I have been trying to fight the misinformation being handed out by those on the Right over the Dems health reforms.

Just when I thought the “death panels” were a thing of the past….

We have all heard the accusations about killing granma…or the Death Panels…or whatever other piece of bovine fecal matter that they try to spread to kill health reform.  The biggest, in my opinion, lie was the death panels and believe it or not some of the crazies will NOT let it go even after it has been proven to be so much crap.

But recently I was looking over the NYT and found an article that, to my amazement, sounded like those “death Panels” that the crazies are so worried about.

“The bankers plan to buy ‘life settlements,’ life insurance policies that ill and elderly people sell for cash—$400,000 for a $1 million policy, say, depending on the life expectancy of the insured person,” Times correspondent Jenny Anderson reports. “Then they plan to ‘securitize’ these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds,” to be sold to investors.

Investors will continue to pay out the premiums on the insurance and will collect the payout when the person dies. “The earlier the policyholder dies, the bigger the return.” In the example given, if the insurance is for $1 million, it is sold for $400,000, and an investor pays out $100,000 in premiums before the individual dies, the resultant profit will come to half a million dollars.

Of course, the great danger for an investor would be a sharp rise in life expectancy for a particular section of the population. “A bond made up of life settlements would ideally have policies from people with a range of diseases—leukemia, lung cancer, heart disease, breast cancer, diabetes, Alzheimer’s,” the Times notes, to safeguard against the danger of a cure for any one of these.

After I read that I started thinking that this sounds like a feasible plan for Wall Street…why?…..as people loss their livelihood they will be searching for ways to pay the bills and with a hefty insurance policy at their disposal it would be a logical step in finding funds to continue living their lives.

There are several reasons to believe that a new life insurance securitization market—one wit dubbed the resulting securities, “collateralized death obligations”—could be very profitable.

First, with the desperate financial situation facing millions of people, there will inevitably be a large pool of poor or elderly workers who find themselves unable to pay their insurance premiums. They may also be in need of immediate cash to fund mortgage payments, medical expenses or other necessities for themselves or their relatives. As the economic crisis deepens, the willingness of individuals to part with their insurance policies at a low price will increase.

Second, investors will be essentially betting that individuals on average will be dying sooner than anticipated by insurance companies who originally devised the policies—that is, they will be betting that the curve of life expectancy in the population will dip.

So yes…the crazies were right about Death Panels but I doubt very seriously that they will find too much objectionable to the idea.  After all this is just the “free market” at work will be their only comment when confronted with this idea.  But I seriously doubt if we will ever hear too much more about it, for now.

Think about it…..if this becomes reality….your death would make a profit for investors….don’t just love the free market?

You want “death panels”…you got it!

I would like to thank Joe Kishore of wsws.org for his insights into this situation and the use of some of his words.