Let our Dean of Economics (NC VOL) and Residental Legal Beagle (FL)

[ben stein fan]

tell Richard Epstein he doesn't have a clue
http://online.wsj.com/article/SB10001424052748704304504574610040924143158.html?mod=rss_opinion_main

The CBO concluded that this one restriction turned the Reid bill into "an essentially governmental program." In other words, the targeted health insurers would become de facto public utilities whose profits are gutted when the huge compliance costs under the Reid bill are piled on top of the hefty costs inherent in running a labor intensive health-care insurance business.

Worse still, the statutory rebate is only the tip of a larger regulatory iceberg that permeates the bill. Normally, insurers have the power to underwrite—to choose their line of business, to select and to price risks, and to decline unattractive risks. Not under the Reid bill. In its frantic effort to expand coverage to the uninsured, the bill will create state health-care exchanges supported by generous federal subsidies to unspecified millions of needy and low-income individuals. Any health insurance carrier that steers clear of these exchanges cannot keep its customers. Any insurance carrier that enters Mr. Reid's inferno will lose its financial shirt."

[NCVol]

You have me confused with someone who supported this bill.

But I don't much think he's right about predicting the end of insurance companies as we know it and this statement - "whose profits are gutted" - since the stock market and health insurance owners have pretty much celebrated the last few weeks, watching their stocks hit 52 week highs. 

As I type, WLP is selling for 60, up from 30 a few weeks ago.  UNH is at 32, up from 16, AET at 34, up from 19.  Hospitals - THC is at 5.50 from less than 2,  CYH at 37 up from 13 and drug maker and PFE is at 18 from 11.  That's a very odd reaction to a development that will "gut" these insurers' and other players' profits, don't you think?  In fact it seems the markets think this bill won't do shiate to control costs or limit profits.  I could kick myself for not predicting this obvious outcome. 

Maybe the market buyers and sellers are a bunch of idiots, but I have a feeling a few of them have looked at it and done a decent analysis since they're making millions in bets with real money and probably have as good an idea of the real effects as Richard Epstein. 

Why do YOU think the markets have cheered the presumed package of this "socialist" system?  My thought is it's socialism for plutocrats and in particular the insurance companies, but that's a different argument than saying they're all of a sudden stodgy utilities.  I'd actually FAVOR them being regulated like boring utilities since they really don't offer (the insurers I mean) anything superior to what Medicare offers when it comes to cutting checks and paying your health care bills.  Why should I care whether the checks for my next visit are cut by Medicare or BCBS?  I don't....