Friday, February 10, 2012

A difference in contraception provision without much of distinction

The White House, feeling the heat from Catholics' and conservatives' hysterical reactions to its original decision to treat religiously-affiliated non-profits like other employers by requiring them to include contraceptive care in their health insurance plans, announced a new policy today--or did it?
Women still will be guaranteed coverage for contraceptive services without any out-of-pocket cost, but will have to seek the coverage directly from their insurance companies if their employers object to birth control on religious grounds.

Religiously-affiliated non-profit employers such as schools, charities, universities, and hospitals will be able to provide their workers with plans that exclude such coverage. However, the insurance companies that provide the plans will have to offer those workers the opportunity to obtain additional contraceptive coverage directly, at no additional charge.
Huh?

Families would have access to the same insurance coverage at the same cost as the original proposal. The only difference is that the coverage would not formally be part of the plan, and families would have to apply for coverage separately and directly with the insurer.

Pick your metaphor--fig leaf, shell game, smoke and mirrors--there isn't much of a change (though given the Catholic church's fondness for ritual and given the clergy's history of studied blindness and Catholics' general cognitive dissonance regarding contraception since Humanae Vitae in 1968, you could see how President Obama would think he could get this one past them).

Which isn't to say that the policy is costless.

The policy increases the paperwork burden for families and insurance companies. Although the coverage is "free" to families, these minor hassles along with people's inertia will undoubtedly reduce take-up. So in the end, fewer families will get coverage, and administrative costs will rise.

The usual practice of this blog is to argue on the basis of rationality. However, in this case, President Obama has proposed something so outrageously and audaciously irrational that it just might work.

2 comments:

polifrog said...

A fair assessment.

Thank you.

W.E. Heasley said...

“This isn’t to say that the policy is costless.

The policy increases the paperwork burden for families and insurance companies. Although the coverage is "free" to families, these minor hassles along with people's inertia will undoubtedly reduce take-up. So in the end, fewer families will get coverage, and administrative costs will rise.”


Putting aside any additional administration cost, one must add back the cost of “free”. Hence Catholic hospital C opts out of the contraceptive provision, however insurer Y must offer the “free” item directly to the employee-insured. One knows for a fact that “free” cannot exist hence the cost associated with “free” contraceptive is passed onto all parties [the catholic hospital being one of those parties] by insurer Y.


Moreover, Catholic hospital worker E pays for the “free” contraceptive as C experiences a premium increase from Y associated with furnishing “free” and E’s potential total compensation is effected either by a reduction in compensation, an increase in employee health-care contributions, or lower benefits in the form of higher deductibles or co-insurance. Even if C attempts to pass on the cost to health-care consumer X then X’s health-care bills increase and insurer Y has to raise premiums to compensate for additional expense and keep reserve requirements healthy hence back to E we go with Y’s increase in cost.


“The usual practice of this blog is to argue on the basis of rationality.”


There is a world of difference between arguing on a rational basis and what this blog engages in which is arguing based upon “the way things ought to be”. An economist will tell you that “the way things ought to be” is scheme based.


“However, in this case, President Obama has proposed something so outrageously and audaciously irrational that it just might work.”


It will work if one believes in the following: “Political dupery, under political nitwitery, and in government mysticism we trust”.