Monday, August 20, 2012

Move on, You're Obsolete

Sunday's Pioneer Press reported on worries among "health care agents," who are anxious about what is to become of them once the state's online health exchange goes live.

These are the middlemen and -women who have made their living by consulting with small businesses and individuals to find a health plan at some level of affordability. They have been needed because the mess of plans makes it impossible for regular people to understand the costs and options.

Under Obamacare (a term I use affectionately), each state will create a website that does a lot of the comparison work that used to be done by the agents. This means the agents won't be able to get commissions because they won't be needed.

This is a prime example of the potential benefits of the Affordable Care Act -- cutting out middlemen who don't add true value to anyone's health. Inefficiencies like this are part of the reason the U.S. spends such a disproportionately large part of its GDP on the health care (although much more of it goes to insurance company profits and administrative overhead).

The agents, of course, are up in arms because the new law specifically (and rightfully in my view) prohibits paying commissions to anyone who helps consumers navigate their way the health care purchasing decision.

Early 19th century image of the Charles River Bridge
All of this reminds me of the first bridge built across the Charles River between Boston and Cambridge. A ferry had been operating on the site since 1630, and was operated to benefit Harvard College after 1640. When a bridge was finally opened in 1786, its builder had to pay Harvard College £200 per year to make up for the lost revenue!

The upshot of the situation for both the ferry and health care agents is this: You aren't guaranteed your job or that your economic function will continue to exist. Tell it to the people who set type by hand, only to be replaced by the Linotype, let alone every other innovation that has ever put someone out of a job.

Get over it, move on, and do something productive for society.

1 comment:

Blissed-Out Grandma said...

Yes, I noticed that the story didn't seem to raise the idea that these agents might be part of the unnecessary costs in our current system. The Pioneer Press has become, I think, increasingly one-sided in its reporting.