A couple weeks ago Dede de Percin of the Colorado Consumer Health Initiative repeated the cost-shift fallacy that people use to justify mandatory insurance.   Now she claims last year’s health control bill makes it illegal for insurers to drop coverage when policy holders get sick.  But that’s been illegal for years. The Denver Daily News reports:

Dede de Percin, executive director of the Colorado Consumer Health Initiative, which heavily supported health care reform, pointed to several immediate effects Coloradans would feel if a repeal went through.

“I don’t think anybody really, really wants to go back to the days when kids with pre-existing conditions were denied coverage, when companies canceled policies the moment people got sick, when there were no protections for egregious gouging of premium increases — none of that was good,” said de Percin.

Ms. De Percin leaves out some important details.

Regarding children with pre-existing conditions, the health control bill (HR 3590) mandates both guaranteed issue and community rating. That is, insurers have to issue policies to everyone one, and at the same price, regardless of the applicant’s health risk.  This is like forcing Geico to charge a mom in a minivan the same rate as a 19-year-old guy with a sports car. In short, in encourages insurers to design policies that sick people don’t want, and act like slumlords. Also, Ms. De Percin does not mention that at least five Colorado insurers have stopped selling child-only policies because of this mandate.

Regarding insurers’ canceling policies when people get sick, guess what?  Dropping coverage in this way has been illegal since 1997.

And regarding “protections for egregious gouging of premium increases,” typically competitive markets protect against that. But since you’re not able to buy policies available in other states, and the tax code binds you to the few choices your employer offers, insurers are very much shielded from competition.  Thanks, politicians!