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Insurance Is Not a Savings Account

August 20, 2009

piggy-bankIn some of the conversations about health care and health insurance, we’ve seen debates about whether some people should pay more and other people should pay less, on the basis of things like “do they smoke?” and “are they obese?” Although I don’t think everyone should necessarily pay exactly the same, I’m wary of the fact that differential costs related to sex and race can reproduce relations of domination.

All that aside, there is one really stupid thing I’ve heard said that got on my nerves: in one conversation I heard someone suggest that some people should pay more for insurance in order to cover the “real costs” associated with their care.

I’m sorry, but this fundamentally misunderstands what insurance is. It is not a savings account; you are not supposed to get out what you pay in or pay in what you expect to get out. “Real costs” don’t enter into it. The cost of your insurance is related to risk, which is an entirely different matter.

I’m not sure what I think about risk calculation—which is a complicated matter, about which a number of Foucauldian critics have insightfully written—but for the debate about insurance to have any level of sophistication, people need to stop thinking about insurance as a banking account.

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2 Comments leave one →
  1. Deane Galbraith permalink
    August 20, 2009 4:50 pm

    Oooooh! Nice new blog header. That’s from a poster from about 100 years ago, and there’s some prols waving red flags at the bottom, eh?

  2. missivesfrommarx permalink*
    August 20, 2009 6:25 pm

    Yep; you can see the whole image if you google pyramid of capitalism (or look here: http://voidmanufacturing.files.wordpress.com/2008/10/pyramid-kap1.jpg )

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