The internet and social media lit up when the Speaker of the House of Representatives made a strange declaration about health insurance.
The insurance industry was shocked by a recent statement from Speaker of the House of Representatives, Paul Ryan. He recently expressed his displeasure with the fact that premiums from healthy individuals are being used to subsidize the premiums of sick people.
Social media, particularly Twitter, immediately blew up to inform Ryan that this is how insurance works.
The insurance industry – including professionals and consumers alike – took to social media to teach Paul Ryan that everybody pays for health insurance and everybody draws from it when they are ill or injured. Indeed, younger people may be more likely to be healthy than older people, but all age groups pay for their health insurance. That way, it’s there when they need it, no matter how healthy they may have been when they first purchased a plan.
The odds may be that young people are less likely to become ill than older people, but that doesn’t rule it out completely. People pay for health insurance so they can use it when needed, regardless of whether that is right now or decades from now.
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The American insurance industry has always functioned in that way in order to ensure the money is there when needed.
Risks are calculated through insurance systems in order to determine the size of the risks associated with a given individual. That said, regardless of how high or low your risks may be, everyone still needs to pay. In that way, whether it was likely that a person would need to make a claim or whether they needed to make a claim against all odds, the money will be there and available to pay them.
From the statement made at a Trumpcare press conference, Ryan seemed to imply that it is only Obamacare that functioned in that way. This, despite the fact that it is the industry standard. “The conceit of Obamacare,” he said, is that “young and healthy people are going to go into the market and pay for the older, sicker people.” He went on to point out that this explains the “death spiral” of Obamacare.
From there, it was a matter of seconds before Twitter and other social media platforms came alive with people pointing out that this is exactly how the insurance industry works, not only for health coverage, but for all coverage.