Is employer-based health insurance a barrier to entrepreneurship?(sciencedirect.com)
sciencedirect.com
Is employer-based health insurance a barrier to entrepreneurship?
http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V8K-512K1KY-1&_user=10&_coverDate=01/31/2011&_rdoc=1&_fmt=high&_orig=search&_origin=search&_sort=d&_docanchor=&view=c&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=ae336445c13e1f5172d6f65d0c420f4d&searchtype=a
147 comments
I haven't done so, but have done a fair bit of investigation. The most technically correct answer I can give is that it depends on where you're going and how you leave things in the US.
First, where you're going. You obviously want to go somewhere with better healthcare than the U.S., which isn't all that difficult to find. The ? becomes what your obligations will be as a somewhat permanent resident and how you can maintain that status legally. That's really going to be location dependent, but you should look and look hard before you leap, because the consequences could be unpleasant if you screw up. I believe there are agencies that cater to potential expats like yourself, and if you're really serious about this you should talk to one of them to make sure you don't step on any landmines in the process.
As for the second ?, The US assumes that you continue to owe US taxes as long as you maintain your citizenship, and they make it difficult to give that up. I don't know exact figures, but you are exempt up to something like $78000 of income and are allowed to write any foreign taxes you pay on that off, but as long as you are a US citizen you're on the hook. If you move to Singapore and strike it rich, unless you pay the IRS you could have extradition hearings in your future. I'm pretty sure the deficient US health care system would be pretty low on your list of worries in that case. Again, this is the sort of thing a professional could tell you more about, but this is definitely out there. I don't want to advocate giving up your citizenship lightly, but know that the US is unique in this sort of taxation and making a fortune abroad without paying US taxes would almost certainly be viewed as some sort of tax evasion if you didn't proceed very carefully.
First, where you're going. You obviously want to go somewhere with better healthcare than the U.S., which isn't all that difficult to find. The ? becomes what your obligations will be as a somewhat permanent resident and how you can maintain that status legally. That's really going to be location dependent, but you should look and look hard before you leap, because the consequences could be unpleasant if you screw up. I believe there are agencies that cater to potential expats like yourself, and if you're really serious about this you should talk to one of them to make sure you don't step on any landmines in the process.
As for the second ?, The US assumes that you continue to owe US taxes as long as you maintain your citizenship, and they make it difficult to give that up. I don't know exact figures, but you are exempt up to something like $78000 of income and are allowed to write any foreign taxes you pay on that off, but as long as you are a US citizen you're on the hook. If you move to Singapore and strike it rich, unless you pay the IRS you could have extradition hearings in your future. I'm pretty sure the deficient US health care system would be pretty low on your list of worries in that case. Again, this is the sort of thing a professional could tell you more about, but this is definitely out there. I don't want to advocate giving up your citizenship lightly, but know that the US is unique in this sort of taxation and making a fortune abroad without paying US taxes would almost certainly be viewed as some sort of tax evasion if you didn't proceed very carefully.
$92,900 in 2011
http://www.irs.gov/businesses/small/international/article/0,...
Considering that's a large salary in many first-world western-european countries, it's probably only a follow-on consideration (ie, GP-comment's hypothetical striking it rich in Singapore).
Furthermore, at that point, you will most likely be able to shelter your income anyway by putting it into a corporation, and you shouldn't be worried about striking it rich abroad.
Furthermore, at that point, you will most likely be able to shelter your income anyway by putting it into a corporation, and you shouldn't be worried about striking it rich abroad.
It's a standard deduction, not taxable income. Having a salary less than that is only favorable to you as a tax payer.
Once you shelter into a corporation, how do you un-shelter? Assumption being that you do want to spend a little of it. You can pay it yourself via salary, or dividends. However, from income tax perspective it's all income anyways.
Once you shelter into a corporation, how do you un-shelter? Assumption being that you do want to spend a little of it. You can pay it yourself via salary, or dividends. However, from income tax perspective it's all income anyways.
I don't know about going to europe, but going to Canada is not impossible. It isn't an open door - you need skills and/or a job offer, or you need to be in school. However, once you are there, you can apply for your health care card immediately. Some provinces have premiums - around $50 a month IIRC, which are waived if you are a student or make under a certain amount.
Note that the "free health care" only covers doctor and hospital visits/procedures. It does not cover dental, optical, or any medications. Like in the US, any Canadian employer will offer a benefits plan to cover these things, or you can purchase insurance for them on your own.
This is a trade-off though. There is not much of a startup scene in Canada. The few "major" tech centers are really weak compared to most US cities. There is not much innovation. How many tech startups can you think of that came out of Canada? They do exist, but the deck is clearly stacked against them. On the other hand, there is less competition for funding, so maybe you can use that as an advantage. I am sure you have read the PG article about why your city matters.
I've lived in both countries, and people in both get a "grass is greener" viewpoint (aside from the too-proud patriots on either side). It is easier to see the things you don't have and want, rather than the things that you do have and would miss.
My personal opinion is that the US is more extreme in all directions. Higher highs and lower lows. Crazier crazies. Except weather. Canada is cold :) But it depends what you want to do, and what will best cater to your needs.
Note that the "free health care" only covers doctor and hospital visits/procedures. It does not cover dental, optical, or any medications. Like in the US, any Canadian employer will offer a benefits plan to cover these things, or you can purchase insurance for them on your own.
This is a trade-off though. There is not much of a startup scene in Canada. The few "major" tech centers are really weak compared to most US cities. There is not much innovation. How many tech startups can you think of that came out of Canada? They do exist, but the deck is clearly stacked against them. On the other hand, there is less competition for funding, so maybe you can use that as an advantage. I am sure you have read the PG article about why your city matters.
I've lived in both countries, and people in both get a "grass is greener" viewpoint (aside from the too-proud patriots on either side). It is easier to see the things you don't have and want, rather than the things that you do have and would miss.
My personal opinion is that the US is more extreme in all directions. Higher highs and lower lows. Crazier crazies. Except weather. Canada is cold :) But it depends what you want to do, and what will best cater to your needs.
I moved from the UK to SF because of startup culture.
I hate the health care system here, would love to be under the UK National Health Care system instead, but overall would rather be living in SF than UK.
I suck up the $200/month health insurance (I'm a healthy 29 year old). If I had kids it would be a different story, mind you.
I hate the health care system here, would love to be under the UK National Health Care system instead, but overall would rather be living in SF than UK.
I suck up the $200/month health insurance (I'm a healthy 29 year old). If I had kids it would be a different story, mind you.
As champion says below, everyone in Massachusetts can get health insurance, regardless of pre-existing conditions. You can go to https://www.mahealthconnector.org/portal/site/connector/ and see what plans are available, and how much they cost, for someone your age. Or you can hang on until 2014, and something similar will be available throughout the US.
If you want to see if you qualify for immigration to Canada as a skilled worker, http://www.cic.gc.ca/english/immigrate/skilled/assess/index.... has an online test. (I just took the test for the hell of it, and I qualified, even though I don’t have a Canadian job offer in hand and je parle français comme une vache espagnole.)
If you want to see if you qualify for immigration to Canada as a skilled worker, http://www.cic.gc.ca/english/immigrate/skilled/assess/index.... has an online test. (I just took the test for the hell of it, and I qualified, even though I don’t have a Canadian job offer in hand and je parle français comme une vache espagnole.)
Come to Massachusetts! Our health care reform means that the market for private insurance isn't insane. You can afford reasonable coverage for reasonable price through the MassConnector group plans, and they can't deny you because of pre-existing health conditions (they only ask age / number of dependents).
While far from perfect, it is a significant improvement for entrepreneurs who may be buying insurance for themselves and for early employees before funding/revenue to pay for traditional coverage. There are a lot of folks who cannot go without insurance but in many areas the cost of buying outside of an employer is prohibitively expensive or restrictive.
While far from perfect, it is a significant improvement for entrepreneurs who may be buying insurance for themselves and for early employees before funding/revenue to pay for traditional coverage. There are a lot of folks who cannot go without insurance but in many areas the cost of buying outside of an employer is prohibitively expensive or restrictive.
Insurance in general is an impediment to entrepreneurship. I know our insurance costs are way more per unit than those of larger companies. I don't know if the higher costs could be attributed to the marketplace or the fact the larger companies are much more sophisticated in their risk management.
Next time try posting links that doesn't need subscription - not all of us here are backed by institutions to read hacker news :-)
http://www.rand.org/pubs/working_papers/2010/RAND_WR637-1.pd...
(viewer: http://docs.google.com/viewer?url=http%3A%2F%2Fwww.rand.org%...)
(scribd: http://www.scribd.com/full/49777774?access_key=key-1z4k6uefp...)
Not as well formated as ScienceDirect (which is sourced from the Journal of Health Economics) but doesn't require a subscription.
http://www.rand.org/pubs/working_papers/2010/RAND_WR637-1.pd...
(viewer: http://docs.google.com/viewer?url=http%3A%2F%2Fwww.rand.org%...)
(scribd: http://www.scribd.com/full/49777774?access_key=key-1z4k6uefp...)
Not as well formated as ScienceDirect (which is sourced from the Journal of Health Economics) but doesn't require a subscription.
A lot of us New Yorkers use the Freelancers Union for health insurance. It solved this exact problem for me. They're more of a service platform for independent workers than a union. They've got health, dental and 401k plans.
http://www.freelancersunion.org/
http://www.freelancersunion.org/
I've seen their advertisements, they look awesome. If I wasn't already covered by my parents plan I would go for it.
To give some perspective I now live in the US and have, as best as I can tell, excellent insurance from my employer.
I am Australian and have lived in the UK, Switzerland and Germany so I can compare all of these.
Australia has a mix of private and public health care. You pay 1.5% of your income as theMedicare levy. If you have sufficient income but no private hospital insurance, you pay a surcharge (1% iirc). The previous (Liberal/National, which is actually conservative) government made private health insurance tax deductible. I can't remember but the current government has tried to roll that back but I think has so far failed (to get it through the Senate).
Private health insurance pays you a portion back of each expense, a system I actually think is not good. It encourages people to "get their money's worth".
Doctor surgeries are all small businesses so they have differing hours, costs, etc. Medicare pays for a part of that bill. Low income earners can generally get their doctor visits bulk-billed, meaning the practice only charges the government rebate so there is no out of pocket expense.
For years I had no private health insurance. Any serious hospital care (eg cancer treatment, transplant, serious injury, heart attack, stroke, etc) could be covered in the public system. The private system seems like it's for people who don't want to share hospital rooms.
Some so-called elective surgery can have long waiting times which is why I say I'm self-insured. If I needed something like this I could pay $2-5000 out of pocket (large medical expenses are tax deductible too). Not everyone has the disposable income for that.
The one weird thing is private health insurers have "community pricing" (I forget the exact term). That means they charge the same premium for everybody. The net result is young people don't get it and old people drive up the premiums.
The UK system is similar except they take 11% of your income (capped) but health care is basically one huge bureaucracy. Seeing a GP is generally a pain. You have to be registered with a surgery. Often their books are full so you can only get into the one open from 9-4 Mon-Fri. Since that's typically near where you live going to the doctor typically means taking the day off work.
The UK has long wait times for some even common medical procedures (eg certain scans) to the point they've started paying Germany and other countries to help clear the backlog.
Seeing a doctor is free though but IMHO this leads to overuse. The cliched example is of the old age pensioner seeing the doctor to have someone to talk to. Also for a procedure or seeing a specialist you'll receive a letter telling you when your appointment is sometimes 3+ months later and it might be a few days away. Can't make it? Back to the bottom of the list.
Switzerland has a system of mandatory insurances everyone must by law have various health and unemployment insurances. I don't remember the specifics but I had lime 5 policies iirc.
Actually Germany I know little about because I never used the system while there. It has a reputation for efficiency though.
The US system is IMHO the worst in the developed world (and even some developing countries put it to shame).as people have said the best insurance is negotiated at group level. Good for large companies. Bad for the self-employed, small businesses, entrepreneurs and individuals.
What's more, if you start to incur large expenses the companies are motivated to find some way to disqualify you. And then good luck as you'll have a preexisting condition. Last month a story made the national press of a veteran in cancer treatment being dropped for being 2 cents short on paying the premium.
Defendants of the current system argue free market but the result is the most expensive health care I've ever seen. Drugs, hospitals, doctors, you name it. The litigious nature of the US probably doesn't help.
Actually even Australia has the problem of litigation in certain fields. Obstetricians pay upwards of $200k a year in malpractice insurance due to a lot of frivolous litigation, forcing many out of the profession. It's a field dominated by women who more often than not end up having families at which point it is uneconomic to work part time in that field due to the insurance.
So if I ever went to work for a small start up here I'd take advantage of COBRA (iirc) for 1+ year then get insurance with a huge excess and I ever needed, say, cancer treatment I'd go back to the UK or Australia (I have dual citizenship).
Not everyone has that option.
I get the feeling many entrepreneurs are young and gambling with their health, figuring it's cheaper to declare bankruptcy pr just not figuring on unintended expenses like a motor vehicle accident.
So anyway I'm not against health insurance but group insurance is a huge problem and people need the right to get insurance. Honorifics are better insurers than for-profits (IMHO).
I am Australian and have lived in the UK, Switzerland and Germany so I can compare all of these.
Australia has a mix of private and public health care. You pay 1.5% of your income as theMedicare levy. If you have sufficient income but no private hospital insurance, you pay a surcharge (1% iirc). The previous (Liberal/National, which is actually conservative) government made private health insurance tax deductible. I can't remember but the current government has tried to roll that back but I think has so far failed (to get it through the Senate).
Private health insurance pays you a portion back of each expense, a system I actually think is not good. It encourages people to "get their money's worth".
Doctor surgeries are all small businesses so they have differing hours, costs, etc. Medicare pays for a part of that bill. Low income earners can generally get their doctor visits bulk-billed, meaning the practice only charges the government rebate so there is no out of pocket expense.
For years I had no private health insurance. Any serious hospital care (eg cancer treatment, transplant, serious injury, heart attack, stroke, etc) could be covered in the public system. The private system seems like it's for people who don't want to share hospital rooms.
Some so-called elective surgery can have long waiting times which is why I say I'm self-insured. If I needed something like this I could pay $2-5000 out of pocket (large medical expenses are tax deductible too). Not everyone has the disposable income for that.
The one weird thing is private health insurers have "community pricing" (I forget the exact term). That means they charge the same premium for everybody. The net result is young people don't get it and old people drive up the premiums.
The UK system is similar except they take 11% of your income (capped) but health care is basically one huge bureaucracy. Seeing a GP is generally a pain. You have to be registered with a surgery. Often their books are full so you can only get into the one open from 9-4 Mon-Fri. Since that's typically near where you live going to the doctor typically means taking the day off work.
The UK has long wait times for some even common medical procedures (eg certain scans) to the point they've started paying Germany and other countries to help clear the backlog.
Seeing a doctor is free though but IMHO this leads to overuse. The cliched example is of the old age pensioner seeing the doctor to have someone to talk to. Also for a procedure or seeing a specialist you'll receive a letter telling you when your appointment is sometimes 3+ months later and it might be a few days away. Can't make it? Back to the bottom of the list.
Switzerland has a system of mandatory insurances everyone must by law have various health and unemployment insurances. I don't remember the specifics but I had lime 5 policies iirc.
Actually Germany I know little about because I never used the system while there. It has a reputation for efficiency though.
The US system is IMHO the worst in the developed world (and even some developing countries put it to shame).as people have said the best insurance is negotiated at group level. Good for large companies. Bad for the self-employed, small businesses, entrepreneurs and individuals.
What's more, if you start to incur large expenses the companies are motivated to find some way to disqualify you. And then good luck as you'll have a preexisting condition. Last month a story made the national press of a veteran in cancer treatment being dropped for being 2 cents short on paying the premium.
Defendants of the current system argue free market but the result is the most expensive health care I've ever seen. Drugs, hospitals, doctors, you name it. The litigious nature of the US probably doesn't help.
Actually even Australia has the problem of litigation in certain fields. Obstetricians pay upwards of $200k a year in malpractice insurance due to a lot of frivolous litigation, forcing many out of the profession. It's a field dominated by women who more often than not end up having families at which point it is uneconomic to work part time in that field due to the insurance.
So if I ever went to work for a small start up here I'd take advantage of COBRA (iirc) for 1+ year then get insurance with a huge excess and I ever needed, say, cancer treatment I'd go back to the UK or Australia (I have dual citizenship).
Not everyone has that option.
I get the feeling many entrepreneurs are young and gambling with their health, figuring it's cheaper to declare bankruptcy pr just not figuring on unintended expenses like a motor vehicle accident.
So anyway I'm not against health insurance but group insurance is a huge problem and people need the right to get insurance. Honorifics are better insurers than for-profits (IMHO).
> Defendants of the current system argue free market but the result is the most expensive health care I've ever seen.
Interesting, but the current system in the US isn't "free market".
It's communistic.
- 80%+ of health care expenditures are made by a 3rd party not the person requesting a service. (employers, insurance, government)
- 40-50% of health care expeditures in the USA are made by the government. (free market usually doesn't mean paid-for/run by government)
- There are thousands of government regulations and incentives which created the current system we have.
That's a free market? You must not understand the free market- either that or you are intentionally misleading people.
Those in favor of a free market, including myself, are NOT defending the current system - they are against a complete government takeover of the system.
Interesting, but the current system in the US isn't "free market".
It's communistic.
- 80%+ of health care expenditures are made by a 3rd party not the person requesting a service. (employers, insurance, government)
- 40-50% of health care expeditures in the USA are made by the government. (free market usually doesn't mean paid-for/run by government)
- There are thousands of government regulations and incentives which created the current system we have.
That's a free market? You must not understand the free market- either that or you are intentionally misleading people.
Those in favor of a free market, including myself, are NOT defending the current system - they are against a complete government takeover of the system.
[deleted]
[deleted]
yes
I remember an episode where this american life explained why health insurance came to be like it is.
I was specifically interested in the fact that they said during WWII wages where not allowed to increase, so the only things that employers could increase were benefits. This was the biggest factor in making Health Insurance employer-based.
I was specifically interested in the fact that they said during WWII wages where not allowed to increase, so the only things that employers could increase were benefits. This was the biggest factor in making Health Insurance employer-based.
Also having it be a tax write-off. If an employee were to buy it on their own it would be with after tax dollars and thus much more costly. (That's even discounting group rate discounts.)
Also, employers expense health insurance premiums and pay no payroll taxes on the contribution as they would on normal wages.
Health insurance premiums are tax deductible.
Not if you have an employer. The deduction is for self employed people.
Right, sorry. I was speaking in the context of being an entrepreneur. If you are not self-employed, health care costs must clear 7.5% of your AIG before they are deductible.
which begs the question, if your company is so small that you can't offer health insurance, 401(k), etc then what is the point of having your employees salaried.
You might as well have them as contractors so they can enjoy the maximum tax write offs (health insurance, %age of their home as office, all hardware and software, %age of electricity, internet, etc).
You might as well have them as contractors so they can enjoy the maximum tax write offs (health insurance, %age of their home as office, all hardware and software, %age of electricity, internet, etc).
It's not like you can just pick what to call them. An employee is an employee and a contractor is a contractor. If you want someone to work in your office 9-5 and commit their code changes to your server each day, they're an employee, and you can't call them a contractor.
I think you can actually.
EDIT: What's with the downvotes? Companies do call them a contractor. It happens every day. They're are special concerns but they can certainly work 9-5, etc.
EDIT: What's with the downvotes? Companies do call them a contractor. It happens every day. They're are special concerns but they can certainly work 9-5, etc.
The IRS has cracked down on this practice. You can't just call someone a contractor that meets the conditions to be an employee. You can be mindful of these conditions and work around them but just calling an employee a contractor is not good enough. Even intentionally working around the IRS rules can get you in trouble.
You might get away with it but if you want to make the IRS happy, you better not call an employee a contractor if you don't want to deal with the fines, reclassification and back taxes that go with it.
You might get away with it but if you want to make the IRS happy, you better not call an employee a contractor if you don't want to deal with the fines, reclassification and back taxes that go with it.
If you tell someone to come in to your office 9-5 and tell them how to do the work, they're an employee. If you call them a contractor, and the IRS audits you and talks to that person, they're going to fine you for all the unpaid payroll taxes you'll owe. These are words with specific definitions in the tax code.
You are basically right. There are companies specifically set up to allow employers to hire contractors but treat them as employees. Search for "Employer of Portable Record"
You could put it under 'unreimbursed expenses'. Yeah, you might get audited, but it's something you may be able to argue.
Alternatively, go self-employed and have the employer pay you enough to cover the extra FICA/SS numbers. If they're not providing insurance coverage for you, there aren't many other reasons to be an 'employee' of a company.
Alternatively, go self-employed and have the employer pay you enough to cover the extra FICA/SS numbers. If they're not providing insurance coverage for you, there aren't many other reasons to be an 'employee' of a company.
Ah, the law of unintended consequences.
We've been working on a startup and this has been a constant worry for us. I imagine that a lot of startups are one car crash away or one sickness away from failing.
The second part of that statement is that a lot of individuals are one car crash or one sickness away from suffering a serious financial hardship on top of a serious medical issue. If the startup suffers, it's collateral damage.
During our initial phases we lost a potential hire that we really wanted because we just couldn't afford to offer health insurance. They ended up taking a job with a similar startup in Toronto. We had our first hire leave primarily because we couldn't offer health insurance.
I'm happy that we're in a place that we can offer those benefits now. Getting through those first couple of years was really tough. If my wife didn't have decent insurance I'm not sure my company would exist today.
I'm happy that we're in a place that we can offer those benefits now. Getting through those first couple of years was really tough. If my wife didn't have decent insurance I'm not sure my company would exist today.
I'm not in the US, this is a actual question.
Is this different in some fundamental way from not being able to offer a high enough salary?
Is this different in some fundamental way from not being able to offer a high enough salary?
Health insurance for companies is sold on a group basis and it's often much more difficult (and expensive) to negotiate a smaller group. If you do get a policy, good luck if anyone in your small group has a serious claim...
Right, US heath insurance is a form of collective bargaining. The more people you have the more you can negotiate. If you have a small group you cost are exponentially higher and the conditions covered significantly less.
I once bought a policy for myself, we had just exited one of our startups and I was on my own and working freelance. So I had no insurance. I was a 25 year old male and the only health problem I had was high blood pressure. It is/was controlled by medication.
Anyway, given that I was essentially a group of 1, the policies available to me where pretty expensive. If I recall correctly they where around $1000 a month for me. I did not have family at the time so it was just me.
Further I had a $500 annual deductible (I had to spend $500 before they started paying anything) then the per visit co-pays where pretty steep too. They ruled almost every possible male related problem a preexisting condition, so if I had a major medical issue related to any of them, they would not cover it and probably the wost of all, self purchased insurance plans don't cover perscriptions, these are a huge medical expense.
So not only where the policies expensive but they where essential useless for 2 years while you run down the clock on the preexisting conditions clauses. Given that many people are insured through a company policy or medicare many never deal directly with the reality of trying to get a decent policy on their own. I have to say, when I had that experience I realized how broke the insurance system is, it is totally stacked in the favor of the insurance company and the only way to claw some of that favor back is through collective bargaining.
I once bought a policy for myself, we had just exited one of our startups and I was on my own and working freelance. So I had no insurance. I was a 25 year old male and the only health problem I had was high blood pressure. It is/was controlled by medication.
Anyway, given that I was essentially a group of 1, the policies available to me where pretty expensive. If I recall correctly they where around $1000 a month for me. I did not have family at the time so it was just me.
Further I had a $500 annual deductible (I had to spend $500 before they started paying anything) then the per visit co-pays where pretty steep too. They ruled almost every possible male related problem a preexisting condition, so if I had a major medical issue related to any of them, they would not cover it and probably the wost of all, self purchased insurance plans don't cover perscriptions, these are a huge medical expense.
So not only where the policies expensive but they where essential useless for 2 years while you run down the clock on the preexisting conditions clauses. Given that many people are insured through a company policy or medicare many never deal directly with the reality of trying to get a decent policy on their own. I have to say, when I had that experience I realized how broke the insurance system is, it is totally stacked in the favor of the insurance company and the only way to claw some of that favor back is through collective bargaining.
> The more people you have the more you can negotiate. If you have a small group you cost are exponentially higher and the conditions covered significantly less.
I have not found this to be true. I run a small company in Florida. We have BlueCross BlueShield. Comparing notes with other employers, big and small, the size of the group does not appear to make a difference. What seems to matter more is the makeup of the group in terms of age, gender, and preexisting conditions.
There is a huge difference between buying individual insurance and qualifying as an employer group of two or more.
I have not found this to be true. I run a small company in Florida. We have BlueCross BlueShield. Comparing notes with other employers, big and small, the size of the group does not appear to make a difference. What seems to matter more is the makeup of the group in terms of age, gender, and preexisting conditions.
There is a huge difference between buying individual insurance and qualifying as an employer group of two or more.
Yes, individuals cannot buy health insurance for the same rates that employers pay. Some individuals cannot buy health insurance at all if they have preexisting conditions.
> Some individuals cannot buy health insurance at all if they have preexisting conditions.
That's true only if they let their insurance lapse. As long as they don't do that, they can stay with their current, switch, etc, all without waiting periods or a significant premium relative to "well people". (It's been that way for years.)
That's why I wouldn't let insurance lapse if I had a pre-existing condition, so why do folks with pre-existing conditions let their insurance lapse? Or, are we assuming that they do without cause or that they don't know the rules?
Or, are "we" ranting about the system without knowing rules that don't apply to us?
That's true only if they let their insurance lapse. As long as they don't do that, they can stay with their current, switch, etc, all without waiting periods or a significant premium relative to "well people". (It's been that way for years.)
That's why I wouldn't let insurance lapse if I had a pre-existing condition, so why do folks with pre-existing conditions let their insurance lapse? Or, are we assuming that they do without cause or that they don't know the rules?
Or, are "we" ranting about the system without knowing rules that don't apply to us?
I have employees who were laid off from their previous jobs. They could not afford to pay the COBRA payment and let their insurance lapse. They are now disqualified from private insurance and have pre-existing conditions that are not covered under our group plan.
It is easy to tell people not to let their insurance lapse. If they have no income, this is not feasible.
The point of the article is that the current system inhibits entrepreneurship. Plenty of employees in the current system stay with their employer out of fear of losing their coverage instead of pursuing other opportunities.
It is easy to tell people not to let their insurance lapse. If they have no income, this is not feasible.
The point of the article is that the current system inhibits entrepreneurship. Plenty of employees in the current system stay with their employer out of fear of losing their coverage instead of pursuing other opportunities.
> It is easy to tell people not to let their insurance lapse. If they have no income, this is not feasible.
If they have no income, health insurance isn't their only problem. There's housing and food as well.
> Plenty of employees in the current system stay with their employer out of fear of losing their coverage instead of pursuing other opportunities.
Lots of things have that effect, including having kids, buying a house, and so on. Many of them have far greater effect than pre-existing conditions, yet ....
There are also people who can't take the leap because taxes keep them from saving enough. Increasing their taxes to pay for other people's healthcare is going to make that worse.
None of the proposals address cost. (No, preventative care doesn't actually reduce costs. It "merely" makes life more enjoyable.) They just cost shift differently.
If they have no income, health insurance isn't their only problem. There's housing and food as well.
> Plenty of employees in the current system stay with their employer out of fear of losing their coverage instead of pursuing other opportunities.
Lots of things have that effect, including having kids, buying a house, and so on. Many of them have far greater effect than pre-existing conditions, yet ....
There are also people who can't take the leap because taxes keep them from saving enough. Increasing their taxes to pay for other people's healthcare is going to make that worse.
None of the proposals address cost. (No, preventative care doesn't actually reduce costs. It "merely" makes life more enjoyable.) They just cost shift differently.
>That's true only if they let their insurance lapse. As long as they don't do that, they can stay with their current, switch, etc, all without waiting periods or a significant premium relative to "well people". (It's been that way for years.)
On individual and even small group (or medium size groups) they up your premiums, often by a lot of you have something big done, possibly beyond the point of payment. So yes, "if you lapse it goes" is true, often the COST of insurance goes up 10x if something happens to you and you don't happen to be able to be kicked out on another technicality.
On individual and even small group (or medium size groups) they up your premiums, often by a lot of you have something big done, possibly beyond the point of payment. So yes, "if you lapse it goes" is true, often the COST of insurance goes up 10x if something happens to you and you don't happen to be able to be kicked out on another technicality.
> Or, are "we" ranting about the system without knowing rules that don't apply to us?
I don't know about you. I am ranting about the system that I pay into every month for my employees that doesn't cover their pre-existing conditions.
I don't know about you. I am ranting about the system that I pay into every month for my employees that doesn't cover their pre-existing conditions.
I don't want to sound like I'm attacking you, but the fact that you were able to start a company without providing health insurance or a salary sufficient to buy it individually is itself a problem. If your employees got sick, it would be spouses' companies or the public that would shoulder the cost.
The drag on entrepreneurialism would significantly heavier if companies and individuals weren't allowed to freeload.
The drag on entrepreneurialism would significantly heavier if companies and individuals weren't allowed to freeload.
> The drag on entrepreneurialism would significantly heavier if companies and individuals weren't allowed to freeload.
Measuring that difference is actually the methodology the linked study used; their main source of data was looking at the difference between people who had coverage via a spouse and those who didn't, then attempting to control for confounding variables. In effect people with coverage through a spouse serve as a "freeloaders" control group who are assumed not to suffer the health-insurance drag on entrepreneurship (or at least not to fully suffer it).
Measuring that difference is actually the methodology the linked study used; their main source of data was looking at the difference between people who had coverage via a spouse and those who didn't, then attempting to control for confounding variables. In effect people with coverage through a spouse serve as a "freeloaders" control group who are assumed not to suffer the health-insurance drag on entrepreneurship (or at least not to fully suffer it).
> "I don't want to sound like I'm attacking you, but the fact that you were able to start a company without providing health insurance or a salary sufficient to buy it individually is itself a problem."
There is a big difference between financial compensation and offering health insurance for entrepreneurs. Startups frequently pay low salaries (ones that may not support the high cost of health insurance) in return for an equity stake that offers the possibility of a high future payout. You cannot similarly defer health care benefits: when cash is tight, you either offer costly benefits at the expense of other priorities or leave your employees without health insurance. This tradeoff is not present if the insurance system isn't employer-based.
Of course this is only part of the explanation for how our system impedes entrepreneurship. One way or another, we're all paying an absurd amount just to keep us (somewhat) healthy.
http://andrewsullivan.theatlantic.com/the_daily_dish/2011/02...
There is a big difference between financial compensation and offering health insurance for entrepreneurs. Startups frequently pay low salaries (ones that may not support the high cost of health insurance) in return for an equity stake that offers the possibility of a high future payout. You cannot similarly defer health care benefits: when cash is tight, you either offer costly benefits at the expense of other priorities or leave your employees without health insurance. This tradeoff is not present if the insurance system isn't employer-based.
Of course this is only part of the explanation for how our system impedes entrepreneurship. One way or another, we're all paying an absurd amount just to keep us (somewhat) healthy.
http://andrewsullivan.theatlantic.com/the_daily_dish/2011/02...
No one forced the employees of his company to apply. There should not be restrictions on companies like this. I don't even think there should be a minimum wage. If the employees are walking in the door, and asking for a job, then it's their choice whether to take it or not.
When you raise the minimum wage, or require the employer to provide health insurance, you are closing the door on many potential employees and definitely increasing the unemployment rate.
Employees are paid according to their value. If you are making low wages it's either what you're worth, or because you're too stupid to realize you're being exploited.
I for one think people have a right to be either worthless or stupid, and therefore do not think business should be regulated in such a way.
When you raise the minimum wage, or require the employer to provide health insurance, you are closing the door on many potential employees and definitely increasing the unemployment rate.
Employees are paid according to their value. If you are making low wages it's either what you're worth, or because you're too stupid to realize you're being exploited.
I for one think people have a right to be either worthless or stupid, and therefore do not think business should be regulated in such a way.
He's not talking about unfairness to the employees in this case, but to third parties who are neither the employer nor the employee. If a company doesn't offer health insurance or a salary sufficient to buy private coverage, then what happens when one of their employees gets seriously ill? Generally they will still receive some care (at least in serious enough cases), so someone has to pay for it. It will be either: 1) a different company, indirectly via their health insurance package, which covers the person in question as a spouse or child; or 2) hospitals or the government, if a patient ends up going to the ER and receiving care they can't pay for.
The costs incurred by people not paying for their medical services are relatively small, less than 5% of all health care costs.
A much bigger issue is higher insurance premiums due to unhealthy lifestyles.
Preventable poor health due to obesity, poor nutrition and lack of exercise are a major contributor to health care costs.
That results in higher costs for everybody.
As a healthy, fit, non-smoker and non-drug user, why should I have to pay their costs?
A much bigger issue is higher insurance premiums due to unhealthy lifestyles.
Preventable poor health due to obesity, poor nutrition and lack of exercise are a major contributor to health care costs.
That results in higher costs for everybody.
As a healthy, fit, non-smoker and non-drug user, why should I have to pay their costs?
Exactly. Unless you're going to allow people to die in the waiting room at the ER because they don't have insurance, someone is bearing the cost of treating the uninsured. It's either a spouse, the government, or everyone else who has insurance via higher premiums.
Generally, that cost is much higher. US hospitals can only treat uninsured people who are on death's door, which is ridiculously expensive. Treating people before they need emergency treatment is much cheaper. Or you could be really hard-line, and just let them die if they can't pay for treatment.
Reality, you already have socialised care. It's just really inefficient. And you pay extra for private cover!
Reality, you already have socialised care. It's just really inefficient. And you pay extra for private cover!
US hospitals can only treat uninsured people who are on death's door
I don't know that to be true, here in Florida we have a lot of immigration, many of them are fleeing worse places and don't have a lot of money and definitely don't have insurance, so they go to the ER like others go to their general practitioner. They do this because hospitals are not allowed to refuse treatment to the uninsured.
I don't know that to be true, here in Florida we have a lot of immigration, many of them are fleeing worse places and don't have a lot of money and definitely don't have insurance, so they go to the ER like others go to their general practitioner. They do this because hospitals are not allowed to refuse treatment to the uninsured.
US hospitals can only treat uninsured people who are on death's door
If you break your arm or get poked in the eye and don't have insurance, you do not get refused treatment at the ER.
If you break your arm or get poked in the eye and don't have insurance, you do not get refused treatment at the ER.
> Employees are paid according to their value. If you are making low wages it's either what you're worth, or because you're too stupid to realize you're being exploited.
Somebody ought to tell that to Goldman Sachs or just about any big american corporation which pays insane amounts to people who have a track record of running businesses into the ground.
Somebody ought to tell that to Goldman Sachs or just about any big american corporation which pays insane amounts to people who have a track record of running businesses into the ground.
Right. The reason that every first world country in the world has minimum wage is because they want to hurt business as much as possible.
>No one forced the employees of his company to apply.
Companies have been proven to be conspiring to keep wages down just recently. An employee is forced to work somewhere.
But I bet you think the insane amount of money CEOs get is their "market rate" too.
>No one forced the employees of his company to apply.
Companies have been proven to be conspiring to keep wages down just recently. An employee is forced to work somewhere.
But I bet you think the insane amount of money CEOs get is their "market rate" too.
You seem to have taken as a given the idea that companies, like parents to children, or medieval lords to their vassals, should bear responsibility for their employees' health costs. Otherwise, the company is 'freeloading'.
Yet the point of this study seems to be that employer-centric health-arrangements prevent new business formation.
Let's assume new business formation is something we want to maximize. (New businesses are how our culture rapidly searches for new productive arrangements, and countries with lower rates of business-formation tend to stagnate on lots of other things too.)
Then we have to get away from the cultural expectation that the employer is the direct payer/purchaser of health costs.
Whether the responsibility moves to the national government ('single-payer'), or other governmental bodies, or individuals/families, or other civic/voluntary/religious associations is a separate issue. It has to get away from companies, or else we're losing out on business-formation (and job-mobility) that we need.
Yet the point of this study seems to be that employer-centric health-arrangements prevent new business formation.
Let's assume new business formation is something we want to maximize. (New businesses are how our culture rapidly searches for new productive arrangements, and countries with lower rates of business-formation tend to stagnate on lots of other things too.)
Then we have to get away from the cultural expectation that the employer is the direct payer/purchaser of health costs.
Whether the responsibility moves to the national government ('single-payer'), or other governmental bodies, or individuals/families, or other civic/voluntary/religious associations is a separate issue. It has to get away from companies, or else we're losing out on business-formation (and job-mobility) that we need.
You're reading too much into my post. Employer-based health insurance is a terrible idea. Single-payer is IMO the only reasonable choice, but employer-based private insurance is just about the worst conceivable option. Unfortunately, it is deeply embedded.
My point was that the only reason the current system hasn't completely killed new business formation is that employees and founders are able to freeload. Freeloading takes a broken system and makes it even more unfair and dysfunctional.
My point was that the only reason the current system hasn't completely killed new business formation is that employees and founders are able to freeload. Freeloading takes a broken system and makes it even more unfair and dysfunctional.
Fair enough; with your clarification I can see what you meant.
Still, what you call 'freeloading' I see as local approximations of a more-logical system, where someone else – anyone else – pays rather than companies directly. Since it allows a necessary good thing – business formation – to happen, it looks like a step in a fairer/more-functional direction to me.
Still, what you call 'freeloading' I see as local approximations of a more-logical system, where someone else – anyone else – pays rather than companies directly. Since it allows a necessary good thing – business formation – to happen, it looks like a step in a fairer/more-functional direction to me.
I think you have got it backwards. Why should companies have to provide health insurance for their employees? It makes it inefficient since people are beholden to their jobs and can't easily change jobs (or start new companies).
[deleted]
Answer: Hell yes. Self-insurance is absurdly expensive while group insurance outside of an employer or credit union is harder to find than a Republican with a conscience.
The lie that "Obama-Care kills small businesses and/or jobs" is a smokescreen for the truth: Healthcare reform would free employees from indentured health care servitude and allow small businesses to hire more competitively, creating more jobs.
The lie that "Obama-Care kills small businesses and/or jobs" is a smokescreen for the truth: Healthcare reform would free employees from indentured health care servitude and allow small businesses to hire more competitively, creating more jobs.
The "Republican with a conscience" line is unfair. Life would be a lot easier if all the sociopaths in the world were on one side, and all the conscientious people on the other. But it's not like that.
Granted, sorry. The problem I have with Republican rhetoric on the issue is the "I got mine" smugness of it all. The message seems to be "If you want health care, get a job like me. Problem solved." But it isn't that simple. Unemployment is real even for the able-bodied and a common consequence of being underinsured. Some jobs don't offer health care (at all) or offer inadequate, unaffordable health care (small businesses, in my experience.) Preexisting conditions can lock hard-working people out or keep them from seeking optimum employment.
I'd love to hear from even one anti-healthcare reform advocate who has ever been "outside the system" (as outlined above) and thinks that's a principled position to take.
I'd love to hear from even one anti-healthcare reform advocate who has ever been "outside the system" (as outlined above) and thinks that's a principled position to take.
This comment is, unfortunately, an illustration of how sites go downhill. It has 19 downvotes, including mine. So how does it have so many points? Because it has twice as many upvotes.
When badness arrives in online communities, it arrives first in forms that make people invite it right in.
When badness arrives in online communities, it arrives first in forms that make people invite it right in.
You're right that employer-based health insurance is idiotic and economically destructive (conservative and libertarian analysts have been saying so for decades), but your blatant partisanship is not helpful. In 2008 John McCain's platform included a migration away from employer coverage by treating benefits as taxable income, while simultaneously granting a refundable tax credit for the purchase of individual insurance. Obama and the Democrats instantly demagogued that as "taking away your existing coverage" and defended the employer-based system.
Let's please not have political discussions on HN.
> Let's please not have political discussions on HN.
It's interesting that you chose to respond to the person who demonstrated "dems good, republicans bad" was wrong instead of the person who just asserted "dems good, republicans bad".
It's interesting that you chose to respond to the person who demonstrated "dems good, republicans bad" was wrong instead of the person who just asserted "dems good, republicans bad".
I got here after both people posted. I posted below both people to indicate that I wanted the convo thread killed. I downvoted both people.
Okay, I know hating on Republicans is fun, but is that really necessary? Why sow the seeds of discord?
This is precisely why I loathe the political articles so much.
For instance, if I'm not mistaken, patio11, who is a great contributor here, has declared his Republicanness (sorry if that's not accurate), something I'm more or less opposed to in its current form in the US. I might find it fun to chat with him about that in person, but I do not want to get into political discussions with him here. First of all, because he has way more valuable ways to contribute his time in terms of discussing his startup, tech or whatever, and because... why introduce discord about a subject that's off-topic here.
I guess this article is closer to on-topic in that it certainly is pertinent to new startups in the US... but look where it got us already.
For instance, if I'm not mistaken, patio11, who is a great contributor here, has declared his Republicanness (sorry if that's not accurate), something I'm more or less opposed to in its current form in the US. I might find it fun to chat with him about that in person, but I do not want to get into political discussions with him here. First of all, because he has way more valuable ways to contribute his time in terms of discussing his startup, tech or whatever, and because... why introduce discord about a subject that's off-topic here.
I guess this article is closer to on-topic in that it certainly is pertinent to new startups in the US... but look where it got us already.
Moreover, this discussion is not helpful nor germane to the topic at hand.
Please take the vitriol to /r/politics. This is HN. We shall remain civilized.
The Republicans have been trying to kill employer based health care forever... it's the unions responsible for it.
But they don't want to replace it with anything other than everyone buys their insurance on the open market if they want coverage, which is why unions are against it. If they wanted to move to a full coverage system (single payer?), unions would be happy because everyone has healthcare.
No, they wouldn't be happy with that... they would get waivers from the single payer system... just like 650 of the 773 ObamaCare waivers currently go to unions.
This list does indeed appear to be a veritable who's who of the president's campaign supporters. Seems hypocritical to me. If it's good enough for the rest of us, it should be good enough for them too.
http://www.hhs.gov/ociio/regulations/approved_applications_f...
http://www.hhs.gov/ociio/regulations/approved_applications_f...
Were there opponents of the current administration who applied for waivers and were turned down, even though they had exactly the same circumstances as supporters who got their waiver applications approved?
I don't think unions would be necessarily happy with single payer- I wouldn't be surprised to see most (non-public sector, at least) unions cease to exist before long if single payer becomes a reality. Negotiation of benefits is one of the few valuable roles unions play these days, outside of political lobbying for the assumed goals of their constituents. Which is arguably part of the problem.
> If they wanted to move to a full coverage system (single payer?), unions would be happy because everyone has healthcare.
Citation needed.
Yes, the health care employers unions have expressed considerable interest in measures that would increase the demand for their members' services, but you're making a very different claim.
Citation needed.
Yes, the health care employers unions have expressed considerable interest in measures that would increase the demand for their members' services, but you're making a very different claim.
> Citation needed.
Here's a good start:
http://unionsforsinglepayerhr676.org/union_endorsers
Here's a good start:
http://unionsforsinglepayerhr676.org/union_endorsers
Dont have immediate access to the paper. I agree it is a hurdle to overcome, but I don't really know how many startups ultimately don't get started or fail because of it especially if you look at the number of startups and entrepreneurs consistently popping up in the US compared to some countries where the government provides universal healthcare.
How is this problem overcome ?
Ihave a few ideas but no real specifics. A website with specifics would be very useful.
Yes, but government ran healthcare is not the answer...
What is the answer and is there anywhere in the world that it's currently functioning?
Anecdotally, the best system I've ever experienced was in Austria, which is some weird mish-mash of public and private which I never fully understood the details of. You have to have health insurance, but those companies are non-profits... or something like that. Here in Italy, it's government run, and suffers a bit from that, at times, although on the other hand, you have complete "peace of mind" in terms of not worrying about losing your job or something and being unable to take your child to the doctor.
I'm kind of fond of Singapore's health care system...
http://econlog.econlib.org/archives/2008/01/singapores_heal....
http://blog.jparsons.net/2009/08/why-singapores-health-care-...
http://econlog.econlib.org/archives/2008/01/singapores_heal....
http://blog.jparsons.net/2009/08/why-singapores-health-care-...
Me too, but it's government run... Seems like your previous statement would preclude you from liking it.
Some governments are good at running some things. The US government seems to screw up everything. I don't know why this is, but if public health care ever becomes reality, and it is anything like the DMV, or any government services in California for that matter, or VA hospitals...may [deity] help us all.
I am in no way a fan of the perverse incentives created by a for-profit private health care system, but I am worried that the alternative might be even worse.
I am in no way a fan of the perverse incentives created by a for-profit private health care system, but I am worried that the alternative might be even worse.
Singapore is the size of a city in the US, it's hard to compare the efficiencies of government programs. Medicare's enrollment alone is over 10x the size of Singapore's population.
What wrong with a for-profit system? There should be MORE profit, not less.
High profits attract entrepreneurs to compete for customers by offering lower prices and innovating - consumers benefit.
The current system is the exact opposite - there is relatively little and uncertain profit (and high barriers to entry) in insurance and hospitals, and a ton of government interference and regulation. Few entrepreneurs want to get involved, which reduces competition and innovation and keeps prices higher.
"Plunging revenues from investments have forced median profit margins for U.S. hospitals to zero, according to a Thomson Reuters analysis of hospital finances published on Monday.
And half of the more than 400 hospitals studied are losing money, the analysis found."
http://www.reuters.com/article/2009/03/02/us-hospitals-usa-i...
High profits attract entrepreneurs to compete for customers by offering lower prices and innovating - consumers benefit.
The current system is the exact opposite - there is relatively little and uncertain profit (and high barriers to entry) in insurance and hospitals, and a ton of government interference and regulation. Few entrepreneurs want to get involved, which reduces competition and innovation and keeps prices higher.
"Plunging revenues from investments have forced median profit margins for U.S. hospitals to zero, according to a Thomson Reuters analysis of hospital finances published on Monday.
And half of the more than 400 hospitals studied are losing money, the analysis found."
http://www.reuters.com/article/2009/03/02/us-hospitals-usa-i...
"What wrong with a for-profit system? There should be MORE profit, not less.
High profits attract entrepreneurs to compete for customers by offering lower prices and innovating - consumers benefit."
That ideal doesn't exist, and probably can't, in the real world. In most situations, the easiest/fastest/cheapest way to 'profit' is by getting more customers' money, and spending less of it. When 'spending less' means customers get less care (the easiest way to spend less) then people will suffer.
The 'innovations' and such... well... I've no doubt some would/will happen, but how much 'innovation' can there be in insurance? We saw a lot of 'innovation' in the financial insurance markets (CDOs and such) and that wasn't a resounding success.
The bigger problem with your premise assumes that people are smart with respect to choosing between multiple private insurers each offering 'innovations' of their own. Most people wouldn't be on day 1 switching away from their current system, and it's not something that you can easily learn from or experiment with. With consumer items, I can buy them, try them, and recommend them to my friends if I like them or not. It's a lot harder to try out various insurance programs for multiple surgeries to see how each one fares in your particular situation.
Hospitals are often losing money because they're covering the cost of procedures for people who can't pay.
Long and short, hospitals and medical entities exist to help people with their most basic needs - health and life. People generally go to hospitals when they are sick or dying. Seeing 'for profit' companies making a profit from misery, illness, sickness and death isn't something that is going to sit well with most people.
That ideal doesn't exist, and probably can't, in the real world. In most situations, the easiest/fastest/cheapest way to 'profit' is by getting more customers' money, and spending less of it. When 'spending less' means customers get less care (the easiest way to spend less) then people will suffer.
The 'innovations' and such... well... I've no doubt some would/will happen, but how much 'innovation' can there be in insurance? We saw a lot of 'innovation' in the financial insurance markets (CDOs and such) and that wasn't a resounding success.
The bigger problem with your premise assumes that people are smart with respect to choosing between multiple private insurers each offering 'innovations' of their own. Most people wouldn't be on day 1 switching away from their current system, and it's not something that you can easily learn from or experiment with. With consumer items, I can buy them, try them, and recommend them to my friends if I like them or not. It's a lot harder to try out various insurance programs for multiple surgeries to see how each one fares in your particular situation.
Hospitals are often losing money because they're covering the cost of procedures for people who can't pay.
Long and short, hospitals and medical entities exist to help people with their most basic needs - health and life. People generally go to hospitals when they are sick or dying. Seeing 'for profit' companies making a profit from misery, illness, sickness and death isn't something that is going to sit well with most people.
> That ideal doesn't exist, and probably can't, in the real world.
Yes it does, and it's a reality throughout the economy not just an ideal.
> Hospitals are often losing money because they're covering the cost of procedures for people who can't pay.
No, that's not true. The costs of unpaid bills is very low and not a major cost.
> When 'spending less' means customers get less care
That's not the case. Look at the horrible reputation of the VAs and government medical facilities vs. privately run.
My grandfather had free VA due to his military service, but bought additional medical insurance so he could go to a non-VA hospital instead-- the reputation of VA hospitals has been horrible.
Also there are many top-quality for-profit hospitals, some of the most respected in my area are for-profit hospitals. But also many doctors in practice for themselves provide excellent services as a for-profit practice.
> Long and short, hospitals and medical entities exist to help people with their most basic needs
That's why profitability is important, because it drives down costs and encourages innovation, as opposed to lack of profitability.
> Seeing 'for profit' companies making a profit from misery, illness, sickness and death isn't something that is going to sit well with most people.
Profitable companies help people every day, they make a profit providing a valuable service which is complex and requires a lot of investment and expertise.
They provide advanced medical services and pharmaceuticals and they save millions of people's lives. If you claim otherwise then you are simply clueless.
Profit is what lowers costs and drives innovation and investment. I don't know why you would be on an entrepreneur forum if you think profit is bad-- without profit there would be no entrepreneurship.
Yes it does, and it's a reality throughout the economy not just an ideal.
> Hospitals are often losing money because they're covering the cost of procedures for people who can't pay.
No, that's not true. The costs of unpaid bills is very low and not a major cost.
> When 'spending less' means customers get less care
That's not the case. Look at the horrible reputation of the VAs and government medical facilities vs. privately run.
My grandfather had free VA due to his military service, but bought additional medical insurance so he could go to a non-VA hospital instead-- the reputation of VA hospitals has been horrible.
Also there are many top-quality for-profit hospitals, some of the most respected in my area are for-profit hospitals. But also many doctors in practice for themselves provide excellent services as a for-profit practice.
> Long and short, hospitals and medical entities exist to help people with their most basic needs
That's why profitability is important, because it drives down costs and encourages innovation, as opposed to lack of profitability.
> Seeing 'for profit' companies making a profit from misery, illness, sickness and death isn't something that is going to sit well with most people.
Profitable companies help people every day, they make a profit providing a valuable service which is complex and requires a lot of investment and expertise.
They provide advanced medical services and pharmaceuticals and they save millions of people's lives. If you claim otherwise then you are simply clueless.
Profit is what lowers costs and drives innovation and investment. I don't know why you would be on an entrepreneur forum if you think profit is bad-- without profit there would be no entrepreneurship.
What evidence is there that few entrepreneurs want to get involved in hospitals? Here's some evidence to the contrary:
http://www.bizjournals.com/houston/news/2011/01/18/emerus-ho...
http://www.emerus.com/
http://www.bizjournals.com/houston/news/2011/01/18/emerus-ho...
http://www.emerus.com/
That's one example. There are 5,500+ hospitals in the US, so one example is hardly representative. There would be many more investments if it was more profitable.
As the link I posted states - many are not profitable and many have a very low profit margin. Higher profits would bring more entrepreneurs and investment.
As the link I posted states - many are not profitable and many have a very low profit margin. Higher profits would bring more entrepreneurs and investment.
You are assuming that because the industry has many unprofitable participants, there must be few new entrants. You're guessing. You haven't shown that there are indeed few new entrants, nor have you shown that low profit margins are the main factor that discourages them. Any industry that is as capital intensive as hospitals are will have relatively few new entrants, so a convincing argument of the causal relationship you're claiming will be difficult to make.
I mostly agree with you that healthy profits are desirable if we want to have an effective healthcare system, but I don't think hospital profit has much to do with it. The profit that healthcare technology companies and actual care providers make seems more important.
I mostly agree with you that healthy profits are desirable if we want to have an effective healthcare system, but I don't think hospital profit has much to do with it. The profit that healthcare technology companies and actual care providers make seems more important.
Investors/entrepreneurs are attracted to businesses that show promise to be profitable, and turn away from making investment in unprofitable businesses.
This is a basic economics principle - I'm not assuming anything. I cited hospitals as an example to illustrate this, because there are many stats, such as what I posted (not an assumption, but a study), which show it's not a very profitable business (relative other businesses) - and btw, neither is health insurance.
If you disagree, then look it up in a basic economics or finance textbook, here are a few explanatons of the relationship of investment, profitability and ROI:
"In other words, profit-seeking businesses operating in the private sector of the economy will be prepared to go ahead with an investment if they believe that the project will over its projected lifetime yield a real rate of return greater than if the money tied up in an investment project had been invested in the next best alternative way."
Macroeconomics - Capital Investment http://tutor2u.net/economics/revision-notes/a2-macro-capital...
"The owners of a company and the company’s creditors share a similar goal: to increase wealth. They are thus very concerned about profitability in all phases of operations.
Creditors are specifically concerned that the company use its resources profitably so that it can pay interest and principal on its debt. Owners are concerned that the company be profitable so that stock values will increase. Company managers must show they can manage the owners’ investment and produce the profits that owners and creditors demand. Because top management must meet the profit expectations of company owners, it passes down to the lower levels of management those profitability goals, which are then spread throughout the company. All managers, therefore, are expected to meet profitability goals, which are often increased and tightened as each level of management seeks a margin of safety."
PDF - The Importance of Return on Investment: ROI http://media.wiley.com/product_data/excerpt/50/04712037/0471...
This is a basic economics principle - I'm not assuming anything. I cited hospitals as an example to illustrate this, because there are many stats, such as what I posted (not an assumption, but a study), which show it's not a very profitable business (relative other businesses) - and btw, neither is health insurance.
If you disagree, then look it up in a basic economics or finance textbook, here are a few explanatons of the relationship of investment, profitability and ROI:
"In other words, profit-seeking businesses operating in the private sector of the economy will be prepared to go ahead with an investment if they believe that the project will over its projected lifetime yield a real rate of return greater than if the money tied up in an investment project had been invested in the next best alternative way."
Macroeconomics - Capital Investment http://tutor2u.net/economics/revision-notes/a2-macro-capital...
"The owners of a company and the company’s creditors share a similar goal: to increase wealth. They are thus very concerned about profitability in all phases of operations.
Creditors are specifically concerned that the company use its resources profitably so that it can pay interest and principal on its debt. Owners are concerned that the company be profitable so that stock values will increase. Company managers must show they can manage the owners’ investment and produce the profits that owners and creditors demand. Because top management must meet the profit expectations of company owners, it passes down to the lower levels of management those profitability goals, which are then spread throughout the company. All managers, therefore, are expected to meet profitability goals, which are often increased and tightened as each level of management seeks a margin of safety."
PDF - The Importance of Return on Investment: ROI http://media.wiley.com/product_data/excerpt/50/04712037/0471...
When's the last time you were in a US hospital? I'd say the nightmare you fear is already here.
I think context is important. As a US citizen I agree with the general sentiment that the US government isn't competent to run healthcare. Comparisons with Canada and the UK are not helpful because they are different kinds of governments. The notion in the US that government should be as small as possible has yielded a government which cannot be trusted.
The proponents of a single payer system in the US don't address this sufficiently.
A solution for the US would be reform of the health insurance market. Require that health insurance providers be disallowed to refuse coverage to individuals for any reason. Disallow health care providers from charging lower rates to health insurance providers than they do to individual payers.
A free market would work. A single payer system would work. What we have now is in between and will always be bad.
The proponents of a single payer system in the US don't address this sufficiently.
A solution for the US would be reform of the health insurance market. Require that health insurance providers be disallowed to refuse coverage to individuals for any reason. Disallow health care providers from charging lower rates to health insurance providers than they do to individual payers.
A free market would work. A single payer system would work. What we have now is in between and will always be bad.
As a US citizen I agree with the general sentiment that the US government isn't competent to run healthcare.
The VA hospitals are actually very well run.
The VA hospitals are actually very well run.
That's a good point. I have no experience with VA hospitals. If it is true then I think it would be reasonable to endorse expanding the VA infrastructure to support everybody.
> The VA hospitals are actually very well run.
Some VA facilities are well run, some aren't. (And some are a mix - Walter Reed, which is where CongressCritters go, had some horrific wards as of a couple of years ago.)
The Indian Health Care service, on the other hand, is a complete horrorshow.
Some VA facilities are well run, some aren't. (And some are a mix - Walter Reed, which is where CongressCritters go, had some horrific wards as of a couple of years ago.)
The Indian Health Care service, on the other hand, is a complete horrorshow.
What are the solutions employed by all the startups that get started?
For information, here in Germany, from where I run my startup which itself is a UK Limited, I provide my employees with full health insurance (teeth, sick days, everything), pension, unemployment insurance, etc. for basically €700/month for an after tax salary of about €2500/month.
As soon as you start to factor in all the costs of insurance, etc., doing business in the old Europe is pretty cheap. Even in Denmark, where I lived and worked for a while, you get everything included from the state and as a startup founder, this is really great.
I believe in free market for a lot of things, but not for health insurance.
As soon as you start to factor in all the costs of insurance, etc., doing business in the old Europe is pretty cheap. Even in Denmark, where I lived and worked for a while, you get everything included from the state and as a startup founder, this is really great.
I believe in free market for a lot of things, but not for health insurance.
what I don't like on european (interpolating from czech, but it's probably quite similar everywhere in europe) health and welfare insurance is that you generally can't opt-out from that. Complete opt-out is probably bad idea, but I would like to pay insurance only when I actually have income, not be obliged by law to pay what equates to half of my other expenses every month. It seems fair to me to roll these "insurances" into income tax, as it is essentially nothing different from income tax (although logic of caps is different on income tax and this "insurances").
I'm perfectly willing to pay significantly more than is obligatory, but only when my income for given period allows that.
I'm perfectly willing to pay significantly more than is obligatory, but only when my income for given period allows that.
In Germany, Denmark and France (the only places I was employed for more than 3 years), if you have no incomes, you are automatically covered. Of course as a consultant, if you have no incomes in a given month, you still need to pay. If you do not want, you need to switch to officially unemployed for the month, which is not worth it.
Why don't you believe in a free market for health insurance? Forcing
people to pay into a health insurance is kind of scammy - let's say
that I have a genetic condition that is certain to kill me rapidly at
age 30. I want to live my life to the fullest, and I'd rather not be
forced to buy health insurance that protects me from things like adult
onset diabetes, alzheimer's, cancer, parkinson's, etc, that I'm just
not going to get. Why should I be forced to pony up for other people's
healthcare, too? What do I owe those bastards who get to live twice
as long as I am and beat me up and teased me on the playground in
middle school?
The more insidious thing about universal healthcare is that it really screws over most minorities. Minorities tend to have diseases that are not as well researched as those found in ethnic majorities (or certain minorities which are disproportionately represented in the medical research community). Moreover, drug testing -for safety and efficacy- in minorities is very scant, and it is sometimes the case that adverse reactions to drugs occur in minorities that do not occur in the ethnic or racial majorities. Of course to find that out you need statistically relevant sample sizes, and the way drug safety testing is done is by recruiting on college campuses - you can see the potential problem here - and even still some minorities that are overrepresented on colleges are, for whatever reason, underrepresented in testing pools. So as a minority, one might be paying into a system that disproportionately treats diseases that one would not be getting, or with different pathologies, and for which the treatments may be completely ineffective or even dangerous due to lack of study.
Then there is this problem. What if those who decide health coverage decide that heterozygous genetic condition X is covered (and it's expensive). Two parents who are carriers now can decide, hey we can afford to have kids - after all it's their right. So now everyone is saddled with the burden of their selfish choice. Or, we can restrict their liberty by prohibiting all such pairs of parents from reproducing. Whereas if they are responsible for the cost of their children's care, then the simple answer is they might think twice about having children and if they are foolhardy enough to, there is a 1 in 4 chance they get dinged with the cost of coverage.
Ultimately, any governmental (i.e. non-free-market) health insurance plan must either explicitly discriminate between individuals or, if universal, implicitly discriminate between individuals. The perverted consequence is, ultimately, going to be a transfer of wealth from the poor (via inflation) to those who have the right genetic predisposition to conditions which are decided to be covered by the powers that be.
Keep in mind that 'free market' != 'for-profit'. You can have nonprofit insurance companies, and healthcare charities, in a 'free market' system. What free market means is that the consumer has a choice of where to go for their services. If you are saying that you don't like 'free market healthcare' you are saying that in the aggregate, the population is too stupid to make responsible, cost-effective decisions about their own health. If that is the case, who or what group of people could possibly be so enlightened and all-knowing to correctly orchestrate all those choices from the full society on down to the individual level? And how might we shield society from the hubris of our godlike health chancellor/council?
The more insidious thing about universal healthcare is that it really screws over most minorities. Minorities tend to have diseases that are not as well researched as those found in ethnic majorities (or certain minorities which are disproportionately represented in the medical research community). Moreover, drug testing -for safety and efficacy- in minorities is very scant, and it is sometimes the case that adverse reactions to drugs occur in minorities that do not occur in the ethnic or racial majorities. Of course to find that out you need statistically relevant sample sizes, and the way drug safety testing is done is by recruiting on college campuses - you can see the potential problem here - and even still some minorities that are overrepresented on colleges are, for whatever reason, underrepresented in testing pools. So as a minority, one might be paying into a system that disproportionately treats diseases that one would not be getting, or with different pathologies, and for which the treatments may be completely ineffective or even dangerous due to lack of study.
Then there is this problem. What if those who decide health coverage decide that heterozygous genetic condition X is covered (and it's expensive). Two parents who are carriers now can decide, hey we can afford to have kids - after all it's their right. So now everyone is saddled with the burden of their selfish choice. Or, we can restrict their liberty by prohibiting all such pairs of parents from reproducing. Whereas if they are responsible for the cost of their children's care, then the simple answer is they might think twice about having children and if they are foolhardy enough to, there is a 1 in 4 chance they get dinged with the cost of coverage.
Ultimately, any governmental (i.e. non-free-market) health insurance plan must either explicitly discriminate between individuals or, if universal, implicitly discriminate between individuals. The perverted consequence is, ultimately, going to be a transfer of wealth from the poor (via inflation) to those who have the right genetic predisposition to conditions which are decided to be covered by the powers that be.
Keep in mind that 'free market' != 'for-profit'. You can have nonprofit insurance companies, and healthcare charities, in a 'free market' system. What free market means is that the consumer has a choice of where to go for their services. If you are saying that you don't like 'free market healthcare' you are saying that in the aggregate, the population is too stupid to make responsible, cost-effective decisions about their own health. If that is the case, who or what group of people could possibly be so enlightened and all-knowing to correctly orchestrate all those choices from the full society on down to the individual level? And how might we shield society from the hubris of our godlike health chancellor/council?
> why don't you believe in a free market for health insurance? Forcing people to pay into a health insurance is kind of scammy - let's say that I have a genetic condition that is certain to kill me rapidly at age 30. I want to live my life to the fullest, and I'd rather not be forced to buy health insurance that protects me from things like adult onset diabetes, alzheimer's, cancer, parkinson's, etc, that I'm just not going to get. Why should I be forced to pony up for other people's healthcare, too?
Don't you think that your argument might be somewhat flawed if the most plausible scenario you can come up with is this?
Don't you think that your argument might be somewhat flawed if the most plausible scenario you can come up with is this?
I'm terribly sorry for you if you don't believe that protecting the rights of minorities and corner cases is important.
If you don't believe the section about minorities, then you are pulling a denial of science that is far worse than any climate science denier. There are two 'canonical' heterozygous recessive diseases that are covered in every high school biology textbook - cystic fibrosis and sickle cell anemia. Sickle cell anemia affects mostly people of west african descent. Cystic fibrosis mostly affects people of askenazi jewish descent. Sometimes I wonder why do we have high standards of care and treatment protocols, and are racing toward a cure for CF, while sickle cell anemia even has, an admittedly crude, known treatment (for a decade now) that still has languished in regulation. Why don't we have better research on SCA to figure out how to treat it?
If you don't believe the section about minorities, then you are pulling a denial of science that is far worse than any climate science denier. There are two 'canonical' heterozygous recessive diseases that are covered in every high school biology textbook - cystic fibrosis and sickle cell anemia. Sickle cell anemia affects mostly people of west african descent. Cystic fibrosis mostly affects people of askenazi jewish descent. Sometimes I wonder why do we have high standards of care and treatment protocols, and are racing toward a cure for CF, while sickle cell anemia even has, an admittedly crude, known treatment (for a decade now) that still has languished in regulation. Why don't we have better research on SCA to figure out how to treat it?
...and the way to encourage research into SCA is to make sure most people that suffer from it are unable to pay for whatever treatment gets developed, by denying them healthcare? You've made the point that some diseases disproportionately affect minorities, but the step that gets us from "unaffordable healthcare"=>"treating more minorities" seems lacking.
> Why don't you believe in a free market for health insurance?
There are two main reasons. First of all, as someone mentioned it in another thread here a few days ago, healthcare does not follow the rules of supply and demand, since people would pay anything for survival. You're never going to say that "ah this treatment is a bit overpriced; I think I'll get more value for my money if I'll just die instead". It's ridiculous. Second, there are various domains where the short term interests of various parties do not coincide with the long terms interests of everyone, hence regulation is needed. This is not political theory, it's game theory, it is nothing to do with personal opinion. It's a fact.
> Let's say that I have a genetic condition that is certain to kill me rapidly at age 30
You probably don't want to die then at 25 after not receiving a treatment after having car accident.
> Why should I be forced to pony up for other people's healthcare, too?
It's called compassion and it is a cornerstone of our civilization.
> The more insidious thing about universal healthcare is that it really screws over most minorities.
I don't know about that. I am not a doctor so I don't know whether such conditions really exist, but my gut feeling is that almost all of the stuff people get treated for are universal across various minorities.
> What if those who decide health coverage decide that heterozygous genetic condition X is covered...
I think this must be a fundamental, antagonistic difference between our world views. As a European conservative, I truly believe that no life is unnecessary, no life is wasted.
> ultimately, going to be a transfer of wealth from the poor (via inflation) to those who have the right genetic predisposition to conditions
Most of the things people get treated for have nothing or almost nothing to do with genetic conditions. There is no gene for suffering a car accident. While having unlucky genes could decrease the chances of survival, ultimately everyone can get cancer.
There are two main reasons. First of all, as someone mentioned it in another thread here a few days ago, healthcare does not follow the rules of supply and demand, since people would pay anything for survival. You're never going to say that "ah this treatment is a bit overpriced; I think I'll get more value for my money if I'll just die instead". It's ridiculous. Second, there are various domains where the short term interests of various parties do not coincide with the long terms interests of everyone, hence regulation is needed. This is not political theory, it's game theory, it is nothing to do with personal opinion. It's a fact.
> Let's say that I have a genetic condition that is certain to kill me rapidly at age 30
You probably don't want to die then at 25 after not receiving a treatment after having car accident.
> Why should I be forced to pony up for other people's healthcare, too?
It's called compassion and it is a cornerstone of our civilization.
> The more insidious thing about universal healthcare is that it really screws over most minorities.
I don't know about that. I am not a doctor so I don't know whether such conditions really exist, but my gut feeling is that almost all of the stuff people get treated for are universal across various minorities.
> What if those who decide health coverage decide that heterozygous genetic condition X is covered...
I think this must be a fundamental, antagonistic difference between our world views. As a European conservative, I truly believe that no life is unnecessary, no life is wasted.
> ultimately, going to be a transfer of wealth from the poor (via inflation) to those who have the right genetic predisposition to conditions
Most of the things people get treated for have nothing or almost nothing to do with genetic conditions. There is no gene for suffering a car accident. While having unlucky genes could decrease the chances of survival, ultimately everyone can get cancer.
While I agree with some of what you say, I take issue with the following:
> You're never going to say that "ah this treatment is a bit overpriced; I think I'll get more value for my money if I'll just die instead".
No one is rationally arguing this. The free-market point-of-view is that multiple providers will offer you treatment, and you can select, based on quality, price, provider's reputation etc. etc. what best fits your needs.
Over and over in this debate I see this fallacy that a free-market system says "You pay this price or you die." If a procedure can be made cheaper or more effective, a variety of providers is going to scramble to provide it.
The difficulty we face in the U.S. is that there is no real competition in healthcare. As others have pointed out, the people making the purchasing decisions are not the people with a vested interest in the affordability and quality of healthcare, and price/quality signals are obscure at best, and typically hidden altogether.
You, as a consumer, can't make rational healthcare decisions when your insurance is selected by your employer, your doctor is chosen by your insurer, and your treatment is chosen with an eye toward liability rather than effectiveness.
> You're never going to say that "ah this treatment is a bit overpriced; I think I'll get more value for my money if I'll just die instead".
No one is rationally arguing this. The free-market point-of-view is that multiple providers will offer you treatment, and you can select, based on quality, price, provider's reputation etc. etc. what best fits your needs.
Over and over in this debate I see this fallacy that a free-market system says "You pay this price or you die." If a procedure can be made cheaper or more effective, a variety of providers is going to scramble to provide it.
The difficulty we face in the U.S. is that there is no real competition in healthcare. As others have pointed out, the people making the purchasing decisions are not the people with a vested interest in the affordability and quality of healthcare, and price/quality signals are obscure at best, and typically hidden altogether.
You, as a consumer, can't make rational healthcare decisions when your insurance is selected by your employer, your doctor is chosen by your insurer, and your treatment is chosen with an eye toward liability rather than effectiveness.
"Most of the things people get treated for have nothing or almost nothing to do with genetic conditions."
Almost completely incorrect. Got the flu? Well that's because the flu virus latched onto a receptor that let it get into your respiratory cell. That receptor could be mutated in you.
Got into a car accident? The surgery is painful. They're going to give you an anaesthetic. Your response to the anaesthetic is going to be governed by genetics. The pharamacokinetics - how much anaesthetic you'll need - governed by genetics. Maybe the current standards of care will kill you.
"While having unlucky genes could decrease the chances of survival, ultimately everyone can get cancer."
Thanks for making my point for me. Cancer is extremely genetic. Got a mutation in BRCA? You're going to have an elevated (or possibly reduced) risk of breast and prostate cancers. And especially, individual cancers' response to drug treatments is going to be partially stochastic and highly dependent on the underlying genetics.
"As a European conservative, I truly believe that no life is unnecessary, no life is wasted."
Hypothetical: You see, I'm a biomedical engineer (true). Let's say I build a machine that can keep anyone alive. The machine is great, the quality of life for the user is awesome. And it's such a great machine, it works indefinitely. Here's the catch. To operate the machine takes 400 barrels of crude oil a day. There's no way around this. Now. If health care is a right, and no life should be unnecessary or wasted, then do people have a right to this machine?
Just to be clear, I don't think that no life is unnecessary or wasted, I just don't think that health care is a right, and I think that people need to accept the fact that they are going to die someday, and it's not such a horrible tragedy if medicine cannot save them, even if a possible cure existed and the only reason why they couldn't get access to it due to money. Obviously, I am not heartless and I think that situation should be minimized, via charitable actions - and I think that any system that tries to cover everyone will wind up costing everyone more and having rapidly diminishing returns in the face of reality, and will also really screw over corner cases. If such a system has the capacity to appropriate money from people against their will and the authority to make decisions for people, then the costs and the injustices will pile up even faster.
Almost completely incorrect. Got the flu? Well that's because the flu virus latched onto a receptor that let it get into your respiratory cell. That receptor could be mutated in you.
Got into a car accident? The surgery is painful. They're going to give you an anaesthetic. Your response to the anaesthetic is going to be governed by genetics. The pharamacokinetics - how much anaesthetic you'll need - governed by genetics. Maybe the current standards of care will kill you.
"While having unlucky genes could decrease the chances of survival, ultimately everyone can get cancer."
Thanks for making my point for me. Cancer is extremely genetic. Got a mutation in BRCA? You're going to have an elevated (or possibly reduced) risk of breast and prostate cancers. And especially, individual cancers' response to drug treatments is going to be partially stochastic and highly dependent on the underlying genetics.
"As a European conservative, I truly believe that no life is unnecessary, no life is wasted."
Hypothetical: You see, I'm a biomedical engineer (true). Let's say I build a machine that can keep anyone alive. The machine is great, the quality of life for the user is awesome. And it's such a great machine, it works indefinitely. Here's the catch. To operate the machine takes 400 barrels of crude oil a day. There's no way around this. Now. If health care is a right, and no life should be unnecessary or wasted, then do people have a right to this machine?
Just to be clear, I don't think that no life is unnecessary or wasted, I just don't think that health care is a right, and I think that people need to accept the fact that they are going to die someday, and it's not such a horrible tragedy if medicine cannot save them, even if a possible cure existed and the only reason why they couldn't get access to it due to money. Obviously, I am not heartless and I think that situation should be minimized, via charitable actions - and I think that any system that tries to cover everyone will wind up costing everyone more and having rapidly diminishing returns in the face of reality, and will also really screw over corner cases. If such a system has the capacity to appropriate money from people against their will and the authority to make decisions for people, then the costs and the injustices will pile up even faster.
you know what. I know someone is going to criticize me for my hypothetical. So I'm going to just say, this is not far from reality (although it is not the reason why US healthcare costs so damn much). In 2004 Novartis reported that they were making the anticancer drug discodermolide. From scratch. (http://pubs.acs.org/doi/abs/10.1021/op034130e) This process started from petrochemical feedstocks and largely used chromatographic purification steps. According to FDA regulations, chromatographic media must be discarded after each use and basically cannot be efficiently recycled. The amount of resources that went into producing 60 grams of this drug is staggering - keep in mind that it is estimated that in the known universe only about 6 milligrams total of the material exists. Unless this was some sort of sick PR stunt, Novartis clearly thought that in the short term it could actually make enough for this drug to be profitable (it failed phase I trials on safety grounds, which gives you an idea of how bad an idea this was in the first place since to fail a safety trial on a cancer drug means your candidate really sucks). But the question of long-term sustainability of medical care is going to become very real in the not too distant future, whether or not this country and others gets the cost of our medical care down due to its structural problems.
Whether or not we like it, the issue of health care rationing is going to but up against the problem of limited global resources.
Whether or not we like it, the issue of health care rationing is going to but up against the problem of limited global resources.
1. Health care does follow the rules of supply and demand. It's erroneous to claim otherwise.
2. Many if not most health care costs are not emergency services, and they include many elective non-emergency procedures, diagnostics, mental health issues, drugs etc. A lot of costs come from behavioral choices and are preventable by responsible individuals.
"Emergency care represents less than 3 percent of the nation’s $2.1 trillion in health care expenditures while covering 120 million people a year."
http://www.acep.org/content.aspx?id=25902
3. Regarding compassion - Hospitals are not staffed with nurses, doctors, advanced medical services based on compassion -- all that costs money, labor and raw materials, and takes investment, education, specializations and entreneurship- all of which are not achieved through compassion.
Economics and finance applies regardless of intention (ie. compassion).
2. Many if not most health care costs are not emergency services, and they include many elective non-emergency procedures, diagnostics, mental health issues, drugs etc. A lot of costs come from behavioral choices and are preventable by responsible individuals.
"Emergency care represents less than 3 percent of the nation’s $2.1 trillion in health care expenditures while covering 120 million people a year."
http://www.acep.org/content.aspx?id=25902
3. Regarding compassion - Hospitals are not staffed with nurses, doctors, advanced medical services based on compassion -- all that costs money, labor and raw materials, and takes investment, education, specializations and entreneurship- all of which are not achieved through compassion.
Economics and finance applies regardless of intention (ie. compassion).
>It's called compassion and it is a cornerstone of our civilization.
compassion does not occur when someone forces you to pay into a system. If you want to be compassionate, pay out of your own pocket. Do not take out of someone else's pocket for charity and pat yourself on the back for being 'compassionate'. That is the opposite of compassion, it is total selfishness.
compassion does not occur when someone forces you to pay into a system. If you want to be compassionate, pay out of your own pocket. Do not take out of someone else's pocket for charity and pat yourself on the back for being 'compassionate'. That is the opposite of compassion, it is total selfishness.
> Why should I be forced to pony up for other people's healthcare, too?
This entire argument is predicated on the idea that people who decide not to buy insurance will actually stay home when they get so sick that they feel their life is in danger, instead of going to the hospital.
History has shown that's not the case; they end up in the emergency room with no insurance, and end up being a cost that hospitals have to recoup via higher rates for the people that have paid for their insurance.
This entire argument is predicated on the idea that people who decide not to buy insurance will actually stay home when they get so sick that they feel their life is in danger, instead of going to the hospital.
History has shown that's not the case; they end up in the emergency room with no insurance, and end up being a cost that hospitals have to recoup via higher rates for the people that have paid for their insurance.
"History has shown that's not the case; they end up in the emergency room with no insurance, and end up being a cost that hospitals have to recoup via higher rates for the people that have paid for their insurance."
No. That is not "history". This is a recent phenomenon. This sort of thing was not generally occurring 30 years ago.
No. That is not "history". This is a recent phenomenon. This sort of thing was not generally occurring 30 years ago.
The 1990s are history: http://articles.baltimoresun.com/2001-01-31/business/0101310...
2002 is history: http://www.bizjournals.com/seattle/stories/2002/08/05/story3...
2003 is history: http://www.healthylivingnyc.com/article/58
2005 is history: http://www.msnbc.msn.com/id/7995137/ns/health-health_care/
2006 is history: http://www.hhs.gov/news/press/2009pres/07/20090715b.html
Affordability was quite different 30 years ago, perhaps that's why this is a relatively recent phenomenon. It doesn't really matter what the situation was 30 years ago though, because the trend over the past decade has been that uninsured people go to the emergency room when they're very ill.
I assume they didn't lay down and die at home 30 years ago either.
2002 is history: http://www.bizjournals.com/seattle/stories/2002/08/05/story3...
2003 is history: http://www.healthylivingnyc.com/article/58
2005 is history: http://www.msnbc.msn.com/id/7995137/ns/health-health_care/
2006 is history: http://www.hhs.gov/news/press/2009pres/07/20090715b.html
Affordability was quite different 30 years ago, perhaps that's why this is a relatively recent phenomenon. It doesn't really matter what the situation was 30 years ago though, because the trend over the past decade has been that uninsured people go to the emergency room when they're very ill.
I assume they didn't lay down and die at home 30 years ago either.
"the trend over the past decade has been that uninsured people go to the emergency room when they're very ill."
I really don't understand that. I was unemployed for a few months last fall when I went to go take care of a friend who was dying of cancer, and during this time I got a really terrible case of giardia from drinking poorly purified tap water (the US is rapidly becoming a third world country). I went to a local medical clinic and got to see a doctor the same day, for about a half hour and it cost me $35. Heck, I even offered to pay the actual cost of $55 but they insisted i pay the lower rate because I was unemployed (I think they get some extra kickback from the local government if they report unemployed people coming in). The wait was relatively short and I got a scrip for a drug that worked. The clinic really did a good job of taking care of low income individuals at very reasonable cost.
I'm really not certain why there is such a need to go to emergency rooms when there are great places like this. Are people just misinformed about their options, or are places like this few and far between? I don't know.
I really don't understand that. I was unemployed for a few months last fall when I went to go take care of a friend who was dying of cancer, and during this time I got a really terrible case of giardia from drinking poorly purified tap water (the US is rapidly becoming a third world country). I went to a local medical clinic and got to see a doctor the same day, for about a half hour and it cost me $35. Heck, I even offered to pay the actual cost of $55 but they insisted i pay the lower rate because I was unemployed (I think they get some extra kickback from the local government if they report unemployed people coming in). The wait was relatively short and I got a scrip for a drug that worked. The clinic really did a good job of taking care of low income individuals at very reasonable cost.
I'm really not certain why there is such a need to go to emergency rooms when there are great places like this. Are people just misinformed about their options, or are places like this few and far between? I don't know.
No, they went to emergency rooms, and got pro bono care. It wasn't even charged to someone else's account! Or they worked out simple payment plans directly with the hospital.
Do you genuinely believe that pro bono care comes at no cost? That the doctors and nurses opt not to get paid for the time that they deal with people who don't have insurance? That the electricity company doesn't charge to keep the lights on when there are uninsured people being cared for? That the landlord says "eh, 20% of your patients didn't have insurance, how about a reduction in your rent this month"?
Simple payment plans don't really work out when an emergency visit to the hospital can easily cost more than $100,000.
Simple payment plans don't really work out when an emergency visit to the hospital can easily cost more than $100,000.
of course I don't believe that. The question is how best to handle that cost? Through voluntary action or through an inefficient behemoth of a bureaucracy. I'm going to get overtly political here, but I have to say: I cannot honestly believe that a country that fails to successfully take care of osama bin laden without slaughtering millions of innocents along the way, has any hope of managing something as delicate as individual healthcare needs for 300 million.
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Why don't you believe in a free market for health insurance?
The capacity to observe reality?
The capacity to observe reality?
You've observed that when some people get to force others to their will, that works best? And when was the free market tried consistently and failed?
We have a mixed economy in the US. Observing its failings doesn't prove that a free economy is wrong.
We have a mixed economy in the US. Observing its failings doesn't prove that a free economy is wrong.
Our healthcare market is arguably freer than that of other industrialized countries. Our quality of health care is much, much worse, although I'll grant you that the much larger standard deviation means that the outcome is sometimes better (which is why the very rich like to come here for their healthcare). Generally, when somebody argues that the reason a given approach has failed is that it hasn't been tried hard enough, they're laughed at.
More specifically, if you've never had a child with a serious illness (such as my son with kidney disease) and you haven't tried the healthcare systems of several countries (as I have), then your opinion is worthless as well as illogical. Try comparison shopping in situations where you really fucking need it, then get back to me.
More specifically, if you've never had a child with a serious illness (such as my son with kidney disease) and you haven't tried the healthcare systems of several countries (as I have), then your opinion is worthless as well as illogical. Try comparison shopping in situations where you really fucking need it, then get back to me.
> The capacity to observe reality?
That is a very strong statement. My point is you haven't proven it. I certainly sympathize with your situation, but neither that nor your evidence prove that the free market is impossible according to the laws of reality. Just don't overstate your position.
> Generally, when somebody argues that the reason a given approach has failed is that it hasn't been tried hard enough, they're laughed at.
I know - I would say the same thing about socialism.
> Our healthcare market is arguably freer than that of other industrialized countries.
It's not one dimension. Maybe the way in which the US is not free causes the problems that aren't seen in countries with more powerful rulers. We have to look deeper than one dimension.
That is a very strong statement. My point is you haven't proven it. I certainly sympathize with your situation, but neither that nor your evidence prove that the free market is impossible according to the laws of reality. Just don't overstate your position.
> Generally, when somebody argues that the reason a given approach has failed is that it hasn't been tried hard enough, they're laughed at.
I know - I would say the same thing about socialism.
> Our healthcare market is arguably freer than that of other industrialized countries.
It's not one dimension. Maybe the way in which the US is not free causes the problems that aren't seen in countries with more powerful rulers. We have to look deeper than one dimension.
Offtopic, but the parent post should not be downvoted. It clearly adds to the discussion. (I can barely read it to make sense of the replies!)
Please, don't downvote when you think someone is wrong; downvote when their post doesn't contribute.
Please, don't downvote when you think someone is wrong; downvote when their post doesn't contribute.
I disagree. The above post does not add anything but propaganda to the discussion. The US has had decades to prove what the poster said was true and utterly failed. "Scammy socialist" health care has utterly won.
No, you don't get to call something propaganda just because you disagree with it. Plenty of people can come up with proof for all sorts of points of view, I don't think you're special here.
Edit: The other side can say the same thing, and now you're stuck with two ends who call each other propagandists and thus refuse to take each other seriously, which is a stalemate. What good does that do anybody?
Edit: The other side can say the same thing, and now you're stuck with two ends who call each other propagandists and thus refuse to take each other seriously, which is a stalemate. What good does that do anybody?
No, again, there is no "other side". There is no first world country that has anything approaching a "free market" health care system. I'm not aware of anything like that working anywhere in the world at all.
So, yes, someone jumping out and saying "duh, people sure are stupid, of course we should be using <insert something that has never worked anywhere it has been tried>" is not "just an opinion to disagree with", it's propaganda.
EDIT: Misspelling
So, yes, someone jumping out and saying "duh, people sure are stupid, of course we should be using <insert something that has never worked anywhere it has been tried>" is not "just an opinion to disagree with", it's propaganda.
EDIT: Misspelling
I disagree with the parent (I think health insurance should be mandatory), but I upvoted the post because I think it contains several arguments that add to the discussion (for example the part with minority health issues being less well researched is correct), and because I dislike the practice of downvoting a post based solely on whether one agrees with the expressed opinion or not.
yes...
It hasn't been for me, but only because I (and other, likeminded people) have chosen to bank on the fact that we're relatively healthy so far--knock on wood--and chosen to forego it.
I don't mean that I'm literally uninsured. I mean that I have one of those "catastrophic" high-deductible policies that so many young people are stuck with, so for any kind of routine procedures or office visits or anything barring an improbable tragedy, it's as good as not having a policy at all. The charges are simply passed through to me unadjusted. And when you have a policy like that and run into a large claim (say, a $90,000 hospitalisation with an acute condition), you have a fairly high chance of being denied a claim on the basis of a "pre-existing condition" or some other reason they will find to try to deny your claim. Insurers have entire departments just to deal with disputing large claims. Much of the Obamacare "pre-existing condition" legislation doesn't apply to this scenario, or grandfathers in policies written in prior years.
An actually decent policy - some kind of low-deductible, high-choice PPO plan - is just absurdly expensive from an operational expense drag point of view, even for an ostensibly healthy 25 year old.
I don't mean that I'm literally uninsured. I mean that I have one of those "catastrophic" high-deductible policies that so many young people are stuck with, so for any kind of routine procedures or office visits or anything barring an improbable tragedy, it's as good as not having a policy at all. The charges are simply passed through to me unadjusted. And when you have a policy like that and run into a large claim (say, a $90,000 hospitalisation with an acute condition), you have a fairly high chance of being denied a claim on the basis of a "pre-existing condition" or some other reason they will find to try to deny your claim. Insurers have entire departments just to deal with disputing large claims. Much of the Obamacare "pre-existing condition" legislation doesn't apply to this scenario, or grandfathers in policies written in prior years.
An actually decent policy - some kind of low-deductible, high-choice PPO plan - is just absurdly expensive from an operational expense drag point of view, even for an ostensibly healthy 25 year old.
I certainly think so - I'm in the process of quitting my job to work on a company, and the health insurance will be my biggest expense other than rent and food. If it was more affordable, I could survive a lot longer without running out of money.
Also, if you're starting a company, you shouldn't even consider not having health insurance - while expensive, at least there is a limit to the downside. Without it, your potential downside is almost unlimited.
Also, if you're starting a company, you shouldn't even consider not having health insurance - while expensive, at least there is a limit to the downside. Without it, your potential downside is almost unlimited.
As far as I can tell, these places tend to have fairly steep immigration/visa hurdles to overcome, usually involving some kind of employer sponsorship (presumably to deter freeloaders?).
If anyone here has done this, I'd love to hear your stories.