENSE. Pandemics need to be quarantined, bio-attacks need to be thwarted and/or cleaned up afterwards – and the environmental also needs DEFENSE protection against pollution-for-profit when everyone in a 5 or 50 or wha’ever mile radius to the toxic ingredient are going to get sick – look at how morally AWFUL it is to have a measly, low-paying job at a FOR PROFIT HEALTH INSURANCE company where you have to “NO” to paying for the oncology meds for all the first responders at the WTC! That’s not a REAL job (saying NO-soup-for-you!) that promotes the basic RIGHT that people have to make their lives less miserable through honest work, is it?…a *real job*?!

    Beating swords back into ploughshares, so to speak, will involve BASIC *health care* coming from the Defense Department. Radical, I know, but it is humanly possible to replace killing with better living.

  2. It’s true that any kind of insurance can be framed after the fact as redistribution, and that this is not a valid critique of *voluntarily-purchased* insurance. That argument has little bearing on compulsory, mandated insurance of a particular type/level; this is apples/oranges. If/when insurance ‘has value to us’, people will buy it voluntarily; but if they don’t, it didn’t. So arguments in favor of the former can’t automatically be carried over to the latter.

    Left to their own devices, in a real market, people may legitimately want different levels of insurance (or none). Being forced into a one-size-fits-all plan whose properties are centrally determined may in some cases be legitimately said to convert the transaction into something else, and to dispute (or feign ignorance of) this plain fact is bizarre know-nothingism.

    e.g. If a homeowner who lives on a hilltop is forced to buy flood insurance, he has a perfectly-valid case that he is not merely buying ‘insurance’ that he ‘values’ (he clearly doesn’t and wouldn’t); instead he is ‘insuring’ against something he knows (~99.9999%) he will never collect on and that others will, artificially lowering their premiums in the process. The difference between that and redistribution is academic (indeed, any form of redistribution whatsoever could be recast as compulsory ‘insurance’ of this type, and apparently by your reasoning here, not be redistribution?).

    You would have us ignore these economic realities and, in a sense, basic mathematics in such cases, in your attempt to blur the lines between compulsory and freely-purchased insurance. Why?

  3. The difference between homeowner’s insurance and health insurance is that the risks corresponding to the latter are largely under your control.

    I do not smoke, drink, overeat, or sit around watching TV for 8 hours a day… So why should I have to pay health insurance premiums for those who do?

    I suppose we can “fix” this by making smoking, drinking, junk food, etc. illegal. Wow. Is there any problem that cannot be solved by a sufficiently intrusive state?

  4. But in fact, in many cases it is known in advance who will be a winner and who will be a loser. Some children are born with severe health problems. Is your view that they should face huge bills throughout their lives?

    If it’s true that

    I don’t see anything wrong with asking people to pay the expected value of their health care

    then why does ACA include the community rating provision? Private insurance companies have been quite effective at linking people’s payments to the expected value of their health care. The bill is intended to make them stop doing so. Why, if there’s nothing wrong with it?

    At some point, it seems avoiding moral hazard went from being a necessary requirement given the bill’s reliance on private insurers, to the goal in itself. in which case the logic endpoint is Floyd Norris’ proposal today to just let people opt out and then deny them care.

    Note also that the “mandate” is a tax no higher than 2.5% of income or $2085/year. Is there any reason to reflect that represents the expected value of care?

  5. I have yet to see the discussion on healthcare costs touch on the costs of pre-natal and children’s healthcare . There appears to me an overwhelming case for funding the health of the next generation through mandatory measures. There are only winnerers , and no losers , if the next generation grows to adulthood healthy.

  6. Here are the “health insurance” premiums for residents of British Columbia, Canada : —- In B.C., premiums are payable for MSP coverage and are based on family size and income. … From January 1, 2011, to December 31, 2011 monthly rates are $60.50 for one person, $109.00 for a family of two and $121.00 for a family of three or more. Effective January 1, 2012, monthly rates are $64.00 for one person, $116.00 for a family of two and $128.00 for a family of three or more.

    Yep, $128 per month for a family of three or more.

    No British Columbian in their right mind will protest that paying $128 a month is unfair because everyone pays the same rate and $128 a month might be less than a flu shot in the Murrican system. Our health care system is very “generous” in the care it provides, from flu shots to premature births, cancer, treatment for hiv-aids, heart and stroke, catastrophic accidents, and more.

    Canada also apparently has a lower corporate tax rate than the United States.

  7. annie said: HEALTH INSURANCE is a *failed* product so it’s ridiculous to force people to buy a *failed* product – that’s it in a nutshell.

    & that is it, in a nutshell…

  8. Dean Baker writes here “Exorbitant health care costs were major factors in the bankruptcy of GM and Chrysler.”

    Perhaps what might be needed is Murrica’s famous capacity for — innovation, creativity and leadership — to solve the gordian knot of its healthcare crisis (and I don’t mean vouchers).

  9. Here are some actual facts that everybody seems to be avoiding. First, we spend 20% of our GDP on healthcare, more than twice as much as any other developed country. Let’s leave aside what we get for it. And healthcare expenses have been growing at a steady 8% a year. That growth path says we will be spending a huge one third of the GDP by the end of the decade. Any bill that does not address that fact head on is a fraud and a waste of time, not matter what you call it.

    Second, I have found four very solid, respectable, scientific, studies of where our healthcare money goes. (There is an incredible amount of crap out there.) While they all used different definitions, I can summarize all of them like this; 60%, 70%, 80% of all our healthcare expenditures are spent in the last two years, two months, two weeks of life. Until we face the Wicked Witch of the North head on, we are just kidding ourselves.

  10. “I do not smoke, drink, overeat, or sit around watching TV for 8 hours a day… So why should I have to pay health insurance premiums for those who do?”

    Neither do I. I’m simply older than 40. I have a hard time calling anything other than trauma (major medical) insurance “insurance”. Anything beyond that is simply health care delivery, which is, like electricity, water, and garbage disposal, a utility fee; the cost, if you will, of staying alive. We are confusing the two in this argument. The issue is, how do we wish to pay for these two functions? Trauma insurance should be inexpensive because the probability of trauma is rare, and actuarial computations involving community ratings are both appropriate and would seem fair. One can choose to pay or not to pay depending on the type of life one wishes for one or one’s family after the event: none, maximally functional, or somewhere in between. Trauma insurance is therefore just another form of life insurance.
    Health care delivery, on the other hand, is where we get all confused. Thoma is correct that the cost of this should be reflective of the lifetime cost of health maintenance. The question is how this cost should be charged over a client’s lifetime. Right now, it is cheap for the young and absurdly expensive for the middle aged largely because it is absurdly cheap for the young. This creates huge disincentives for the young to properly account for the true cost of their health maintenance and their personal choices and huge distortions in many sectors of the economy. Consider one: companies are discouraged from hiring older workers not because they are not as energetic as younger ones, but because they cost the company more in health maintenance without the compensating benefit of that applicant’s contributions earlier in their lives.
    I would dearly love for us to stop talking about health care as insurance, because the vast majority of it is not. The longitudinal perspective of a universal pool with commensurate flatter maintenance charges (not “premiums”) would be a welcome reframing of the issue. If one consistently thinks of health as something one can lose – mostly by chance – then, one will never accept the idea of health as a process which you must consistently attend to and pay into.
    @James Taylor, Indeed, the Wicked Witch of the North is our nemesis, however we eventually choose to pay for our lives before then. Single payer, or singly.
    Incidentally, @Annie, you make a good point. Health care is part of a proper Defense department. Public health care will be essential in times of contemporary asymmetric warfare. Guns, bombs, and missiles will be mostly useless.

  11. I am totally against funding over priced interventionist health care for mostly financially secure old people like me by collecting premiums from underemployed, undereducated, poor young people. That being said, I favor single payer universal health care Ala Canada which is not on the menu. The right wing says the government has no right to force people to buy a private service. But they love the fact that the 50 governments can force you to buy auto insurance and prevent you from driving if you don’t. Whats the dif?

    The whole Democratic health care program was like using a pea shooter against a buffalo stampede. It was designed for minimum impact and maximum political benefit. The fact that the private insurance companies loved it is proof of its fraud.

  12. People have access to a basic level of emergency care. Yes, that’s true. However, it’s only care to stabilization and nothing in PPACA makes that care free. In fact, someone who pays the penalty will pay the penalty and pay for their emergency care as well unless they are poor. If we want to provide access to catastrophic care and provide adequate funding for EMTALA, let’s do so via a payroll tax and have emergency care be provided without cost to recipients. Let people purchase health care in accordance with their needs rather than require everyone to purchase extensive coverage that turns predictable, routine health care expenses into insurable events. It’s never been proven whether access to free or near free care makes us healthier or frees us to be sick.

  13. The individual mandate is a bastardized device designed to turn a social good into a private opportunity, for the benefit of the insurance industry. It’s not there to help Americans. It’s there because corporate America fears that helping Americans may actually become unavoidable, and this device will conserve the massive profits healthcare generates under the current system. From what I can tell from the SCOTUS Q&A, if it were a single-payer government-run universal health insurance program, there could be no gainsaying the federal government’s right to levy a tax to pay for it. But there’s a difference between that, and telling people they must buy a product — any product — from a private company, under threat of government-imposed penalty. And that seems like a pretty good point, no?

  14. Thomas’ position is nonsense, and ony works if you are predatorclass. Everyone else must subtract from whatever wages they can garner to pay for healthcare. Great if you are rich – not so much if you are poor. America is the wealthiest nation on earth (yeah we’re loosing ground, but today we are the wealthiest nation an earth.). The idea that this wealthiest of all nations would not or could not provide some basic healthcare to EVERY citizen or at least EVERY child – is absurd. It’s a simple matter of distribution and basic fairness, and human compassion. Any argument to the contrary is fascist predatorclass babble, propaganda, and disinformation. The pharmaceutical, healthcare, and insurance oligarchs are criminal cartels practicing criminal enterprises for wanton profits.

    A civilized society provides for and takes care of it’s children, or it is NOT civilized and deserves whatever fiery pit and hell that society hurls itself into,

    The US healthcare system is leap and bounds the most expensive on earth, and we offer 3rd world healthcare. The oligarchs are the problem – and the oligarchs must pay!!!!

    Universal healthcare (government funded) I’d the only workable solution.

    Everything else is giving money to predatorclass oligarchs with absolutely zero concern for healthcare, total focus on wanton profits,

    Tear it all down – reset !!!

  15. Brooks (Gordon)

    It’s not just redistribution in the arguably less significant sense of those who don’t utilize healthcare in a given period of time “paying for” those who do. It’s also redistribution in many cases in the more meaningful sense of people with lower risk profiles (lower expected value of expense) subsidizing those with higher risk profiles, and in the case of the mandate, being forced to do so, and the group in question (those who would be forced who otherwise would not purchase insurance) indeed having a lower risk profile.

  16. James Coffman

    Think for a minute. We know where this court is going, unless they wake up and smell the coffee. Throw this plan out. Fine. There is no question that a single payer plan is constitutional (see: Social Security). Strike this plan down and that is what is coming down the road. That or upheaval, because sooner or later the folks will wake up to the fact that 90+% of wage growth goes to the top 1% and that is not sustainable. Knock this down and sooner or later the 99% will wake up, the 1% will lose out and they will regret the limitations their court placed on gun control. Not a threat, just a thought.

  17. I have not been t a doctor in 25years.

    Do you people imagine that I – who have been deprived of healthcare most of my life would willingly succumb to the insurance, pharmaceutical, and healthcare oligarchs bruting some MANDATORY healthcare costs heaped upon me.

    Idiots! You got another thing coming!

    In a world where there are no laws -there are no laws for anyone predatorclass biiiiaaatches!

  18. “…[W]henever you buy insurance, you are hoping that you will end up as a loser….”

    I would’t go quite so far as to say that. Insurance companies generally try to avoid payouts that significantly exceed the value of losses.

  19. Health “insurance” is actually three financial transactions rolled into one:

    – Inter-temporal financing of the cost of health care, which statistically rises as you get older (and at some other points in your life).

    – Socially motivated redistribution of the burden from those fortunate and sensible enough to be relatively healthy to the others.

    – Actual insurance against the unpredictable timing and size of health care costs within a short period.

    I’m not well versed in the math, but my hunch is that treating these three unrelated problems with one tool, insurance, is going to be inefficient and prone to overcharging for the parts that are not insurance (but are actually a form of financing and, from the insurer’s point of view, a cherry-picking arms race).

    Wouldn’t it be better to come up with a system that uses the correct tools to solve each part of the economic problem? Financing the cost of old age (including the health cost in the average) is theoretically best done by investment funds. Redistributing across society for ethical reasons is best done by governments. And pure short-term risk assessment and amortisation is indeed the speciality of insurers.

    Design a system that uses these three tools correctly and transparently. Not only would it be more economically efficient, but it would also motivate changes to medical practice to improve predictive power of health tests, improve health records, increase preventive care, and decrease costly acute care. The current incentive scheme motivates the opposite.

  20. The writer might recall the public outcry when Obamacare was first introduced, people didn’t want it then and they don’t want it now. When initially introduced, congress listened to the people’s wishes and voted it down. Then, on the second go around Obama comes along and offers certain members congress bribes, twists a few arms and gets them to vote in favor of his healthcare plan. Just like Mob shakes down storeowners and businesses for protection money.

    The writer further assumes that everyone will be able to afford the health care insurance premium, which is unlikely however if they don’t pay they’ll get fined. Great idea, they couldn’t afford the insurance premium but somehow they are expected to afford a fine.

    And then there’s the likelihood that employers who currently provide health care insurance for their employees will find it less costly to pay the fine as opposed to the insurance premium thereby leaving the employees to pay the insurance premiums themselves. Yeah, Obamacare sounds like a great plan.

  21. addicted4444

    This post brings up an interesting idea which may go further in explaining the increasing distaste for taxes amongst the American rich.

    The fact is that the growing inequality in the country (and it is largely growing inequality of opportunity) means that you can be relatively sure about where in the poor to rich spectrum you will fall when you enter the system (i.e. when you are born). If your parents are rich, odds are you will get a great education, good food, healthy living environment, and build useful connections, and hence are extremely likely to be rich. If you are born poor, the above does not hold, and odds of you becoming rich are extremely low.

    As a result, you (or your parents) can be pretty sure whether you would be a net winner or loser with a stronger safety net, and those who are likely to be losers (ie. the richest) are wanting to opt out.

  22. @rjsigmund – can’t cut and paste without your glasses?

    THIS is what I wrote:

    “FOR PROFIT HEALTH INSURANCE is a *failed* product so it’s ridiculous to force people to buy a *failed* product – that’s it in a nutshell.”

    “FOR PROFIT”

    Why would anyone trust a weasel like you with the details of their health needs and whether, or not, you ALLOW them to have their needs taken care of….?

    FOR PROFIT HEALTH INSURANCE IS FAILED PRODUCT.

    IRS will not win the argument in court that extracting a fine from a person because they did NOT buy a failed product from *the don* is legit and not EXTORTION.

    “Extortion (also called blackmail, shakedown, outwresting, and exaction) is a criminal offence which occurs when a person unlawfully obtains either money, property or services from a person(s), entity, or institution, through coercion. Refraining from doing harm is sometimes euphemistically called protection. Extortion is commonly practiced by organized crime groups. The actual obtainment of money or property is not required to commit the offense. Making a threat of violence which refers to a requirement of a payment of money or property to halt future violence is sufficient to commit the offense. Exaction refers not only to extortion or the unlawful demanding and obtaining of something through force,[1] but additionally, in its formal definition, means the infliction of something such as pain and suffering or making somebody endure something unpleasant.[2]”

  23. bayardwaterbury

    There are many possibilities other than the purchase mandate created under the ACA. From my perspective, of course, this bill/law was and is NOT in any way reformative. When I think of reform, I first and foremost think that reform is done to remedy a disfunctional system of something (like financial reform). The biggest mistake of all in this reform effort was a simple failure to consider one of the successful systems used in over 25 of the world’s developed nations to provide universal care at about half of the cost that we pay with better outcomes. This is simple false pride, and it is made even more obvious when we consider that the entire process, from beginning to end, was controlled by the vested commercial interests (i.e. big Pharma, big health provider conglomerates, big insurance, etc.) and the outcome in about 2700 pages of legislative mishmash, handed each of these interests control and massive profits, and virtually eliminated the chance at overall cost control. After all, the cost of health care is responsible for more than half of all personal bankruptcy filings, not foreclosures.

    The mandate was unnecessary. All we had to do is tell people that if they bought insurance, they would receive a meaningful tax credit, and if they didn’t their taxes would be adjusted upwards to pay for the Medicaid that they would need if they had any kind of treatable health issue which had to be paid for by the government. Aside from that, we also had the option of the “public option”, or requiring that any insurance company offering coverage had to do so on a national basis. And there are lots of other potential means for reducing costs, such as setting up a review for supplemental testing and other measures which are now prescribed overkill by providers just to get more payments, but unnecessary for treatment. There are endless things which could be done if we could control the power of the lobbies and the funding of political campaigns by the health care oligarch(ies).

    Doesn’t anyone realize that the system is fully rigged by the governance of people who are elected not for what they do for the nation as a whole, but for the endless favors that they do for those who pay for their campaigns.

  24. The main purpose of health “insurance” in the US is simply to negotiate lower prices for medical services. Doctors and hospitals consistently charge the most for any service that anyone might ever pay, and insurance companies consistently pay only a fraction of that.

    Cash customers are charged full boat — sure, they can usually negotiate something, if they actually have the cash, but there is no guarantee. The protection that health insurance gives is against unexpectedly high charges, quite possibly for an apparently trivial health problem. Ever try to get an estimate for a non-elective medical procedure?

    The effect of the whole system is to systematically overcharge the poorest customers. Obviously, if everyone had medical insurance this price fixing service would be worth nothing.

  25. @Bayard – we do realize it – this attempt at extortion will be their Waterloo moment…

    You wrote, “Doesn’t anyone realize that the system is fully rigged by the governance of people who are elected not for what they do for the nation as a whole, but for the endless favors that they do for those who pay for their campaigns.”

    We need to invite FEMEN to protest against the Supreme Court in cahoots with IRS to do Hatch’s bidding – “…poor people can afford to pay MORE (to us…)”.

    The very DEFINITION of extortion!

  26. I have not had the defense department defend me in 25years.

    Do you people imagine that I would willingly succumb to the defense oligarchs bruting some MANDATORY defense costs heaped upon me.

    Idiots! You got another thing coming!

    In a world where there are no laws -there are no laws for anyone predatorclass biiiiaaatches!

  27. Pavlos wrote:
    Health insurance is actually 3 financial transactions rolled into one.
    Inter-temporal financing the cost of health care, which statistically rises as you get older.
    Socially motivated redistribution of the burden from those fortunate and sensible to be relatively healthy to the others.
    Actual insurance against the unpredictable timing and size of health insurance costs within a short period.
    Wouldn’t it be better to come up with a system that uses the correct tools to solve each part of the economic problem?
    Very astute observation.
    In order to address this trifold problem, it will take 3 insurance policies, not one.
    This is what I and 3 others are working on with Milliman, an actuarial firm.
    We hope to provide these numbers to a for-profit life insurer, and form a not-for-profit subsidiary, as a 501(c)(4).
    The starting point is your third point, insurance against the unpredictable timing and size of health care costs within a short period.
    That part of the plan is the insurance you pay a relatively small amount for, for a very big payout over a short time; the type of insurance you hope to never collect on.
    The other 2 parts help fill in the gap for smaller claims.
    Don Levit

  28. THe difference between SS and the health insurance mandate is that in the latter case we are being forced to buy a commercial product. The entire mandate issue could have been avoided by setting up a single payer, government run health care program.

  29. @lhf: then we never would have. Unfortunately, single payer, even for a nominally friendly congress,is and was a non-starter. For a useful longitudinal study of the history of health care reform in the US, read “remedy and reaction”, by Paul Starr.
    @Don: you’re addressing what I was trying to get at in my earlier comment and what @Pavlos elucidated. However, you’re going at this from the insurance angle for all 3 components of health care, and I don’t think that that’s the right framing of the first two components, maintenance and charity. Because the effects of poor health choices manifest long after the choices are made (diabetes II, sedentary life styles, smoking, etc.), visibility is poor to those who most need it: the younger insured. This is not to say that older insured don’t need it as well, but the pricing structure of any maintenance program needs to not distort this signal.

  30. Anonymous at 3:16
    Thanks for your comments.
    Regarding maintenance and charity, that is a real stickler. Any suggestions you or others may have would be much appreciated.
    Along the charitable line, I have thought of people contributing to our not-for-profit, although contributions are not tax deductible.
    If by maintenance, you mean relatively large expenses for chronic illnesses, I really don’t have a clue how to finance that part.
    The strength of our product design is financing catastrophic expenses every 2- 4 years, not paying for large chronic expenses every year.
    Don Levit

  31. Good Grief!!! Stop all this blather about what to call it. It is Healthcare Costs. period, end of story. What you call it doesn’t change the problem. Why don’t you all agree to call it “rutabaga”, and get on with your lives. Then you would have time to engage in really important questions, like how many fairies can dance on the head of a pin.

    Ah geezzz……..when this is the best that the best and brightest (and you are or you would not be here) can come up with, we are in world of hurt!

  32. I think that this article nails the argument for the individual mandate in terms of the Millian “harm” principle of governmental action. And why the government’s rebuttal to the “limit question” was so lame. Enjoy:

    http://www.thedailybeast.com/articles/2012/03/28/michael-tomasky-asks-did-liberals-screw-obamacare.html

  33. It’s simply wrong to say that mandating purchase of an insurance contract is equivalent to taxing someone to pay for social security. Even if the economic implications are the same (which I gather is your point) the legal implications are not.

    Similarly,Thoma is wrong. The expected value of one’s health care expenses is an ephemeral value, and depends on judgment — guesstimates over risks and future costs. (Why is it again you think the government is better at calculating this than anyone else?)

    But the idea of forcing each of us to pay our expected costs is quite an interesting idea. Perhaps we should also calculate the time spent in prison per capita, and we each just spend that? Think of the money we’ll save on court costs!

  34. How many people die in car crashes a year? How many survive with life long increased medical costs? How many people suffer prolonged illness from living near toxic waste, or in poor housing, or live with chronic malnutrition?

    FOR PROFIT HEALTH INSURANCE is a FAILED product.