Slate: How United Airlines' overhead bin charge resembles proposed healthcare reform

A columnist at Slate drew the comparison between airline companies' increasing service commoditization and competing healthcare reform ideas.

United Airlines' overhead storage fee is effective early next year. The airline touts the policy change as the introduction of a bare-bones fare called Basic Economy. The fare would enable customers who do not plan to use overhead bins to shave money off their ticket cost.

Airline companies defended these types of fees by appealing to the economic principle of price discrimination — the idea consumers should only pay for the services they use rather than paying a standard fare for a breadth of services, including those they will not use.

The theory suggests travelers who check heavy bags (therefore increasing fuel needs) or cannot minimize their carry-on luggage will pay more while conscientious travelers will pay less, keeping airline costs reasonable for passengers willing to pare down.

The theory draws some comparisons to GOP ideas for reform in the healthcare market. Slate noted one of the chief GOP complaints about the ACA is it forces healthier consumers to subsidize sicker and more elderly persons' costs by putting everyone in the same market and requiring payers to offer a standard, broad benefits package. This is similar to how consumers who need checked baggage and overhead storage would drive up the standard airline fare for those who only need one carry-on, Slate argued.

The article can be accessed here in full.

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Whitepapers

Featured Webinars

>