Juror#8 Posted January 4, 2012 Share Posted January 4, 2012 That's nothing more than a complete misunderstanding of the very concept of risk mitigation. What do you mean? Link to comment Share on other sites More sharing options...
Bigfatbillsfan Posted January 4, 2012 Share Posted January 4, 2012 You pay for your own insurance. Other people pay for your government entitlement. If you have health insurance you are paying for other people's health care. Link to comment Share on other sites More sharing options...
DC Tom Posted January 4, 2012 Share Posted January 4, 2012 If you have health insurance you are paying for other people's health care. If I have health insurance I am paying to mitigate my own risk of ill health. I'm not paying for health care, mine or anyone else's. Link to comment Share on other sites More sharing options...
GG Posted January 4, 2012 Share Posted January 4, 2012 What do you mean? Insurance is a pooling of risky assets that get paid when that risk occurs. Insurers charge a premium based on the probability of the likelihood of paying out the claims. The goal for the insurer is to be in a net zero position where: Claim payouts = Premiums + Shareholder Returns. In cases where the insurer guesses wrong on the claims, it leads to insurer losses and hopefully the insurance company has enough capital to meet the oversize losses. Its response to that situation is to jack up premiums or to cut off that class of insureds completely. Using your example, if you file a claim two months after getting car coverage will put you into a penalty box with the insurance company. One more claim within a predetermined period will get your coverage suspended. You will then have to go into a pool where the premiums are sky high. This is nothing like a government entitlement program, where there's absolutely no relationship between coverage and premiums, in fact the social "contract" that's written into regulations is the opposite effect - you are incentivized to put in unlimited claims because there is no impact at all on the "premium" that you pay in terms of deductibles, copays or taxes. Link to comment Share on other sites More sharing options...
Juror#8 Posted January 4, 2012 Share Posted January 4, 2012 Insurance is a pooling of risky assets that get paid when that risk occurs. Insurers charge a premium based on the probability of the likelihood of paying out the claims. The goal for the insurer is to be in a net zero position where: Claim payouts = Premiums + Shareholder Returns. In cases where the insurer guesses wrong on the claims, it leads to insurer losses and hopefully the insurance company has enough capital to meet the oversize losses. Its response to that situation is to jack up premiums or to cut off that class of insureds completely. Using your example, if you file a claim two months after getting car coverage will put you into a penalty box with the insurance company. One more claim within a predetermined period will get your coverage suspended. You will then have to go into a pool where the premiums are sky high. This is nothing like a government entitlement program, where there's absolutely no relationship between coverage and premiums, in fact the social "contract" that's written into regulations is the opposite effect - you are incentivized to put in unlimited claims because there is no impact at all on the "premium" that you pay in terms of deductibles, copays or taxes. Excellent post and I see where you're going with it. To be fair though, you may be approaching it in a slightly more nuanced way than the analogy demands. The point that I am making is that functionally (even if not entirely technically) they operate the same way. The little that I know about the field is this: In exchange for a premium, the insurer will pay money in the event that an articulated contingency happens. The insurer is able to offer the protection by pooling risks from a larger group of similarly situated folks. The law of probability says that only a small fraction of the pooled group will need even a modicum of the aggregate amount paid in. If the articulated contingency arises, the impact of payout is absorbed by the even larger amount of premiums paid in. The point that I was making is that welfare, like automobile insurance, follows this arrangement, and operates in this way. Within the minutia, there are tons of differences. That is why I used "if" in my hypotheticals (e.g., "IF _____ remains insured..." et cetera). My goal was to distinguish where appropriate but maintain the broader point of comparison. And there is a strong point of comparison. Link to comment Share on other sites More sharing options...
GG Posted January 4, 2012 Share Posted January 4, 2012 But that nuance is the germane point of the difference. Government programs are named "insurance" to make them appear more sanguine than they are, when in the end they are not insurance because it's nearly impossible to kick the high risk pool to the curb. If anything the whole point of a government program is to ensure that the high risk pool remains covered. That is opposite of what insurance is. Link to comment Share on other sites More sharing options...
Dave_In_Norfolk Posted January 4, 2012 Share Posted January 4, 2012 But that nuance is the germane point of the difference. Government programs are named "insurance" to make them appear more sanguine than they are, when in the end they are not insurance because it's nearly impossible to kick the high risk pool to the curb. If anything the whole point of a government program is to ensure that the high risk pool remains covered. That is opposite of what insurance is. This is total idiocy Link to comment Share on other sites More sharing options...
IDBillzFan Posted January 4, 2012 Share Posted January 4, 2012 This is total idiocy And no one knows total idiocy like Dave in Norfolk... Link to comment Share on other sites More sharing options...
GG Posted January 4, 2012 Share Posted January 4, 2012 This is total idiocy I'm sorry that I discuss a topic that requires understanding above Dr Seuss. Link to comment Share on other sites More sharing options...
DC Tom Posted January 4, 2012 Share Posted January 4, 2012 This is total idiocy Please explain. Link to comment Share on other sites More sharing options...
Juror#8 Posted January 4, 2012 Share Posted January 4, 2012 (edited) But that nuance is the germane point of the difference. Government programs are named "insurance" to make them appear more sanguine than they are, when in the end they are not insurance because it's nearly impossible to kick the high risk pool to the curb. If anything the whole point of a government program is to ensure that the high risk pool remains covered. That is opposite of what insurance is. I understand your point that governments don't eliminate the risk class in the same way that insurance companies do. However, they do minimize their risk class (or for purposes of "welfare," we'll say "dependency class") through benefit caps and many of the other tools that I mentioned in my original post. Also (though I understand that nuances can't be dismissed) there is still a parallel with respect to the functional operation of the welfare and insurance mechanisms. Case in point: If you crash your brand new 7 series BMW, you'll get the fmv paid to you - whether or not you paid that in premiums. In that one single instance, that $50,000 represents a windfall to you, that other similarly situated insureds will subsidize ("on their backs," if you will), solely for your benefit. That is my only point. Edited January 4, 2012 by Juror#8 Link to comment Share on other sites More sharing options...
GG Posted January 4, 2012 Share Posted January 4, 2012 I understand your point that governments don't eliminate the risk class in the same way that insurance companies do. However, they do minimize their risk class (or for purposes of "welfare," we'll say "dependency class") through benefit caps and many of the other tools that I mentioned in my original post. Also (though I understand that nuances can't be dismissed) there is still a parallel with respect to the functional operation of the welfare and insurance mechanisms. Case in point: If you crash your brand new 7 series BMW, you'll get the fmv paid to you - whether or not you paid that in premiums. In that one single instance, that $50,000 represents a windfall to you, that other similarly situated insureds will subsidize ("on their backs," if you will), solely for your benefit. That is my only point. You're verging on the converging to the mean argument of a coin toss getting to a 3.5 value (look it up). You're arguing only 50% of the point. Of course, by design welfare redistributes wealth similarly to how an insurance pool redistributes premiums. But that's where the similarities end. Link to comment Share on other sites More sharing options...
Bigfatbillsfan Posted January 5, 2012 Share Posted January 5, 2012 If I have health insurance I am paying to mitigate my own risk of ill health. I'm not paying for health care, mine or anyone else's. To say this is to say that if you have insurance you somehow lessen your chance of getting sick. When you pay your premium the money is pooled and payed out to the people who are filing claims. (that is, after they take their cut) Link to comment Share on other sites More sharing options...
Chef Jim Posted January 5, 2012 Share Posted January 5, 2012 To say this is to say that if you have insurance you somehow lessen your chance of getting sick. When you pay your premium the money is pooled and payed out to the people who are filing claims. (that is, after they take their cut) And how is your premium determined vs how is your tax determined? Link to comment Share on other sites More sharing options...
DC Tom Posted January 5, 2012 Share Posted January 5, 2012 To say this is to say that if you have insurance you somehow lessen your chance of getting sick. Excuse me...lessen the risk financial loss associated with ill health. At least now I know you're dumb enough that you have to have concepts spelled out for you in overly pedantic detail. Good talk, thanks. Link to comment Share on other sites More sharing options...
Bigfatbillsfan Posted January 5, 2012 Share Posted January 5, 2012 Excuse me...lessen the risk financial loss associated with ill health. At least now I know you're dumb enough that you have to have concepts spelled out for you in overly pedantic detail. Good talk, thanks. I think your tampon's full. You might need to change it. Link to comment Share on other sites More sharing options...
Juror#8 Posted January 5, 2012 Share Posted January 5, 2012 You're verging on the converging to the mean argument of a coin toss getting to a 3.5 value (look it up). You're arguing only 50% of the point. Of course, by design welfare redistributes wealth similarly to how an insurance pool redistributes premiums. But that's where the similarities end. I havent had a chance to look that phrase up yet...but I will. I actually did argue the point 100% in it's entirety. Initially I just mentioned the superficial comparison. After that, I discussed the comparison in a bit more detail. Correct me if I'm wrong, but essentially you contend that private insurance endeavors to minimize risk whereas the welfare system invites risk. I contend that welfare doesn't invite risk...anymore than private insurance does. Preliminarily, the welfare system may be less interested (vis-a-vis private insurance) in the level of attendant risk. However, there are tons of measures, tools, and qualifiers used to distill down eligible recipients versus everyone else. Then, once an individual has received welfare benefits, they're saddled with re-evaluations, criteria, and contingencies aimed at removing the riskiest subset from the welfare roles (e.g., those who are not actively trying to work; those who can qualify for medicare, social security, et cetera; those who have a demonstrable ability to pay...). In this way, welfare operates very similiarly to private insurance. So not only does the subsidy schema operate analagously, but the logistical element of identifying imbalanced risk and maintaining solvency by eliminating or excluding that risk operates somewhat similarly as well. Link to comment Share on other sites More sharing options...
OCinBuffalo Posted January 6, 2012 Share Posted January 6, 2012 (edited) It took you 5 days to respond and this is what you've come up with? Your first construction is telling me why I should just accept your contention sight unseen. Your second construction is trying to tell me about the dangers of confusing welfare and social security. Where, oh where, did I EVER mention social security or reference the numbers 6 or 2 or 5 or 1/2 in a close enough arrangement for your confusion to be justified? Oh....I get it...you're trying to be cute, by referencing the infinitesimally small amount of folks [comparatively speaking] who qualify for Social Security's disability provision. What you don't seem to comprehend though (since you don't have as thorough an understanding of the Act as me legislatively ;-)) is that even the disability provision requires recent and sufficient work history for qualification. So...what does that have to do with the posts of mine that you quoted so confidently? When did I say that the hungry "disabled" folks, whom I referenced in my last post, after 5 years of faithful service lost their Subway gig within the last couple of years because they fell off a ladder? Or maybe you had a different reason for your social security reference? Lastly, the "180 year" thing is somewhat fallacious because it doesn't take into account someone's individual circumstances. There are PLENTY of people who used welfare as an interim condition to get back on solid footing. Just because welfare conceptually has been in existence for ____ years, doesn't mean that it has failed in the execution of it's goals for individuals. Your "180 year" thing presumes no natural matriculation or life cycle of any thing or any one. Ok, my New Year's resolution is to not use any insults while debating. My original post was considerably more piquant, but I amended it to be more in line with the new and improved Juror#8. S Some of my post will not read as fluidly because it was originally constructed with an occassional nippy insult (and subsequently amended). Hopefully the bright, sunny, optimistic context rings through. After reading through the rest of this thread, I suppose I don't really need to respond to any of this, now do I? But, what the hell, I will anyway. See, some of us work in the corporate world, and therefore, our work can actually interfere with our posting, as is the case here. Please don't misunderstand, I would have loved to continue this. If you had told me you were going to predicate posts on your nitwit understanding of health care, insurance in general, risk, risk mitigation, and how these things are managed properly....and try to use that as justification for why we need to continue welfare as designed ...well, nah, I probably still didn't have the time, but I would have tried a lot harder. For the last time, first you created a straw man and argued against "my position". When I called you on that, you tried to get out of it. When I wouldn't let you, you whined, threw up on the page, and finally admitted it. Then, I demanded that you respond to my actual point, and restated it: I said "welfare hasn't delivered on it's promise to reduce poverty. It's been 60 years and we've either stayed the same or gotten worse, because welfare over-emphasizes the survival needs while creating deficits in the other 4....because it f'ing does." Then, you said "well, we'd need an interim solution...". To which I responded "When do you think these idiots will get to work on fixing this crap? Next year? IF the first 60 years is the beginning, then the next 60 is 'interim', with of course another requisite 60 years for the 'transition'". That is if we are to excuse Welfare's poor performance, or defend not changing it immediately, with your ridiculous "interim" excuse. That's how we got to 180 years. A few individuals succeeding, IN SPITE Of, the generational debilitation of Welfare, does not excuse the massive problems it exacerbates, causes, and causes to be ignored. There is a time to enhance a design, and then, there's a time to scrap the thing and start over. Welfare's results clearly means the second choice is what is required. And, Social security covers the type of disabilities you brought up, not welfare. Again, based on what you posted. Edited January 6, 2012 by OCinBuffalo Link to comment Share on other sites More sharing options...
Dave_In_Norfolk Posted January 6, 2012 Share Posted January 6, 2012 Please explain. Sure, his definition of insurance is straight out of Conservopedia. High risk or not, government or private, it's insurance, no matter what your ideological butt buddy wants to define it as. Is FDIC not insurance simply because the government does it? GG is simply full of it. You guys jump on people for being "partisan" and then let that trash go? Link to comment Share on other sites More sharing options...
DC Tom Posted January 8, 2012 Share Posted January 8, 2012 Sure, his definition of insurance is straight out of Conservopedia. High risk or not, government or private, it's insurance, no matter what your ideological butt buddy wants to define it as. Is FDIC not insurance simply because the government does it? GG is simply full of it. You guys jump on people for being "partisan" and then let that trash go? Let's start small. Do you understand the idea of a "risk pool"? Link to comment Share on other sites More sharing options...
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