BeyondGenius.com

California and Massachusetts have signed into law compulsory universal health coverage. Laid up with a broken leg, Arnie announced California was going to make it’s 6.5 million uninsured, insured. As per usual, there’s a great deal of concern about how this will cause insurance premiums to go up, quality of care to go down, the state to go bankrupt, and the sky to fall.

Now, the idea that insurance premiums could go up is not entirely false. People who insurance companies would otherwise take a pass on because they’re likely to require more expensive treatment over a longer period of time (and would therefore have a negative impact on profit margins) will need to be insured by someone. The need to balance out these negative effects on profit will have an upward force on premiums (the high tide raising all boats). The state will assist the very poorest (and not so poor) in getting insured; this will also drain the state’s coffers. The naysayers have valid points.

However, there are factors that get ignored. There’s good reason behind the adage about “an ounce of prevention is worth a pound of cure.” Preventative medicine is much cheaper to provide than the after-the-fact sort, and it’s specifically what people without insurance avoid. Landing one’s self in the ER with pneumonia is much more expensive (for the state, who is obligated to treat you) than getting a flu shot. Being warned early about your cholesterol being high or your weight increasing your chance of (extremely expensive to treat) diabetes can have an effect upon the number of individuals who actually develop long-term chronic conditions. There are also benefits in preventative medicine to be found outside of the realm of insurance, specifically in productivity.

Firms offer health coverage to employees (and sick days, for that matter) not just to recruit quality talent, but because it improves productivity. Employees will seek out preventative care that may help them avoid a long illness. Increasing preventative medicine within the general populace cuts down the losses in productivity from those most at risk; those who currently can’t afford the insurance can afford to be sick even less.

There is a public good in everyone getting health coverage, especially where avoidable chronic conditions are considered. The state is paying increasing costs for things like obesity related diseases (both through Medicare/Medicaid and in lost productivity). In the future, we may be able to reduce this as well as chronic heart problems, advanced-stage cancers and cervical cancer. Too bad we probably can’t reduce the number of broken legs.