The health-insurance nationalization bill that passed the House Saturday night has a lot of enemies. One reason for this is that in order to get a majority to support the bill, House Speaker Pelosi had to accept an amendment by Rep. Bart Stupak that would ban tax-funded abortions (except for rape, incest and danger to the mother’s life) under the “public option.” It would also bar people who get government insurance subsidies from buying policies with abortion coverage. However, AP reports: “Under the Stupak amendment, people who do not receive federal insurance subsidies could buy private insurance plans in the exchange that includes abortion coverage. People who receive federal subsidies could buy separate policies covering only abortions if they use only their own money to do it.”
To all those people who are upset by the amendment, I say: That’s what you get for inviting government to become involved in a personal matter like medical care.
But there’s a more fundamental point: How can there be such a thing as insurance coverage for elective abortions? Insurance emerged to protect one’s financial well-being against unlikely catastrophic happenings (as Thomas Szasz likes to call things that befall people). But an elective abortion (whatever your position on the issue) is not a happening. It’s a volitional act (which follows previous volitional act). How does a company insure against a volitional act? It can’t, but that doesn’t mean firms which we call insurance companies aren’t willing to appear to cover abortion by collecting payments from customers in advance. They are happy to do so, but only under the right circumstances. The key factor is that someone other than the insured person, such as an employer, must be willing to pay the premium. Of course when an employer pays the premium he reduces the employee’s cash wages, but most employees don’t understand that. So they think their insurance is paid for by someone else. But if the employee had to pay for her own insurance against elective abortion, I suspect she wouldn’t think it worth the price. That’s because the premium would consist of prepayment for possible future services plus costly administrative overhead. It would be a bad deal. What would she do if she decided she wanted an abortion? She’d pay out of savings or borrow the money. Insurance is a costly way to pay for things you (and the insurance company) know you may choose to buy one day.
7 comments:
Depending on a woman's situation, an unwanted pregnancy may well be a catastrophic happening. Why not insure against it?
Putting the moral issues aside, how is this different than insuring your car against accidents? Getting your car repaired is entirely volitional, after all, and so is driving.
If you intentionally ram another car, would your auto policy cover you? (I'm not counting what a government regulation might require.) Does a life insurance policy pay off on suicides? A homeowner's policy on arson by the owner? That's called insurance fraud. If you were an insurer, why would you cover volitional acts? It makes no sense. Insurance developed to protect people from rare but costly events that could not be guarded against. Predictable events and volitional acts were covered by self-insurance, i.e., savings. Government policy is behind the insurance of non-insurable events. If the insured person causes the event that's covered, the very principle of insurance is subverted. Government policy has corrupted a perfectly good word.
Pregnancy is not always volitional, just as car accidents aren't. If you drive a car, even if you take all the necessary precautions, there is still a small risk you might have an accident.
And if a women is sexually active, there is a small risk that she can get pregnant despite using protection. Insuring against that risk makes perfect sense.
Not that I would claim that most abortions today are the result of such a scenario. But that doesn't mean that the concept of pregnancy insurance is nonsensical.
The topic was abortion insurance not pregnancy insurance. Perhaps on a free market there would be accidental-pregnancy insurance. But maybe not. How would the insurer know that the woman took sufficient precautions? The informational asymmetry might be too great. My hunch is that it would be prohibitively expensive, with too much of the price going to administrative overhead. At any rate, it wouldn't be real insurance, but rather prepayment for future services, which is how medical "insurance" largely began under Blue Cross and Blue Shield.
I'm willing to see all of this tested in the the market, of course. But for that to happen, all regulations, licensing, and subsidies must be abolished forthwith.
Covering abortions is one of the options an insurer might offer to mitigate the consequences of an unwanted pregnancy. Some forms of birth control are pretty reliable and independently verifiable, too. Even if it weren't so, a reputation-based system akin to credit rating might work... we can't know until we try.
I'm skeptical, but I favor people's freedom to determine the terms of their own contracts.
Could a father purchase life insurance for his unborn child and then collect payment if the child's mother has an abortion against his will? This is surely catastrophic for the father and child.
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