An excellent short article in this week’s New Yorker, in the Talk of the Town section, explains how two cognitive biases make the case for health care reform difficult to make with the American public. I recommend you read the article yourself, but I will summarize its major points here.

The combination of two human foibles, the endowment effect and the status-quo bias are combining to make fixing our health care system particularly difficult. The endowment effect describes the tendency of people to overvalue something they already have. The status-quo bias is the fancy cognitive psychology term for humankind’s deep-seated resistance to change. This resistance is driven by our fear of loss. As explained in the article,

Behavioral economists have established that we feel the pain of losses more than we enjoy the pleasure of gains. So when we think about change we focus more on what we might lose rather than on what we might get. Even people who aren’t all that happy with the current system, then, are still likely to feel anxious about whatever will replace it.

You can predict the result of combining the endowment effect and the status quo bias with regards to our health care system: people who currently have coverage overvalue the coverage they have, and fear any change to the system will leave them worse off.

Unfortunately, if they’re lucky enough to have good health insurance, people tend to fail to see how tenuous their coverage actually is. Since most people’s insurance coverage is linked to their employment, losing one’s job (something increasingly probable in today’s economy) leaves one without any health insurance coverage at all. Further, the insurance industry practice of rescission, or the retroactive cancellation of an insurance policy, means everybody has a small but very real chance that the coverage one thinks one has will be yanked away just when it is needed most.

In other words, as the New Yorker helpfully explains, to keep the status quo of existing coverage, we’re going to have to have to change the way the system works. This paradox goes a long way towards explaining why the case for healthcare reform is so difficult to make with the American public.