Alleged ‘Boy Genius’ Paul Ryan doesn’t know how insurance works

Wow. This actually happened this week.

The GOP’s alleged boy genius, the “zombie-eyed granny starver from the state of Wisconsin” and Ayn Rand fan boy Paul Ryan, gave an “explainer” explaining his RyanCare TrumpCare repeal of ObamaCare in which he said Obamacare in a ‘death spiral’ because healthy people are forced to pay for sicker people (video).

Even a late-night comic, Jimmy Kimmel, could see the obvious flaw in boy genius’s argument. Jimmy Kimmel Sums Up the Problem with Paul Ryan’s Obamacare Replacement:

Kimmel reserved his most damning comments for House Speaker Paul Ryan, who has been trying to defend his party’s plan. “He said the reason Obamacare doesn’t work is because it makes healthy people pay for the care of sick people,” Kimmel explained. “Isn’t that how all insurance works?

“Imagine trying to buy car insurance,” Kimmel continued. “’Hey, my car is fine. I’m not paying for those people who got in accidents.’ It’s like saying the lottery doesn’t work because only one person hits the jackpot.”

Ryan’s nemesis, Charles Pierce of Esquire, writes Paul Ryan Doesn’t Know How Insurance Works:

I had thought that the burlesque comic opera The Agony of Paul Ryan, Genius had closed on the night in 2012 when Joe Biden laughed the zombie-eyed granny starver off the stage during their debate. (That was the night that Ryan demonstrated that he knew it snowed in Afghanistan in the winter.) But I had not reckoned with his many fanboys among the kept political press. He ascended to become Speaker of the House, largely because nobody else wanted the job after John Boehner got kicked to the curb by the crazy people.

Now he is out there pimping the dungheap that is the new healthcare reform bill as though Mitch and Murray from downtown were lighting his pants on fire. He even lost the suit coat and broke out the PowerPoint on Thursday. It was like watching something on cable access late at night, or a flop-sweaty rookie substitute teacher, and it was hilarious—except for the parts where people will lose their health insurance and die, of course. And this is what he said and, peace be unto Dave Barry, I am not making it up, either:

Paul Ryan said that insurance cannot work if healthy people have to pay more to subsidize the sick.

This is literally how all insurance works. If someone’s house burns down, some of your fire insurance money goes to help that person rebuild. If someone gets sick, some of your premium, healthy person, goes toward that person’s coverage. Increasingly, I have come to believe that Paul Ryan is a not particularly bright creature from another world. Let us see if we can explain this to the lad.

Let’s say that, in 1986, a 16-year-old lad loses his father to a sudden heart attack. Despite the fact that the family’s construction firm is relatively prosperous due to its generous share of government contracts, the family’s finances are considerably straitened. For the next two years, the young man and his mother receive Social Security survivor’s benefits. Of course, these came from millions of people who had Social Security withheld from their paychecks and whose fathers did not die young due to a sudden heart attack. One of them was, say, a 32-year-old sportswriter for the Boston Herald, who had Social Security withheld from what he was paid to watch the Red Sox blow the ’86 World Series, and whose father was still alive, but slipping fast into Alzheimer’s. Some of his money went to make sure Paul Ryan could complete high school and go on the college and get the BA in economics that made him the smartest man in the world.

Got it now?

Also, you’re welcome, rube.

15 Responses to Alleged ‘Boy Genius’ Paul Ryan doesn’t know how insurance works

  1. lot oo posts on this one. ryan knows he needs 218 votes to pass anything. he hasn’t got them. what if they just let aca wither away or collapse what then? they will try to blame obama we will blame republicans and people will be dying as political gamesmanship goes on and on and on…

  2. “Of course since that means no one will buy insurance until they are sick…”

    That isn’t true as evidenced by the total number of people (approximately 20 million) who are insured through the various provisions of the ACA. It would seem that most of those people value their health and have chosen preventative health care as opposed to waiting until they are sick to buy insurance.

    But suppose that some uninsured person does get very sick and manages to do that during the open enrollment period for the ACA and buys insurance. What good to society is served if this person is denied treatment and has to suffer and perhaps die prematurely? I suppose Paul Ryan and his ilk would say that a useless mass of flesh has been eliminated and buried in the ground where it belongs.

    Not everyone agrees.

    • This was meant to be a reply to Steve @3-11-17 7:23 AM

    • “Not everyone agrees.”

      Including me. Everyone has to participate in order to spread the costs over a large pool of subscribers. Otherwise the entire healthcare system will go broke very quickly. I don’t like mandatory participation, but it is necessary.

      • Yeah, without question the goal of national healthcare should be to cover everyone. Some are still slipping through the cracks and that is a problem.

        I think we have proved that private insurance companies are not the answer. Even with the very best of intentions, we are merely increasing the underinsurance problem.

        The Medicare age should be lowered to 50.

  3. Frances Perkins

    As I recall it was a REPUBLICAN idea to begin with. Remember all the whining about taking personal responsibility for your own health insurance by getting EVERYONE to pay into it and get it. Now through the alleged miracle of tax credits and savings accounts, you can pay for your own! Of course 98% of the population could not pay for a weeks hospitalization with their entire income, let alone health savings accounts and tax credits. The “magic hand ” of the marketplace doesn’t work in healthcare in this country because all billings and costs are mythology. I Cite one of my recent bills from the wonderfully “managed” Banner UMC group. The bill was $1200, but with my insurance discount my portion is supposed to be only $82. $1200 for one lab test and seeing a doctor for 12 minutes, with a companion assistant, to keep the time really. So Ryan advocates that only the rich can get sick. The rest can drop dead and reduce the surplus population, Dr. Scrooge. I advocate whatever health care Ryan, McCain, Flake and McSally get, should be available to every American.

    • I’ve had a recent journey into the healthcare system that would max out at around $36,000 for an uninsured person. I have high deductible insurance that isn’t as bad as some of those policies and I also have an HSA. I’ve only seen one bill so far but what I noticed is that the insurance company, in addition to only paying their lower contracted price, can slash other charges for all kinds of reasons. And this is with the notation that you may have to pay these charges yourself. You can appeal, of course.

      This is my first time having to go through this, and my conclusion so far is that no one should have to. There has to be a better way. I will eventually be several thousand dollars out of pocket, but the final amount is unknown to me right now. I wonder how many people would even be able to do this at all without going into debt.

      • I should say that the provider who did my surgery would charge an uninsured person $12,500 paid in advance and that would cover everything including the hospital charges (this was an outpatient procedure). No one would actually have to pay the full $36,000 that is listed as the cost of the procedure.

        I think that in some cases providers are willing to charge the uninsured a price closer to what an insurance company would pay based on their contract. This helps people who can afford the lower price.

        • Part of this, I have heard, is so hospitals can ‘charge’ $36,000 dollars, magnanimously lower that price down to $12,500, and claim a $23,500 tax deduction for ‘charitably’ lowering the price for the patient.

          Not a hospital administrator, but this is something that people have claimed.

          • Interesting. Makes you wonder how much of our healthcare resources are devoted to these various forms of “administration”.

    • ” I advocate whatever health care Ryan, McCain, Flake and McSally get, should be available to every American.”

      I have always thought that was a good idea. But don’t forget Schumer, Pelosi, Reed and other democrats…after all, democrats ride that gravy train, too. Congress has traditionally set itself up with premium programs (regardless of what benefit we are discussing) as another way of lining their pockets. It seems to me that what is good for them should be good for us, as well.

  4. “Alleged ‘Boy Genius’ Paul Ryan doesn’t know how insurance works.”

    I don’t think any of the genius’s in volved with healthcare all along have any idea how insurance is supposed to to work. I include the genius’s who crafted the ACA, as well.

    A key factor – in fact, the entire purpose – of insurance is to pay someone else to accept risk on your behalf should an event take place. It doesn’t matter what kind of insurance you are discussing or what you are insuring. That is why you buy insurance.

    But the genius’s who craft our healthcare insurance think you should be able to buy “insurance” AFTER you have gotten sick. That ISN’T insurance…I don’t know what it is, but it ISN’T insurance. Try to imagine insuring your car AFTER the accident has occurred. Or insuring someone’s life AFTER they have died. Ludicrous! But we accept it as normal that you can buy health insurance AFTER you are sick. Of course since that means no one will buy insurance until they are sick (who is going to be stupid and pay for something they don’t need when they can wait until they need it to buy it) it is necessary to force EVERYONE to buy health insurance or pay a stiff penalty if they don’t. Only politicians could come up with something so stupid and be proud of it.

    • Steve, the individual mandate is in place in order to prevent an insurance death spiral. At any price for insurance, whether it be actuarily fair or not, the only people who would voluntarily sign up for coverage are those who believe that the insurance is worth the price being charged. Even among people who are healthy (for certain values of healthy), there is private information about a person’s health (say, health history, minor conditions, family history, health habits) which the insurer is ignorant of, and if signing up for coverage is voluntary, then only the relatively unhealthy, who expect to benefit from purchasing insurance, end up doing so, which leads the actuarily fair price of coverage to rise, and more people end up dropping out of coverage. The individual mandate, at least in theory, helps push costs down for people who are less healthy than average.

      It’s also worth noting that insurance, at least in the U.S., serves another purpose, namely, negotiating with healthcare providers for cost containment before the point of use, since there’s an element of a captive audience when one becomes critically ill – I don’t generally see people negotiating hospital fees when they get into an automobile collision. Also, healthcare costs are notoriously opaque, which is where you get $28 ibuprofen pills and $40 charges to hold your newborn immediately following birth.

      I’ll just leave this link here. https://en.wikipedia.org/wiki/Adverse_selection

      • Thank you for taking the time explain that, Edward. I actually understand why it is being done. It just irritates me a little that we still want to call it “insurance” when it long ago stopped being anything like insurance. A BIG flaw in the GOP Plan (one of many) is the elimination of mandated participation. Yes, I know I griped about it, but it won’t work any other way. ;o)