Friday, March 9, 2012

$1,000 genome a BAD idea?

So postulates Ezra Klein, policy wonk extraordinaire, in the Washington Post.

Klein worries that cheap sequencing could harm the health insurance industry:

"Those with a clean genomic result might go for a cheap catastrophic plan, while those with a high risk of developing pricey illnesses will opt for more comprehensive insurance…….The result would be, in insurance terms, an 'adverse-selection death spiral,' as the healthy opt out of expensive insurance, the sick opt into it, and premiums spin out of control."

Klein also argues that cheap sequencing guarantees an eventual individual mandate.

I call bull-feathers to all the above. Here's my reasoning:

-Our genome is not our pre-destination. (especially what epigenetics research keeps telling us).

-I suspect that even if it were, our health care costs have more to do with our behaviors than our pre-disposition. (Does someone's pre-disposition to Alzheimer's have a greater cost than their really bad diet and sedentary behavior resulting in diabetes?)

-You'd have to believe that treatment guided by sequence is a bad thing, because someone who lives longer ultimately costs more. If you've read any of the early impact stories from clinical sequencing, you see how detecting and treating childhood genetic diseases have the opposite and hugely positive impacts - both in terms of lives and $$$.

As for Klein's point about the necessity of individual mandates: Like a good wonk, Klein intends to see everything in healthcare in black or white - you're either fully covered, or you're not. I've argued for a long time that health insurance should be broken into 2 products "everyday, regular health insurance," and "catastrophic care insurance."

Everyday insurance is targeted towards things like broken bones, torn ACLs, delivering babies, or even diabetes treatment. Some would want to just pay "everyday" costs out of pocket, but if not, this insurance product would be VERY affordable, and the 'free rider' problem would be minimized.

The bulk of healthcare costs are driven by "catastrophic care." (I think the stat is that more than half of healthcare spending is for the last 6 months of life, or something equally eye-popping.)

If you're convinced that your predisposition to Alzheimer's means you don't have to worry about cancer, then you need not buy catastrophic insurance (likewise if you had neither predisposition), but I think most would buy some form of catastrophic insurance.

No matter, even with future health clarity driven by genomics, most would want at least one of the 2 insurances, greatly mitigating the adverse selection problem and obviating the need for an individual mandate.

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