The Hill is reporting that Colorado Senator Cory Gardner is introducing a bill that would require drug companies that produce birth control drugs to apply to the FDA to have them be sold over the counter. These drugs have been on the market now for decades with few if any side-effects, and most such drugs go over the counter quite soon. Senator Gardner has six Republican co-sponsors.
It’s only common sense to make safe drugs with no abuse potential as easily available as possible, right? But guess who opposes the measure. Planned Parenthood, among other liberal organizations. They have one stated objection and one unstated. The latter is that if a woman can just walk into a drug store and buy birth control pills, she won’t need to go to Planned Parenthood first to get a prescription. Planned Parenthood would become, in effect, the world’s largest abortion clinic.
But their stated objection is that if birth control is OTC, then insurance companies might stop paying for it, just as they don’t pay for aspirin, cold medicines, and Tums.
Of course, insurance companies shouldn’t be paying for it even if it’s a prescription drug.
Insurance is meant to protect people and organizations from large expenses that cannot be predicted, such as a house fire or an automobile accident. Everyone who sends a premium to an insurance company hopes that he won’t have to make a claim. What insurance does not and should not cover are routine, predictable expenses, such as, with automobiles, oil changes. Equally, health insurance should cover large, unpredictable expenses, such as serious illness. They should not cover routine, predictable expenses such as birth control. But Obamacare forces them to, at great expense to the women who take birth control pills.
Here’s the economics-101 reason: Covering such expenses is not insurance at all, it’s a prepayment plan and a very expensive one.
Because insurance companies don’t cover oil changes, the car owner drops by the garage four times a year, gets his oil changed, pays the garage $25 and drives off, for an annual expense of $100. But if the federal government in its infinite wisdom were to decide to force automobile insurance companies to pay for oil changes, the garage owner would bill the insurance company instead. But because that requires clerical effort and he has to wait for his money, the garage owner won’t charge $25, he’ll charge, say, $30. When the insurance company gets the claim, it will run it through its own clerical process and, eventually, cut a check and send it to the garage.
But that overhead has to covered by the premium as well, as does the company’s need to make a profit. So the insurance company will jack up the premium by, say $10 per oil change. So now, instead of the four annual oil changes costing $100, they cost $160 in increased insurance premiums.
And liberals think that birth control, thanks to Obamacare, is now “free.” Milton Friedman, call your office.
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