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April 2, 1982

Medical Insurance

JAMA. 1982;247(13):1812. doi:10.1001/jama.1982.03320380018018

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To the Editor.—  Oh, the magic in the sound "third-party payer," or is it "third-party savior?" So simple. Submit a claim form and receive a check. But what has happened? The amount of the checks just do not keep up with the ever-increasing amounts of the claim. Could it be that the amount the consumer is able to pay for sick care is reaching a limit?There is no magic in how the "third-party payer" system works, whether government or private. The insurer attempts to find out what the consumer wants to buy (benefits), the actuary prices the product (premium), and the sales force sells the contract in the competitive market place. Simple? Not so! As the cost of health care accelerates faster than other goods and services, the premium increases to a level that is affordable to fewer persons. The answer is to reduce selectively the covered services and