"Many of the 1.5 million people who pay an average of around €700 each year in health insurance premiums hope that... they will be protected ... The reality is that ... once you enter the system through an A&E unit - which is how around 70 per cent of people are admitted - you are placed in whatever type of bed is available, if there is a bed available".
The story is here on the Times website.
So one possibility is that people don't know what they are paying for when they subscribe to VHI etc.Or maybe they do: the 70% quoted is an average, not a marginal.There are benefits from private insurance and to some extent there is private information: people know whether they are more likely to benefit (moral hazard, adverse selection etc).
ReplyDeleteAlternatively insurance is actually a form of assurance: it makes you feel good.Hey whats wrong with that?
I discussed this with Peter and one thought was that people might not know what they are paying for. It was a Chatham House Rules chat with Mr.Carney so I can only give you my thought really - which is that an insurance policy may only be good value if its only for consulatant care.
ReplyDeleteThe response from health insurers in the article is that health insurance has a major benefit in that “the waiting list for private consultants is considerably shorter”. It is possible that this is the only benefit but I'm not a health insurance expert.
I think I would feel as good as possible if I knew that I wasn't wasting money on an insurance policy (above and beyond consultant care). On a macro level, its a huge waste issue, as the money could be spent on other things, but I'll let Peter lead the way there, if he so wishes...