Paul Krugman: Insurance Horror Stories

In the past, insurance companies put a lot of effort and resources into identifying people likely to get sick, and then avoided extending them coverage. However, as Paul Krugman describes, insurance companies are increasingly diverting even more resources away from health care in order to find reasons to cancel coverage for those who already have insurance, generally just when they need it the most:

Insurance Horror Stories, by Paul Krugman, Sick System Commentary, NY Times: “When Steve and Leslie Shaeffer’s daughter, Selah, was diagnosed at age 4 with a potentially fatal tumor in her jaw, they figured their health insurance would cover the bulk of her treatment costs.” But “shortly after Selah’s medical bills hit $20,000, Blue Cross stopped covering them and eventually canceled her coverage retroactively.”

So begins a recent report in The Los Angeles Times ... which offers a series of similar horror stories and suggests that these stories represent a growing trend: more and more health insurers are finding ways to yank your insurance when you get sick.

This trend helps explain something that has been puzzling me: why is the health insurance industry growing rapidly, even as it covers fewer Americans?

Between 2000 and 2005, the number of Americans with private health insurance coverage fell by 1 percent. But over the same period, employment at health insurance companies rose a remarkable 32 percent. What are all those extra employees doing?

Now we know at least part of the answer: they’re working harder than ever at identifying people who really need medical care, and ensuring that they don’t get it. ... Welcome to the ugly world of American health care economics. ...

Because everyone faces some risk of incurring huge medical costs, only the superrich can afford to be without health insurance. Yet private insurers try to refuse coverage to those most likely to need it, and deny payment whenever they can get away with it.

The point isn’t that they’re evil or greedy (although you do wonder how the people who cut off the Schaeffers can look themselves in the mirror). The fact is that cruelty and injustice are the inevitable result of the current rules of the game. Blue Shield of California is a nonprofit insurance provider, yet as a spokesman put it, if his organization doesn’t follow the for-profit practice of selectively covering only the healthiest people, “we will end up with all the high-risk people.”

Now, before you panic about the state of your own coverage, ... the horror stories in The Los Angeles Times article all involve individual insurance; if your coverage comes via your employer, you’re reasonably secure against sudden cancellation.

But employment-based insurance is in rapid decline, as ... more and more companies adopt Wal-Mart-style minimal-benefit policies. That’s why many people are turning to individual insurance — only to find out, in some cases, that they didn’t get what they thought they paid for.

And here’s the thing: it’s all unnecessary.

Every other wealthy nation manages to provide almost all its citizens with guaranteed health insurance, while spending less on health care than we do. And there’s no mystery why: we’re paying the price for pointless, destructive reliance on private insurers. Medicare, which is a universal health insurance program for older Americans, spends less than 2 cents of every dollar on administrative costs, leaving 98 cents to pay for medical care. By contrast, private insurance companies spend only around 80 cents of each dollar in premiums on medical care; much of the remaining 20 cents is spent denying insurance to those who need it.

If we had a universal system — Medicare for everyone — there would be no more horror stories like those reported by The Los Angeles Times. And we’d almost certainly spend less on health care than we do now.

_________________________
Previous (9/18) column: Paul Krugman: King of Pain
Next (10/2) column: Paul Krugman: Things Fall Apart

Comments

[quiz]

" we’re paying the price for pointless, destructive reliance on private insurers"

One of the main reasons for the state of our health insurance crisis. The insurers are middle men and make their money by not paying the other half of the problem, the monopoly providers. It is difficult these days to recieve benefits even from employer sponsored programs.

Cobra coverage is awful. The middleman insurer dodges and stalls, stringing people along paying outrageous premiums with no intention of providing any benefit over a few hundred bucks.

John Kerry's plan was a huge improvement over the mess we now have. It is vitally important that the voters turn this Congress over in November so this country can make the insurance, health provider, and pharmaceutical industries act more like competitive businesses than monopolies.

[cm]

Point 1, this is not first-hand, but literally second-hand information, I know of a coworker's wife who got booted off a supposedly good (I have began to question it) employer healthcare plan for breast cancer (or rather "exceeding" benefit limits I suppose).

Point 2, it is not unreasonable to assume that the cost of the infrastructure for denying coverage about matches or perhaps even exceeds the cost of the coverage denied. Attempts at cost "optimization" are often enough not net positive. (Insult on top of injury is, whether this is so is often unknowable.)

[John Konop]

I support the mandatory pay plan what do you think.

Mass. Gov. Romney's health care plan says everyone pays
By Julie Appleby, USA TODAY
You have to buy car insurance if you own a car. You have to buy home insurance to get a mortgage. Why don't you have to buy health insurance?
Massachusetts Gov. Mitt Romney re-ignited that debate last month when he announced a plan to expand health coverage to all the state's residents, with a caveat that those who don't buy coverage could face a penalty.

"We can't have as a nation 40 million people — or, in my state, half a million — saying, 'I don't have insurance, and if I get sick, I want someone else to pay,' " says Romney, a Republican who says he might run for president in 2008

http://www.usatoday.com/money/industries/health/2005-07-04-health-insurance-usat_x.htm

[reason]

I don't think this is just health insurance. In Germany for instance, most middle class people have something with the Orwellian name "Rechtschutzversicherung" - i.e. rights insurance (if you need to insure it is it really a right?). This pays for the cost of a lawyer in certain circumstances. We recently without warning got thrown out of insurance policy (after 13 years) without reason. When we pressed for a reason, we were told it was because we made a claim. That is private insurance is only there if you don't need it.

Now we are sensible responsible people, but my experience is that insurance really is a ripoff. There are so many holes in it and you need so many different policies that it becomes a nightmare to manage. And a good claims history in one area should be offsetable against claims in another.

I'm wondering whether some sort of universal safety net isn't a simple and more cost effective form of insurance than anything private insurance can provide. I know in theory that the wider risks are pooled the less the threat of catastrophe so long as risks are not highly correlated with another.

And I haven't even touched on adverse selection (on both sides).

[anne]

http://www.nytimes.com/2006/04/09/opinion/l09health.html

Health Care, the Massachusetts Way

To the Editor:

Your reports about Massachusetts' health reform legislation treat politicians' overblown claims as gospel.

The legislation completely ignores one-third of the uninsured, dismissing the Census Bureau's estimate that 748,000 lack coverage in Massachusetts in favor of an estimate of 500,000 derived from a phone survey.

The linchpin of the promised coverage is a requirement that most of the uninsured buy their own coverage, and assurances that private insurers will offer affordable, comprehensive policies.

But already reports have surfaced that these new policies will be far costlier than promised, putting them out of reach of most of the uninsured and sharply raising the costs of state subsidies to help the very poor.

Predictably, rising costs will force more employers to drop coverage, while state coffers will be drained by the continuing cost increases in Medicaid. When the next recession hits, tax revenues will fall just as a flood of newly unemployed people join the Medicaid program or apply for the insurance subsidies promised in the reform legislation.

The program is simply not sustainable over the long or even short term. In contrast, a single-payer reform could save $9 billion a year on bureaucracy in Massachusetts, more than enough to cover the uninsured and to upgrade coverage for the rest of us.

David U. Himmelstein, M.D.
Steffie Woolhandler, M.D.
Cambridge, Mass., April 6, 2006
The writers, associate professors of medicine at Harvard, co-founded Physicians for a National Health Program.

[anne]

A Massachusetts Blue Cross/Blue Shield insurance policy for a single middle aged person costs $567 a month with all sorts of deductions or co-pays. About the only thing paid for in full is a flu shot. We have a problem, a severe problem.

[anne]

Now, there is health insurance and health insurance; how much insurance does, say, $1.6 billion buy?

http://query.nytimes.com/gst/fullpage.html?res=950CE5DB133FF934A15757C0A9609C8B63

April 27, 2006

Insurer Reviews Stock Pay

UnitedHealth Group, one of the largest health-insurance providers, said yesterday that its board would vote May 1 on whether to end stock-based compensation for a small number of top executives who already have a well-established stake.

The board may eliminate golden-parachute packages tied to a change in control, freeze supplemental retirement benefits and drop non-cash perquisites for certain officers, the company said today in a statement.

William W. McGuire, the company's chief executive, said last week that he would recommend ending stock-option grants after The Wall Street Journal reported that his own options amounted to $1.6 billion, one of the largest totals for any executive.

The Journal reported that 11 UnitedHealth executives received stock option grants at the lowest daily closing price of their respective quarters, giving them the maximum opportunity for profit. The Securities and Exchange Commission has also made inquiries into compensation at UnitedHealth.

[anne]

Let me see, $567 a month divides to $1.6 billion by, well, I am slow at math. Oh, executives at UnitedHealth actually received $2.4 billion in sotck options this year, but who can count that high? Tra la.

[anne]

http://www.nytimes.com/2006/04/26/business/26calpers.html?ex=1303704000&en=3681ed86de02eab5&ei=5090&partner=rssuserland&emc=rss

April 26, 2006

Calpers Questions Pay at UnitedHealth
By BLOOMBERG NEWS

The California Public Employees Retirement System, the largest public pension fund, said yesterday that the UnitedHealth Group, the health insurance company, must explain the $2.4 billion in stock options granted to its top executives....

[Here now is comedy of the highest order. UnitedHealth is our largest private health insurer, and 12 executives took home $2.4 billion this year in stock options. Tra la.]

[anne]

Now, to write the lyrics to just what is socialized medicine anyway? Tra la. UnitedHealth is my kind of socialized insurance company; as in my kind of town, tra la.

[reason]

Anne,
my quick calculation says that it takes about 300,000 policy holders to pay the executives, before you pay anything else. (But of course it is the old story, they'll claim options aren't really paid by anyone.-)

[save_the_rustbelt]

Be careful what you wish for - you might not like the results.

[anne]

Reason:

"My quick calculation says that it takes about 300,000 policy holders to pay the executives, before you pay anything else."

Astonishing, simply astonishing; this then is American health care insurance. Too many zeroes for us to properly understand, but good grief.

[anne]

Reason, please now add to the discussion of German health insurance in any way you find interesting. Imagine though needing 300,000 policy holders at already absurdly and needlessly high rates to make up the value of stock options for 12 executives. To the barricades!

[anne]

Robert Reich, remember Robert Reich? rants and raves about automobile workers supposedly costing $80 an hour, and never bothers for a moment to think where such an idiotic figure might come from and never thinks to question what labor costs really amount to. Phooey. Where are concerns from General Motors all these years about what health care insurance costs really mean? Care to look to the scandalous activities among other health insurers? Now, the point of insurance is to make sure it covers only the healthy.

[Calvin]

If the number by Paul is right. The question in my mind is what internal or institutional mechanism that makes publicly provided insurane way more efficient than the private ones. We always see how inefficient our USPS post office, DMV or public university are. what can we learn from that? If everyone realizes that problem in some private insurers, and if everyone realized there is always a chance to get into deep illness, will she rationally switch to some good reputable private insurers? Will that create some market discipline eventually?

[anne]

Now, I find public universities from Jefferson's Virginia on to Texas and Michigan and California and New York to be a reason for much of American well being. I only wish there might be federal revenue sharing with states to eliminate or much reduce tuition. Inneficiency, where?

I also find the post office coupled with private carriers to be wonderfully efficient. I find the Division of Motor Vehicles coupled with AAA to be easy as pie to deal with.

[anne]

"We always see how inefficient our...public universities are. What can we learn from that?"

We can learn how lovely public education is, and expand the facilities and places for students and lower lower lower student cost. Imagine, really imagine, America with no public education through the generations.

[JRossi]

Krugman is right, of course. Perverse incentives are the norm in health care insurance,and health insurance companies are like politicians in a land of warlords--they have to be evil just to survive. We pay 20% of every health care dollar for a system that not only provides no useful services but that actually makes things worse. I can only shake my head. When will the American people wake up?

[calmo]

Thanks for rejoining us Jrossi --any thoughts on how the message can be disseminated to the American people rather than bemoaning their unresponsiveness? This diagnosis of public insomnia seems a little on the limp side, no?

[nyuk]

I wonder if the healthcare system will have to implode before it gets fixed. Meanwhile, I continue to try to stay to the center of the herd.

[Unknown]

"Imagine, really imagine, America with no public education through the generations."

Back to feudal age and then jungle. Oh yeah...

[anne]

Come to think about it, I am going to spend some time learning about options accounting. I have not been paying enough attention to the way options have been used recently. So, I have to wangle another lunch with a patient business type soon soon.

[Blissex]

«spend some time learning about options accounting.»

No no, that's almost irrelevant. Options and tax, that's the big thing. In particular the cases where they count as income and where they count as capital gains.

And the threshold at which misreporting income as capital gain becomes a felony :-).

[anne]

Ah, options and tax ramifications is what I have in mind. There must be a massive tax benefit to UnitedHealth associated with the options grants. So, I need to get a simple sense how the options are counted and how sizable and valuable the deductions can be. I have too vague a sense.

[anne]

A conservative friend, I even have one, startled me last night, by mentioning what could be done with a public funded catastrophe medical insurance plan and how the funding could be gained. Then, this fine as usual column.

[Blissex]

«more and more health insurers are finding ways to yank your insurance when you get sick.»

But that is obvious: because as Daniel Gross indirectly pointed out, that is not health insurance, it is a mortgage facility for sickness mortagages that have to be repaid in full. And if the lender thinks you stand little chance to repay the mortgage in full, plus profit, why should they lend the mortgage?

Part of the fault lies with the idiots who buy health mortgages thinking that they are insurance, and these are the same idiots who vote against public health because they think that they are fully vested with cheap health ''insurance''. Sure it is cheaper, if you don't become sick.

Reposting a previous explanation:

http://WWW.DanielGross.net/archives/2006/07/30-week/index.html#a000995
«Insurers' resolve to price every account at a profitable level»

In other words the industry is no longer selling health insurance, but health mortgages, which is a very different
thing, as this example illustrates rather vividly:

«His 30-employee company makes packaging prototypes for advertising. [ ... ] His medical costs were roughly half of the premiums he paid between 2002 and 2004, according to his insurance data.
But last year, after an employee was severely injured in a highway accident, WellPoint's Blue Cross Blue Shield of Georgia boosted premiums by 30%. It had asked for a 41% increase but came down after Mr. Perkinson agreed to make employees pay even more of their bills out of pocket. [ ... ] The WellPoint unit says it had to increase AdProp's premiums so much to cover the big claims it incurred after the employee's accident.»

The last paragraph makes it damn clear that the so-called insurer is not running a book or pooling risk (insurance), just selling collective deferred payment plans (mortgages).

What health ''insurers'' call ''premiums'' are actually facility fees before a payout, and they are actually loan repayments after a payout; what health ''insurers'' sell is not insurance, it is a very expensive credit line.

[Blissex]

«There must be a massive tax benefit to UnitedHealth associated with the options grants.»

That too ($1m limit on deductibility of non-performance related compensation), but that is sort of not so important: shareholders suck, as every CEO knows :-).

CEO compensation packages are designed to benefit the CEO, not the company, perish the thought.

What really matters is the tax effect on the CEO. Remember, taxes are for the little people :-).

[anne]

Fine comments as usual, Blissex.

[Blissex]

«deductibility of non-performance related compensation»

That should have been ''non performance-related compensation'', but in practice of course CEO compensation is related more to non-performance than performance :-).

[cm]

reason: I thought it was pronounced "Rechtsschutzversicherung", but I'm not going to argue individual letters. Had you had a good one, you would have sued the pants off of the insurance. Not to lecture you but other readers, German denotations often do not mean what they mean literally. The above is really "legal services insurance" in the active/passive sense, when you file a suit or defend against one, to cover the cost of attorney services, subject to terms & conditions (& exclusions of course). Back in the days I didn't have one, but after having lived in the US, I'm not so sure anymore ... not that I have needed one here (yet?), but people are far more litigious, at least nominally (probably not in actual practice as far as I can see).

[cm]

Blissex: Anything related to X is trivially related to the complement of X. (In your case X being performance.)

[anne]

http://krugman.page.nytimes.com/b/a/258015.htm

September 22, 2006

Paul Krugman:

All the employment data in this piece come from the Bureau of Labor Statistics, whose Web site, www.bls.gov, is exceptionally well-designed and useful.

I relied specifically on data from the establishment survey, at http://www.bls.gov/ces/home.htm. To extract the data you need to use one of the "Create customized tables" options (I used the multiple screens option, because for some reason Java was in a bad mood). Use the "not seasonally adjusted" data, which go into more detail.

Data on health insurance coverage come from the Census page at http://www.census.gov/hhes/www/hlthins/historic/index.html.

Medicare administrative expenses come from the Trustees report: http://www.cms.hhs.gov/ReportsTrustFunds/downloads/tr2006.pdf(PDF file), p. 5.

A summary of "medical-loss ratios" – the share of insurance premiums spent on providing care – is at http://www.pnhp.org/news/2006/march/medicalloss_ratios_.php.

[anne]

Having data sources immediately available for Paul Krugman's columns will allow a remarkable building of refences resources.

[anne]

http://krugman.page.nytimes.com/b/a/258014.htm

September 22, 2006

Health Care Uncoverage

Paul Krugman: It's very hard to regulate the insurance companies into providing the kind of service we want. The problem here is that this is one of those cases where market incentives are, in a fundamental sense, at odds with social goals; the invisible hand in this case happens to be on the wrong side. As a society we — at least, most of us — don't want our fellow citizens to suffer from lack of medical care when they are the victims of acts of God, like a tumor in the jaw of a child. But insurance companies are in the business of trying to pay as little as they can. Rather than trying to bully them into not acting in their own interests, why not simply provide insurance directly from the government?

[Blissex]

"But insurance companies are in the business of trying to pay as little as they can. Rather than trying to bully them into not acting in their own interests,"

But that is not quite the right analysis; in this case ''insurance'' companies are responding to market demand, the problem is that it is market demand by shortsighted idiots, or worse.

The insurance companies could be making the same money by selling sickness risk insurance instead of sickness loan facilities, but their customers prefer to buy sickeness loan facilities because they don't understand the difference between that and risk insurance, and a loan facility fee is lower than a risk insurance fee.

Perhaps it is best if I re-eexplain the difference between insurance and lending.

* Risk insurance involves running a book, as in betting, and pooling risk. The potential victims of a risk agree to put money into a pool account, and to pay out to the members of the pool that become victims. The pool manager, the insurance company, takes a cut out of the account, or just the interest on the money left in the account.

* Loan facilities involve paying a fee whether a loan is needed or not, and then being advanced money by the lender to cover an unexpected cash flow problem, which money has to be repaid in full as cash outflow returns to normal.

In a sense a sickness loan facility insures not against the risk of the cost of the sickeness, but against the risk of the temporary cash outflow surge caused by that cost.

Of course it is much cheaper to insure against merely the cost of the cash outflow surge than the cost itself.

Therefore businesses, who are the biggest customers of the sickeness mortgage vendors, are only too happy to buy policies that do that for their employees, and the employees are either too stupid to appreciate the difference, or have too little bargaining power to do anything about it.

Then what happens is that when one of the employees does get sick, the premiums go up because now the cost of the sickness has to be paid back by the company, but at that point the executives of the business act surprised (or are genuinely surprised that they did not understand the basis of the deal) and just say ''cannot afford it'', and reduce the cover; that is the cost of the sickness is paid for by reducing the cover for future sickness.

In other words again sickness insurance is about spreading the cost of sickness across a group of people, sickness mortages are about spreading the cost of sickeness across time for one person (or account).

Thus the upfront price of sickness risk insurance is higher than that of sickness loan facilities, but the latter have repayment costs after the sickness, that only the affected accounts see. And they are the minority, so the majority is happy with the lower premiums (untill they enter the minority).

So companies (and individuals) choose the loan facility because it looks cheaper, and then cut the cover when the shock of higher ''premiums'' comes up as repayment gets added to the facility fee. Suckers.

For ''insurance'' companies there is indeed one benefit: sickness risk insurance is only profitable if they calculate right the odds that apply to the pool, and who knows until it is too late. To make sickeness loan facilities profitable they only need to avoid lending to poor credit risks, which in this case are people with permanent rather than temporary cash flow problems, that is those who develop any permanent or expensive illness.

Sure this gives them an incentive to "pay as little as they can", but that happens also in overpricing the odds in the risk insurance case.

The big problem is the basis of the policy (risk or loan) and that the wrong basis seems cheaper initially, and that the majority of policy buyers get away with it either because they suffer sickness less than average, or they don't get so sick that they cannot repay the loan. Self risk insurance seems such an attractive way of cheating...

[anne]

Now, I have to properly wake up and understand the insurance differences. What would company self-insurace entail, for instance? This could be very interesting, but I am puzzled by the language so far. Likely it is only because of the early morning following late late night.

[John Konop]

blissex,

When you build risk models on loans that are unsecured, we do it on behavior.Part of the problem healthcare cost has to be based on human behavior also. You should have the right to smoke or be 50 pounds overwieght. But you should also pay the price.

Another factor is , I think around 80% of healthcare is spent on the last 2 years of someones life.

[anne]

Yes; there is the solution, I should have known, oh my, be still my heart. the solution to all our health care problems is, oh my, avoid the last 2 years of life. So, either knock off anyone suspicially older than I ever intend to be or, well, you know what's left.

[anne]

Now, I have to figure out just how old I am willing to let other people get to be and I already have little tolerance for again. Even middle aged and smoky by the way, is beyond the pale (pail, no one knows for sure but I have a theory though I refuse to offend anyone). Old and smoky, then, means get me my shotgun.

[anne]

I have long been determined to live like the French, at least since I wandered about France, and take so many efforts at pampering myself now that there will never be a closing set of tomorrows. The point of insurance is to spend 80% when you can really really appreciate it.

[anne]

Talk about creative spelling for superior minds, "suspiciously."

[John Konop]

anne,

You would be for limiting are making them paying a large up-charge for a smoker needing high dollar care ?

[Isabel]

Your coldness of heart shocks me, Anne! Fortunately not everybody is like you: recently I came across a product in a site with products that help people with disability that stroke me as
1) Funny (dark humour, really)
2) French (more precisely, unamerican)
3) Compassionate (and heaven knows that we all need THAT)
It was an implement that allowed a person bed-ridden or with very weak muscles to smoke in all safety (?) without setting the house on fire...
I KNEW I should have bookmarked it (one never knows), and now the prospective of a drive across Europe in a couple of hours with bags not yet packed prevents from doing a full blown search. I thought I would share, anyway... ;-)

[calmo]

I'm in love with (Hottie) Isabel people.
No question. (Love is like that: undeniably declarative.)
You have an icy different point of view?
Isn't this spectacular: Fortunately not everybody is like you: So you can see how anne got bumped to #2 people. Issy is a dizzy and who could not be madly in love with her? Not me.

[anne]

Oh dear, Isabel is driving through the bandit ridden wilds of Europe, at least she has the native's languages, and chocolate, the natives crave chocolate. Travel well, as a sort of maid of La Mancha for we are ready for another after 400 years.

[anne]

http://books.guardian.co.uk/review/story/0,12084,1105510,00.html

December 13, 2003

The Knight in the Mirror
By Harold Bloom - Guardian

What is the true object of Don Quixote's quest? I find that unanswerable. What are Hamlet's authentic motives? We are not permitted to know. Since Cervantes's magnificent knight's quest has cosmological scope and reverberation, no object seems beyond reach. Hamlet's frustration is that he is allowed only Elsinore and revenge tragedy. Shakespeare composed a poem unlimited, in which only the protagonist is beyond all limits.

Cervantes and Shakespeare, who died almost simultaneously, are the central western authors, at least since Dante, and no writer since has matched them, not Tolstoy or Goethe, Dickens, Proust, Joyce. Context cannot hold Cervantes and Shakespeare: the Spanish golden age and the Elizabethan-Jacobean era are secondary when we attempt a full appreciation of what we are given.

WH Auden found in Don Quixote a portrait of the Christian saint, as opposed to Hamlet, who "lacks faith in God and in himself". Though Auden sounds perversely ironic, he was quite serious and, I think, wrong-headed.

Herman Melville blended Don Quixote and Hamlet into Captain Ahab (with a touch of Milton's Satan added for seasoning). Ahab desires to avenge himself upon the white whale, while Satan would destroy God, if only he could. Hamlet is death's ambassador to us, according to G Wilson Knight. Don Quixote says his quest is to destroy injustice.

The final injustice is death, the ultimate bondage. To set captives free is the knight's pragmatic way of battling against death.

Though there have been many valuable English translations of Don Quixote, I would commend Edith Grossman's new version for the extraordinarily high quality of her prose. The spiritual atmosphere of a Spain already in steep decline can be felt throughout, thanks to the heightened quality of her diction.

Grossman might be called the Glenn Gould of translators, because she, too, articulates every note. Reading her amazing mode of finding equivalents in English for Cervantes's darkening vision is an entrance into a further understanding of why this great book contains within itself all the novels that have followed in its sublime wake. Like Shakespeare, Cervantes is inescapable for all writers who have come after him. Dickens and Flaubert, Joyce and Proust reflect the narrative procedures of Cervantes, and their glories of characterisation mingle strains of Shakespeare and Cervantes.

Cervantes inhabits his great book so pervasively that we need to see that it has three unique personalities: the knight, Sancho and Cervantes himself.

Yet how sly and subtle is the presence of Cervantes! At its most hilarious, Don Quixote is immensely sombre. Shakespeare again is the illuminating analogue: Hamlet at his most melancholic will not cease his punning or his gallows humour, and Falstaff's boundless wit is tormented by intimations of rejection. Just as Shakespeare wrote in no genre, Don Quixote is tragedy as well as comedy. Though it stands for ever as the birth of the novel out of the prose romance, and is still the best of all novels, I find its sadness augments each time I reread it, and does make it "the Spanish Bible", as Miguel de Unamuno termed this greatest of all narratives.

Don Quixote may not be scripture, but it so contains us that, as with Shakespeare, we cannot get out of it to achieve perspectivism. We are inside the vast book, privileged to hear the superb conversations between the knight and his squire, Sancho Panza. Sometimes we are fused with Cervantes, but more often we are invisible wanderers who accompany the sublime pair in their adventures and debacles.

King Lear's first performance took place as part I of Don Quixote was published. Contra Auden, Cervantes, like Shakespeare, gives us a secular transcendence. Don Quixote does regard himself as God's knight, but he continuously follows his own capricious will, which is gloriously idiosyncratic. King Lear appeals to the skyey heavens for aid, but on the personal grounds that they and he are old.

Battered by realities that are even more violent than he is, Don Quixote resists yielding to the authority of church and state. When he ceases to assert his autonomy, there is nothing left except to be Alonso Quixano the Good again, and no action remaining except to die.

I return to my initial question: the Sorrowful Knight's object. He is at war with Freud's reality principle, which accepts the necessity of dying.

But he is neither a fool nor a madman, and his vision always is at least double: he sees what we see, yet he sees something else also, a possible glory that he desires to appropriate or at least share. De Unamuno names this transcendence as literary fame, the immortality of Cervantes and Shakespeare. We need to hold in mind as we read Don Quixote that we cannot condescend to the knight and Sancho, since together they know more than we do, just as we never can catch up to the amazing speed of Hamlet's cognitions. Do we know exactly who we are? The more urgently we quest for our authentic selves, the more they tend to recede. The knight and Sancho, as the great work closes, know exactly who they are, not so much by their adventures as through their marvellous conversations, be they quarrels or exchanges of insights....

[anne]

Imagine the irony of a young translator setting out on knightly travel, book in increasingly brandy stained smoke wafting fingers, wondering was such a travel ever so.

[calmo]

Some posts are unfathomably dense, (Ok maybe "deep" for all you well-diggers out there.)
Cherish this gem people and know that The Gods have visited us:
2) French (more precisely, unamerican) Am I here to promote the genius of Isabel?
You know it.

[anne]

Isabel:

"French (more precisely, unamerican)"

Among the cleverest aphorisms ever, as Calmo shows.

[calmo]

Ok (Once upon a time flame) anne, do you figure it takes 2 hours to pack, 2 hours to travel across Europe or 2 hours to do a full-blown search? [Mist (Smoke maybe...something) gets in my eyes and I need assistance, direction, maybe even genuine help.]
I missed the dark humor-chocolate connection too. When you're in love people, misses are delightfully easy.

[calmo]

The Guardian's Harold plays his literate hand terribly with this bitCervantes and Shakespeare, who died almost simultaneously, are the central western authors, at least since Dante, and no writer since has matched them, not Tolstoy or Goethe, Dickens, Proust, Joyce.
But maybe we all have bad days and murdering us with "died almost simultaneously" or bethumping us with some suitably short list of Great Writers is excusable. I want to tickle Harold to get him off his horse, you?

[anne]

Ah, you are always clever; read Harold Bloom for the sake of the argument for no one argues better and enjoys arguing more than he does. When I read Bloom, I find myself talking to him and he is a dear who is gruff but always deferential in listening. Bloom is as fine a reader as we could ever ask.

[anne]

http://www.nytimes.com/2003/11/02/books/review/02FUENTET.html?ex=1383109200&en=afc4868fc40f2f80&ei=5007&partner=USERLAND

November 2, 2003

Tilt
By Carlos Fuentes

DON QUIXOTE
By Miguel de Cervantes.
Translation by Edith Grossman.
Introduction by Harold Bloom.

In 2005, Don Quixote will be 400 years old. Most epic heroes are young, from Achilles to El Cid. It was part of the genius of Cervantes to put an old man in the saddle and send him off to relive the heroic tales of the past. But Don Quixote is not alone in his mad quest for chivalry. He is accompanied by his opposite in figure, speech and temperament: the round, earthy, plainspoken Sancho Panza.

I stop right here, as the curtain goes up -- or the pages open -- to celebrate the great new translation of ''Don Quixote'' by Edith Grossman. Nothing harder for the traduttore, if he or she is not to be seen as the traditore, than to render a classic in contemporary idiom yet retain its sense of time and space. Up to now, my favorite ''Quixote'' translation has been that of Tobias Smollett, the 18th-century picaresque novelist, who rendered Cervantes in the style proper to Smollett and his own age. His ''Quixote'' reads much like ''Humphry Clinker,'' and this seems appropriate and, even, delightful. The family relationship is there.

Edith Grossman delivers her ''Quixote'' in plain but plentiful contemporary English. The quality of her translation is evident in the opening line: ''Somewhere in La Mancha, in a place whose name I do not care to remember, a gentleman lived not long ago, one of those who has a lance and ancient shield on a shelf and keeps a skinny nag and a greyhound for racing.'' This ''Don Quixote'' can be read with the same ease as the latest Philip Roth and with much greater facility than any Hawthorne. Yet there is not a single moment in which, in forthright English, we are not reading a 17th-century novel. This is truly masterly: the contemporaneous and the original co-exist. Not, mind you, the ''old'' and the ''new.'' Grossman sees to it that these facile categories do not creep into her work. To make the classic contemporary: this is the achievement. And through it, Grossman can highlight Don Quixote's flight into heroic rhetoric with great comic effect and meaningful emphasis.

If for many reasons ''Don Quixote'' is the first modern novel, it is pre-eminently because of the different languages spoken in it. Characters in classical literature all spoke the same language. Achilles understands Hector; Ulysses can even speak to Polyphemus. But Quixote and Sancho speak two different idioms. Why? Because the characters are engaged in what the Spanish critic Claudio Guillén calls ''a dialogue of genres.''

There has been some dispute about whether ''Quixote'' is indeed the first modern novel. Ian Watt gives primacy to the 18th-century English novel, which was responding to the rise of a middle-class, book-buying public. André Malraux thought of Madame de Lafayette's ''Princesse de Clèves'' as the first because it initiated inner exploration of character. But I believe that ''Don Quixote'' really inaugurates what we understand modern fiction to be -- a reflection of our presence in the world as problematic beings in an unending history, whose continuity depends on subjecting reality to the imagination. Cervantes does it, as all writers do, in a precise time and space. This is Spain in the decadent reign of Philip III, a country that has conquered and plundered and built a New World in the Americas and returns, exhausted, to its native village in La Mancha with nothing but the memory of past deeds. It is also the Spain of the Counter-Reformation, where the Renaissance enlightenment brought to the court of Charles V by the Erasmist scholars had long been buried under the severe vigilance of the Inquisition and the edicts of the Council of Trent.

Cervantes knew his times....

[calmo]

So when folks die in the same year or even the same month, we say "died almost simultaneously"?
I can bear it when the steam-roller takes out both of us anne, but not here.
Nope.
I pull out my red pencil and mark Harold down as committing 2 sins --almost simultaneously.
Ignoring useful expressions like 'contemporaries' (In a day and age where we all tell the time to the nearest minute rather than quarter/fraction of the hour --did Harold just get his first digital watch?), and only scant seconds later, (almost simultaneously people) stuffing his choices or great literature down our throats. Inspite of his less than great "almost simultaneously".
Which suggests to me that those great writers did not rub off on him. Not really. Not greatly. Not nearly greatly enough.

[anne]

Edith Grossman is among the finest of all translators, and from Gabriel Garcia Marquez to Cervantes, the writing is sparkling. As for Cervantes, a conversation began 400 years has continued even when we are not aware of the conversation as such. Spanish fictional conversation actually begins with Cervantes, English having understood and borrowed the device to our possibly earier self-reflective ability.

[anne]

http://books.guardian.co.uk/review/story/0,12084,1105510,00.html

December 13, 2003

The Opening of Cervantes' Entrancing Tale of a Gentle Knight and His Servant, Sancho Panza

Somewhere in La Mancha, in a place whose name I do not care to remember, a gentleman lived not long ago, one of those who has a lance and ancient shield on a shelf and keeps a skinny nag and a greyhound for racing. An occasional stew, beef more often than lamb, hash most nights, eggs and abstinence on Saturdays, lentils on Fridays, sometimes squab as a treat on Sundays - these consumed three-fourths of his income.

The rest went for a light woollen tunic and velvet breeches and hose of the same material for feast days, while weekdays were honoured with dun-coloured coarse cloth. He had a housekeeper past 40, a niece not yet 20, and a man-of-all-work who did everything from saddling the horse to pruning the trees. Our gentleman was approximately 50 years old; his complexion was weathered, his flesh scrawny, his face gaunt, and he was a very early riser and a great lover of the hunt. Some claim that his family name was Quixada, or Quexada, for there is a certain amount of disagreement among the authors who write of this matter, although reliable conjecture seems to indicate that his name was Quexana. But this does not matter very much to our story; in its telling there is absolutely no deviation from the truth.

... this aforementioned gentleman spent his times of leisure - which meant most of the year - reading books of chivalry with so much devotion and enthusiasm that he forgot almost completely about the hunt and even about the administration of his estate; and in his rash curiosity and folly he went so far as to sell acres of arable land in order to buy books of chivalry to read, and he brought as many of them as he could into his house...

His fantasy filled with everything he had read in his books, enchantments as well as combats, battles, challenges, wounds, courtings, loves, torments, and other impossible foolishness, and he became so convinced in his imagination of the truth of all the countless grandiloquent and false inventions he read that for him no history in the world was truer.

[anne]

Not to worry, by the way, the resolution, after the French, to our health care worries, is preventing and preventive aging; we have ways....

[John Konop]

anne,

Is that a yes or no, would you suport holding people accountable for unhealthy behavior?

[calmo]

John, you figure a good digression is injurious to our health? (How about a frivolous distraction?) [What about one that you initiate or tolerate for...eversolong?]
You allow that relief might be warranted occasionally but there are limits? (As long as you can be the master of ceremonies, producer, director and, Heaven's to Betsy, lead singer?) Are you still running for office?
Yes or no?

[anne]

No; I am not running for office, nor do I intend to run, though on acclimation I might be convinced to serve. I suppose though that I wish people might live in relatively healthy ways, and we are healthier than our parent and grandparents, but we are each distinct each different from anyone other living being. Biology is not physics or chemistry. Each living organism is forever singlular, forever distinct. So, some are healthier than others no matter the ways in which they live. Encourage health in ways of life, but serve those who are ill properly here and beyond.

[anne]

Yes; ask for relative health, ask quitely, though we do not so readily ask even for healthier school lunches. But, we are a people who need to question many aspects of the ways in which we conduct ourselves while looking about and judging neighbors ferociously.

says...

http://www.calvorn.com/gallery/photo.php?photo=3316&u=3878|4|...

American Robins Feeding Their Young in a Nest Perched on Juliet's Chest
New York City--Central Park, Great Lawn.

Travel along, Calmo, imagining.

[anne]

http://www.calvorn.com/gallery/photo.php?photo=3317&u=62|67|...

Robin and Chicks Contemplate Statue of Romeo and Juliet
New York City--Central Park, Great Lawn.

Computers that do not sign names properly are fearsome.

[calmo]

I miss my Isabel.
She was that singular piece of Biology punching through all the rest of us mere pieces of chemistry and physics people.
Something was said that struck the wrong note I fear. We could use a little more sensitivity training, [Oh well.] following John's example. [yes or no?]
All those people practicing unhealthily should be held accountable. And you know what that means people [yes or no?] Detensions rather than rehabilitations. [yes or no?]
Why should we pay for their fun/self indulgences/imprudences/recklessnesses/witlessnesses...when we have the dog to feed, the lawn to mow...?
John's was a loaded question [yes or no?] but Isabel was just loaded, ready to help anne at any cost.
I'm sure of it.

[anne]

Calmo, I understand and agree and we will gain Isabel shortly.

[anne]

http://www.nytimes.com/2006/09/25/opinion/l25krugman.html

Our Unhealthy Health Care System

To the Editor:

A single-payer system that would offer coverage to all Americans? The lobbyists who work on behalf of our $2 trillion-a-year health care industry are simply too powerful to allow the wholesale dismantling of our insurance system.

But there is a way to preserve our system, cut costs and provide universal coverage. The Dutch have a system that combines competition among private insurance companies with government control of the cost of services and insurance.

Everyone who lives in the Netherlands is eligible for a basic package of benefits at a fixed price, paid for by employers and employees. Private insurance companies compete to sell their plans to consumers by adding a benefit here or reducing a co-pay there.

The unemployed are covered by the government, and the wealthy can buy boutique insurance plans. Fees for medical services and drugs are fixed, but entrepreneurial doctors can still get rich, not by charging more for their care, but by working more hours a day.

Sounds downright American to me! A politician who wishes to improve our dismal medical system could endorse this model without fear of being labeled a socialist or described as an opponent of the marketplace.

Raymond De Vries
Leuven, Belgium, Sept. 22, 2006
The writer, a member of the bioethics program at the University of Michigan School of Medicine, is a visiting fellow at the Center for Biomedical Ethics and Law, Catholic University.

•

To the Editor:

Paul Krugman has it right — a single-payer system is the only way out of our health care nightmare. Everyone knows that except the American public.

The real question is: How has the right managed to convince Americans of so much that is demonstrably not true?

Why do we believe in unregulated markets, when over and over again, from Enron to airlines to automakers to health care, the free market has failed to provide the products and services we really need?

We will not fix our health care system, or anything else, until the American voter starts paying attention to reality.

David Berman
New York, Sept. 22, 2006

•

To the Editor:

Paul Krugman cites an anecdote from The Los Angeles Times of a couple whose health insurance is canceled after their daughter develops a life-threatening disease, presumably because the high cost of treatment is anathema to the profit-motivated insurance company.

There is a Part 2: The young girl’s parents seek medical treatment anyway, and if the hospital is like the one I work for, excellent and compassionate care is rendered.

The huge medical bills, which would most likely bankrupt the family, will not get paid, and the hospital will end up shouldering the cost.

The hospital, whose state and federal subsidies are consistently being reduced, will then slash and burn to balance its budget, laying off employees and cutting services.

Do we need to mention what Part 3 has in store for both sides of the American health care nightmare?

Pietro Allar
New York, Sept. 22, 2006
The writer is a registered nurse.

[anne]

Each letter is interestingly important alone. 1. There are successful alternative public-private models to the American private health care insurance model that are simply not looked to. 2. Terms such a socialized medicine are thrown around and enough of the public is at once turned away from what is in all the public's interest. 3. With some 47 million Americans lacking health care insurance, we have a genuine crisis, but still turn away.

[Ken]

Anne,

The insurance industry is so deeply embedded in equity and secondary debt markets that any attempt to remove them from it would be catastophic. Lets face it. The Cash pumped in via premiums is a great source of capital for the equity markets. When the markets are flat just raise premiums. we should be asking the question. Its not that I have a problem with anyone leaving cash idle. I believe in markets. The problem I have is that these premiums are pumped into the markets and are not a reflection of any underlying current economic activity. They are more like a Tax.

The other problem I have is how they are handled statisically. The business surveys used to conduct wage growth and productivity query only gross wages. I once worked for a public co. that was part of the survey. we reported gross wages. In 95 we began a co-contribution for heathcare costs and still only reported gross wages. That co-contribution continued to increase in every year though the time I left in 2000.

My point is that this contribution by the employee, in my mind, is not income as it is not liquid. By that same token it reduces the ECI by requiring the employee to, in a sense, pay for productivity gains. This may partially explain why productivity has gone from a 1 to 1.5% gain annually to over 2% since 95. It may also explain why we have gained so much over the Europeans in that same period. Their benefit system is very different.

"Have insurance companies become daytraders with no downside?"

[anne]

Interesting, but not quite. Insurance premiums for health care go almost entirely to the bond market. Beyond this, however, I am considering the objection.

[Ken]

Anne
True for healthcare but I am speaking of the industry as a whole. as far as healthcare i think we have taken the first steps toward moving away from that investment regulation.

[anne]

Ken, agreed; I am going to carefully think through your objection from both a Berkshire Hathaway and traditional AIG perspective.

[Ken]

Thanks,

I have asked the BLS, and Census about the Stat. Gramlich told me it wouldnt understate or overstate productivity but would matter in comparison to other economies.

[Holly W.]

reason: I don't think this is just health insurance. I don't either; I keep reading horror stories about people either losing their homeowners' insurance if they actually file a claim, or getting their rates increased by draconian amounts. My husband says people need to start up mutual insurance organizations again to get away from these greedy outfits that only have loyalty to their stockholders, not their policy holders.

John Konop: We have yet to see how the MA plan will work out. The state has yet to create an insurance pool for uninsured residents to join, which means costs haven't been determined, but estimates are that premiums will be 10% of gross individual/family income for people who qualify for the state pool. Do you pay 10% of your total income for car insurance, or homeowner's insurance? It's also unclear at the moment what kind of coverage will be provided for that premium; it could be that we will end up with high deductible plans that still discourage people from getting health care until they're desperately ill (and expensive).

Mitt Romney's smarmy barb about people "wanting other people to pay" for their illnesses misses the point that most people who lack insurance aren't deliberately trying to foist their medical costs off on anyone else; they're just hoping they don't get sick because they can't afford insurance when their employer doesn't provide it.

[anne]

Holly, thanks for the reference to Governor, I want to be President, Mitt Romney who I generally avoid listening to or reading about. Yes; I really do want my employer paying for my health insurance, every which way, well and ill. Good grief.

[Holly W.]

You mean Mitt "Oh God don't associate me with Massachusetts!" Romney ...

Yes, I'm feeling cranky today. :)

[anne]

Oh, I agree cranky or not, and cranky fits all too often.

[Torishimariyaku]

Basically, the Insurance companies have the policy holders playing a mathematical Game against themselves. The Insurance companies, in turn rake off a large percentage (20%) of a huge cash flow.

The root problem is that we spend too much on health care (13% of GDP), but don't get any favorable results in return.

If you want to fix the U.S. Health Care Financing system, you are going to have to confront both the doctors and the healthy patients.

The doctors manipulate the system to get paid more than the economic value of their services. How many times have you had the doctor use/add inflated billing codes that were different from the six minute visit you had?

The healthy patients will have to drop the attitude that someone else is going to pay for them to go to the doctor and participate in the purchase decision. Most "purchases" consist of the doctor doing whatever they want to, without price/value ever entering into the decision.

Just my humble opinion.

I agree that this system isn't working. The problem is that so many Corporate Welfare Queens are used to pigging out that a major effort will be required to separate them from the trough.

Oink Oink Oink

[Joe von zur Muehlen]

Why can't we look at the German healthcare system?
1. It is not socialistic, it is paid by contributors. It even covers people working part time. There is only a real small minority not covered. It is not run by the Government, it is run by a board of the principals, the Government has one seat.
2. Any procedure is included. You need a heart, you get it. On the average a German goes 15 times a year to the Doctor.
3. Nobody can get cancelled.
4. Last year the system had a surplus, so they lowered the premiums.
5. At no time will you get a bill in the mail.
6. And yes, if you do not like the Government handling the premiums, you can do it through a private insurance. Same premiums, same benefits, same rules.

Oh yes, when Clinton was elected the first time, Hilary Clinton and Robert Reich looked at various healthcare system in order to change the healthcare system in the US. They never looked at the German model; I think this was out of pure naked prejudice. They were not about to look at anything German, no matter how good.

[anne]

Please set down a reference describing more fully the German health care insurance system if you can.

[anne]

http://www.prospect.org/web/printfriendly-view.ww?id=12683

May 8, 2007

The Health of Nations: Here's how Canada, France, Britain, Germany, and our own Veterans Health Administration manage to cover everybody at less cost and with better care than we do.
By Ezra Klein

Germany

The German system offers a possible model for those who want to retain the insurance industry but end its ability to profit by pricing out the sick and shifting financial risk onto individuals. The German system's insurers are 300 or so different "sickness funds" that act both as both payers and purchasers for their members' care. Originally, each fund covered only a particular region, profession, or company, but now each one has open enrollment. All, however, are heavily regulated, not for profit, and neither fully private nor publicly owned. The funds can't charge different prices based on age or health status, and they must continue covering members even when the members lose the job or status that got them into the fund in the first place. The equivalent would be if you could retain membership in your company's health-care plan after leaving the company.

The move toward open enrollment was an admission that interfund competition could have some positive effects. The fear, however, was that the funds would begin competing for the healthiest enrollees and maneuvering to avoid the sickest, creating the sort of adverse selection problems that bedevil American insurance. To avoid such a spiral, the government has instituted exactly the opposite sort of risk profiling that we have in the United States. Rather than identifying the unhealthy to charge them higher rates, as our insurers do, the government compels sickness funds with particularly healthy applicants to pay into a central fund; the government then redistributes those dollars to the funds with less-healthy enrollees. In other words, the government pays higher rates to sickness funds with unhealthy enrollees in order to level the playing field and make the funds compete on grounds of price and efficiency. In this way, the incentive to dump the sick and capture the well is completely erased. The burdens of bad luck and ill health are spread across the populace, rather than remaining confined to unlucky individuals.

The system works well enough that even though Germans are allowed to opt-out of the sickness funds, they largely don't. Those with incomes of more than $60,000 a year are not required to join a sickness fund; about 10 percent of these citizens purchase private insurance and .02 percent choose to eschew coverage entirely. The retention of a private insurance option ensures that Germans have an escape hatch if the sickness funds cease providing responsive and comprehensive coverage; it also clears a channel for experimentation and the rapid introduction of new technologies. And the mix of private-public competition works to spur innovation: By 2005, Germany had spent $21.20 per capita wiring its system with health-information technology; America, meanwhile, had spent a mere 43 cents per capita, and most U.S. hospitals still have no systems to speak of.

What the German system has managed to achieve is competition without cruelty, deploying market forces without unleashing capitalism's natural capriciousness. They have not brought the provision of health care completely under the government's control, but neither have they allowed the private market, with its attendant and natural focus on profits, to have its way with their health system. It's a balance the United States has been unable to strike....

[reason]

As an Australian living in Germany, I can offer an informed view of this (cm can perhaps offer a better one).

The insurers all issue their own cards, but use a standard format. Most medical practitioners advertise "all insurers" but there are some only take private patients. I have found it hard to find practitioners I like, objective advice is hard to come by and your insurer won't help you.

I don't consider the system brilliant. The fees vary from year to year, but it doesn't make sense to change fund from one year to the next as you are now allowed to do. Insuring privately looks a good deal for young high income earners, but you can't switch back if your circumstances change. This is a potential time bomb as the privately insured age. The redistribution to avoid adverse selection is of course inevitably a political football between the funds. Some of the restrictions on what is paid and what is not seem fairly arbitrary and not always sensible (providing an incentive to sell "gap" insurance). There is some rather silly bureaucracy as well (for instance manual maintenance records for dental work). There is of course also a constant war between the practitioners, the funds and the government. At present there seems a danger of a brain-drain towards the UK as practitioner income is being squeezed hard.

I think in some ways the Australian system was simpler, but as I mentioned on another thread, it could point the way to a transition for the US to follow.

[anne]

Thank you, and please do add comments and references as they come and there is time. The health care insurance issue is just coming to be carefully looked at again, with little significant movement nationally and much oppostion to any and every meaningful change. There is also state movement, but as yet little.

[Sithan]

Oh, I agree cranky or not, and cranky fits all too often.

D2A

[pmi]

The UK health system is struggling under the weight of an increasing population that is ageing fast. Private health insurers are trying to innovate to get their slice of the market but rising health costs have made premiums out of the reach of many.