Amazingly, Poor People Don’t Actually Want Health Insurance


The true measure of whether someone wants something is whether they’ll pay for it out of their own resources. Given the resources they’ve got, the varied things on offer, will they voluntarily spend their own money on this thing?

Yes, this is indeed an entirely different method of valuation from whether we think they ought to want it. Or even than we should take the resources of others so that everyone does get this thing.

Yet we find that when given the choice poor people don;t in fact want health care insurance:

Insurance take-up falls rapidly as subsidies decline. About 25% of the eligible population of low-income individuals drop coverage in response to a $40 increase in monthly enrollee premiums. The researchers’ estimates suggest that as the cost of buying insurance rises from $0 to $116 per month, take-up falls from nearly complete (94%) to less than half (44%).

Another way to say the same thing is that providing health care insurance to people – using other peoples’ money – is valued by the recipients at less than the cost of providing it.

So, you know, perhaps we should stop doing it?

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Rhoda Klapp Recent comment authors
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Rhoda Klapp
Rhoda Klapp

Are poor people poor because they make sensible decisions about what they do? I expect the reverse. But I also expect there may be many unmentioned considerations when this particular issue is discussed. Why not give us all the data and ask them why they have made that decision?