In an exclusive interview with The Daily Caller, Dr. Robert Nirschl — a practicing orthopedic surgeon, former faculty member of Georgetown and a former member of the legislative committee of the American Academy of Orthopedic surgery — dismissed the recent issues suffered by HealthCare.gov and the media feeding frenzy surrounding it, arguing that the systemic flaws within the law had not yet surfaced, and that when they do, it will be catastrophic.
Nirschl took apart the concept of “health insurance” arguing that it’s an inaccurate buzzword. What is being legislated is not insurance at all, Nirschl said. By its very nature, “insurance” is a way of protecting against an unforeseen, catastrophic incident. It works by having large groups of people paying premiums into a central fund with the understanding that if they were to suffer an unlikely incident, they will be compensated. The likelyhood of people claiming out of the central fund is a calculated through a risk assessment, and the riskier the “bet,” the higher the premium. Nirschl points out that since the 1950s’s true health “insurance” has not existed.
“The facts of the matter are that the product we have had has, since the UAW (United Auto Workers) negotiated with General Motors in 1959 to do first dollar coverage, we destroyed the concept of insurance,” Nirschl said. “The product we have had since 1959 has been a hybrid of a service maintenance contract plus insurance. If you’re going to buy true insurance, you want to buy it for a catastrophic event, example, auto insurance. If I go to my auto insurer, I don’t want to be covered for oil changes and lube jobs. I want to be covered for a car crash and so when we went to first dollar coverage thats when it [health insurance] became a service maintenance contract.”
Nirschl explained the consequences of including supplementary services on premiums using his auto insurance analogy: “One hundred percent of folks are going to use the service. One hundred percent of people who want cars are going to get oil changes and lube jobs, so it doesn’t lower the premium. It increases the premium, and at the same time it adds an enormous administrative cost… We squander 35 percent in administrative costs by this form of insurance… For maintenance services, oil changes and lube job, you want to pay out of your own pocket, and you want to basically have insurance for a car crash, for catastrophic things. So we have destroyed true insurance.”
Nirschl says that that destruction of ‘true insurance’ and the wide scale implementation of ‘service maintenance’ has come at a cost. By his calculations, it likely runs as high as $1 trillion dollars annually on “useless costs, administrative costs which deliver absolutely no service.”
When asked about the future of the law, and if it is now sacrosanct in American minds and unable to be repealed, Nirschl said no.
“As the law unfolds and as people are seeing the derogatory effects of it — I mean, the granddaddy of that situation was Prohibition. That was not sacrosanct and for that matter, all of the Jim Crow laws from way back when were the law of the land, so when ever I hear some of our politicians say: ‘Well, this is the law of the land, and so we can’t do anything about it.’ Well, as an example, Martin Luther King did a lot about it. I think that when the people really see what it’s all about it should go the way of Jim Crow laws. It should go the way of Prohibition.”
Catch the rest of Nirschl’s interview tonight only on TheDC.