Who Needs Health Insurance?
By Arnold Kling
The self-employed are less likely to have health insurance than ordinary wage-earners. This may not be the bad thing that most Washington wonks assume it to be, according to a paper by Craig William Perry and Harvey Rosen.
Perry and Rosen find that the gap in the utilization of health care services between the self-employed and wage-earners is generally fairly small. Indeed, for some important services there is no substantial gap at all. Further, they find no evidence that the medical expenditures of the self-employed reduce their capacity to purchase other commodities. On average, the self-employed devote only 0.4 percent more of their incomes to out-of-pocket medical expenditures than wage-earners. Nor are the children of the self-employed less likely to have access to medical services than the children of wage-earners.
Thanks to Alex Tabarrok for mentioning this paper, on the occasion of Rosen’s (temporary?) accession to Chair of the Council of Economic Advisers.
I am becoming increasingly convinced that health insurance is highly over-rated. Frankly, if hospitals would treat my Mastercard with as much respect as my insurance card (i.e., they would allow me to present the Mastercard in advance as a promise to pay my bill), then I could do away with health insurance. The premiums are so high in our risk class that I would just as soon self-insure.
UPDATE: more interesting medical spending data at ParaPundit.
For Discussion. If health insurance is really such a good thing, then should we not be able to observe differences in the health and/or financial condition of insured vs. uninsured, other things equal?