Page 1

Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

Dashboard

Blog Stats

10/23/10 5:51 PM

Edit Post

Grasping Reality with Both Hands The Semi-Daily Journal of Economist J. Bradford DeLong: Fair, Balanced, RealityBased, and Even-Handed Department of Economics, U.C. Berkeley #3880, Berkeley, CA 94720-3880; 925 708 0467; delong@econ.berkeley.edu.

Economics 210a Weblog Archives DeLong Hot on Google DeLong Hot on Google Blogsearch August 29, 2010

Bring Your Genes to Your Life Insurance Sales Representative Bring Your Genes to Your Life Insurance Sales Representative « The Berkeley Blog: Put me down as one of those who was puzzled when Dean Mark Schissel said on “All Things Considered,” of the three genes to be tested in “bring your genes to Cal”: [W]e purposefully chose three genes that are not disease associated… People who are lactose-intolerant are more likely to develop hip fractures late in life– especially if they do not regularly take their calcium supplements. People with a low ability to metabolize alcohol are unlikely to become alcoholics–but if they do, they (at least as I read the literature) may be at greater risk of developing cirrhosis of the liver. Pregnant women who metabolize folic acid poorly are more likely to have babies with neural tube defects like spina bifida. People with poor folic acid metabolism may be at greater risk of heart attack, stroke, and cancer. [UPDATE: This was wrong. See correction] Now lactose-intolerance, slow alcohol metabolism, poor folic acid metabolism are not associated with any diseases that Berkeley freshmen have now: they are all healthy as horses–an amazingly fit and clean-living group. In that Dean Schissel is correct: a freshman who hits “bingo” and is lactose intolerant, cannot metabolize alcohol easily, and metabolizes folic acid poorly does not have any diseases. Today. But these genetic markers are associated with a greater likelihood to develop diseases later on. And that has implications. The first and most important impication is that, from a public health perspective, we would very much want freshmen to bring their genes to call and find out what the tests say. Those who are or will become lactose intolerant should get in the habit of taking their calcium supplements, and taking them regularly, now. Those with low alcohol metabolism… well, there are some fraternities that I think they should definitely not http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 1 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

10/23/10 5:51 PM

join, because the long-term health dangers of high alcohol consumption may be grave. Those with poor folic acid metabolism should get in the habit of taking folic acid supplements, and get in the habit now–especially women who are thinking of becoming pregnant. Figuring out what your genetic endowment is, determining what risks and obstacles it puts in the way of your leading a long and happy life, and taking action to mitigate those risks and avoid those obstacles is a very smart thing to do. But there is a second implication–a consequence of our highly messed-up health and insurance system. If you ask a normal American whether those unlucky enough to get deathly ill should have to pay the full cost of their extraordinary medical treatment, he or she will say no–that that is what health insurance is for. Most of us will be lucky. Some of us will be unlucky. We should all buy insurance. That way, being unlucky in your health will not leave you broke and impoverished as well as unhealthy. That is fair. But suppose that the “luck” is something that is inextricably a part of you–suppose that the luck is, literally, in your genes and thus part of what makes you you? Are you still unlucky if you have a hip fracture at 70 because you have been lactose-intolerant all your life because that was in the genes that your parents gave you? Or should the insurance company be allowed to say that that is not bad luck, that is who you are–and charge you a higher price for your life and Medigap insurance than it charges others? I would say no: people who are unlucky in their genes are unlucky just as people who are unlucky in having a tree branch fall and break their leg are unlucky. In both cases we want the community to cover the cost of their treatment: it’s bad enough that they are in bad health, we don’t need to make them poor also. There are others who would say yes: that once you know that you have a good chance of developing some condition or disease it is no longer insurance, and that others who don’t run the same chance as you shouldn’t pay for treating you for something that they never had any chance of getting. In the United States of today, the logic of the life insurance industry and of risk underwriting is pushing us toward the second answer. If some life insurance companies use genetic information–like that being tested for in “bring your genes to Cal”–to deny policies and raise rates while others do not, those life insurance companies that do not will find themselves losing money and markets and disappear. And it is conceivable in some possible futures that some insurance adjuster somewhere will deny payment because “your mother knew that she was at higher risk for a hip fracture because of her lactose intolerance, and did not disclose that to us.” In the United States of today, however, the logic of the social insurance state–most recently the PPACA Obama health care reform bill–is to deny private insurance companies and the government of the option to treat some people differently than others, to charge some more or deny some policy coverage completely because of what is in their genes. The PPACA requires community rating: that insurers ignore what they know about how much your medical care is likely to cost because you are lactose intolerant or predisposed to hypertention or whatever. Thus I would like to see “bring your genes to Cal” proceed along two tracks: First, what our genetic endowment tell us about how we should, as a group and also as individuals each with our own unique genetic makeup, change our behavior to lead longer, richer, and healthier lives. Second, what the increase in knowledge about our individual selves and our individual http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 2 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

10/23/10 5:51 PM

risks does to undermine the more general principles of social insurance–that one of the things societies do is to spread risks around, so that the unhealthy are covered by insurance and treated by doctors and so are just unhealthy, and that their ill-luck is not amplified by a system that requires that they impoverish themselves in order to get treatment or even that denies them treatment so that they die instead. The best place to be, it seems to me, is with single-payer publicly-funded national health insurance and as much individual fine-grained information about genetic makeup and risk as we can get. But the United States is not there. And it does not look like the United States is going there anytime soon. And as long as we are not there–as long as your life insurance company would dearly like to know how likely it is that you will fracture a hip at 70 because it might cost them money–there was going to be a tension to manage between social insurance risk-spreading on the one hand and knowledge of our genes and their effect on our destinies on the other. So we had better get started on managing this tension. Brad DeLong on August 29, 2010 at 09:51 PM in Economics, Economics: Health, Obama Administration, Politics, Science, Science: Biology | Permalink Favorite

Reblog (0) | del.icio.us | Tweet This!

| Digg This | Save to

TrackBack TrackBack URL for this entry: http://www.typepad.com/services/trackback/6a00e551f0800388340134868c9a8c970c Listed below are links to weblogs that reference Bring Your Genes to Your Life Insurance Sales Representative:

Comments Jason Dick said... Honestly, if we were talking about total lifetime care, I'd be a bit surprised if these considerations made much difference at all. First, once somebody contracts a major, life-threatening illness, they usually, well, die. And so the medical bills stop. Every once in a great while you end up with a person who gets one nasty illness after another, and manages to survive them all. But these are the exception, not the rule. I don't have any numbers on hand of total lifetime costs, but unless you're killed rather suddenly, I strongly suspect that over a total lifetime of care, we tend to have more similar medical costs than you might expect. That said, private insurance doesn't much care about total lifetime costs. They care about how much they have to pay while you're under their coverage, which will be, at latest, until you're 65. This distorts things significantly, because even though the total lifetime cost may be similar, a person who starts contracting a nasty, expensive illness before the age of 65 is going to hit private insurance's pocket book, while one who http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 3 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

10/23/10 5:51 PM

doesn't won't. And that disparity sets us up for some nasty behavior on the part of private insurance. I really wish we had single-payer health care. Reply August 30, 2010 at 02:59 AM save_the_rustbelt said... All of this pales before the fact that 1 of 3 Americans are likely to become obese, with many seriously obese, for some extended period of their lifetime. We will be defeated not by tyranny, but by Krispy Kreme. Reply August 30, 2010 at 05:56 AM Neal said... Bravo!! Reply August 30, 2010 at 07:51 AM Carl Shulman said... Brad, Surely you should mention that the 2008 Genetic Information Nondiscrimination Act is already law, and prohibits insurers from charging higher prices or denying coverage based on genetic predispositions to disease? http://en.wikipedia.org/wiki/Genetic_Information_Nondiscrimination_Act Reply August 30, 2010 at 08:04 AM Brad DeLong said in reply to Carl Shulman... That applies to health insurers only. Does it apply to life insurance? No. Does it apply to long-term care insurance? Im not sure. Is it enforceable? I doubt it: there are so many other reasons to deny life insurance coverage that could serve as excuses... Yours, Brad DeLong Reply August 30, 2010 at 08:46 AM Platypus said... As a geneticist I feel I should add a two points about 2008 Genetic Information Nondiscrimination Act (GINA), as it offers less protection that you might think against genetic discrimination. GINA applies specifically to discrimination in group health insurance and employment. Insurance companies are free to use genetic information in pricing individual health insurance policies as well as life insurance and disability insurance. In addition, GINA was designed to address the issue of genetic predisposition - "bad genes" that haven't yet affected your health. Under GINA insurers are free to discriminate once there is a clinical manifestation of your genetic burden - e.g., GINA would ban an insurer from using the results of a molecular test demonstrating that you had a mutation that predisposed you to high cholesterol but would allow the insurer to use the results of your high serum cholesterol to set your rates or deny you coverage. Cancer predisposition would work the same under GINA. Discrimination against http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 4 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

10/23/10 5:51 PM

people with a high genetic risk of cancer - prohibited; discrimination against people who had developed cancer because of their high genetic risk - allowed. Reply August 30, 2010 at 08:49 AM Maynard Handley said in reply to Jason Dick... "First, once somebody contracts a major, life-threatening illness, they usually, well, die. And so the medical bills stop. Every once in a great while you end up with a person who gets one nasty illness after another, and manages to survive them all. But these are the exception, not the rule." Do you have any evidence for these claims? I mean, isn't this a large part of the problem with our healhcare debate --- a surfeit of supposedly "obvious" claims about healthcare, the motivations of doctors, the effects of lawsuits, etc etc; most of which, when examined closely, appear to be BS. I agree with your larger point ("private insurance doesn't much care about total lifetime costs"), I just wish that your statements along the way were either not said, or said with some evidence. Reply August 30, 2010 at 09:52 AM Kali said in reply to Jason Dick... Sadly, no, there are a great many of us who have chronic illnesses that cost us a huge amount of money but don't tend to kill us in a hurry. Some of the more common ones are lupus, cancer, and multiple sclerosis, but there are a great many long-term health conditions that cost ridiculous amount of money for a long time. I happen to have one of the comparatively rare expensive conditions - Ehlers-Danlos Syndrome, which is a genetic collagen disorder. The direct effect of it is to give me fragile tissues, which leads to injuries like cuts and bruises and joint injuries like subluxations, dislocations, and hyperextention (all of my joints are affected). I also have secondary conditions because of it: Raynaud's syndrome, Postural Orthostatic Tachycardia Syndrome (POTS), fibromyalgia, Gastro-Esophegal Reflux Disease (GERD), Irritable Bowel Syndrome (IBS), Alpha-Delta sleep disorder (which is actually secondary to the fibromyalgia, we think), snapping hip syndrome, snapping shoulder syndrome. I also have unrelated conditons: asthma, migraines, allergies, extremely sensitive skin. I'm a very, very expensive person, both short term and long term. And I'm only 26 - I'll go on being a very expensive person for the next 40-70 years (depending on which side of the family I take after in lifespan). We're not that rare, unfortunately for us. And oh man do I ever agree with you on single-payer health care! The people I know in the UK with the same condition who sometimes complain because I can get certain types of healthcare quicker, but they've never been denied for the medication or equipment they need simply because their insurance decides it's too expensive. ~Kali www.brilliantmindbrokenbody.wordpress.com Reply August 30, 2010 at 02:50 PM Kali said... Brad, I think it is worth noting that of the people who file for bankruptcy because of health care bills, some 75% had insurance at the start of the illness that led them to declaring bankruptcy. Keeping people insured is only a very, very limited solution; the bigger problem is that insurance rarely covers what people expect it to. In the case of http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 5 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

10/23/10 5:51 PM

catastrophic illness, the plans most people have include relatively low caps for singleevent or annual or lifetime benefits. (That's from a Harvard Study that looked at 2001 data; it was particularly frightening when you consider that over half of all people who file for bankruptcy are there because of illness, so somewhere between 37% and 40% of people who file for bankruptcy are filing because of an illness that they were supposedly insured for.) ~Kali www.brilliantmindbrokenbody.wordpress.com Reply August 30, 2010 at 02:57 PM Comments on this post are closed.

First, Kill all the Pensions

economics DeLong

Me:

The Atlantic (blog) - Oct 19, 2010 She may or may not have been the first major economics blogger, depending on whether we are allowed to throw outlying variables such as Brad Delong out of ... Related Articles » « Previous Next »

Economists: Juicebox Paul Mafia: Krugman Ezra Klein Mark Thoma Matthew Cowen and Yglesias Tabarrok Spencer Chinn and Ackerman Hamilton Dana Brad Setser Goldstein Dan Froomkin

Moral Philosophers: Hilzoy and Friends Crooked Timber of Humanity Mark Kleiman and Friends Eric Rauchway and Friends John Holbo and Friends

http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

Page 6 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

10/23/10 5:51 PM

Page 7 of 8


Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands

http://delong.typepad.com/sdj/2010/08/bring-your-genes-to-your-life-insurance-sales-representative.html

10/23/10 5:51 PM

Page 8 of 8

Bring Your Genes to Your Life Insurance Sales Representative - Grasping Reality with Both Hands  

The Semi-Daily Journal of Economist J. Bradford DeLong: Fair, Balanced, Reality- Based, and Even-Handed Department of Economics, U.C. Berkel...

Read more
Read more
Similar to
Popular now
Just for you