Ensuring insurance

    A report recently released by the Rutgers Center for State Health Policy presents results from a New Jersey health care opinion poll. Citizens of New Jersey are currently in favor of expanding health coverage, with nearly 60% of those polled even willing to pay higher taxes so that everyone in New Jersey has health insurance.

    Surely, the majority of New Jerseyans currently have some form of health insurance. So why do these utility-maximizing individuals support expansion of health insurance, even if it means higher taxes for them?

    For a specific individual with health insurance, paying higher taxes to ensure other citizens have insurance is a case of redistribution: money taken from them and given to others in the form of health insurance.

    As discussed in class, there are two major reasons for voluntary redistribution, and both come into play here.

    Altruism could play a role in motivating New Jerseyans with health insurance to pay higher taxes if it means more of their fellow citizens can also get health insurance.

  But it is the second reason – uncertainty – that seems to be most influential in motivating many in New Jersey to support universal (or at least, expanded) health care coverage. Heath care concerns are rising, with nearly half in New Jersey worried about losing their health insurance. Those uncertain, even if they have insurance now, benefit from ensuring insurance for all in case they do lose their insurance in the future.

This is not an issue unique to New Jersey – rising health care concerns along with altruistic concerns and the resulting rising support for expanded coverage are making health insurance one of the top domestic issues in the upcoming election. We will just have to wait and see if those who desire expanded health coverage are granted their wish after November 2008.