I've always disliked how right-wing parties automatically get to enjoy the assumption that they are "business-friendly". That's not the case -- their policies tend to be friendly to existing big businesses, but may be deeply hostile to new or merely potential businesses.
This list of founders who were able to make the leap thanks to ACA's safety net is a case in point. Under Republican policies, these businesses would not exist.
These problems are all a result of the huge tax benefit given to employer-provided healthcare; if we got rid of that or extended it to apply to individual plans as well (and hopefully allowed people to purchase out-of-state insurance), it would reduce costs, and allow for more job freedom.
I would also personally rather have health insurance actually act as insurance, where you are granted the coverage at the time of diagnosis, rather than having the insurer gradually pay for treatment, but this is unlikely to come to pass.
A tax benefit works only if the person has income to offset. If you are a freelance developer and you get sick with a life threatening or chronic illness or even just injured, you may not be able to work while you are getting treatment. If you want more job freedom, a needs based subsidy based on tax income allows cost shifting from years of productive work and tax earnings to years where you can't work, even if your productive work comes later in life, after treatment.
It also provides for those who may never be able to earn enough working to pay for current health insurance, those who are retraining latter in life, and those starting a company.
If I were campaigning for something similar to what you describe, I might sell it as a refundable tax credit, which would be no change for people with employer-provided healthcare, and a benefit for the unemployed or self-employed.
Insurance is a terrible model for health care. Everyone needs health care. Insurance only works when you have a large pool of persons paying premiums against an at-least-relatively unlikely risk. That might work for things like cancer, but it doesn't really work for anything else.
We should not have to have an insurance policy for a doctor check out that weird lump on our thigh or come in and spend 10 seconds pretending to talk to us before scribbling out a prescription for something that vaguely sounds appropriate and walking out.
Insurance is what distorts these markets. Patients need to pay doctors directly again. Real competition needs to be returned. Right now, the doctor inflates their bill 5x because they know the insurance is going to talk them down, the insurance talks them down because they know they're going to inflate the bill and not worry about it since it's an insurance company paying out, and round and round we go.
There's no reason the market for medical care needs to be different than the market for food, which is cheap and abundant. People often say that you can't can have an efficient medical marketplace because medical care is emergent, but that's usually not true; most medical care, like most meal times, can wait long enough to allow the patient to make a choice between competitors, and providers who charge more than the average demographic in their area can afford will go out of business.
The incentive to overcharge for emergent care is countered by the incentive to compete, which has already lead to many "urgent care centers" arising throughout the U.S. Good government regulations that prevent cartels from organizing and causing the markets to freeze up/fail can help. These regulations should include outlawing medical insurance.
Whatever the solution is, the current situation is an abject failure. ACA band-aids a couple of warts but it gave us new wounds in the process. Whole thing needs to be torn down and rebooted based on sound market principles.
The FDP (Free Democratic Party) claims to go for liberal rules so businesses can strive. Somehow this mostly includes rules for big corps, with the remark that they provide employment.
Funny thing is, the head of FDP is a guy who burned about 3,4M€ of investment money and federal credit.
There are always parties with nice ideas, but when you see who donates money to them, you understand why they can't realize them :\",
I see it as part of the DC bubble effect. What is considered "pro business" is defined by corporate lobbyists, what is "pro labor" by the unions with the largest bureaucracies, and so on.
The ACA increases the opportunities for young people and people with chronic illnesses. By distributing those costs, healthy individuals pay more in premiums, which limit their opportunities. If we are optimizating for overall economic productivity, far more people benefit from not having the ACA.
I'm not sure it is or will work that way, in practice - the more preventative care, less emergency room part, anyway.
The total cost of my health insurance premiums is about 20k/year; some of this is subsidized by my employer. I have a $4500 deductible. The insurance does not pay for anything, outside of preventative care, until I've paid $4500. After that, they contribute 80% up to some number, $7500 I think, and then they contribute 100% until the end of the calendar year.
Because I have such a high deductible, and due to the opacity of medical billing, I am not going to the doctor unless I'm pretty sure that not going to the doctor means I'm going to be put out of work or going to die. "Preventative" care is defined very strictly: you get a physical. For example, "preventing" the development of pneumonia by treating your respiratory illness early does not count as preventative care.
The best I can do is squirrel away what I can in my HSA...but that's one health catastrophe from being blown away. God forbid I come down with any kind of chronic illness that lasts longer than the calendar year.
That said, for the poor population, this is definitely true - Medicaid is a dream compared to private insurance. At least in my state, if you're on Medicaid, you don't even see medical bills. It's really lamentable the states were allowed to turn down the Medicaid expansion - the expansion of public health insurance was the best part of the ACA, in my opinion, and the most regrettable part of the bill is that the public option is not available to everyone.
About $7500. I would be surprised if your costs are radically different - be sure to account for any employer or government subsidy for health insurance premiums.
Also, those numbers include only in-network providers. If I am given out-of-network care - which isn't always under my control - then I could potentially be on the hook for tens of thousands more dollars.
But the concept of in-network and out-of-network coverage isn't a new to the ACA, or that different. There are plans with national network coverages - so why are you going out of network?
I wouldn't deliberately, but there are plenty of situations where someone might inadvertently be given out-of-network care.
- An out-of-network providers gives you medical attention at an in-provider facility - maybe your ER doctor, surprise, is not in-network, even though the hospital is in-network. [1] [2] [3]
- Maybe you have a medical emergency and the closest facility at the time is out-of-network. (In some states and with some insurers under some circumstances, you can get them to pay the difference for emergency out-of-network care.)
The biggest risk factor is the "normal" <= $7500 medical bill from an in-network provider, but inadvertent out-of-network care is still something you have to be concerned about.
Also, I'm not sure if I'm reading you right, but "in-network" does not necessarily have anything to do with geography - sure, there exist in-network providers for my insurance throughout the country, but the second-closest hospital to me is still out-of-network.
EDIT: The HN backoff must be crazy high - 40 minutes later, and I still can't post, and I'll be offline the rest of the day.
Because the ACA didn't fix it. From my perspective, it was largely a giveaway to private insurance companies with some fortunate side effects.
The total cost for my health insurance premiums are 20k a year.
My in-network deductible is $4500.
My in-network out of pocket is $7500.
My out-of-network out of pocket is $20k.
Those are not hypotheticals, and because of those costs, I avoid medical care unless it is absolutely necessary. I'm afraid we're getting into the weeds - my main point is that the ACA's preventative care provisions are really quite weak and don't mean what we might think they'd mean; the preponderance of high deductibles and out-of-pocket maximums mean that people will continue to avoid getting prompt medical care until their condition becomes serious. The preventative benefit, mainly, is that everyone gets a yearly physical and a few other narrow types of preventative care.
> Not when you factor in more insured people means less expensive medical costs - i.e. more preventative care and less emergency room visits.
Well, you can make the argument for preventive care on medical grounds or even moral ones, but you can't say it actually saves money. When people have access to preventive care, they also tend to consume more, which means greater costs (although better overall care)[0].
This has borne out with the ACA[1], as the data shows that preventive costs increased faster than chronic and acute care costs dropped, by a very significant margin.
I'm not sure to what extent that factors in productivity improvements from workers with better health though, in terms of overall economic activity and GDP.
You should really read articles before you cite them, because neither use data after 2014, when the ACA provisions took effect.
The ACA report last month shows the opposite of what you're saying, that oupatient costs have dropped more than inpatient costs have risen, and that medical prices have not risen more than inflation.
> The ACA report last month shows the opposite of what you're saying, that oupatient costs have dropped more than inpatient costs have risen
That's not actually the opposite of what I said. Outpatient vs. inpatient isn't the same comparison as preventive vs. responsive care. You're comparing apples and oranges.
> You should really read articles before you cite them
From the Hacker News guidelines:
> Avoid gratuitous negativity.... Please don't insinuate that someone hasn't read an article. "Did you even read the article? It mentions that" can be shortened to "The article mentions that."
The majority of outpatient treatments are preventative healthcare, e.g. check-ups, x-rays, rehab, minor procedures, blood draws, etc.
The majority of inpatient treatments are responsive healthcare, e.g. emergency, major surgeries, ICU/NICU, burn unit, etc.
Also, when you present an article as a source for something that it is not, then it is valid to question if you read it and present why, like I did. The full sentence of what I said is valid by HN rules, even if you attempt to quote it out of context:
>You should really read articles before you cite them, because neither use data after 2014, when the ACA provisions took effect.
I'm well aware of what ambulatory care is. But not all ambulatory care is preventive care; in fact, the majority is not, which is directly contrary to your previous claim.
Virtually all economic growth comes from small businesses and startups. If we're "optimizing for overall economic productivity", we should be bending over backwards as a society to make it as easy as possible to start businesses! The existing employer-provided model strongly discriminates against small businesses and startups. Providing insurance to employees is both a cost and a bureaucratic overhead. Big corporations have much more negotiating power and can get better prices than small businesses. They have much more staff and can afford dedicated HR staff to deal with insurance.
Moreover, in the case of expensive or catastrophic coverage, society is picking up those costs anyway (or alternately, just letting people die). Your premiums then go to cover the costs of people who wound up declaring bankruptcy. And no insurance (or bad insurance) cuts into preventative care that can detect problems early, when they're much cheaper to treat.
I support the ACA (or better yet, much more socialized models) because I want to optimize for overall economic productivity.
My point is that for the median entrepreneur or small business owner, the ACA made it harder. Increases in premiums are not trivial.
I agree an employer based model does discriminate against startups, but my point is that the ACA also makes it harder for the median entrepreneur to succeed. The fact that the fringe cases can start companies does not to me justify the drain on all other entrepreneurs.
Distributing cost will improve economic vitality if it removes critical obstacles for others while not substantially impacting the opportunities available to the rest.
Without ACA, a software engineer with a chronic illness wouldn't be able to start a business. Meanwhile, a healthy software engineer will start a business regardless of ACA because a minor difference in healthcare premiums is not material to that decision.
Hear, hear! Moreover, if we somehow create a law to limit people's age so that they die at 40 (obviously without any kind of pain), the premiums would be really affordable for those who really deserve it because at 40 is when health costs for even healthy people begin to ramp up.
You really don't understand how insurance works, do you?
People pay into a pool and if one day they too become ill they'll need to draw on that. Prior to the ACA it was in the best interest of insurers to simply eject all the "sick" people from the pool. What use is insurance if when you really need it they cut you off?
This hurts everyone. It's not about paying more in premiums. It's about insurance that sticks around when the shit hits the fan.
> They are for free market radicalism. It can hardly be considered "conservative" but it is certainly for something.
Neither party is really in favor of free markets in any meaningful sense. The GOP happens to use that rhetoric more than the Democrats do in order to gain support for their policies, but knowing how to leverage the rhetoric doesn't mean that's what they actually support, if you look at their actions.
I really think the GOP needs to go with evidence based policy analysis. If they think they can come up with a better health care system, fine, but what are the metrics for better? health care costs have gone up way past the amount of inflation, and to some extent that makes sense, because there are new treatments, but it seems like tax breaks are not going to help the working poor to the same extent that the ACA subsidies and medicare expansion do.
> I think the GOP has yet to figure out what their health care policy even is. They really need to figure out how to be for something again.
I'm not sure what the policy is, but I know they don't have a plan. I can't find the link, but I heard a spot on NPR (either Fresh Air or Here & Now) talking about the plan to repeal the ACA. The purported goal was to vote immediately to repeal it but delay the effective date. There's no plan. In the mean time, they're supposed to figure it all out.
There is also the mantra that Republicans are the party of small government and fiscal responsibility. Nope, the difference between Democrats and Republicans is what they want to spend the money on. This is just a fact, easily verified by looking at the debt across decades of various administrations and congressional alignments.
A few years ago Ted Cruz and company very nearly shut down the government and defaulted on the national debt, insisting that raising it was irresponsible and laying it at the feet of President Obama. They insisted any increase in spending had to be offset by a cut somewhere else. Sounds like a really bold, principled stand. Then this:
Now that Republicans are fully in charge, they just authorized an escalating increase of the debt limit, running from $580B/year (2017) to $946B/year (2026), or a $10T increase over the next 10 years. There was no dissent, it was just quietly passed. I'm not saying it was wrong or irresponsible to do -- I'm just saying the politics are transparent, if they weren't already.
We also know for a fact that Republicans aren't in favor of the government staying out of people's private lives. They are, after all, strongly anti-abortion, which by definition is an extremely private affair.
edit: what I said is 100% correct, so I will assume that the downvotes are simply political in nature.
"We also know for a fact that Republicans aren't in favor of the government staying out of people's private lives."
I think it's pretty clear at this point that both parties love getting involved in the private affairs of individuals. Obama continued Bush-era spying policies, and in fact just this week (https://news.ycombinator.com/item?id=13390511) expanded the power of the intelligence community to snoop on Americans.
Blaming just one political party is demonstrable nonsense.
Democrats have never said they want the government to stay out of people's private lives. That's strictly a Republican talking point that goes in tandem with their criticisms of "Big Gubment".
> increase of the debt [sic] limit, running from $580B/year (2017) to $946B/year (2026)
Growing the deficit from $580bn to $950bn over 7 years means it is growing at over 6.2% per year. To be fair, the median nominal GDP growth rate between 1933 and 2015 was 6.4% [1]. That said, forecasted near-term growth is expected to come in between 2.5 and 3.5% [2].
The difference between the 6.2% deficit growth rate and 2.5 to 3.5% nominal GDP growth rate will need to be made up with a mix of tax increases (austerity), inflation (redistribution) or, while unlikely, default.
As a liberal-leaning person, I disagree with Rand Paul on many policy issues, but respect the fact that his actions are consistent with his stated ideals, which is becoming increasingly rare.
""my only option was to work for a large employer with an established health plan that would provide me with the appropriate benefits to support my situation""
I think the anti-ACA lobby sees this as a feature not a bug.
It's a balancing act though, no? Health Insurance is stupid expensive in the US. In Bolivia I used to pay $300/month for my entire family full coverage, no copay. But they did screen for preexisting conditions when I signed up.
So what's the answer? How can health insurance providers help people with pre-existing conditions, and also not gouge young healthy customers?
Is the healthcare industry just charging too much money?
Asking everyone to pay into a shared risk pool is not gouging. That's simply the nature of insurance. We're going to have to pay for people with pre-existing conditions one way or another, whether it's structured as a tax, penalty, or insurance premium.
Certainly there is some waste, fraud, and abuse in the healthcare system which could be cut. But ultimately the only way to significantly cut costs would be to ration care. It's a hard issue and no one likes to talk about it.
It's the nature of universal insurance with no lifetime limits.
In terms of insurance, it's perfectly possible to write healthy young people a significantly cheaper policy that has limits and is no longer available as they age. It's probably pretty stupid for the young people to opt for that policy, but whatever.
What is interesting is the really expensive portion of insuring individuals is already essentially single payer. When people age most of them end up on medicare and the majority of health expenses happen in the weeks and months prior to your death.
> But ultimately the only way to significantly cut costs would be to ration care.
As far as I know, Western European countries spend about half (per capita) on health care as what USA spends. I don't know if US health care is that much better. And if it's not, then in theory there is a way to get the same results cheaper.
Sure if we ration care intelligently based on maximizing QALYs per dollar or something then we can get roughly equivalent results (on a total population basis) for much less money. But that means we have to put a price on human life, and for emotional reasons most people don't like to do that.
My experience with the USA healthcare system has been utterly phenomenal. Almost no waits for procedures of any kind, top-tier care. My last hospital stay was 5 days with many lab tests and two ER visits and an ambulance ride preceding it. Out of pocket I paid $100, $50 of which was later refunded to me.
Parts of the ACA are necessary but I can't help but feeling, based on the price increases, the Act itself is horribly inefficient. We didn't increase the supply, we just increased the demand for a product which is very inelastic, resulting in skyrocketing premiums. A reform must involve increasing the supply of care.
> Taxes go up, but they go up less than health insurance premiums would. Remove insurance companies as an industry.
From the international perspective, I get the impression that Americans are against this because then you are "paying for other people" (as though insurance doesn't count, but through a private company is somehow 'better').
With actual insurance, you aren't paying for other people. Your premiums are based on the expected value of your future claims.
The financial incentive helps preserve that property: If a company can identify the cheaper customers, then they can offer lower premiums than the companies that can't. The customers left behind are more expensive, forcing those premiums to rise in order to remain solvent.
>Is the healthcare industry just charging too much money?
Yes. Twice as much as the rest of the world in fact. Mostly due to lack of competition (25 year monopolies for simply adding a antacid to an existing drug) and zero negotiation on pricing.
It's vaguely true. Insurance policies are regulated at the state level (so to be sold to residents in a state a policy has to follow the regulations in that state). It's kind of hilarious that the conservative, small government party is proposing to federalize this regulation.
The reality is that the policies that companies will be willing to sell across state lines are likely to be truly awfully shitty, by doing things like not having a coverage agreement with most hospitals (which will at least drive up out of pocket costs and complicate claims, if not enabling the companies to outright deny claims).
This is not a thing you can legislate away effectively. The key to understanding here is that negotiation for health care is hard due to the fractured nature of providers and care. Insurers are micro-monopolies because they tend to serve districts or business sectors more effectively (cheaply) than others and rise to the top, but without a huge base of citizens to negotiate for no significant pricing change can really occur.
One of the largest and seemingly most unnoticed changes recently has been the consolidation of local hospitals into regional monopolies. It was already difficult to compare pricing in healthcare, now imagine when there are no other choices in your area.
Consolidation is an accelerating trend on both sides. Payers merge in order to have more negotiating power with providers. Providers respond by merging in order to have more negotiating power with payers.
Providers? Thats doctors and hospitals. Im not aware of anything but natural monopolies. Insurance company competition is rather low in my opinion. They are exempt from antitrust law[0] and can virtually collude to set prices.
I think it's less that they're charging "too much" money, and more that costs are too high (which can be true for plenty of reasons other than profit).
I believe that single payer systems can bring prices lower with more efficiency, but there are plenty of things that can be done that are less controversial (combating waste, increasing administrative efficiencies, etc).
One personal example from my life that put health care costs into perspective was surrounding the issue of Midwives vs. OB/GYNs when we were having our first child. We were approved by our insurance to have an OB/GYN deliver our child, which would cost the insurance company about $5,000 if everything went well (more if there were complications). But they wouldn't cover us at all if we delivered the child with a midwife, which cost about $1,500 and has been shown in study after study to reduce the likelihood of more costly intervention.
In our case, we paid the midwife out of pocket, but there are so many people that don't have the economic freedom to make that choice and the result is that their insurance companies pay far more money for child births than they would have otherwise had to.
Again, just one example, but I'm sure there are thousands more.
just curious, what % is $300/average salary in Bolivia?
PS health cost is US are not just stupid expensive, it is broad day light extortion. the victims for some reason prefer not to see it as robbery, but rather to argue about qualities of their robbers. charging $600 to empty the urine bag is possible only because the whole hospital system is rigged (i.e. excessively regulated and monopolized).
Helping people with preexisting conditions through an _insurance_ program is just daft conceptually. We do need to do this, but calling the result "insurance" just leads to confusion about how it should work, because it can't actually be "insurance" in the way the term is normally understood...
> I had no insurance and had stopped all physical activity beyond basic exercise for years, being too scared to hurt myself
Now you can hurt yourself no problem, or you can hit by a bus if you want!
What a stupid thought. Having no insurance is not an excuse for being active.
Come on, you really behave differently and put yourself at risk if you have insurance? That's at least thinking backward but I think it's stupid. I don't do things when the risk of getting hurt is not acceptable for me no matter if I would have insurance or not. Also it's mostly for disasters so you don't go broke, but if you scratch your knee or something, who cares?
I'd be far less likely to engage in semi-extreme activities that I enjoy (mountain biking, snowboarding) if I didn't have the safety net of insurance to cover me should an accident happen. I love those activities, but if they have the potential to put me both forever in debt and bad health, I'm probably going to think twice about it. At a minimum I'm going to enjoy them a bit less and not take as many chances. It would be unfair to my family to expose them to that kind of financial risk just for my enjoyment. With insurance I'm confident even if I were to be killed enjoying one of those activities, my family wouldn't be left paying the bill for the rest of their lives. Exercise can involve a host of activities and anything more than geriatric routines expose you to potential injuries you could otherwise avoid.
Given that cars are obliged to have insurance, said insurance will pay for victims' healthcare costs. In Germany, there is a special state fund to pay for the rare case of an uninsured vehicle being involved in an accident.
For those with a Wall Street Journal subscription, they had an excellent unbiased article on the economics of providing healthcare for people with serious medical conditions. Anyone trying to reform or repeal the ACA will have to address this issue.
"Health Care’s Bipartisan Problem: The Sick Are Expensive and Someone Has to Pay"
It's an unwarranted assumption any Republican plan will deliver health care to very sick people. Except perhaps enough of a sham to get the legislation passed in the glare of the media.
The anecdotes illustrate that there were two main benefactors: young people without formal full-time employment and those with pre-existing conditions that had allowed insurance coverage to lapse.
From someone too old to be on their parent's insurance, while I'm 100% behind the reform that disallows previous conditions from affecting ability to get coverage, the ACA was effectively a shake-down that made me delay taking the risk to go full time on my startup -- the options for coverage in my state were expensive and very low-quality, and the penalty for opting-out would have been $4000 for my domestic partner and I (on top of the additional taxes we paid to support ACA).
Thanks for sharing. I alluded to this in another thread but got downvoted and stirred controversy.
My claim is this: For the median entrepreneur, there is more financial drag due to insurance now than there was before the ACA. For those who are sick or young, there is less financial drag. Your story anecdotally supports that claim.
Yeah, I think that there's a political type that is just a zealot scared of anything that will challenge his/her worldview and feels a need to flag/downvote/hide.
The reform surrounding pre-existing conditions for people that let their health coverage lapse is the only good thing that came out of the ACA, and it was very expensive for the taxpayers and continues to be. This should have just been a piece of legislature and not a terrible government shakedown of the American public; a simple reform was needed, not another way to subsidize the non-working while compelling the public to give money to private corporations.
Isn't the biggest part of health cost is from drug company and insurance company?
If that's the case, addressing the cost is the foremost issue, instead of forcing everyone to join a universal plan. That does not help addressing the root problem above.
The biggest cost driver is complexity, not profiteering.
The Japanese system is not terribly different from ours - it still depends on private employer-provided health insurance. But per capita costs are less than half the US cost, with higher utilization and far better outcomes. The key difference is that Japan has strict national-level price controls. The price of identical products and procedures is identical in every facility. This eliminates both complexity and negotiation between insurance and providers. A government board carefully tracks costs for profiteering and makes adjustments.
Do that, and you get rid of the whole "in network/out of network" nonsense of the American system.
No. Insurance companies have to spend a majority of premiums on healthcare or rebate them to consumers. So the money goes to providers and drug companies.
We spend several times more in hospitals and clinics than what we spend on prescription drugs:
(nearly $1.6 trillion to large providers, $300 billion to drugs)
So the costs are not concentrated in drugs and insurance. There are certainly some drugs that are very lucrative, it's just that they aren't the dominant spending.
How is that affordable? How are $600 epi-pens affordable?[1] How is a 4000% price hike on a 62 year old generic affordable?[2] Google for "snake bite hospital bill." $153,000. That's not affordable. That sounds downright fraudulent.
It seems they should have named it something more appropriate, like the Universal Health Insurance Act. Insurance that is no more affordable than the overpriced health care available in the country. But point this out, and everyone starts their partisan bickering and nothing gets done at all.
Wrt to your first link[1], the very first sentence in the overview tab states, "US Health Care Inflation Rate is at 3.98%, compared to 4.26% last month and 2.95% last year. This is lower than the long term average of 5.40%."
I don't intend any snarkiness, but am I somehow misreading those numbers? I'm reading that statement as "an inflation rate of 2.95% for the last year compared to the long term average of 5.40% could be equated with 'more affordable'".
It's an improvement over the status quo but it still has health care costs increasing faster than the rate of inflation. Which is pretty easy to characterize as health care getting less affordable, even though it is likely an improvement.
The long term inflation rate of the US is much lower than that as a whole. That's the point. Inflation in health care exceeds inflation in the US as a whole.
That is the core issue. That was not solved by the ACA. How do we solve it? Ideas? Oh yeah, you know what? Let's argue about Obama and Trump instead. That will surely work. Look at the comments in this thread.
If I asked you how to solve a sorting problem, I'd have a dozen good solutions presented. If I ask how to solve a healthcare cost problem that many other countries don't seem to have, everyone's brain switches off and they go into arguing about politics.
"Health care inflation" isn't directly comparable to the overall inflation rate, as the quality and amount of health care has been rising alongside the increasing percentage of GDP we spend on it. Compared to when the only available remedies were bloodletting and leeches, I bet we spend a lot more on the health care sector.
Are you seriously making excuses for the overpriced health care in the US? Every other country has the same procedures we have in the US at lower prices.
I don't think we need any partisan bickering to address your point:
It seems they should have named it something more appropriate, like the Universal Health Insurance Act.
The name of the bill is a lot less important to most people than the substance. If you read Sam's post, there is a man in there with a heart condition who is essentially uninsurable without the ACA. For him, the word "Affordable" definitely applies, but he doesn't care what the bill's title is. In my opinion, you shouldn't either, because the bill's substance is what is important.
Substance? Health care costs continue growing significantly faster than inflation since the passage of the Affordable Care Act.
>In my opinion, you shouldn't either
It's clear to me, I need to leave and go to a country with a higher average IQ. They, unsurprisingly, have figured out how to deliver actual affordable care. The people here are too ignorant to actually solve this problem. Even "smart" people have been completely brainwashed by propaganda.
Affordable care is more expensive. War is Peace. Ignorance is Strength.
Exactly. Along the way we accepted the premise without even realizing it -- "everyone should be able to afford health insurance [implicit: no matter what it costs]". Sounds great, but only really serves to put money in the pockets of rich hospitals, nurses' unions, big pharma, etc.
Making healthcare actually affordable -- as in, reining in costs -- is where we should be looking.
Pull in the reigns on big pharma, they're primarily responsible for the outstanding inflation of medical costs.
Other ways to lower healthcare costs:
* Increase med-school acceptance rates & fund more residency programs/additional slots to increase supply of MD's
* Subsidize med-school tuition so MD's don't graduate drowning in debt
* Allow PA's and NP's more authority in primary care and non-trauma emergent care situations without an attending physician having to sign for every order and discharge - some states are ahead of others here, we have a lot of NP's in GA ER's that work without an attending
Oh, and single payer healthcare would do wonders too. Administrative costs for hospitals and billing companies would drop dramatically not having to manage dozens of different insurance contracts just to get paid, would love to pass that savings onto patients.
> The ACA wasn't a bad attempt given the constant efforts of the opposition to sabbotage it.
Actually, it was, given that many of the misfeatures of the ACA were premptive compromises to gain the support of opposition that never accepted it anyway.
But even so, it's better than the status quo ante was, and there's no sign of anything better on the horizon amidst the rush to repeal it.
The average might have gone up, but the it's the high-end that's supposed to have come down. Health care costs are the #1 cause of bankruptcy in the country.
Those price increases are not from the ACA, they're the result of Medicare Part D, which took effect in 2006.
From the wiki[1]:
By the design of the program, the federal government is not permitted to negotiate prices of drugs with the drug companies, as federal agencies do in other programs
The bill forces the government to pay whatever the pharma manufacturers will charge. If you were selling a product and there were a law preventing your largest customer from negotiating the prices which you set, why wouldn't you heavily inflate your prices?
>Those price increases are not from the ACA, they're the result of Medicare Part D, which took effect in 2006.
Oh good, let's see you present to me evidence that the inflation rate of health care in the US is below that of the inflation rate of the country as a whole. Can you do that? Because that's my point.
Health care is not affordable. Hospitals are charging tens of thousands of dollars for treatments that cost a couple hundred dollars 2 hours away across the border.
Oh good, let's see you present to me evidence that the inflation rate of health care in the US is below that of the inflation rate of the country as a whole. Can you do that? Because that's my point.
No, because the cost increases were not due to the affordable care act, they were due to Medicare Part D. The goal of the ACA was to reduce the number of people without insurance. Controlling pharmaceutical costs is outside of the scope and for that you can blame the law that specifically forbids the government from controlling pharmaceutical costs.
>No, because the cost increases were not due to the affordable care act
You're distracting from the real issue with a different argument. I didn't say the ACA caused the increases. I am saying the Affordable Care Act failed to make health care more affordable.
ACA raised the bar on the minimum level of coverage for private plans. This means that the shitty door-to-door private plans you make movies like The Rainmaker about had to increase costs to start providing actual coverage for healthcare.
You can tell because while some premiums have increased, the overall healthcare costs (including premiums) for all Americans has been reduced.
If you'd said "most" I wouldn't have responded, but since you said, 'all': My out of pocket expenses are drastically up; the smallest deductible I can get now is $3,000 (after that, it's covered at 80%). I'd have to see the doctor > 120 times a year for my overall healthcare costs to be anywhere close to what they used to be, and that's exclusive of premiums (~6x what they used to be) and drugs (haven't checked lately, but last time I looked, they were around that same multiple).
I think you've confused your out of pocket with deductible, and misunderstood what type of plan you should be on.
You should only focus on a low-deductible plan if you know you're going to be in and out of the hospital (e.g. elderly, chronic, etc.). I also don't think you know what your out of pocket maximum is now compared to what it was before.
I have a deductible of $3,000. If I spent it all on doctor's visits (that is the vast majority of my medical expenses), I'd have to visit the doctor 120+ times to make it cheaper to have a $3,000 deductible than a $25 copay for doctor's visits. My out of pocket is quite a bit higher than that $3,000 deductible.
You're correct that I don't know the difference in out of pocket maximums, but I do know it's a great deal higher than it used to be.
As for "what type of plan I should be on", I really don't have a choice. My employer offers what amounts to basically the same plan through two different insurers, and the main difference seems to be which doctors are on which insurer's network, so in practice, it doesn't matter which one I pick-- the out of pockets maximums are broadly similar, and the deductibles are identical.
Another point to consider: my out of pocket maximum might be lower (it's not, but let's assume it is), but so much less is covered now than before. I used to have a copay for doctor's visits, ranging from $20 to $30 depending on my employer at the time. So if I was visiting the doctor say, a dozen times per year (including wife and kids), I was paying $100/mo + $30/visit = $1,580/yr just accounting for doctor's office visits. At $300/mo and $140/visit (average; higher if tests are performed), that's $5,280 in out of pocket costs for doctor's office visits.
And that's not counting specialists-- my daughter had a heart defect at birth, so now she has to see a cardiologist every other year, which has the happy(?) benefit of pretty much eating up my entire deductible in one fell swoop right there; before the ACA, I paid $50 for a specialist visit and maybe a few hundred extra depending on which tests that particular specialist ordered.
So your primary complaint is with the price of pharmaceuticals, and perhaps the cost of health care in general in the USA, and not health insurance itself.
If only there was some large body that was able to negotiate reasonable rates for health care on behalf of consumers... it's amazing nobody in the world has figured this out before!
When Libermen was able to get the public option removed from the ACA it's survival chances took a serious nose dive -- after the last election there was no chance it would be restructured/fixed
> Health care is not becoming more affordable. The rate of inflation in health care is significantly higher than the US inflation rate.
I think healthcare has become a jobs project. As manufacturing employment decreased, many found replacement jobs in an ever-expanding health care industry.
There is no incentive for anyone to get medical costs under control. The health care delivery system has every incentive to use the "blank checks" offered by the insurance industry. The insurance industry makes a certain percentage off whatever they pay out in claims, so their incentive is to pay as much as possible.
Patients want to feel better, and aren't in a position to evaluate whether the recommended treatments are actually their best option.
> But point this out, and everyone starts their partisan bickering and nothing gets done at all.
In the early days of medicare the government's costs quickly got out of control. The first reform was to figure out what a procedure should actually cost. It's been "trench warfare" between doctors and payers ever since.
I have some anecdotes from my passengers and friends that would hopefully sidestep the bickering to point out that the status quo is quite harmful to the health industry's customers...
Iatrogenic conditions are exceedingly common. These are conditions caused (or worsened) by the treatment provided.
For example, hospitalists (doctors who manage patients' care in a hospital) are starting to look at old patients' pile of prescriptions to figure out which ones are actually necessary [1].
The ACA pretty clearly made health care more affordable than it would have otherwise been[0]. Still, it was an incremental change and a huge compromise compared to what I'd really like. It doesn't make sense to mock the name of the Affordable Care Act when it is in fact helping with affordability. We should do a lot more, but your criticism seems misdirected.
One of the best experiences I had was actually going through a different site which seemed to have even more options than Healthcare.gov, https://www.policygenius.com/health-insurance
I'm sure there's more as well, but this definitely helped several friends of mine. Seems like these kind of things would have been impossible without large swaths of the ACA.
This post, especially presented as it is through the voices of these founders, makes an important point.
However, missing, as far as I can tell, is the critique of health care that startups and the open source movement stand to make - a point which the ACA ignores:
Health care has a gatekeeper problem. And an IP problem. Many people find that medical doctors are only a part - maybe a small part - of their health care regiment. And that being and staying healthy has little in common with the official positions of agencies from HHS (especially FDA) to EPA.
The ACA enshrines insurance, pharma, and hospital companies, including those that are the biggest parts of the problem in health care in the USA.
For my part, I need to hear how we can move away from the credentialist model of care toward an open source model before I can become impassioned about any plan.
> The ACA enshrines insurance, pharma, and hospital companies, including those that are the biggest parts of the problem in health care in the USA.
Absolutely agree. The ACA (or repealing the ACA) are both "solutions" to the wrong problem. So much potential innovation in the health care space is illegal. If it wasn't illegal, someone might (gasp!) find a way to provide a valuable service for less money than in the current system.
It will not, and cannot, be fixed by regulation, because of what you said - any regulation MUST be approved by the big companies. They'll never approve something that goes against their interests.
Thanks for writing this. Whatever your view on the ACA, you can probably agree that health is important. It's a tough problem, how we handle it will define the US more than anything else in the future.
When my wife and I looked for insurance just before ACA, the private plan without subsidies, because they didn't exist, was $250. It was a basic plan with a high deductible and an HSA. It was pretty much what my employer offered. After the ACA, same plan, by name, now cost $530. Sure it had more bells and whistles, but I didn't want nor need them. This priced me out. This same plan today is $780 a month without subsidies.
We are now on an ACA plan. $270 with subsidies. Think about that. The government doubled the price of the plan or more, and is paying with our tax dollars the difference between my $270 and $780.
The ACA helped many people. It helped people under 26. It helped people with pre-existing conditions. It helped give free or low-cost health care to people that couldn't afford it because now the government is picking up the lion's share of the tab.
As much as people like to rag on the Republicans, and they deserve it, I don't think they will throw out the good parts. I think they will look at the industrial recommendations such as expanding risk pools across states (Commerce Clause allows this regulation), and other rational plans. Will it be perfect? No. Will it be better than the current ACA? Maybe.
What evidence is there that the government itself doubled the price of the plan? The government doesn't collect the money, and it certainly goes somewhere...
It's at least correlated. Within 1 month's time, the plan cost doubled. The ACA required insurance to cover things like mental health care. As a result, the plans had to be more expensive since they needed to cover more.
If you're looking for something directly in the law, you're not going to find the government saying that prices should be raised.
It's a second-order effect; there was minimal cost control in the ACA, and plenty of room for companies to raise their prices. In a lot of ways, it was a sweetheart deal to insurance companies: they had essentially a mandate for people to buy their insurance, demand was through the roof, so they could charge more.
> What evidence is there that the government itself doubled the price of the plan? The government doesn't collect the money, and it certainly goes somewhere.
My evidence is that the premiums for my insurance went up even before ACA passed just in anticipation. That is exactly what the health insurance representative told us.
It was pretty clear why it happened. After ACA passed it kept going up a higher rate for us than in previous years (I have data for 3 years before).
> What evidence is there that the government itself doubled the price of the plan? The government doesn't collect the money, and it certainly goes somewhere...
Isn't it a bit disingenuous to suggest that the increase in health insurance is unrelated to legislation regulating health insurance. Or to put it another way is there evidence that government regulation didn't affect the prices and something else did?
If you look at the numbers, the rate increases didn't change significantly when the ACA was put into practice. The only exception is the first year, when companies weren't sure what the appropriate pricing should be.
The government does not, so far as I am aware, set the prices of the plans. Therefore it is nonsensical to claim that "the government itself doubled the price".
Now, if one were to claim that the government failed to do anything that had the effect of reducing the cost of health care or health insurance, then I would completely agree.
For example, there is nothing to prevent someone from signing up for insurance, having some expensive medical procedures performed, and subsequently dropping the insurance. I have personally heard reports from insurance agencies that some people do in fact do this. And I can't say I'm surprised, either; even after factoring in the tax penalties, it's probably a completely economically rational thing to do in a lot of cases.
There is no evidence because government did not raise the price - the insurance companies did, all while raking in record profits.
Premiums in states which refused federal money to expand Medicaid generally rose much, much more than states (like CA) which did not[1].
Cynically, this was likely a designed play by Republicans to kneecap the effectiveness of the ACA by skewing the risk pool towards the elderly (who require more medical care, in general).
A couple additional pieces to keep in mind. Insurance companies are essentially capped at how much profit they can make on average per subscriber. For large groups 85% of every dollar collected has to be spent on medical expenses, and for small group / individual 80% has to be spent on medical expenses. If they don't meet those standards, the companies need to refund the premium to make up the difference.
In the linked article most of their profit would be coming from the large group market. The individual exchange is a separate segment and where they would be suffering those loses. So the desire to not remain in an unprofitable segment is not really negated by being profitable in a completely different segment.
There is basically no real cost control in the bill, with the logical consequence being that insurance companies will do what they can get away with to raise premiums so that the new premium rate minus subsidies equals the old premium rate. The extra requirements of the ACA, and the lack of universal roll-out basically ensures that there are plenty of excuses for doing so.
> False. The ACA imposed a minimum 80-85% medical loss ratio on insurance companies. This is a cost control.
That's not a cost control. That's a price inflater!
If the only way for them to make more money is to have the price of things go up, what do you expect they're going to be in favor of? In a perfect world (from the perspective of the insurance company), everything from premiums to procedures goes up X% so that their profits go up X%.
That's a seriously messed up system and may be the most egregious part of the entire ACA.
Did it? As an industry, hospital and lab management companies outperformed the general stock market (which itself was doing very, very well) for 2010-2015. Compare VHT vs VTI, for example.
Insurers have to compete against other insurers on price. Otherwise they lose market share. All of them negotiate hard with providers to drive down prices.
The creation of exchanges was so that insurance companies would have to compete in a market where customers had an apples to apples comparison tool. Theoretically, that should drive down rates in places where there are enough insurance companies for market forces to take over.
Not true. The senate has already voted down the pre-existing protections plan, letting young adults stay on their parents' plans, and keeping contraceptive coverage.
American's don't follow the actual machinations of the senate much so it's not "politically unpopular" to do this. We think electing a President every 4 years who's a radical departure from what we had before will fix all our problems and prevent us from actually having to pay attention to the details.
The Senate can't remove the pre-existing conditions protections or letting young adults stay on their parents plans through budget reconciliation.
They can remove funding for subsidies through budget reconciliation, and let the system collapse on its own, but they don't have the votes to overcome the filibusterer they'd get if they tried to remove those protections directly.
1 of 2 things will likely happen.
1. They will repeal and delay. Meaning they will remove funding through reconciliation, but delay implementation until 2020. Then depending on what happens in 2018 who knows what might happen. This is the bad option because it could cause the collapses of the individual market even before it takes effect.
2. They will repeal and replace. Most likely they will replace it with the new Health and Human Services Secretary's plan to keep the preexisting conditions protection plan, as long as you maintain coverage. If you don't maintain coverage you'll go into a high risk pool with higher rates until you maintain coverage for 18 months.
Plan 2 is very similar to what we currently have, but it replaces the punishment for not maintain coverage with higher premiums instead of a tax penalty.
What they should do is to increase the tax penalty to force more people into the pool and simultaneously add a public option, but that's not going to happen.
plan to keep the preexisting conditions protection plan, as long as you maintain coverage
That's a repeal of the pre-existing condition protection, because it goes back to how pre-existing conditions worked pre-ACA (HIPAA -- remember the "P" is for "Portability", not "Privacy" -- guarantees you can avoid denial of pre-existing conditions so long as you maintain coverage continuously or with no break longer than 63 days).
No. If you exclude preexisting conditions, how do you prevent the case where someone decides to buy insurance the day after they're diagnosed with cancer?
You do that by requiring everyone to have insurance when they're well to help cover those that are sick. That's the mandate. If you try to separate them, the system collapses under the weight of even more cost.
Thats easy, actually. If you suffer cancer it should be the company that you are active with at the time who are responsible for paying for your treatment for that, even if you are no longer with them.
You weight until you have cancer to sign up? Well then you have to pay for the cancer treatment, but if you break your leg tomorrow, the insurance company has to pay.
Again previous conditions are not an issue, because they won't cost the next insurance company anything. If you get diagnosed with, say, aids and need treatment for the rest of your life, then it should be the company you were with at the time of your illness that has to paid, even if you are no longer with them.
Couple this with payment in cash for treatment, so that you can shop for the best/cheapest/whatever doctor (just as you would with car work), a mandatory disclosure of prizes and untangle health insurance from your employer and the system should be much more manageable.
Among other things, you are relying on no insurance companies ever closing in the future. What happens if they go bankrupt? The government has to bail them out?
That plan won't work because people constantly change insurance companies and there are too many conditions that are life long.
Most people develop many pre-existing conditions as they get older. By the time you're 70 you'll have 5 different insurance companies all treating different conditions that you developed at various times in your life.
Not to mention what happens when companies go out of business. This plan isn't workable at all.
"You weight until you have cancer to sign up? Well then you have to pay for the cancer treatment"
Unless you're rich, you either die from lack of treatment, or declare bankruptcy and let the rest of us pay for your treatment. Neither option is particularly good for any of us.
This is one of the more ironic parts - obviously, few people choose death. They choose to massively delay going to the doctor, driving up total cost by skipping preventative care, and then bankruptcy when they finally do.
That bankruptcy is not a magic free moment - it simply means someone else pays. Depending on the case, this might be the state through medicare/medicaid, it might be the health care provider, or it might be third party creditors.
Eventually, though, those defaults are all factored into operating costs of hospitals, the government, banks and so on - meaning you and I pay for them.
So, in the old system, we were all forced to pay for health coverage, whether we liked it or not. In the new system, we're all forced to pay for health coverage, whether we like it or not. ACA is explicit and, with extreme certainty, cheaper, since it expands preventative care on a systemic level.
But, of course, since people didn't realize they were paying for it previously, they now throw fits because the cost is made explicit.
Right on. We've had some form of universal coverage at least since the Emergency Medical Treatment and Active Labor Act was passed in 1986. Unless someone wants to roll that back, then it's just a matter of how you want the universal coverage to be structured, not whether you want it to exist.
But, as with many things, the politics around this issue is all about feels over reals.
We've had some form of universal coverage at least since the Emergency Medical Treatment and Active Labor Act was passed in 1986
Which, of course, is the most expensive way to go. You have people who can't pay visiting the emergency room for an ear infection or the flu. And that cost gets passed on to everyone else, which is why that single Tylenol tablet in your hospital room costs $10.
I've heard a republican idea that would instead allow insurance companies to charge a large fee for lapses in coverage, which would be nearly equivalent to requiring coverage except people would be hit with a big fee when signing up.
I didn't say it was a good plan, just one I heard suggested. I'm in the opinion that the US should just combine to have one giant risk pool, and include everyone in it (aka single payer)
Medicare already does this. If you go uninsured and then try to enroll (at a time when you're eligible, of course), there's a penalty you're required to pay.
The irony of that is that in the pre-ACA days, if you did get cancer (or were diagnosed early on-set), in theory, you could go get a job with group healthcare and even with a known diagnosis, you would receive that policy and could immediately receive benefits under that employer group health plan.
The danger is that the mandates can be repealed budget reconciliation, but banning denials based on pre-existing conditions can't. So if the mandate gets repealed before Obamacare is replaced the ACA health insurance market will probably collapse.
> But the question is can we keep those parts and not keep the insurance mandate?
The state of Washington tried that in the '90s. Passed an ACA-like system. Republicans repealed the mandate, kept the preexisting conditions. Result: within a few years every single insurance company stopped selling individual health insurance in Washington.
It's odd that you expect the people, who fought to prevent ACA from happening and have tried to repeal it weekly since it's inception, are now going to fix it.
And since people have an issue with recentism, just look at recent events that prompted sama's post, Republicans in the senate repealed half of the good things in the ACA.
The ACA lowered the costs of people with insurance by reducing the pool of people without insurance adn thus the free rider costs. Free markets however continued to raise prices just like they have for the last 30 years. http://www.motherjones.com/files/blog_premium_growth_2014.jp...
HSA require a deductible of at least $1,300 for one person, so people have starting calling that a 'high' deductible from 2003 or so.
Before ACA you could by health insurance with a 15,000$ deductible as an individual. After, ACA the individual out of pocket maximum is $7,150 per year for an individual. So, now legally the maximum is below the old pre HSA threshold for 'high' deductible.
Deductibles are insane, period. It's a horrendous concept unless you're rich. You don't get them in most (all?) countries with universal coverage, not even in hybrid systems like Germany's with their public insurance options.
It's insane because it just forces people who can't afford the deductible anyway to choose this plan for the low premium thus breaking the entire point of the system.
If someone can't afford either A) the monthly premiums for a plan with a low deductible or B) the high deductible associated with a low premium plan, then that person is not capable of paying for their own health care and needs charity.
It is certainly insane to expect people who are incapable of paying for their own health care to be capable of paying for their own health care. But the health insurance market is not there for people who are incapable of paying for their own health care.
> then that person is not capable of paying for their own health care and needs charity
They need an effective government and socialized medicine. Charity is not a workable solution.
> It is certainly insane to expect people who are incapable of paying for their own health care to be capable of paying for their own health care. But the health insurance market is not there for people who are incapable of paying for their own health care.
Sure it is, that's exactly why it's there, hence the subsidies. It's a shitty system, better than it was, but still crap that needs to be replaced with socialized medicine.
>They need an effective government and socialized medicine. Charity is not a workable solution.
Whether the charity comes through government or private organizations is not relevant to my point. The point is that they need someone else to pay for it, and not via a normal market transaction.
>Sure it is, that's exactly why it's there, hence the subsidies.
Allow me to rephrase: The health insurance market is not there to ensure everyone is able to afford to pay for their own health care needs. It is not broken because some people are not able to afford to participate in it. That is not its purpose. Judging it to be 'broken' or 'insane' because it doesn't do something that it's not intended to do is ridiculous.
> So, now legally the maximum is below the old threshold for 'high' deductible.
The HSA-tied minimum was the old threshold for "high-deductible" since the HSA/HDHP pairing was created, which was several years before Obama was elected.
Yes, edited for clarity. In the mid 90's a high deductible plan was on the order of 10k for an individual. Really there is not a lot of room between zero deductible and $1,300/year for a 'low' or 'medium' deductible and making the new definition silly.
This also added a lot of confusion as what was considered normal was suddenly called high.
For example, let's start at https://secure.marylandhealthconnection.gov/AHCT/LoadExplore... then click "Get an Estimate". Put in a family of 3, ages 63, 61, 21, no pregnancies, no dental. Income $100k. You get a list of 21 plans. The very first one on the list has a $12,400 deductible and a $13,100 out of pocket max.
In fact, there is not a single option on this list with an annual out of pocket max below $9000.
Granted, these are family plans. Your cited number is for an individual; the number is $14,300 for a family. But note that there are plans on this list that have out of pocket maximums larger than $14,300 (e.g. "BluePreferred PPO HSA Bronze $6,550" has a $26,200 out-of-pocket max). How to reconcile that with your link, I don't know: the theory says they should not exist, but experiment says they do.
Note that I picked on Maryland because they allow you to get this data without creating an account.
In any case, most of the plans on this list would have been considered "high deductible" before the advent of the ACA.
Anyway, what's the definition of "high deductible"? The standard definition used for HSAs is $1300 for an individual or $2600 for a family, which is almost hilariously low in today's marketplace. And the maxium out-of-pocket max for HSAs is actually _lower_ than the overall caps. I have no idea how that $26,200 out-of-pocket plan is "HSA-qualified", as it's claimed to be....
> The ACA lowered the costs of people with insurance by reducing the pool of people without insurance.
That's not true. The ACA raised the costs of people with insurance by pooling them together with people who used to be uninsurable because their estimated care cost so much. This effect completely dominated the effect of adding healthy people to the pool. One reason for that is that for healthy people paying the penalties is way cheaper than actually getting insurance, so a lot of them stayed uninsured, but even that is not the full story. The main upshot is that caring for some people is _really_ expensive and the cost has to come out somewhere.
We can proceed to an argument about whether the tradeoffs were worth it, of course, whether there were other ways of achieving the laudable goal of getting rid of the preexisting condition problem, etc. But let's not pretend that the reason prices went up is just "gouging". Prices went up to a large extent because the risk structure of the insured pool skewed towards more risk.
Now there is certainly _some_ gouging going on, largely abetted by the restrictions on interstate sale of health insurance, which leads many states to have a very small number of companies providing insurance. For the Maryland case above, there are precisely 3 companies represented in the list. And only one of those companies offers PPOs. Which is why the price of the PPOs in Maryland about doubled in the last two years: no competition, why not? This is hardly a "free market" behavior, though; it's a highly regulated, in a dumb way, market, that encourages monopolist behavior. Which is what we get.
That's apples to oranges. Some family plans used to also have higher deductibles I know of someone that had a 30+ grand deductible per year. It was cheap, they where healthy, having insurance meant many procedures cost less, and they had enough money that a low risk for a 30k out of pocket was just not a big deal.
So yea, for a tiny slice of the population ACA did make things worse, but frankly the tiny minority that where negatively affected don't really care about the new premiums either. Because, for most families having a 30k deductible is approximately the same thing as not having insurance.
PS: The ACA allowed some people without insurance because of health issues to get insurance. But, it also added a lot of young healthy people that would not have had insurance. The net gains and losses depended significantly on age. https://www.valuepenguin.com/how-age-affects-health-insuranc... So, people looking back on cheap insurance also look back when they where younger. New York and Vermont do not permit any use of age as a factor when determining health insurance rates, so younger workers do significantly subsidize older workers. Masschusetts limits cost increases to 2x so there is a significant subsidy.
For my hypothetical family with the ages I listed, insurance cost about doubled in the last two years in the state of Maryland for an equivalent (PPO) plan. Deductibles also rose significantly. I know a specific family like that, and they are _very_ unhappy about it.
> but frankly the tiny minority that where negatively affected don't really care about the new premiums either
Really? You think people don't care about $25k/year in premiums instead of $12k/year in premiums?
What makes you think this is a tiny minority? What I listed is a basic baby boomer family with one child still in college.
> The net gains and losses depended significantly on age.
Sure. I'm aware of all that. The upshot of the ACA is that people with preexisting conditions are _much_ better off (which is good), but people who are relatively healthy, independent of age, are generally worse off. This is almost a tautology, of course.
I should note that the price cited at your link is way too low for the states I know of, in the "64" age range, assuming you want a PPO. For an HMO, it's perhaps doable.
What's apples to oranges, exactly? (single vs. family) also (HSAs 'high deductible' vs. actual high deductible).
HSAs are from 2003 and it's overloading a reasonable definition with a new a silly one. You can see people in the mid 90's talking about high deductible and meaning something very different. ACA also capped out of pocket so you need to compare everything about a plan not just it's deductible.
PS: Find me a family plan with a 50k deductible under ACA. They used to exist.
That's fair. I agree there is nothing like that on the market now; instead we have plans with $25k premiums and $14k out of pocket maximums. Which is less than $50k, sure, but not by much, and is a _guaranteed_ $25k cost...
My brother's work calls their $1500 deductible option the "high deductible" plan.
The limits are more sane than they used to be, but a lot of people that are getting subsidies aren't going to have an easy time coming up with $10,000 more in a given year. It's high enough.
Something to consider, though it doesn't directly relate to max out of pocket costs, is that healthcare providers fail to collect the majority of out of pocket responsibility from patients.
The cost to collect and the collection rates themselves are abysmal and the increase in deductibles has amplified the problem to the point that many hospitals are closing due to patients' inability to pay their bills.
Consider the percent of Americans who don't have ready access to $5000 (or even $500) for an unexpected medical event that causes them to hit their deductible. I work in patient payment technology and this is an all too common situation that providers are forced to accommodate.
That's very true. So price tags keep getting inflated to shift the burden more to those who _can_ pay (with the understanding that a lot of others won't be able to), which prices even more people out, etc. The same dynamic we're seeing in higher education....
> The ACA helped many people. It helped people under 26. It helped people with pre-existing conditions.
And the cost is being borne by everyone else.The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
The cost of people not being to afford basic care is also borne by everyone else.
I do not understand why the US can't join most of the western world in instituting single-payer public healthcare. It would be a huge boon for small business and startups, who would no longer have to factor in medical benefits into their compensation structure and whose owners would no longer have to risk being uninsured for an extended period when they start the business.
Moreover, it's the morally right thing to do. It's shameful that the world's premier economic superpower does such a poor job of looking after its most vulnerable citizens.
The reason is relatively simple: approximately half of the electorate and half of our political system is caught in a feedback loop opposing public health care. Lots of voters are convinced that public health care is a disaster. One of our two major parties wins votes by accommodating that. Further, that party ensures votes in the future by pushing misinformation which helps convince more voters.
Until and unless we can get people to examine the facts, this will continue.
Fascinating! I had no idea this was supported by so many Republicans. Thanks for sharing. If we repealed ACA and replaced it with single payer I'd be so happy...
"Lots of voters are convinced public health care is a disaster."
Maybe we could, I dunno, create a government run health care system to show everyone just how super-awesome healthcare can be when DC runs it. We need a demographic... hummm, how about retired military? We'll create a healthcare system for ex-military and their families, show everyone how well these things work, and then the public will be convinced that... oh, wait!
We could also look at the many examples from other countries. Too bad so many Americans are convinced we're somehow special and it can't be done for us.
He's probably not smart enough to realize that a sick person won't be turned away by the hospital, and that the care they receive will end up going into collections when they fail to pay. The people who pay for medical care at the hospital will end up eating the cost of people who can't afford it, regardless, and you get all the administrative costs associated with the collection effort as the cherry on top.
Hospitals can't leave a person with a bullet hole in their stomach to bleed out, but they are under no obligation to provide, for example, chemotherapy to a cancer patient, or a kidney transplant.
So, no, you can't just walk into a hospital and get the same care you would if you actually had insurance, and then just stiff them with the bill later.
People without insurance don't go to hospitals. They don't go to doctors for routine checkups. They don't go to doctors to deal with chronic conditions. They go to ERs because they can't afford healthcare, but they know that the hospitals can afford their emergencies.
Of course people without insurance go to ERs. That's not going to help you if you have, for example, Type 1 diabetes and need daily insulin and test strips. The ER isn't going to send you home with 1000 strips and a half dozen vials of humalog.
So the "solution" on offer for our "problem" of having to insure diabetes sufferers is that if you have Type 1 diabetes but don't have a nice job, you should just die quietly?
No, it's because the ER is legally obligated to treat, regardless of ability to pay. ERs in urban areas are generally money losers.
For example, Kaiser's huge new Santa Clara (CA) complex kept its ER from opening until the very day they closed the ER at the prior site on Kiely. There are fewer ERs in the San Jose area than there were 200,000 people ago.
Yes, but the simple fact of the matter is that the hospital wouldn't be in business if they couldn't afford to provide the care. So the care is going to be administered ANYWAY, at a much greater cost than it should have been, because people wait until their problems blow up into emergencies before seeking care.
> I don't think they will throw out the good parts
You are mistaken. The good parts, like covering pre-existing conditions is exactly what causes your insurance to go up. It's basic economics. The Republicans do not have a plan to fix that.
If there was a way to fix it, don't you think it would already be implemented? You think they're purposefully keeping your rates high just to fuck with you? Not to mention suffer all the political fallout of it?
Don't forget. Obamacare is the Republican plan. This repeal and objection to Obamacare is all politics, not an attempt to fix a broken system.
What makes your insurance go up is the fact that insurance companies are beholden to investors and not the people they insure. They must exceed each and every last quarter or they take a hit.
Everyone knows how to fix the problem in the short/medium term. The solution is money. Specifically, money from the Federal Government.
The real behind-the-scenes debate in DC this month is about, first, the best mechanism to transfer funds (direct subsidies, state subsidies, Federal reinsurance pool for the sickest cases, etc ... each of which create distinct winners and losers whose lobbyists are currently out in force), and second, how much of an annual budget deficit the fiscal-hawk Republicans (now led by Rand Paul) are willing to tolerate.
The longer-term solutions have much more to do with diet, lifestyle management, and other behavioral health issues than with access to providers and drugs (e.g. look up how much of last year's medicaid/medicare budget was spent on type 2 diabetes treatment alone). Unfortunately it doesn't seem like we can tackle these issues at scale until after the current debate on affordable universal access to care is settled.
> Specifically, money from the Federal Government.
Excuse me? What money? The government does not generate net positive economic benefit, and therefore has no [real] money. You might be confused and talking about "taxpayer money" — but then why bother with the gov't at all, why not just say your plan amounts to "we should increase healthcare costs so we're, you know, throwing more money at the problem".
I think the point is that currently there's a profit motive for healthcare. There's no incentive to promote _health_. By putting the federal government (a proxy for the U.S. citizenry itself) in charge of healthcare, the incentives for maximizing health (minimizing sickness / our tax burden for healthcare) become clear.
There's also a profit motive in food production, should we move to single-payer for that (hint: this means breadlines)? There's also a profit motive in housing; single-payer? Mobile phones? Internet access? Entertainment?
This is such a shallow argument. Healthcare is a service unlike any commodity or service you've mentioned. Healthcare demand is unpredictable on an individual level, and it grow on an individual level over time when it isn't met. That is to say you get sicker if you go untreated. If I skip a meal today, I don't need extra meals tomorrow. If I sleep on the street tonight, I don't need two houses tomorrow. This is to say that any random individual can be struck ill (demanding healthcare) at any time, to an unknown cost that snowballs the longer they go untreated. It's a thing unto itself and metaphors don't work well.
Furthermore, there's an enormous information asymmetry in healthcare, so it's hard for it to function as a market.
Because we already have "free" healthcare in the form of emergency rooms, this is ultimately a conversation about how to best allocate health spending. Emergency care is the absolute most expensive form of non end of life care, so we should focus on minimizing that send. There's a well known path for doing so, regular check ups, vaccinations, preventative care, and chronic disease management. All of which cost money now, but reduce future expenditure. And if we already pay for sick broke people in the emergency room, why not optimize the expenditure of those tax dollars by shifting it to more effective health interventions?
If your concern is cost basis, and "allocating health spending well", then why are we subsidizing preventative care?
You yourself admit that end of life care is incredibly expensive. Why are we pushing people to live longer, when it incurs a much much greater cost to keep people alive? Why not just let them die young?
In part, this is a huge reason (the other reason is pregnancy cost) why pre-ACA healthcare prices were much much cheaper for <30 men than women - most things that seriously hurt men under 30 just completely off them, and dead boys don't incur major medical cost.
I think most people disagree with you darwinian notions of societal priorities. And you still aren't addressing that pre-ACA we still spent the same dollars, just on the backend through emergency room spending, and medical debt defaults. Basically all research points to outcome focused medicine and preventive care being critical to controlling costs, anything else just shifts the spend around.
I don't believe in those 'darwinian' notion of societal priorities, I'm just pointing out that those are baked into your priorities. If reducing cost is the priority, the machine (government/society) will churn out a solution that reflects the priorities it is programmed with.
I don't know about your characterization that "Basically all research..."
Oh if only it were that easy. The competition in those other markets is much stronger and has proven to be reasonably efficient.
Healthcare is different because consumers often don't know what anything ought to cost, rarely in a position to shop around, and will never be able to afford some big ticket items without insurance regardless.
And the economic consequences are non-obvious. For example, many conditions are much cheaper to treat if caught early; if access to a doctor has an inconvenient cost attached, overall costs go up. The ability to see a doctor for cheap – ideally free – is the most effective way to lower the risk of expensive procedures in the future.
It's all about choice. We have huge choice when it comes to food - I can live on noodles if my circumstances go downhill. Entertainment I can forgo, and I can live with my old mobile phone.
But if I get pregnant or cancer, I have no choice - I have to get treatment or die.
If you get cancer, chances are you get treatment and die.
I've been through chemo and radiation once, if I ever am told I need to do it again, to scrape and cling to another few months of life, I'm going to laugh in their faces, put my affairs in order, go on a hell of a vacation, and Old Yeller myself.
Markets work well for those things, they don't for healthcare, that we're here is proof of that. There's a good reason civilized nations have socialized medicine, it's the best solution to the problem. Markets are not the correct solution for every problem.
Yes, of course it backs out to taxpayer money - and likely money from taxpayers who haven't even been born yet, to the extent that the Federal Government runs a deficit exceeding inflation.
If you look at the Federal budget it's clear that the Federal Government, beyond national defense, is simply becoming a giant healthcare and pension fund administrator, re-distributing wealth via social security, medicaid, and medicare. All other expenses are dwarfed by these. I'd expect this trend to continue until the singularity occurs and we enter our long-awaited post-capitalist utopia.
Seconded. ACA puts a cap on the profits of insurers. They are not just increasing the premiums and pocketing the difference. Most, if not all of the difference is going towards medical care by law.
"MLR measures the share of health care premium dollars spent on medical benefits, as opposed to company expenses such as overhead or profits. For example, if an insurer collects $100,000 in premiums and spends $85,000 on medical care, the MLR is 85%. In general, the higher the MLR, the more value a policyholder receives for his or her premium dollar. The ACA requires an annual, minimum 80% MLR for individual and small
group insurance plans, and an annual, minimum 85% MLR for large group plans." [1]
That 20% also covers employee salaries, building and maintenance costs, whatever IT infrastructure is needed, etc. That's not net profit like the 2-3% supermarket number you offer.
20% is not the profit. It's the maximum they are allowed not to pay to healthcare providers. Most of it will probably be spent of the cost of running their business: salaries, office space, advertising, office supplies, etc.
The huge tower skyscraper in the middle of town...
Seriously, something is wrong with the whole setup. ACA does address some of it but it has jacked my premiums sky high. Single Payer is the answer in my estimation. The sooner we come to this and stop fiddling around trying to make people we shouldn't happy the better off we will be.
First. I don't know of a more consistent revenue model than something that is often automatically removed from paychecks monthly.
Second, a profit margin will take into account risk. So for the ski resort or the furniture store that includes the overhead of keeping the store open while you have no customers.
Third, if the risk is so insanely high why are these firms so consistently profitable? Shouldn't we expect to see them coming in and out of existence regularly? Restaurants are a truly high risk business venture, the majority fail to exist after the first year. Perhaps they have longer runways but it's rare to hear of an insurance firm shutting its doors. The large and consistent profit seen on their end of year reports belies the risk claim.
I'm not trying to justify insurance company profits. I think it's mostly a load of crap. But the costs of a grocery store are pretty much fixed and easy to predict. The costs for an insurance company are far more complex, because they change with the number and scope of claims.
I don't think you can deny there are cost risks for insurance companies that a lot of other markets don't have. However, to back you up a bit, their profits are extremely good which probably means they are largely overstating the risk in order to gouge their customers.
When interest rates are higher car insurance runs > 100% loss ratio. They stay profitable by earning short term interest on premiums before paying out claims.
In a different insurance vertical fixing loss ratios at 80% would be called a cartel, and would put involved executives into prison for a good long time.
In healthcare the government forms the cartel, fixes the prices, gives money to poor to become consumers, and then fines everybody who won't become the consumer.
said Brer Rabbit. "Only please, Brer Fox, please don't throw me into the briar patch."
It is unfortunate it does not put a cap on the profits of medical providers. Hence the 'pain cream' fraud[1] and others.
Sunlight is an amazing disinfectant and it is my hope that our government mandates every doctor and facility publish the total cost of every prescription and procedure they employ. We will collect that data and disinfect the high cost of health care.
Just to be clear, medical insurance != medical providers. The cap that the ACA set was on insurance companies. And it would be good to put a cap on the profits of medical providers that are paid by the ACA coverage. That however is very complicated.
By comparison, Bush's Medicare Part D prevented the Feds from even negotiating drug prices. Its author, Billy Tauzin, is now a Big Pharma lobbyist.
I agree wholeheartedly. In my opinion, insurance providers and providers of health care (hospitals in particular) are trapped in a co-dependent cycle. Capping one without the other seems short-sighted to me.
So insurance is bounded by cost plus pricing now. They have no problem if actual health care costs go up, their bottom line profits go up too! The insurance companies interests are now misaligned. Yeah they want to keep costs down to increase their spread, but if the spread is limited and allowed now they have no problem if hospitals charge $200 for what was a $100 procedure last year because $30 is more than $15 and they'll just increase premiums!
I never understood why this is not glaringly obvious before anyone implements such a plan. Or maybe it was and this was intended? Seems just as likely at this point.
I mean, this is a constant joke in professional circles. If you are hourly billing and you can use your shitty talent to create something in 8 hours that your good talent would create in 1 - it's usually economically beneficial to have the worse employees do the work as it's more profitable overall. Up until the point where you lose the customer - but in this case that's not a concern.
It's right up there with excess taxes on gambling and tobacco. Governments become dependent on those excesses and are disincentivized to decrease the activities they're ostensibly trying to lower.
You may be mishearing the term "excise tax". An excise tax is a tax on any specific good, such as tobacco or gasoline. Those taxes are included in the cost of the good (it just costs more at the pump or on the shelf). Yes, they are typically used to reduce consumption, or to pay for costs associated with consumption (eg roads).
I'm aware of what excise taxes are, but I see why it might seem like that's what I meant, because I wasn't really explaining what I meant by that phrase. By "excess tax", I mean taxes in excess of the cost of the behavior they're trying to regulate. Both of these examples are both excise taxes, the rates of which are in excess of the costs borne to society of those activities.
Disincentivizing taxes are usually very profitable, because they're targeting goods that are considered overly desired. Their effectiveness is not too clear, but it is commonly accepted that they do reduce consumption. For example, a recent study on soft drink taxes concluded that retailers absorbed half of the extra cost to keep consumption high.
An alternative income source might be luxury taxes. There are a number of luxuries where consumption correlates positively with price - but it would be politically difficult to implement a tax on extravagance.
Why? It seems that if premiums are rising relentlessly for one company that the insured will seek out other companies, and hence that one company will "lose the customer".
To add to this, before, insurance companies tried pushing care costs down and tried to keep premiums lower in order to compete with other insurers. Now with a mandate for coverage the competitive pressure to keep premiums lower in order to steal customers away from others and induce new uncovered buyers went away. A silent industry wide "gentlemen's" agreement now exists. Don't compete on lower premiums, let health care costs go up so they all benefit. It's easier to allow costs to go up and profit more by passing costs onto customers than it is to compete on having lower premiums by reducing costs and being more efficient. You can only cut expenses so much, but the sky is the limit to profits if cost plus pricing is in play and costs go up for the entire industry.
Except that premiums have increased slower in the 5 years after ACA than the 2 5-year periods before [1] and the rate of expenditures, while not decreasing, is basically unchanged after ACA [2].
This was not my experience at all, at least as someone purchasing directly (not through an employer).
Before ACA, our premiums went up ~5% per year - 8% one year - every year was under 10%. Since ACA, I've seen increases of 25%, 20%, 20%, 25%, then 11% then 13%. This is in NC with Blue Cross - the numbers possibly were different elsewhere (was in Michigan before that but wasn't paying as much attention, unfortunately).
The price increases I was seeing seemed primarily in line with inflationary numbers pre-ACA; post-ACA they seem to have no correlation to inflation, and seem to have more to do with a much larger overall cost for the insurance company covering more people, no lifetime caps, more services covered, etc.
EDIT: On, that factcheck chart - that looks to be showing premium increases for employer-provided health insurance. Employers cutting back their contributions to the premium would account for much/most of those increases. Effectively, it doesn't say anything about the actual insurance premium increases, only what employer-covered workers were having to pay - in my view, that's a big difference.
ACA puts a cap on the profit margins of insurers. It does not put a cap on the total profit of insurers. Mandatory minimum medical loss ratios (MLR) actually could have the opposite of the desired effect. To maintain $X in profits that they enjoyed before the minimum MLR, an insurance company would just need to increase total premiums and benefits. This means that they're less incentivized to reduce benefits/premiums, since their profits rise when both rise. It also more strongly encourages mergers of insurance companies, reducing competition.
I used to work for a utility company and there was a huge aversion to any innovation that drove costs down. Guaranteed ROI is incredibly counter-productive as a regulatory measure.
> ACA puts a cap on the profits of insurers. They are not just increasing the premiums and pocketing the difference.
Unfortunately, I think it's percentage cap, not an absolute cap. So, if you're an insurer and want to increase profits by a dollar, you need to increase costs by a few dollars.
I grant that this is particular to ski towns, but it is still a good example of risk pool size [1]. I think the costs will go down when the whole nation is the risk pool, rather than state or smaller pools. To me this makes sense in that, as a Union, Americans migrate for pleasure throughout the States. This means that fundamentally the pool should be the whole country under the Commerce Clause (interstate trading definitionally going on).
I know that adding infirmed people increases costs. The trouble is that the health insurance system of the US is not focused on individuals managing their own health insurance costs. Most Americans get their health insurance from their employers. This makes the ACA markets problematic because the limited risk pools above are further limited by the people utilizing the markets.
Does this mean that the US should ban company sponsored health insurance? Maybe. I don't know. What I do know is that the Democrats tried to stifle debate and thought on the bill. It went so far as Pelosi saying you can only know what's in the bill once you pass it [2].
Overhauling the risk pool will be huge. That's probably in the realm of repeal and replace. What I doubt we'll see, since it would probably destroy the Republicans in two years, is the total gutting of the ACA and the meaningful, unstable gap. The people wouldn't like it, nor would the business community.
> I think the costs will go down when the whole nation is the risk pool.
I think this is a justifiably correct presumption if you assume that costs are normally distributed. Are healthcare costs and risks normally distributed?
We had this problem where the cost of financial risk was assumed to be normally distributed and we built a lot of policy on that, including pooling financial entities into bigger and bigger codependent pools, but everyone seemed to have forgotten the known-for-centuries-fact that financial risk has infinite variance. Of course it turned out okay after we bailed out a bunch of rich people.
> If there was a way to fix it, don't you think it would already be implemented?
No...
The way to "fix" the exorbitant cost of healthcare is to allow young and/or healthy people to sign up for the bare minimum: a dirt-cheap catastrophic plan that covers the absolute basics and prevents personal bankruptcy. Unfortunately, this hasn't been done.
Healthcare economics in the U.S. is sufficiently complicated that it defies any simple fix other than saying implement what country X is doing. However, given the massive amount of profit being generated in the system that's not likely to happen in the foreseeable future. Your fix is almost certainly not "the way to fix the exorbitant cost(s).."
There are primarily three reasons why healthcare is so expensive in the United States.
The first is because the administrative costs are much higher than in other developed countries (about 25 percent). The second is because the U.S. spends much more than other developed countries for the same things (e.g., drugs, doctors, medical equipment, services). The third is because people in the U.S. receive more medical care than people do in other developed countries (for example, they're much more likely to get expensive surgeries).
A cheap, catastrophic insurance coverage plan for young, healthy people addresses all three of these reasons.
> A cheap, catastrophic insurance coverage plan for young, healthy people addresses all three of these reasons.
No it doesn't. This is insurance, if the young healthy people aren't paying more than a bare minimum, there isn't enough money to cover the sick. You can't mandate care must be given and allow those unlikely to get sick to barely contribute, that's not the purpose of insurance which is to spread the cost and risk across the whole pool. What you propose does nothing to solve the actual problem, providing care for those who actually need it.
That's like the completely opposite of what should happen. If you think of health insurance economically, there are income coming in (premiums) and payouts according to some risk pool. Right now the payouts are higher than they were before because of pre-existing conditions, and the income is lower because people under 26 not paying their own insurance premiums. If "healthy" people start paying lower premiums and not really lowering the payments very much since they are pretty healthy and don't really cost the insurance very much anyways, then the "unhealthy" people are going to be paying even higher premiums.
> The way to "fix" the exorbitant cost of healthcare is to allow young and/or healthy people to sign up for the bare minimum: a dirt-cheap catastrophic plan that covers the absolute basics and prevents personal bankruptcy.
No, that's just the way to transfer the costs back to older/sicker people, it doesn't do anything to fix the overall costs (and might drive them up by delaying care.)
>The good parts, like covering pre-existing conditions is exactly what causes your insurance to go up. It's basic economics.
It is really as simple as that. Could you imagine a system in which car insurance wasn't mandated but car insurance companies were required to repair your car regardless of its preexisting condition? No smart person would preemptively buy insurance. You just wait until your get into an accident and then bring the already damaged car to the insurance company and demand a policy to repair it. No insurance company can work like that.
Insurance only works when the costs of the most expensive customers are shared among the cheapest customers. You need incentives to encourage the cheap customers to sign up or the whole system falls apart. Rejecting preexisting conditions is the old capitalist way of incentivizing people, but as soon as that is prohibited nearly all incentives disappear for a healthy person to buy into the system.
> Taking it a step further, I would argue that it ceases to be an 'insurance' product if allowed to purchase after the insured event has passed.
You can offer insurance against an event that has already occurred, but the insured price will always be slightly higher than the uninsured price. One could call that insurance, but it'd be a degenerate case, so at that point it's more of a word puzzle than a real question.
> Our failure to find a non-insurance 'hammer' with which to hit all of the health 'nails' is a larger issue.
Exactly - the problem is that people talk about health insurance like it's supposed to solve the problems that a wealth redistribution program would. Except, insurance is not a wealth redistribution mechanism - it has a completely different goal - and trying to turn it into one just results into the worst of all worlds (expensive and ineffective at achieving either goal).
I'm not sure what you mean by 'wealth redistribution' in this sense, unless you regard 'good health' as a form of wealth. The only wealth redistribution that is facilitated by insurance is from sick people to medical insurers and providers.
> I'm not sure what you mean by 'wealth redistribution' in this sense, unless you regard 'good health' as a form of wealth. The only wealth redistribution that is facilitated by insurance is from sick people to medical insurers and providers.
Pretend for a moment that everyone receives their annual physical, as medical guidelines recommend. (They don't, but it makes our example simpler.) And let's say that the fair-market price of providing the physical, accounting for all costs borne by the provider and their practice, is $100. (That is an arbitrary number I have chosen, also to make our lives easier). What will be the co-pay for the annual physical for an insured patient?
The answer is that it will be $100 - there is absolutely no risk involved in this situation, so the expected payouts of the insurance company will be $100, and therefore they will incorporate that into their price. (The consumer will actually pay a bit more than $100 in total, because the insurance company has overhead costs, which are ultimately paid by the consumers as well). But of course, that's not the case, because the expectation is that health insurance will reduce these costs, and that people who can't necessarily afford $100 will still be able to have their physical. That's why health insurance isn't really insurance, except in name - we talk about it as insurance, but in reality, it's a wealth redistribution program tacked onto a risk smoothing product.
By definition, insurance is literally not intended to save the insured person money, in expectation. The expected value of all claims will always be less than the expected value of all money paid to the insurer by the insured entity. (This does not hold for every individual, but it does hold in the aggregate - that's where the risk smoothing comes in). The insured person pays the insurer a premium[0] in order to reduce the uncertainty in how much they would have to pay on any given month without insurance.
[0] Not as in "monthly premium", but as in "a premium on top of the expected value"
I don't follow, unless you regard 'health insurance subsidies' as a part and parcel of 'health insurance'. Means-tested health insurance subsidies are absolutely a form of wealth redistribution, no doubt, just like housing subsidies are wealth redistributive - but that doesn't mean that the home rental market is wealth redistribution in disguise.
This only holds true if the physical only identifies disease that have downside risk. More realistically, most early identification situations can greatly reduce the cost of future care, eg the overweight 40 y.o. who intervenes to avoid being the obese 60 yo.
It also ignores a number of other selection criteria and behavioral issues, which you are honest enough to note in your pretend for a moment intros.
However, people who proactively care for their health carry "upside risk" as well as downside, which your scenario does not account for.
> By definition, insurance is literally not intended to save the insured person money, in expectation.
You fundamentally misunderstand the concept of insurance. Group insurance is, by definition, a way to spread the cost of rare catastrophes around the group so that the affected individuals don't bear the full brunt. There is the full expectation that in the event of a major medical event you will save money.
Try reworking your example around major medical events (e.g. a $500K hospitalization) rather than preventive care (the function of which is to reduce the risk of certain controllable medical events).
> What will be the co-pay for the annual physical for an insured patient?
> The answer is that it will be $100 - there is absolutely no risk involved in this situation, so the expected payouts of the insurance company will be $100, and therefore they will incorporate that into their price.
No. Even pre-ACA, insurance companies offered low co-pays. How did they do that? Because your monthly fees will over the course of a year add up to far more than the cost of an annual physical. The purpose of insurance is to protect yourself against rare, but catastrophic events: you will probably not experience a wide variety of expensive medical ailments, but if you do they will likely leave you in financial ruin if you're uninsured, so you pay an insurance company money to protect yourself against that risk.
(Or, alternatively, your employer pays a health insurance company money to protect you against that risk, and offers that benefit to you as part of your total compensation package. Which is essentially the same as you paying for it, with some amount of risk differences and thus potentially lower costs due to the pooled employee health insurance policies, but that's outside of the scope of this discussion. TL;DR: it's still regular market economics.)
You might wonder why insurance companies offered low co-pays at all — was it just some marketing gimmick? But no, you can explain that with regular economics too: insurance companies are incentivized to make annual physicals affordable and attractive, because they can catch potentially-expensive medical issues when they're still much less expensive, thus lowering costs for the insurance company.
> The purpose of insurance is to protect yourself against rare, but catastrophic events: you will probably not experience a wide variety of expensive medical ailments, but if you do they will likely leave you in financial ruin if you're uninsured, so you pay an insurance company money to protect yourself against that risk.
Yes, this is what I am saying. However, that has nothing to do with the price of co-pays for routine care, which is by definition predictable.
> But no, you can explain that with regular economics too: insurance companies are incentivized to make annual physicals affordable and attractive, because they can catch potentially-expensive medical issues when they're still much less expensive, thus lowering costs for the insurance company.
See, this is another pervasive myth. For healthy individuals, the annual physical is not cost-effective - it is very unlikely to result in long-term benefits to the patient, and it is far more likely to result in unnecessary care (such as follow-up tests and differential diagnoses for false positives):
https://sciencebasedmedicine.org/re-thinking-the-annual-phys...
Also, I don't know why you're drawing a dichotomy between what I'm saying and "regular market economics". Everything I have said is standard, textbook economic theory. There's nothing obscure or even controversial about it about economists.
Insurance companies are for-profit institutions, and there's no law compelling them to offer co-payments for preventative care. Do you believe that insurance companies are giving out charity?
> Everything I have said is standard, textbook economic theory. There's nothing obscure or even controversial about it about economists.
Claiming that "health insurance isn't really insurance, except in name - we talk about it as insurance, but in reality, it's a wealth redistribution program tacked onto a risk smoothing product" is definitely non-mainstream. An insurance company takes in payments to insure you against high-risk events, and that's exactly what a health insurance company does: you pay them a monthly fee regardless of whether you need medical care (or your employer pays them for you as part of your compensation package), and when you do need expensive medical care, they pay for it. In fact, many plans explicitly only pay for expensive medical care: anything under your deductible, aka inexpensive medical care, you're required to pay for. You might be able to make some sort of weaker claim about wealth redistribution post-ACA, but — co-payments existed pre-ACA.
Actually, some of the largest insurance companies and the vast majority of risk-bearing providers (hospitals that act as insurers) are non-profits. Though I never said that their pricing was based on charity; I said it was based on the fact that the product they offer is not really insurance (and that it exists in a marketplace in which prices are incredibly distorted by the existence of other factors, which would have been too long to explain in that simple example).
> Claiming that "health insurance isn't really insurance, except in name"... is definitely non-mainstream
On the contrary, that's the overwhelming consensus among economists. Which isn't surprising, because the economics of insurance are generally covered even at the undergraduate level, and the ways in which health insurance differs from a true insurance program are pretty glaring.
The five largest health insurance providers in the U.S. by market share are UnitedHealthGroup, Kaiser, Anthem, Aetna, and Humana. Of those five, all but Kaiser are strictly for-profit, and Kaiser is a consortium of for-profit and non-profit entities.
Equating risk-bearing providers and health insurance companies for the purposes of arguing that health insurance isn't insurance might as well be tautological. Sure, blueberry pancakes aren't really pancakes if you include blueberry muffins in the category of blueberry pancakes, but who cares?
> Insurance only works when the costs of the most expensive customers are shared among the cheapest customers.
That is not insurance. That is a wealth redistribution. Those are not the same thing, although the current discourse around health insurance conflates those two concepts, for obvious political reasons.
> Could you imagine a system in which car insurance wasn't mandated but car insurance companies were required to repair your car regardless of its preexisting condition? No smart person would preemptively buy insurance. You just wait until your get into an accident and then bring the already damaged car to the insurance company and demand a policy to repair it. No insurance company can work like that.
Actually, this would be completely feasible to implement. The insurance company would price you based on your risk. In this case, P(risky event | all available information) = 1), so there wouldn't be much of a point to buying the insurance, but it absolutely would work.
The problem is that the ACA also forbids insurers from underwriting plans based on anything other than age, income, zip code, and whether or not they smoke. That's guaranteed to increase the cost both for healthy and for unhealthy patients, because they have to make overly conservative estimates when evaluating the risk level of their patient pool.
>That is not insurance. That is a wealth redistribution. Those are not the same thing, although the current discourse around health insurance conflates those two concepts, for obvious political reasons.
Yes, they are the same thing. Insurance is fundamentally a redistribution of risk with money being shifted from those who have not fallen victim to that risk to those who have. If you have a problem with that aspect of the ACA, you have a problem with the general idea of insurance.
>The insurance company would price you based on your risk (in this case, it would be 100%), so there wouldn't be much of a point to buying the insurance, but it absolutely would work.
You do realize that this is functionally the same as getting rid of the preexisting conditions protection, right? Whether someone pays tens of thousands to a doctor for care or to an insurance company for coverage are in practice exactly the same. The whole point is that many of us think that is a fundamentally unfair system to force someone to face in that situation.
> Yes, they are the same thing. Insurance is fundamentally a redistribution of risk with money being shifted from those who have not fallen victim to that risk to those who have. If you have a problem with that aspect of the ACA, you have a problem with the general idea of insurance.
No, they are not the same thing. The fact that a transfer of money happens is not a sufficient criterion for defining insurance.
Take two people with different risk profiles but who are both insured. If you can tell a priori which one is expected to have lifetime claims that exceed their lifetime premiums, then you don't have insurance - you have a wealth redistribution scheme[0].
Note that I didn't specify which person had the greater risk profile, or whether they both purchased the same "tier" of plan, or even whether they purchased their insurance from the same insurer. This property of insurance still holds even if the two people have completely different risk profiles, if one purchases a gold plan and the other a bronze, and if one person purchases from MegaInsurance in New York and the other purchases from AcmeInsurance in California - as long as they are both insured at risk-adjusted rates.
> You do realize that this is functionally the same as getting rid of the preexisting conditions protection, right? Whether someone pays tens of thousands to a doctor for care or to an insurance company for coverage are in practice exactly the same. The whole point is that many of us think that is a fundamentally unfair system to force someone to face in that situation.
First, nobody is paying tens of thousands of dollars to a doctor, because there's an out-of-pocket maximum cap. (And that cap could still exist under a risk-based pricing world.)
Second, it's not, functionally the same, because that doesn't mean that you can't separately provide income- or wealth-based subsidies if you're aiming to redistribute wealth. But that happens at a completely different layer from the risk underwriting - and because the underwriting process is allowed to properly account for a person's risk profile, you end up with lower aggregate premiums (pre-subsidy). Lower unsubsidized premiums means that you don't need to subsidize as much money in order to achieve the same sticker-price premiums that consumers see - in other words, the entire process is significantly cheaper for what appears to be the same result to the patient.
The reason we don't do this, even though it would be significantly cheaper, is because it's politically infeasible.
[0] Which, you may note, is currently the case - and that's because health insurance as it stands is a mishmash of two completely unrelated products ("insurance" and "wealth redistribution") that we happen to try to stuff into the same box.
First, nobody is paying tens of thousands of dollars to a doctor, because there's an out-of-pocket maximum cap.
If they have insurance. Without guaranteed issue they may not. With guaranteed issue they may have "access" to insurance but can't afford it, or the insurance they can afford may exclude the procedure they need. Retroactively. And even with insurance they may pay 25K a year in premiums plus that 10K max. Then 28K and 15K the next year... It's a system designed for optimal profit, not efficient (or moral) distribution of resources that every person will require. Debating whether it's insurance or insurance-like, or how the underwriting works, begs the question. Insurance companies should not be involved.
> If they have insurance. Without guaranteed issue they may not.
It sounds like you are trying to respond to a different sort of discussion altogether.
This whole subthread is in reference to the (implied) statement "requiring insurers to cover pre-existing conditions requires a mandate [and it will necessarily increase premiums to the extent that we have seen]"
Your responses is tangential to that, addressing either (a) what would happen if we didn't require insurers to cover pre-existing conditions, or (b) other potential failure modes which could potentially occur, and which already occur under the ACA.
We are talking in circles at this point. I guess we are going to need to agree to disagree on this. In summary, I think you and many of the ACA's opponents separate out many aspects of the program that aren't viable without other aspects of the law.
>The reason we don't do this, even though it would be significantly cheaper, is because it's politically infeasible.
I agree with your point here, but it is the whole perfect being the enemy of the good thing. Like the original article states, this system isn't perfect. Even Obama admits this. I do however believe the current system is unquestionably better than the system we had previously. I therefore think it is a bad idea to return to the previous system while we hope to eventually come up with a better one. It is not hyperbolic to say lives literally depend on it.
Probably more than anyone, Obama understands that politics is the art of the possible. The fact that the ACA was passed by a margin of one vote is some evidence that, in the face of raging blind opposition, they didn't leave anything on the table. If congress weren't in thrall to gerrymandered hyperpartisanism and effectively unlimited donor money, the law would have had at least some bipartisan support, been revised numerous times, had bad parts improved, good parts enhanced, and concerns of both parties and various constituencies addressed in light of the empirical evidence gathered over the last seven years. I don't think there will be a return to the previous system. Instead, for several million Americans, they'll try to demolish the first four floors of a building and disingenuously point to the doctor's office on the fifth.
Yes, they are the same thing. Insurance is fundamentally a redistribution of risk with money being shifted from those who have not fallen victim to that risk to those who have. If you have a problem with that aspect of the ACA, you have a problem with the general idea of insurance.
This comment is so profoundly misguided that I have to comment.
Insurance does not work the way you describe. When companies do a fundraiser where someone gets to take a half-court shot with a basketball and win $1M if they make the shot, an insurance policy sells the company doing the fundraiser a policy that reflects the odds that a person chosen at random from the audience will sink the shot. That policy might cost $7K, since the shot will very likely be missed.
The insurance company makes a profit by charging a bit more than the actual odds reflect, so that over time if 200 shots are taken, it pays the $1M once and profits $400K. In a competitive market, the price of insurance will approach the probability.
Similarly, an insurance company might offer insurance that it will not rain on the last weekend in July. Perhaps an outdoor wedding facility wishes to buy that policy, but a farmer wishes to buy the other side of that risk. In such cases, the insurance company can charge less because there is a market for both sides of the uncertain event. Futures markets are also used for this purpose.
Most of our modern health care is not really risk-driven, it's based on markets that are highly regulated and prices that are influenced by lobbyists from various industries etc.
The key problem with your assertion is that at the time insurance is purchased, nobody knows who will be the victim or whether there will be a victim. Purchasers of insurance would rather spend a little bit of money just in case a bad outcome occurs, so they don't bear the full brunt of that bad outcome. Those who don't end up with a bad outcome don't get their money back, which is why the system works.
We all know there is a need for social services to provide healthcare for those who can't afford it or who have really bad luck. That's not insurance, however, it's social services.
>The key problem with your assertion is that at the time insurance is purchased, nobody knows who will be the victim or whether there will be a victim. Purchasers of insurance would rather spend a little bit of money just in case a bad outcome occurs, so they don't bear the full brunt of that bad outcome. Those who don't end up with a bad outcome don't get their money back, which is why the system works.
You say that my comment was profoundly misguided, but your comment right here is just a rephrasing of mine Someone with risk spends a little bit of money to help absolve themselves of that risk. If a bad outcome occurs and they fall victim to that risk, they don't bear the full brunt of that bad outcome because money is shifted from people who didn't fall victim to that risk.
Regarding you point about probability based pricing of insurance, we have collectively decided that we don't want health insurance to function that way. If it did, it would lead to the preexisting condition problem in which a person cannot afford insurance because they have a condition that requires expensive care. We instead subsidize their policy with a price increase on everyone else's policy.
> Insurance only works when the costs of the most expensive customers are shared among the cheapest customers. You need incentives to encourage the cheap customers to sign up or the whole system falls apart
And they screwed that part up. As a healthy young person, there is no incentive to buy massively overpriced, shitty high-deductible ACA plans, when one month of coverage costs more than the IRS penalty.
There is a solution to this paradox. If individuals without insurance were required to repay, at the time of their death, the cost of their healthcare over the last 5 years of life, the economic incentives would change overnight. We already do this and more when it comes to assisted living facilities.
How is that a solution? OK, I'm about to die. I racked up $600K in medical care expenses (or $100K or 'pick a number'). I'm broke and don't have that money.
The cost is directly a reflection of the risk pool and coverage.
Now think about who is buying ACA plans off the marketplace. First, it's almost entirely people eligible for subsidies (86%) since the plans are cost prohibitive without them. Second, it's people who didn't previously have or couldn't get insurance, unemployed, or who aren't offered insurance through work.
You can see immediately the problem... ACA subscribers will overwhelmingly be high-cost subscribers. There aren't any healthy subscribers to ACA because healthy Americans are working and get their insurance through their employer and therefore aren't eligible for subsidies and have no reason to look at the high-cost exchanges.
The ACA is effectively cornering the market for super-high risk pool, and premiums on ACA markets will continue to rise to reflect it.
If the subsidies were available regardless of availability of a so-called "affordable" employer sponsored plan, and if they employer's contribution could be taken by an employee and applied to an ACA plan in addition to subsidies, it would fix this all in an instant. Suddenly healthy Americans would be shopping on the exchanges, fundamentally altering the risk pool and drive down premiums for everyone.
You're leaving out all of us healthy Americans that do consulting, run our own small businesses, or participate in the "gig" economy who were buying overpriced private insurance before.
Only 7% of Americans get their health insurance through non-group coverage, according to Kaiser [1]
It's not nearly enough to counter-balance to huge influx of high risk subscribers. You're being hung out to dry with the high risk pool, which is why your costs have skyrocketed.
"Most people are healthy most of the time, and as a consequence, health care expenditures are heavily concentrated in a small share of the population: about 50 percent of the health care spending in a given year by those below age 65 is attributable to just 5 percent of the nonelderly population. The lowest spending half of the population accounts for only about 3.5 percent of health care spending in a year." [2]
If you want to fix ACA, you have to fix the risk pool. So what's the best way to get healthy people signing up for ACA in droves?
Imagine if you could take your employer contribution, and legally apply it to any plan of your choosing. As-in, sure the employer could arrange a group plan for the office, and you could take it or leave it, but you got to apply the exact same employer-contributed dollars to any plan you chose if you wanted.
Then on top of that, if you could get ACA income-based subsidies, regardless of the amount of the employer cost-share. Because, why on earth should you get less subsidy at the exact same income level, just because you have an employer who is also good enough to contribute?! That's just penalizing employers for contributing. Employer contributions would be an add-back to MAGI for purpose of calculating the subsidy, but nothing more. Currently, today, the meagerest employee contribution will disqualify an employee from all subsidies altogether, almost regardless of income. So-called "affordable" employer-sponsored coverage disqualifies an employee from all subsidies, is defined as an employee share of less than ~10% of household income for an individual plan. WTF?!)
What you would end up with is some extremely cheap plans which a lot of very health workers would flock to. The Fed would pay out significantly more in overall subsidies, but the payment of subsidies would be significantly more fair because it would not penalize an employee for working for an employer who is actually willing to contribute to a share of health costs.
In practice, it would in quick order eviscerate the group market for employer-chosen plans, and see employees taking proper responsibility for choosing their own plans for themselves, while still preserving the ability for employers to share in health care costs with tax-advantaged dollars. It would save millions of small/medium sized businesses the arduous task of trying to negotiate group health plans for their employers evey single year. But most of all, it would fix the risk pool by getting everyone across America actually buying through the marketplace, and not the skewed microcosm we have now.
Early on after ACA passing, I think it was Zenefits was actually trying to sell employers on paying employees to purchased their own plans on ACA marketplaces years ago, until the IRS shut it down. But it was an extremely appealing model at the time.
Pre-ACA a non-group plan that wasn't some government mandated high risk pool would typically be much cheaper than group coverage, simply because of the fact that it went through underwriting and you could be denied.
It was priced similar to life insurance where a healthy young subscriber could get a very cheap premium because the expected value was so low.
Back when it was legal to charge 10x more for a 55yr olds plan than a 25yr old, people paid more in line with their expected utilization. Flattening the rate curve shifted massive costs to young middle class families, which IMO is shit policy. When you're 55 you are generally done raising the kids and saving for their college, so it's actually not a bad time for your health care premiums to skyrocket.
Double the monthly fee for an equivalent full HMO plan that was about the same as I was making when I was working for a Fortune 500. I now pay a little over 1/2 what I paid pre-ACA for an equivalent plan through the ACA marketplace in NY state.
That wasn't my experience at all. Health insurance was literally three times more expensive for me throughout my perfectly healthy twenties compared to now as I'm nearing 40 (on an ACA plan).
If we are swapping anecdotes, my experience is the opposite of yours. I'm paying almost double what I paid 10 years ago, and my deductible is four times higher, with separate deductibles for drugs, and a smaller network of providers. Along with higher co-pays, and coinsurance now.
No they're not leaving this entire demographic out. After all, the original article is anecdotes from entrepreneurs. They're saying that ACA subscribers in general are higher risk. That's not surprising considering that most poor people would shop for health insurance on the exchanges and poor people in general have worse health than rich people.
This was the Republican proposal until Obama took them up on it. Anyone who remembers poor Mitt Romney having to bend himself into logical contortions during the presidential campaign knows that: it was his signature achievement as governor, previously praised by many in his party when advocating against single-payer systems, and suddenly so politically incorrect within his own party that he felt obligated to attack it or invent incredibly fine distinctions to say the ACA was different.
If we could lower the cost of health care in the first place, that would help. We need price transparency, and to fix patent laws so crooked big pharma companies can't charge outrageous prices. Having the govt foot the bill on all this stuff is just feeding into these problems. I know people that buy medicine in Mexico because it's so much cheaper there. Or people will fly to other countries for sugeries because it doesn't cost them their annual salary. Maybe our health care system here is better, but what good is it if we can't even pay for it? The "affordable care" act doesn't make care affordable. It just pays your bill.
"The good parts, like covering pre-existing conditions is exactly what causes your insurance to go up."
True story:
Pre-ACA, I had never been without insurance. I also have asthma. Never been a problem. No pre-existing condition issues. Then, I became a contractor and had to pay for my own insurance. The insurance refused to pay for anything asthma related. Fine; I was making enough to pay for the hideously expensive inhalers (think an epi-pen ever couple of months), but with those, the asthma was well controlled. Then I left that position and became a regular employee with employer provided insurance. Suddenly, no pre-existing condition limit. Weird.
My understanding is The "good parts" like keeping kids on till 26, pre-existing condition are the ones that make the insurance more expensive, the requirement to get insurance was supposed to get the insurance pool big enough so that it wasn't a big problem.
My understanding is The "good parts" like keeping kids on till 26, pre-existing condition are the ones that make the insurance more expensive, the requirement to get insurance was supposed to get the insurance pool big enough so that it wasn't a big problem.
Deductibles have shot up as well. Long details short, I have a $30,000 deductible when a pre-ACA plan had a 3-digit deductible. I'm covered, but the ceiling is unreachably high.
Costs have gone way up; they've just re-arranged where the money comes from, and punish you for not putting more money into the system.
Ensuring everyone is covered by making it illegal to not be covered is not an acceptable solution.
Medical and Prescription Drug combined:
$6,550 individual/$13,100 family for In-Network Providers;
$13,100 individual/$26,200 family for Out-of-Network Providers.
> We are now on an ACA plan. $270 with subsidies. Think about that. The government doubled the price of the plan or more, and is paying with our tax dollars the difference between my $270 and $780.
Can you provide any proof of that? According to Obama, an average insurance will be as affordable as a cellphone bill. Perhaps your plan had some perks in it, no?
Also there was a lot of fake stories about people getting tripled their insurance cost, all have been pretty much debunked as not real. Even Harry Reed was mentioning that in his speech.
Are you kidding? Go on any states healthcare exchange and price out a plan for a family of four. Subsidies only cover low incomes, apparently $70k for a family of four in NY is rich and can afford $18k/yr premiums with $14k deductible. There are some really piss poor regional plans with weak provider networks that are cheaper but you'll end up getting hit by out of network bills. The major carriers are charging astronomical rates if they are providing Exchange plans at all in 2017.
Ya, these prices that you see politicians touting are from the cheapest providers and hmo only. In the Los Angeles area, the closest gp was an hour away with a 30 day lead time to get an appointment if you go with the budget plan.
For those that don't know, in an hmo, you have to go see your gp for a referral for everything. In grown tonail, go to gp when you know he will refer you to a podiatrist. With a ppo, you can go directly to the specialist. But ppo under aca are the "premium" plans.
Well I don't know the details I have to admit. But I go with what President of USA said - it will be as cheap as your phone bill: "less than a hundred bucks a month". Here is the proof if you don't believe me: https://www.youtube.com/watch?v=_lT4VzH5xY8
No more evidence than I just stated. I didn't screen capture the change. Rather I told my wife to sign up for her company's insurance since their non HSA plan dramatically cheaper.
I personally prefer HSA backed plans since I have a real asset. We've saved heavily over the years. Now I can't really do that. I think there is only one such program in Florida. It was a high premium and high deductible.
I have borderline high cholesterol and family history of heart disease. Before ACA, health insurance companies quoted me minimum $1200/month for basic coverage even though I am in my 30s and healthy and rarely visit doctors office.
Whenever I see people talk about their costs going up, I wonder if they realize that health care costs were projected to go up even without the ACA. There's plenty of Government reports and private company reports on this topic and most reports I've read show that ACA is helping. I wonder if people have spent time reading up on quantitative assessments before basing their views on personal observations.
This same comment has showed up a half dozen times and it's a false characterization of the actual vote last night.
From the NYT: "Senate Republicans took their first major step toward repealing the Affordable Care Act on Thursday, approving a budget blueprint that would allow them to (gut the health care law) without the threat of a Democratic filibuster."
So take out the editorial "gut the healthcare law" and replace with "repeal and replace" and you have a clear reporting of what actually happened.
Two paragraphs down the actual non-editorialized reporting states the real truth; "The action by the Senate is essentially procedural"
The Republican Senate and House have voted multiple times to repeal the whole of the ACA over the past years. The only thing that has stopped it has been a presidential veto.
So, they voted to repeal it, offered no plans for replacement, and you want to act like "repeal and replace" is a more fair characterization?
The GOP has been talking about repeal for year(s) now and has nothing to show for a replacement plan. Meanwhile, as part of the resolution passed, they took aim at specific provisions that, again, were things praised in the grandparent comment.
Except they didn't "vote to repeal it" at all last night. And today we're hearing about Republicans in the House planning on voting to fund the $9 billion in subsidies for the cost sharing payments which Obama has been illegally funding by executive fiat the last several years.
In case you're not familiar with the details -- the cost sharing subsidies are payments which reduce co-pays and deductibles for low-income subscribers. These are a step beyond the subsidies, this doesn't reduce the premiums, but rather siginificantly reduces out-of-pocket expenses. The law is written in a way which requires insurers to grant these cost reductions to low income subscribers, regardless of whether the funds to reimburse the insurers are actually appropriated by Congress and paid out to the insurance companies. In other words, every year if the money isn't voted in to fund it, the ACA would immediately collapse because companies would be allowed to flea the marketplaces mid-year, and they certainly would, because they would be facing additional billions of losses due to the now unfunded discounts to low-income subscribers.
To work around this fatal flaw in ACA (one of many) Obama has been using executive orders to "appropriate" the money to pay the subsidies. This is of course an obvious violation of separation of powers (power of the purse is for Congress alone). And the House took the incredible step of suing the Executive branch, and they won. The ruling in the Federal Circuit court would immediately end the $9 billion of cost-sharing payments which Obama has been ordering the DHHS to make to insurance companues... was stayed upon appeal to the Supreme Court. If Trump decides to drop the appeal on January 21st, the payments cease, and ACA self destructs.
So, no, the Senate didn't vote to repeal anything, nor would they have to if anyone wanted to watch the ACA crash and burn. Of course very few elected representatives actually want to see a lot of very needy people lose their health insurance mid-year, as much as they didn't cause this dumpster fire, they will need to try to put it out. So we're likely to see more votes to prop up the failing ACA over the coming months until the replacement can be made ready.
The only thing that operating across state lines actually accomplishes is enabling a race to the bottom. It means that whatever state manages to make their regulations the most attractive to the insurance industry is the state that all the providers will "move" to, and that's the quality of insurance the rest of the nation gets stuck with.
For the most part, the insurance companies are huge, and they operate nationally already. There's really not any economies of scale that are going to produce direct savings. The savings come by slashing everyones coverage.
I'm invoking the commerce clause. So the States can only make more onerous regulations. You see this with California emission standards. The Federal government has a minimum and California say, "You got to do better." This prevents a race to the bottom.
Seems to me, the GOP's entire point for letting insurers sell across state lines is precisely to force a state like California to allow substandard plans to be sold to their citizens
Depends on the Federal requirements. Something that's lost in this whole conversation is the idea of insurance. I have auto insurance because I could be hit. I've gone 15 years without being hit, at least not enough to make a claim. I keep it just in case.
Going to the doctor for an annual physical is not something that should be insured. It's a known cost. You, as the individual, should pay that out of pocket, or get another extended coverage policy or rider to covert that. It's like my auto insurance paying for oil changes.
If car insurance had to cover a 6+ figure operation replacing an old engine that was was seized up because of poor maintenance, it would make financial sense to cover oil changes as a preventative measure.
A health disaster is several orders of magnitude more expensive than an automotive disaster, and you can't just total out a human being and pick up a new one at the local dealership if it's too expensive.
Preventative maintenance is a money saver long term.
Human error causes >90% of car crashes (https://cyberlaw.stanford.edu/blog/2013/12/human-error-cause...), so brake maintenance is a very inefficient way to reduce insurance risk. Instead, insurers penalise people based on their history of crashes (or — more importantly to the insurers — claims). The market is actually working well in that case.
Yes. When I was working on a contract, my income put me out of the subsidies range. I would have had to pay $780 for the cheapest plan per month. Essentially a mortgage. Actually $130 more than my current mortgage.
Jesus, no wonder so many people don't have coverage. I have never had to pay anything, even benefits are largely covered by my employer. I think I pay 15 bucks a month for a family plan on vision/dental/eye/drugs/physio etc.
It's called taxes you pay, assuming your a fellow European. I pay 33% of my income to Healthcare so these rates you Americans say you pay are really small, you're just spoiled :)
We pay those taxes too. Our per-capita government expenditure on health care is higher than many developed countries with single-payer systems. Our government then spends this vast amount of money to provide care for a fraction of us.
My wife and I have a 90/10 low deductible plan with 90% of premiums employer-covered. It costs us ~$220 per month in premiums so total plan cost is over $2k per month plus our out-of-pocket monthly expenses are usually $150-200 in co-pays and prescription costs. So over $25k a year on healthcare alone.
I was born and raised in a single payer country where healthcare is free (or close to it) and we are seriously considering a move back there. If we lose our jobs here in the US we would be screwed due to my wife's ongoing mental health needs.
What are the bells and whistles that weren't needed?
Like, I don't have mental issues so I don't need the mental health parts. I don't have cancer so I don't need the cancer coverage.
Previous to the ACA people would buy "health insurance" with a deductible so high they realistically couldn't use it anyway. I'm talking working class people with $10k deductibles and $2000 in actual savings. And they were freely sending insurance companies $100-200/month knowing there is no way they could actually use it.
I won't ever use mental health services. Personal choice. The old plan didn't offer that. I could get another plan to cover that. Why should I be forced to purchase something I have no intention of using?
Insurance, as a product, was highly customizable. You could get riders and other policies to cover various risks. You see this all the time with fleet insurance. Health insurance use to be the same.
The ACA set a floor on the offerings. If you don't those features, you can get a non ACA approved plan. You then have to pay the tax penalty. Now the penalty is an oddity. There is no lean. The government removes from your refund $X until you either pay the penalty or have no refund.
I looked at such a plan. Best I found was $438. Assuming an income of > $100,000 (I thought that 2017 insurance rates were set using 2016 actual income, I was wrong), the penalty was north of $3.5k total for my wife and I. This made the ACA plan cheaper since I didn't have to worry about filing quarterly estimates since I always have a refund (I'm giving a price to the time and effort required to file).
So the subsidies make the ACA plan cheaper that the non-ACA plan. I went with that. The question I pose to society is "Should we require government, funded through taxes, handout to make medical costs affordable?"
> I won't ever use mental health services. Personal choice. The old plan didn't offer that. I could get another plan to cover that. Why should I be forced to purchase something I have no intention of using?
You are ignorant and heartless.
In the worst and most expensive cases, patients do not even have a choice.
And your subtext is completely clear here.
No, you should not get to pick and choose what conditions are worthy of treatment because you don't have them and don't think they are legitimate, and therefore make coverage more expensive or unobtainable for others.
You don't want to purchase mental health coverage. So, when something changes in your brain and you completely lose it, the rest of us can pick up the tab for you?
I don't buy that "I won't ever use" thing. People change their minds, and sometimes you're not capable or competent to decide for yourself.
I've had chronic, sever depression. Never went to a doctor. Stopped drinking and changed my diet and prayer. Fine now. My wife is a social worker who worked with kids with emotional issues. She issued the depression test to me once a month. All in house.
> People change their minds, and sometimes you're not capable or competent to decide for yourself.
This means one of two things. 1st, I should be able to upgrade my policy or pickup a secondary one. 2nd, my family will have to live with the results of my earlier decision to not include mental health in my coverage. Decisions have consequences. The government shouldn't force me to pickup coverage just because they think it might be a bad decision to forgo it.
If you change your mind due to coming down with some condition, then you won't be able to upgrade your policy or pick up a secondary one, because that will be a preexisting condition.
So, one of a few things will happen. You may forego treatment and recover, in which case great. You may forego treatment and remain ill, meaning we all lose out due to the loss of a productive member of society. (Or, worse, you hurt a bunch of people.) You may seek treatment and be able to afford it, in which case great. Or you may seek treatment and be unable to afford it, meaning the rest of us get to pay for it for you.
That last one in particular is why we like to force people to have insurance. It's basically the same as forcing you to have liability insurance for your car. You can end up costing others a bunch of money, so we want to make sure you're able to pay it back.
Decisions have consequences. So long as the consequences remain confined to the person making the decision, I don't care much. But once they start impacting others, there's trouble.
I've volunteered at hospitals when I was a teenager. The guys with the Cadillac plans got the same medical treatment as everyone else but they had a single bed penthouse suite closer to a hotel in accouterments than a hospital, a larger meal selection, insuite TV and telephone.
You do a disservice by calling everything you don't agree with cadillac coverage. Clearly you've never had it.
> 2nd, my family will have to live with the results of my earlier decision to not include mental health in my coverage. Decisions have consequences. The government shouldn't force me to pickup coverage just because they think it might be a bad decision to forgo it.
You must be wonderful to have as a family member.
Mother: Hey, crazy cousin virmundi is coming to stay with you because he does not have mental health insurance and there is no government social safety net!
Me: Uh, what!?
Mother: Can you clear the guns and knives out of your house?
> I won't ever use mental health services. Personal choice.
I don't blame you there, it's probably a wise decision. I don't think I would ever want to have that listed in my medical records, for fear that it would be used against me in some circumstance down the road.
Guess what? I never thought I'd use that "massive fucking brain tumor" coverage I had. Especially not at 25years old and in great shape, and in perfect health. Nothing about that was fair, I did everything right and still ended up with my skull cut open.
I thought brain tumors were for old people and people who didn't take care of themselves. If you asked me at the time I got the tumor my odds of a brain tumor were zero.
It's not a "personal choice" to get sick. You can only prevent illness to an extent.
>Why should I be forced to purchase something I have no intention of using?
I don't intend to ever use the liability coverage I purchase. In fact, I hope I never have to use it. I don't mind I have to purchase it though because it makes society better off as a whole. I would hope if someone caused me injury they would be insured just the same.
I find your attitude extremely disturbing.
And yes mild to moderate depression can often be treated on your own with lifestyle changes. I'm glad that worked for you (honestly) but not all mental health issues are mild depression.
From what I've seen in my volunteer work I doubt you had severe depression,as rarely can severe depression be treated soley with diet and prayer (unless substance abuse was the underlining cause). Let me ask you, were you able to sleep? Eat? Get out of bed? Shower? Dress yourself? Go to work? Leave the house? Brush your teeth? Get through the day? If so your depression was mild to moderate.
Not that dietary change and prayer aren't useful in treating depression, they absolutely are! Depending on the patient we would encourage both as part of recovery. It's just very few severely depressed patients are able to "pull themselves up by their own bootstraps."
Check out Accident and Long Term Care illness insurance; They are typically ~ $10/month and tack on coverage for things that you have no existing condition or family history of.... and are generally otherwise low risk for.
> Previous to the ACA people would buy "health insurance" with a deductible so high they realistically couldn't use it anyway.
I talked to the CEO of a small rural non-profit hospital and asked if ACA had helped since they traditionally wrote off a lot of the care they provided. I figured that everyone being required to have insurance would really help them stay afloat.
She said it actually hurt them because they had an influx of people coming in with subsidized insurance that never paid any portion of the deductible. So the hospital was now struggling even worse than before because they were writing off more than previously.
For me, this was a counter-intuitive result of ACA that I hadn't expected.
If the patient doesn't pay the deductible, does the insurance company not pay anything at all?
My assumption would be that the insurance company has to pay, and then has to work out the deductible payment with the patient. What's the point of asking for an insurance card if the patient can simply not pay anyways?
Insurance companies don't pay the deductible. Patients pay the deductible directly to the doctors. Deductible as it's defined is the money the insurance company won't cover. Insurance companies won't front the money for the patient.
OK so the patient doesn't pay the deductible, but the hospital will get the rest from the insurance company right?
I fail to see how the amount uncollected could go up from this interaction. Before, uninsured people would have to pay full price (hospitals tend to charge uninsured people more), now they only have to pay a deductible...
Though chances are any time the uninsured rate goes down, the default rates of insured people will go up. Newer insured people are less likely to have their finances intact after all. So anything that lowers the uninsured rate will cause this issue I suppose
Maybe new healthcare revisions should offer FDIC-style insurance for deductibles for hospitals. Wouldn't want people refused from hospitals despite having insurance.
Only if the cost of the services is above the deductible. Let's say you have a $2500 deductible, and go in for a CAT scan that, coincidentally, works out to a cost of $2450. That all comes out of your pocket, if you're doing this on Jan 1 and haven't used any of your deductible yet, with the insurance company paying nothing. If your pockets are empty, the hospital doesn't get paid without hounding you, working out a payment plan, or going to collections.
As a sidebar, it's awesome when you have a situation as described, and then never go to the doctor again for the rest of the year, and so get no cost reductions on anything, despite paying out-of-pocket for the services you did use, plus whatever your premiums are.
Most insurance companies have deductibles AND a percentage of service over the deductible (coinsurance) AND a copay that you always pay and doesn't count towards your deductible.
What I get from this is you and your wife are healthy and didn't go to the doctor and after the ACA your premium went up $20 a month.
> Sure it had more bells and whistles, but I didn't want nor need them.
Like FREE preventative care. That's not a bell and whistle. That's worth more than your $20/month right there. Go to the doctor already.
And more importantly, that premium is identical regardless of what condition you were in. Without ACA, if you had cancer, you would die and/or be financially ruined. Worse yet, if you just had something like depression, or high blood pressure, or diabetes, then you'd be screwed out getting affordable insurance even in the event you got cancer or something unrelated but deadly.
> What I get from this is you and your wife are healthy and didn't go to the doctor and after the ACA your premium went up $20 a month.
My taxes, and everyone else's taxes go to pay this $500 dollar difference. The Federal government didn't some how magically create the gap funds. They have to increase taxes through fines and other sources to pay this.
They've effectively hidden these costs for the subsidized individuals. I'm not paying $780 per month with a large refund at the end of the year. I'm paying a few hundred. Most people don't think about the revenue impact this has on the country. We now have to fund these subsidies. We now remove even more money from people that could have go into stocks, local economies, or services.
The plan should be $280. That's it. Not $280 + subsidies. Just $280.
> Here's a case of a death that cost $250k for want of a $80 tooth extraction
It didn't "cost" $250,000. That's the sticker price of what they billed for the services, but that's not what they expected to be paid by insurance. That's a crucial distinction.
Just as you don't pay sticker price for a new car, the insurance company doesn't pay what the provider bills them for; they pay some agreed-upon rate, which is specified as a multiple of what Medicare pays.
> We were already paying for uninsured folks via bankruptcies etc.
Not exactly. Contrary to public misconception, it's well known in the medical world that preventive care is not cheaper in the long-run. (It generally results in better care, but not always, and it always results in greater utilization either way, so the end result is more expensive).
You can make the argument in favor of routine and preventive care on the grounds that it's the right thing to do, medically or morally. But it does result in greater costs overall, and that still has to be paid for.
>It helped give free or low-cost health care to people that couldn't afford it because now the government is picking up the lion's share of the tab.
But it didn't and doesn't provide care. It provides free or low-cost health care insurance to people that couldn't afford the insurance. They still have to pay for their actual health care with high, up front deductibles. Which many probably still can't afford. But the insurance companies are running to the bank with the mandated policy coverage and flow of federal tax dollars (via subsidies).
I have a hard time interpreting this comment. Reading only the factual statements, I come away thinking, "What a great system, for a couple hundred extra dollars a month a ton of people were helped." Yet the language around those statements seems to be intended to paint all of this as a really bad thing.
I don't see how Republicans could not throw out the good parts. When you boil it down, the good parts of the ACA are the requirement to cover pre-existing conditions, and the individual mandate. The former is what's needed to ensure people aren't completely fucked over at the slightest opportunity, and the latter is needed to avoid destroying the insurance industry in the presence of the former. Republicans appear to be fundamentally opposed to both of those. Without them, what's left?
I think expanding risk pools across states is a very tricky problem. It would imply overriding states' self-determination regarding regulation of insurance companies which is a big no-no for Republicans.
> Sure it had more bells and whistles, but I didn't want nor need them.
You don't want them now but you might want or need them later.
> The ACA helped many people. It helped people under 26. It helped people with pre-existing conditions. It helped give free or low-cost health care to people that couldn't afford it because now the government is picking up the lion's share of the tab.
There are a few important things it did that you missed. It ended lifetime maximum caps and it capped the difference in what you can charge the based on age to 3x. That last one in particular is greatly under appreciated. Yes, the young are now paying more than before but they will also pay less than otherwise when they get older. Everyone gets older so everyone eventually benefits from it.
> I think they will look at the industrial recommendations such as expanding risk pools across states
Nothing prevented them from passing this since they were in control of Congress. My guess is this is much harder to accomplish than it sounds.
Far too few people realize that much of the ACA plans' cost increases is due to Congress reneging on a government promise to mitigate risk in the early years through "risk corridor" reimbursements. Undermining an opposition program, then pointing to its collapse as if it was always fundamentally flawed, is a very clever and effective piece of politicking.
Insurance companies did not know the health, and thereby the cost, of previously uninsured people buying coverage under ACA. To reduce risk of the unknown, the government committed to reimbursing money lost due to underestimating risk (conversely, insurance companies would pay into a pool if they earned above certain thresholds). Over time, prices would meet an equilibrium as policy costs stayed low, allowing more healthy people to join the pool, which lowers coverage costs, which then lowers policy costs. Prices could be raised modestly to account for the difference, and government payments to insurers would ultimately end.
However, Congress rejected payment into the risk pool and ultimately paid out only 12.6% of the promised funds. Many co-op insurance groups had to fold, others needed to dramatically increase premium costs to account for (a) the lost money, (b) the increased cost of the uninsured, and (c) the increased risk that the government wouldn't fulfill its obligations.[1]
The current situation - limited choices, high premium costs, and resultant lower healthy person participation potentially leading to a "death spiral" collapse - is a direct consequence of these actions, not an inherent failure of the ACA.
However, Obamacare gets the blame and Republicans can point to a failing market that they can repeal and, perhaps, replace. Very effective politics indeed. Just ignore the human cost, which certain politicians seem to have no trouble doing.
> then pointing to its collapse as if it was always fundamentally flawed
On the inverse, I see many people on the left pointing to the number of people who have signed up as the primary indication of it's success as well. Which contains it's own notes of ignorance.
Was the government not handing out fines to people who didn't sign-up? So they were basically forcing people onto the program? How could the numbers of sign-ups be meaningful then?
Also, I couldn't imagine going without health care. You have to take what you can get otherwise the risks are significant. So considering it's an essential service, saying "look at the number of people using it" as an success indicator is like saying "plenty of people are calling the firemen, clearly they are doing a good job".
There is a serious human cost here when people have their health plans doubling in cost... while the rest of the world has worked out far more functional systems. So those cost calculations should be relative to this high level reality, not some internal benchmarks between stages of mediocrity.
It seems by not deciding to be free market nor socialized that the US is getting the worst of both worlds. It's easy to blame the republicans for this but the half baked socialized system that the democrats put forward was hardly a good solution.
> Far too few people realize that much of the ACA plans' cost increases is due to Congress reneging on a government promise
Have you considered that maybe the entire Democrat plan of getting to a socialized system via cuts and slivers in one direction, knowing full well that cuts and slivers will be done in the other direction is a terrible idea?
Stop pretending that private companies can function efficiently in an ever more legislated environment, as if only more thousand page bills get passed that it will finally start working well... history has continued to indicate otherwise. Either a) embrace markets or b) go hard on selling the public on the idea of single payer public insurance.
(I should note I'm in favour of public health insurance after living with it in Canada, despite typically being in favour of markets elsewhere)
Please don't assume my comment implies unvarnished support for the ACA. Except for the somewhat cynical last line, I tried to keep it fairly factual.
If you do want my personal opinion, I'll give it here:
1. From an economic standpoint, single-payer healthcare fundamentally makes sense. Put everyone in a single pool to reduce risk, drive efficiency, and maximize negotiating power.
2. From a free market standpoint, the current model of tying healthcare coverage to your employer hurts both employers and employees. As an employer, why am I responsible for paying this "benefit"? If too many of my employees get horribly ill, my premiums go up to the point that I can't provide a competitive benefit; my costs increase, my employees' contribution increases, and my ability to recruit talent suffers. As an employee, why must I forego an entrepreneurial opportunity because I can no longer afford healthcare for my children without an employer footing the majority of the bill?
3. From an efficiency standpoint, the current model wastes tremendous medical resources (bureaucracy, physician time, lack of cost transparency, treatment limits, etc.). I have friends in the medical industry (doctors, executives, med tech providers), all of whom dream of a single-payer system.
4. From a constitutional standpoint, I believe healthcare falls under "promote the general welfare" and "secure the blessings of liberty to ourselves and our posterity." A national, taxpayer-funded health program is no different than any number of other government-funded programs that free us to maximize our potential as citizens. And yes, we pay taxes to fund those services whether we use them or not.
So yes, I'm a believer in a single-payer model. Yes, I believe the ACA is essentially a handout to insurance companies. And yes, I was very disappointed when Obama took single payer "off the table."
However, I also think it's better than pre-ACA, despite its flaws. And at this point, it's certainly better than the chaos that will arise from simply abandoning it. Understanding its compromises, I can't really envision a "replacement ACA" that will pass a Republican congress that can be better.
If Congress delivers a better ACA, I'll happily embrace it. Heck, I'd even give credit to the Republicans if they just tweaked the ACA, renamed it "Winningest Solid Gold Trumpcare" and fully backed the result to make it successful. But I see no positive outcome if they go down the "repeal and delay" path.
1. From an economic standpoint, single-payer healthcare fundamentally makes sense. Put everyone in a single pool to reduce risk, drive efficiency, and maximize negotiating power.
Like the U.S. military has maximum negotiating power with its contractors? I mean, who else is going to pay for the F-35?
Monopsonies aren't inherently more efficient than monopolies.
Do you truly feel military procurement is equivalent to healthcare delivery?
Have you ever sold products to the US government?
Do you believe the primary financial gains would come from negotiating power? (Hint, the list I provided is in order of impact.)
Are you familiar with the impact Medicare Part D had on prescription drug prices? (Spoiler alert: it "substantially lowered the average price and increased the total utilization of prescription drugs by Medicare recipients" [1].)
Do you believe the decisions behind funding defense are in any way influenced by non-economic factors? (Hint: defense budgets increase even when the military itself requests lower funding. Does government healthcare funding follow the same pattern? Why not?)
Are you familiar with the many estimates of the cost of a single payer program in the US? [2]
I could go on, but won't. This is not Reddit. Sound-bite caliber anecdotal arguments are a problem, not a solution.
"Less efficient" is actually a nonsensical term to economists[0], but monopsonies are inherently inefficient, and it's rather straightforward to demonstrate that economically, the same way it's straightforward to demonstrate that a monopoly is always inefficient, even in cases of so-called "natural monopolies".
> Are you familiar with the impact Medicare Part D had on prescription drug prices? It "substantially lowered the average price and increased the total utilization of prescription drugs by Medicare recipients
You can't use Medicare Part D as an example of the impact that negotiating power would or would not have, because Medicare doesn't "negotiate" (read: unilaterally determine by fiat) the prices it pays for drugs, which it does do for providers.
> Are you familiar with the many estimates of the cost of a single payer program in the US? [2]
Yes, and most of those (including the ones you linked) are based on Medicare's reimbursements as a baseline. But that's totally baseless, because according to Medicare's own financial reports, they pay below-sustainable reimbursement rates to providers[1], which means that they are essentially subsidized by the premiums paid by privately insured patients. If Medicare were expanded to include everyone, they would have to massively increase their reimbursement rates, because the private insurance market wouldn't exist.
[0] Efficiency is best explained to a non-economist as a binary property; there does not exist a total (or even partial) ordering of inefficient states.
[1] They pay below COGS, which means that even if all doctors, nurses, and staff worked for free, they would still make a loss on Medicare patients in the aggregate, if they were not able to charge the difference to private insurers. Incidentally, that's why uninsured patients see such high bills - those are the prices that are used as a starting point when negotiating with insurers, and they're massively inflated to cover the gap.
In all fairness, Switzerland and the Netherlands have privatised medical insurance with universal coverage and the people are generally satisfied. Other countries, e.g. France and Germany, have mixed systems which also work well.
The flaws of ACA are not inherent to a privatised system, they are the result of this specific implementation.
First, the Republican-lead senate already voted to throw out the good parts like insurers not being able to exclude pre-existing conditions. This causes rates to up (basic economics). So now, me donating a kidney can be used to refuse me insurance.
Second, I can't figure out what your insurance was that was only $250 before the ACA. The only people I know who pay that little were on catastrophic plans. Insurance for me in NY state as a healthy (I was never without insurance so the kidney donation didn't count against me) single male in my 30s on a private insurer was creeping up to nearly $10,000 a year for complete coverage under an HMO like I used to get when I worked for a Fortune 500. Under the ACA, I pay half that for similar coverage.
> The government doubled the price of the plan or more, and is paying with our tax dollars the difference between my $270 and $780.
Do you have evidence that the government is the main cause of the increase of the price of the plan? It could have merely been the companies using the ACA as an excuse to raise prices.
But that plan was only available to healthy people without any pre-existing conditions.
Now, the $780 version of that plan is available to everyone.
You are a healthy person who could get healthcare before and still can for roughly the same price. The ACA wasn't meant to change things much for you: it was meant to increase coverage. Now people who are older or who have a chronic condition or a bad family history can get the same health insurance as you. That's what your tax dollars are paying-for.
> But that plan was only available to healthy people without any pre-existing conditions.
> Now, the $780 version of that plan is available to everyone
But you're making a political statement that the government should ensure sick people should have access to health care (which is fine, e.g., I support welfare). It's just odd that you think this program should be paid for primarily by middle class Americans, unlike most other government safety nets which come from taxes which mostly target higher income individuals.
>this same plan today is $780 a month without subsidies
The problem with your comment is that your prices are very exact but the consumed goods (insurances) are described only vaguely.
The country I live in, introduced obligatory health insurance 1996. The first proposition by our Democratic Party goes back to 1960. After 30 years of intense political fight we now have a system that is supported by all of the parties. So I think our system is as balanced as it gets. Plus we have a highly competitive system between insurence companies, and you are allowed to switch the insurance company every year, which then is done by lot of people.
The absolute most important thing is a rock-solid legal description of the minimun that every insurance company has to deliver.
Here are the + and - after 10 years of practical experience with obligatory healthcare:
+ High competition, disciplines insurance companies to work efficiently, and allows new, small and innovative companies to enter the market.
+ It's a pretty fair non-discriminatory system, nationwide and across all insurance companies
+ Simple system once it is established
+ Vulnerable persons are well protected.
+ The common health of the people is rising.
- The costs are rising every year because the is no direct interest in keeping the costs down
- The insurance companies get more powerful every year due intense lobbying, this not in our interest.
- There is explosion of special health services, very expensive treatments, rising salaries in the health economy
TLDR: Obligatory healthcare is good and you live longer. But it comes with a price.
@virmundi, In what state do you live?
To my understanding each state has the option to set up it's own State Healthcare Marketplace or use the Federal Marketplace. Different states have more or fewer healthcare providers to choose from, so the state you live in makes a big difference.
I went about eight years without health insurance because I was freelance and in NYC it was somewhere around $550 per month for the worst of plans for a perfectly healthy twentysomething with no medical conditions whatsoever (besides being a smoker at the time)
I ended up taking a job at a start-up when I turned 30 because I figured at 30 I should probably start going to the doctor more often and it was the only way I could afford health insurance.
I was finally able to go back to freelance a little over a year ago because a decent plan only cost about $700 total per month for both me AND my wife, and She has pre-existing conditions, which is to say she had gone even longer without insurance before we'd met. I was merely hedging bets according to my age. She actually needs it.
Of course, BCBS-IL keep cancelling our plans as is their apparent loophole to raise rates. Because even though the non-profit had a surplus of 14B in early 2016, the absolutely perfect plan we were on wasn't making enough money for them, so they killed it. That's twice in a row, so we switched to Cigna this year, which I don't assume will be much better.
It's expensive,. They're all expensive, whether I use the marketplace or not. But they're nowhere near as expensive as they were four years ago. Especially for my wife who literally could not be insured before the ACA.
The average spending per individual in the US per year is $10000 [0]. For an all inclusive insurance plan, if you have say a $5000 deductible and are spending less than $416/month per person you are contributing less to the pool than is being spent on average per individual. You're doing good, and are de-risked for potential health costs.
A healthcare plan where you get dumped the second you have a preexisting condition removes the de-risking benefit of insurance. The only benefit then left is the negotiating leverage of an insurance company able to pay $50k for a surgery that would out of pocket be $100k, lower ambulance bills, etc.
Heh, negotiated leverage. Providers aren't stupid, and they jack up the "rack rate" so they can offer the demanded discounts to insurers. The main result of this is cash patients pay through the nose. If you really want to fix this, have ACA:NG prohibit any cash price exceeding the lowest 'negotiated' rate.
Similarly, if you want to avoid the problem of expensive drugs that sell for significantly less in Canada, legally require Big Pharma to sell in the US for the lowest 'negotiated' price among all the national healthcare systems.
I have no pre-existing conditions, but being able to sign-up using the exchange was a big reason I was able to go full-time in a small business rather than continuing to work part-time for a large company to keep health benefits. The monthly premium is too high in my opinion, but one hospital visit made it worth it.
Improvements definitely need to be made though, I'd rather have Medicare like my grandparents and I have a hard time understanding why people are so against national healthcare or even exploring the idea.
The exchanges are terrible. In Texas, the only options available on the exchanges are HMOs, and in large chunks of the state, only a single provider is available.
If you don't have employer-provided health insurance, you're still basically screwed even under the ACA.
The prevalence of employer-offered, private health insurance is – like many facets of American life and institutions – an interesting path dependency of WW2.
The federal government imposed limitations on the ability of private firms to offer higher wages, so that the government could more easily recruit workers for war industry. Private employers found a loophole. Offering health insurance.
Tactically you are right, but the people who fund the think tanks that fuel the fires you are describing, are playing a longer game. Same people and motivations behind the de-education of Americans kicked off by Reagan.
"I had heart surgery when I was 18. I was virtually uninsurable. I now have health insurance. Why we need the ACA is no more complicated than that."
I am a bit confused by this story. Was Zach not covered under his families' health coverage? He also went to: Westminster School - one of the most expensive private high schools in the US.
Now, one could argue he had a pre-existing condition and thus, was not covered under any health care providers plan, but he states: "I was virtually uninsurable." This tells me there were options, but none that covered the entire cost of the surgery.
Honestly, this story alone makes me seriously question the purpose of this post.
He seems to be implying that, post surgery, he had a preexisting condition that would prevent further insuring for the rest of his life. The heart surgery itself was (presumably) covered, but after that he was on his own.
The ACA allowed adult children to stay on their parents insurance until age 26. Without this provision, Zach would have been kicked off his parents health plan and been uninsured at 18. He probably wouldn't have even been able to afford the heart surgery in the first place.
The heart surgery is now considered a preexisting condition when the individual tries to buy their own insurance. That's why it is mentioned, it is very likely it was covered by their family insurance.
This comment captures a feature of a lot of discussions I've read: somebody's got an axe to grind.
It's unfortunate that we're not able to get these conversations going in a way that's ... what? "unbiased"? I don't know what I'm asking for, but I think it's some variant of honesty and openness. And I think that we're missing a lot of the truth, for ourselves and others, by having to couch our statements in ways that aren't entirely forthcoming.
That said... I'm still glad that medicaid covered my uninsured ass when I broke myself trying something I'm not good at (skiing). I remember thinking (as I was bundled up in the medic's sled) that I was not too different from some New Zealander with a busted body part... about to be carted off to free medical care, to get me back on my feet and working as quickly as possible.
This comment captures a feature of a lot of discussions I've read: somebody's got an axe to grind.
It's unfortunate that we're not able to get these conversations going in a way that's ... what? "unbiased"? I don't know what I'm asking for, but I think it's some variant of honesty and openness. And I think that we're missing a lot of the truth, for ourselves and others, by having to couch our statements in ways that aren't entirely forthcoming.
That said... I'm still glad that medicaid covered my uninsured ass when I broke myself trying something I'm not good at (skiing). I remember thinking (as I was bundled up in the medic's sled) that I was not too different from some New Zealander with a busted body part... about to be carted off to free medical care, to get me back on my feet and working as quickly as possible.
You are reading too much into the word "virtually" — he means that once he was kicked off his parents' health insurance, no insurer would accept him because of the preexisting condition.
It's after the surgery that he would be un-insurable. Before the ACA, when he turned 19, the only possible way for him to get insurance would have been to get a job that offered health insurance because he wasn't allowed on his parents plan and he had a pre-exsiting condition so he wouldn't have been approved for private insurance. After the ACA, at 19, he could have stayed on his parent's plan, bought private insurance because the insurers couldn't discriminate based on the pre-existing condition or get a job that offered health insurance.
A serious heart condition in one's youth (infancy, even), regardless of insurance coverage at the time, could exclude one from all future private insurance (as in: there are zero options, they will not do business with you) leaving only incredibly-expensive state-provided (but privately administered , of course—profit over all) insurance as an "option", i.e. leaving the only actual options as being employed with a large company, going without insurance at all, or being poor enough to qualify for medicaid (so, avoiding employment).
Source: I know someone for whom this was the case pre-ACA.
Anything is a pre-existing condition. I sail and my knee got whacked by the traveller car. It blew up like a pumpkin. I went on my own dime to my ortho guy. He said, it was either going to get better fast or not. It got better fast and I can't even remember which knee it was.
Pre-existing condition. Anthem denied me coverage.
My ortho guy said, I don't understand. It was a good outcome.
Regarding increasing premiums, the complaints tend to be anecdotal. According to the National Conference of State Legislatures, in 2016, the average monthly net premium increased just $4 -- or 4% -- from 2015 to 2016 among the insured that take advantage of subsidies.[1]
Furthermore, premiums have gone up year-over-year every year almost every year since I've been paying for my own insurance -- and that's well before ACA.
There's an interesting chart on the Kaiser Foundation website, where it shows the average plan prices and percent increase year-over-year broken down by state. It also shows that, after tax credits and with very few exceptions, plan prices have remained stable (0% change) between 2015 and 2016.
I understand and sympathize with the high premium prices, but I have serious reservations about the assertion that the high premiums are due to the ACA and not external factors.
>>Furthermore, premiums have gone up year-over-year every year almost every year since I've been paying for my own insurance -- and that's well before ACA.
Not only that, but they were increasing at a much faster rate before the ACA. Of course, most people didn't notice, because those who were employed were covered by their employer, and the unemployed were uninsured.
And also, it was very easy for insurance companies to drop a few expensive procedures in the small print to maintain the same premiums. Then, when customers actually had to use their insurance, they get screwed.
The poster is probably referring to folks with pre-existing conditions who couldn't get insurance either affordably or at all prior to the ACA and who would've faced utterly insurmountable treatment bills without insurance.
Read through the article here. There's a collection of quotes from YCombinator startup founders about how the ACA helped them. Several founders were uninsurable without the ACA.
Yep, you nailed it. Had it not been for ACA, making the career leap to co-founder would have been incredibly difficult. Two years later, it's a honor to be able to provide insurance to our employees.
My wife works for a very small business -- five people, to be exact. They get group insurance through the company providing their payroll processing. Not by going directly to the exchange. It seems like that should be an option any founder of a small business could take advantage of?
But that doesn't mean the ACA saved their lives, it means ACA allowed them to continue with their startups rather than find coverage working for any of a plethora of big businesses. That is obviously still a good thing, but to claim that those founders literally would have died without the ACA seems misleading at best.
You are putting the poster on the spot in a public forum about something that, depending on the circumstances, could be very personal and private (or not, but we don't know and nor should we ask). There are plenty of examples elsewhere. See Sam's post.
The poster can decide how much information they want to share. It is not useful, however, for them to contribute completely empty anecdotes. For as highly as the comment was upvoted, it should have more substance.
If Obamacare is repelled at the Federal level, could a state just implement its local ACA? what prevents California for instance of giving health coverage for its residents? California is a good example since it "the world's sixth-largest economy" (If California was a country)
I'm sure healthcare companies wouldn't want to cut themselves out of this market?
This would give California and SV an even bigger advantage regarding what is described in Sam's post.
> The program is open to city residents, ages 18 and up, whose incomes and net worth are low but who do not qualify for other public coverage, and who have had no insurance for at least 90 days.
Ah the classic "if you are middle class F U" program
> If Obamacare is repelled at the Federal level, could a state just implement its local ACA?
Some parts of the ACA could be implemented in state law, some would be either illegal or impractical at the state level. It's also likely that a repeal would be accompanied or followed by federal policies which would make state-specified versions of the ACA less practical than they are now.
> what prevents California for instance of giving health coverage for its residents?
California already provides state-run send healthcare beyond the requirements of the federal programs it participates in.
> Some parts of the ACA could be implemented in state law, some would be either illegal or impractical at the state level.
That's my poor understanding of U.S. Federal vs State government that fails me here: what exactly would be illegal, what would be impractical?
If a state ACA is challenged in court, couldn't they use the supreme courts rulings of Obamacare as a strong defense?
Other comments here mentions that Massachusetts already had it (and I assume would likely keep it even after Obamacare is repealed), Couldn't California copy the Massachusetts implementation?
> California already provides state-run send healthcare beyond the requirements of the federal programs it participates in.
But I assume those state-run programs aren't providing as strong of a coverage as Obamacare was? Now would seem a good time to update it to match Obamacare?
> That's my poor understanding of U.S. Federal vs State government that fails me here: what exactly would be illegal,
Mandating coverage, which is basically a requirement of affordable universal healthcare.
"What happens if I don't pay the fee?
The IRS will hold back the amount of the fee from any future tax refunds. There are no liens, levies, or criminal penalties for failing to pay the fee."
States have granted themselves their own taxing authority, and have autonomy in doing so.
You wouldn't just copy and paste "IRS" into the state law that a state might decide to create. You would use the state's taxing authority.
Yes, state sanctions don't generally sting as much.
But each state would have to independently decide, with its own constituents, if it could economically offer subsidized health care for all of its residents.
Many states already have some form of parallel subsidized/free health care system for certain segments of the population. Like their school teachers and their children as an example.
Some states don't tax income, like my state of Florida. They don't much care about universal healthcare, because most of their residents are already on a sort of universal healthcare if you're the right age: Medicare. I'm unsure if there's a political will to enact taxes in this state to pay for healthcare when there's only a sales tax in existence (for citizens).
States have autonomy in creating any kind of sanction they want, as long as it is constitutional, but more practically as long as no judge finds that it is unconstitutional.
I think this presents an unnecessarily complicated view of things. The simple answer here is that California absolutely could develop its own healthcare system.
> Massachusetts had Obamacare (RomneyCare) years before the federal law existed (it acted as a model for the federal plan).
And we (in Massachusetts) are still trying to figure out how to pay for it.
Massachusetts already had an incredibly low uninsured rate to begin with, which helped, but even then, the costs have been unsustainable. In each of the last three governor's races, the major issue on both candidate's platforms were their respective promises to find a way to pay for it all.
Most recently, MA elected Charlie Baker, a former health insurance executive who has promised to find a way to make the program sustainable.
To some degree, yes - Massachusetts did that, in fact, and the plan there (that was signed, somewhat ironically, by Mitt Romney) is very very similar to the ACA.
There are a lot of details, though, that make this complicated and not necessarily viable for all states (MA is both relatively wealthy, has relatively wealthy neighboring states, and has a somewhat unusual healthcare market).
> If Obamacare is repelled at the Federal level, could a state just implement its local ACA?
No, because the Constitution mandates that states engage in a "race to the bottom." California could create their own healthcare program, but they couldn't preclude neighboring states from free-riding on their system by not having their own healthcare and enjoying lower taxes, and simply driving across the border when they needed care.
Out of state tuition at public universities is charged pursuant to exceptions to the dormant commerce clause that don't apply to welfare programs like healthcare.
"Shapiro v. Thompson (1968) considered the constitutionality of a state law that established a one-year residency requirement for welfare recipients. The Court struck down the law, finding it a violation of the "right to travel" (really, more the right to migrate). The Court said it had "no reason to ascribe the source to any particular constitutional provision," relying instead on the "fundamental rights" prong of equal protection analysis. In a subsequent case, the Court upheld residency requirement for in-state tuition benefits. In so doing, the Court distinguished Shapiro, which it said involved access to "basic necessities of life." In Zobel v Williams, the Court, 8 to 1, struck down a Alaska scheme that distributed royalties from the state's mineral revenues to state residents based on the length of state residency. Residents received $50 in benefits for each year they lived in Alaska. Various justices offered three different reasons for invalidating the plan.
Finally, in Saenz, the Court breathed new life into the Citizenship Clause of the Fourteenth Amendment in finding that clause to be violated by a California law that set lower welfare benefits for newer residents than for long-term residents. The Court says the clause "does not allow for degrees of citizenship based on length of residence."
I'm not sure I follow. If you can't regulate welfare depending on length of residency, it's fairly trivial to come out of state for just long enough to establish residency, then immediately claim full benefits, and move away once you don't need them anymore.
True, but establishing residency is at least some barrier against exploitation. I suppose it sorta breaks down when you try to determine whether a homeless person is a resident of the state. :/
The Federal Government funds >90% of California's medicaid expansion which is the vast majority of newly-insured people under the ACA. 1 in 3 Californians now receives free health care under Medi-Cal, California's medicaid program. If the Feds withdrew medicaid expansion funding I don't think California could afford to keep it up themselves without extremely painful tax hikes (which it may already be slating for future pension bailouts).
1 in 3 Californians now receives free health care under Medi-Cal
Look at that again, people. That's not just subsidized coverage; it's free coverage, for over 13 million... and that was before adding free coverage for those here illegally.
Does this strike people as a long-term sustainable model?
One problem may be that sick people would move to California just because of this. May be it is not a big problem if enough states do it. The extra load would be shared among several states.
Smaller states may have not big enough to have a healthy market.
A bus ticket is way less expensive than cancer treatment. Of course, it's not like every sick person will travel to a handful of states, but of course some people will move in order to get health insurance. If only a few states implement it, they will thus bear a higher share of the costs than if the whole country participates.
Perhaps I am assuming too much, but any sane universal health care system will require you to be a resident of a state for some period of time. Otherwise, then people will just hop a bus as you said and run the state dry.
Assuming that it requires residency, that requires that the sick person quit their job, find a place in the new state to live and work for say a year or two while staying alive with a dire sickness. It's not just a bus ticket that you need to relocate, there are many more significant costs associated with a move.
And even in that case, unless the state is already overcrowded, this is essentially a way to grow the state's residency and thus it's tax base.
The current ACA wants you enrolled before being diagnosed, obviously. The stated goal is to have EVERYONE enrolled, always. So when a diagnosis occurs, you should already be in the program because everyone is. And if they're not at this point, they're degenerate sponges living off society's good will with no sense of honor, self-respect, or personal responsibility.
Establishing residency usually only requires domicile in the state. It certainly doesn't take a year; more like 30 days, usually. In some states, a trailer can be used as a domicile. And some states also treat certain actions, such as registering to vote, as presumption of residency. Generally speaking, it's not hard.
You mentioned California, so I am using that as an example. They would find it difficult to do such a thing. Other states with more reasonable approaches to taxes, might find it easier, but I'll denote the challenges specifically in California.
First off, keep in mind the following:
1. Populous states like California pay far more in Federal Taxes than they get in return in return. [1]
2. California must have a supermajority in the legislature to approve taxes. [2]
So it's a complex issue, but simply put, there's not a lot of wiggle room for California to add billions of dollars of health subsidies to it's state budget.
Medicaid is basically one big government subsidy for the poor. When the Obamacare medicaid expansion goes away, millions will fall out of health insurance instantly. [3]
As for the managed plans, subsidies were used to make the plans more affordable to the taxpayers which made it easier for people to afford coverage. [4]
It's possible that some things may stay in tact like the pre-existing condition clause, but unfortunately the health insurance companies won't be able to cover everyone without the individual mandate. [5] Also, before the pre-existing clause, health care companies were rejecting people for health insurance with pre-existing conditions. [6]
The options besides subsidies for California are:
1. Government mandate of costs at doctors offices and hospitals, which may become illegal if the US Congress votes against it.
2. Government mandates on the behavior of insurance companies. This might drive many insurance companies out of California.
"In addition to decreasing property taxes and changing the role of the state, the initiative also contained language requiring a two-thirds (2/3) majority in both legislative houses for future increases of any state tax rates or amounts of revenue collected, including income tax rates and sales tax rates."
Some states have tried, including Colorado in the most recent election via ballot measure, but the plans have been resoundingly defeated at the ballot. I doubt even Massachusetts's current health system would pass a vote if it were on the ballot today. I suppose that could change depending on how badly the republicans muck things up.
Obviously there's a non-zero chance it will blow up, but isn't that risk worth it if reform would:
* Preserve some form of protection for people with pre-existing conditions (this covers the "save my life" part)
* Lower costs of health insurance for both individuals and the public (perhaps dramatically)
* Actually address the underlying healthcare issues directly, i.e. implement policies that will reduce the cost of healthcare itself, not just the cost of insurance
In particular, the risk of losing some important things (like coverage of preexisting conditions) seems extraordinarily low.
The reason why ACA was passed in the first place, was that it didn't attack the insurance industry. ACA was about access, not cost. Maintaining the insurance industry will limit the possibility of reducing costs, but the industry is too powerful to simply give up without a fight.
Right. The political power of the insurance companies ensured it was framed as "access to insurance" instead of access to health care itself. Health care is a general ledger category under "loss control".
Likewise, the ACA repeal efforts are disingenuously framed as "enhancing access to insurance".
Those are all admirable goals. But it's difficult to imagine a repeal and replace that accomplishes these. Why? It's all about the pre-existing conditions.
If insurance companies have to take all comers, that makes the system easy to game: don't get insurance until you're sick, and then jump onto the system. This would essentially destroy insurance markets.
What's the obvious solution? Mandate everyone sign up for insurance, at risk of facing penalty fees. Then you're always paying into the insurance industry, and insurance companies can survive and provide value to the healthy and the sick.
But this is tough: not everyone can afford health insurance. So, you provide subsidies to those who can't.
So, if you start from the 2008 status quo and want to add protections for pre-existing conditions, that game plan is pretty much set in stone. But the issue is that that essentially is the ACA. There are other aspects, but that's the core mechanic.
It's pretty much impossible to build a system from 2008 to cover pre-existing conditions without re-implementing the ACA. You can play with how high fees should be and how high subsidies should be, but that's pretty much it. And most of the Republican "alternatives" (insofar as they exist at all) work by putting a ton of loopholes in the pre-existing conditions protections, a strategy widely regarded as revolting and that only works because people are being bamboozled about what protections they would actually receive.
There are some real issues with ACA that you don't see unless you're affected by one of the provisions that starts funneling all of the costs for the legislative generosity your way.
For example, one of my good friends is a lawyer with a very simple single-member law practice. He has no employees and is self-employed.
As I understand it, BY LAW, he cannot apply for coverage or subsidies for himself or his family (wife and single child) and the only way they can provide for their health care is to purchase it via the New York exchange.
Every year, their chosen coverage provider has closed up shop to be replaced by a new provider with worse insurance terms involving premium increases and higher deductibles.
The plan they had before ACA (essentially catastrophic coverage) was deemed illegal by NY state and is no longer offered as it didn't meet the guidelines for suitable coverage for a family.
SO...by his words:
"I had a hospitalization plan I liked that was $175/month. Covered only catastrophic shit. I loved that since I do a lot to be healthy and no deductible. ACA banned that. First ACA plan was 300 a month or so - w 2500 deductible. Then that company went out of business. New company HealthConnect - price 350 a month - but 6500 deductible for bronze plan. They went bankrupt. Now i have CareConnect - 450 a month - 10,000 deductible $80 co-pay"
So, if your good coverage went from $175/month to $450/month and covered less and less with each passing year and you had no choice to go elsewhere because as a "business owner" you were deemed ineligible for any subsidies or other assistance from the government that was pushing these changes down your throat, you'd probably think it was a shitty deal.
The part that people don't seem to get is that these deductibles are HUGE for the kinds of people that ACA is supposed to help.
If you're paying $450/month and don't even get a single dollar of benefit until your family needs more than $10K of healthcare, would you feel like the government made your situation better or worse?
The core complaint here, as far as I can tell, seems to be that bare bones insurance plans were banned.
The reasoning is that, if you allow bare bone plans, then someone could offer plans that let you pay a nominal fee but cover nothing. That, of course, is pretty much nixing the mandate, and you run into the same issues with pre-existing condition protections destroying the insurance market.
Neither of us really know enough about your attorney friend's exact situation to know what went on, but that $450/month plan certainly covers a lot more than the $175/month one. Before, he was essentially self-insuring for the less costly situations, and now that insurance is required to be externalized.
Not perfect, and I'd like if Republicans came up with a solution to ease your friend's situation. But if it comes to a tradeoff between people dying and an attorney being forced to purchase a more comprehensive health insurance plan, it's really not a hard decision.
No the issue is that ALL the plans are now 'bare bones'.
Big Fortune 500 companies that used to offer 'PPO' plans (i.e. you paid your rate and then had $10-$20 copays) now only offer catastrophic plans.
So we are paying the same (and higher) for the plans as we used to, but now we don't actually get anything for them until we reach the deductible, which is higher and higher every year.
I pay the same as a few years ago every month, but get absolutely nothing until I hit $2K or so.
So your argument is that the ACA should provide healthcare that's both very cheap and very comprehensive. Because it isn't doing so, we should repeal it and go back to 2008, and healthcare will be made cheap and comprehensive?
I think the core argument is that it wasn't working and isn't working any better now but costs everyone a BUNCH MORE.
Regulatory capture and conflict of interest made it impossible for government (itself the largest payer for healthcare) to find ways to drive down costs. All the incentives are lined up to deliver worse or less care for more money. That's a recipe for disaster.
OF COURSE their lives have value. This isn't a moral argument. I'm not arguing that we should NOT provide universal coverage to everyone.
What I'm arguing is that the ACA, as written, has established a non-sustainable model for healthcare in this country. It's done so at a huge risk to future populations and seems to try and legislate an outcome instead of working with stakeholders to solve the ACTUAL problem: rampantly rising costs for healthcare.
HOW do you explain the crazy high costs for care in this country relative to almost every single industrialized neighbor? What are the factors for that high cost? Overconsumption? Regulatory capture? Lifestyle factors? Perverse incentives? Administrative overhead? PROFIT?
We've done very very little with the ACA to tackle these problems head on because every problem seems to be owned by an interest group that is incentivized to keep that problem alive.
But repealing the ACA, which is by all appearances what you want (correct me if I'm wrong), would leave these people without health insurance. You make fair complaints about the high costs for care in this country, but you're acting like they're the fault of the ACA. The ACA bent the cost curve downward, if anything.
Going back to 2008 would make things worse, not better. And sure, improve the ACA, but build on it or in parallel to it, don't tear it down and cost lives in the process.
Noooooo. The cost curve was NOT bent downward and if you can show me any evidence it was I'll certainly change my opinion.
What did happen was that a whole lot of people suddenly became the beneficiaries of a brand new government welfare program that wasn't paid for in any way by cost savings anywhere. I've got CBO studies to back that up.
Yes, we raised taxes on some rich people. Big deal. A pittance on what the spending required.
What we DID do was shift a whole lot of insurance costs onto people who were already paying a bunch: the middle-class.
If you want to know who really carries the weight of the ACA, look no further than a family of 4 with two incomes making about $125K between them. They saw their premiums rise, their deductibles grow, and their choices shrink.
There were winners: primarily, under or unemployed adults and those with pre-existing conditions that couldn't get coverage anywhere. Single mothers in some cases who couldn't otherwise get coverage under Medicare.
Everyone else who already had coverage they were paying for got screwed.
Not all plans. I've been on a PPO pretty much forever, before and after ACA. The deductibles have always gone up, as have the costs; but it's always been an option at every company I've worked for.
The full bill for insurance (minus savings for being part of a larger group) is coming out of my paycheck and profit shares, one way or the other.
> if you own a small tire shop and some guy just tripled your healthcare costs, well....he might have a different opinion.
I have a few friends and family who can get insurance due to ACA, so no, I wouldn't. I don't fall in that group (thankfully), but I'm more than happy to pay the costs so they can not go bankrupt or have to play the emergency room shuffle.
Hell, we'll all be there someday. It's the unicorn individual who is never sick throughout their life until they simply drop dead.
The reason the bare bones plans were banned were because many of them had rules that really screwed consumers. No one wants to think they'll be the one that gets cancer, but people do, and when you have plans that practice rescission, or lifetime maxes (after which they don't pay for anything), or annual maxes, then you've got the case where all of a sudden you are going bankrupt and losing your house due to treatment costs.
The main political/democratic value codified into the law is that no one should have to go bankrupt from treatment costs. That means outlawing those practices, which meant a lot of plans no longer qualified. That was the moral argument part that Republicans generally disagreed with. We're all paying a little more so that a family we don't know doesn't go bankrupt from a family member getting cancer. (And we're all also paying a little less due to other parts of the ACA.)
The ACA isn't supposed to help healthy and financially secure people like your lawyer friend. It is supposed to help sick and financially insecure people, by forcing healthy people (who are in the majority) to subsidize the cost of their care (which is very expensive).
There's a moral question at the heart of this, the answer to which defines the solution space: do we, as a society, think it is important that all sick people receive care? If yes, there are a bunch of potential solutions, but they all involve healthy people subsidizing care for sick people. If no, there are, of course, a lot more options.
The thing that frustrates me about the current Republican approach is that they seem to want to answer "yes" to this question, while telling voters they will not have to subsidize care for the sick in any way.
Depending on your point of view, either the best feature, or the biggest failure, of the ACA was that it made this subsidy for the sick visible to anybody buying their own insurance, rather than hiding it behind taxes or complicated dynamics between governments, insurers, employers, and hospitals.
A little more succinctly: either we decide to let emergency rooms turn sick people away, or somebody will be paying for their care. There's no magical solution.
I think you've answered a question you'd like to answer instead of one you don't: WHY is healthcare in this country SO EXPENSIVE?
The way to make care available is to drive down costs. We haven't done a single thing with the ACA to improve the affordability of care, we've just made the un-affordability a problem borne by the people who were already doing a good job of taking care of themselves. That's not a scalable solution.
The ACA got us a lot of short-term benefit for a small group of people but set in motion a chain of events that will only drive UP costs while driving affordability down.
And I'd like to argue that until we do something to improve the market dynamics of healthcare we are very likely to see this sort of thing continue to get worse until it's so unsustainable that it's like trying to legislate away the force of gravity.
One thing I'd like to see in any future version of ACA reform is RIGOROUS price transparency by healthcare providers. It should be absolutely illegal for any healthcare provider to conceal, obfuscate, or otherwise obstruct the price discovery mechanism of the market.
Even if you argue that consumers aren't the best people to decide what services are necessary or needed, they can rely on the advice of trusted advisors and popular understanding to shop for healthcare at providers known for offering good value.
SO MUCH of health care isn't of the "emergent" kind but the kind that is for chronic issues that are the result of unhealthy living or plain bad genetic luck. We need to redouble our efforts to drive those costs of care down and start paying for results and not treatment. Paying for treatment encourages overconsumption. Paying for outcomes encourages optimizing for cures.
Well said. Can we also work on the supply of medical care? We keep giving more and more people insurance which increases demand without doing anything to increase supply and then wonder why prices go up.
Your second paragraph is not even close to true - if you do more research on the ACA you'll find that it does all kinds of things to try and improve the affordability of care, a lot of which has made real improvements. Incentives against fee-for-service, quality-of-care rules, medicare/medicaid rules, there's just a ton of that stuff in the ACA. The stuff in your last paragraph is directly addressed by many parts of the ACA. And, more can definitely be done, including price transparency etc. These things tend to be supported by Democrats and opposed by Republicans.
I think you should post some links to relevant sections of the ACA and show me where they take specific actions to drive down costs.
I will tell you that I've seen scant evidence that it's working.
A wishlist of initiatives isn't a plan for action that drives down costs. Allowing Medicare to NEGOTIATE prices for drugs is a plan to drive down costs.
The insurance companies wanted to GROW the per-capita spend on healthcare. That benefited them. It's really really unclear if it benefited the public right now.
Forcing people into a market they don't want to be in isn't reform. The way to solve this problem is to make being a part of the market ATTRACTIVE.
IMHO we really missed an opportunity to affect behaviors. For one thing, Romneycare incentivized people to skip insurance until they needed it. That was a recipe for adverse selection.
The way to help this is to provide incentives for people to get in WAY EARLY and pay for their OWN care long before they may need it while also providing a measurable benefit to those who get in early right away.
People are capable of responding to incentives and I'm convinced that there exists a Nash equilibrium in healthcare that helps everybody win.
Remember, the same people who gave you "the Internet is not a truck" are the same people you're expecting to solve healthcare affordability. Think about that.
I work for a company which operates in the Medicare Advantage space.
A provision of the ACA sets a minimum medical loss ratio for us. In simpler terms: it puts a legal cap on our profit margin, by requiring a minimum percentage of the money we take in to be spent on benefits to our members (such as paying their claims).
In that scenario, are your interests served more by spending via medicare increasing or going down?
If your incentive is to maximize the absolute amount of actual profit you earn and the ONLY way you can do that is to push more money towards healthcare providers, then what do you think will actually occur?
Because once you have achieved that spend level on provider care, you're in the clear. The ONLY way for you to increase profit is to ensure that more procedures happen.
In a perfect world, you'd keep 100% of the premiums and never pay a cent to a healthcare provider because everyone is healthy, right?
In a terrible world, every single one of your insured has a chronic, long-term expensive to treat condition that requires you to pay tons of money to providers.
In the first/perfect case, premiums are zero, right? In the second/terrible/worst case, you're not making zero money because your (collected premiums - minimum payout) > 0.
See where I'm going with this? In a world with healthy people, there is little need for health insurance and spending trends towards zero. There isn't a need for an insurer. Your company can only exist in a world with sick people.
I don't see how that point has any value. It's kind of like calling Social Security a ponzi/pyramid scheme. It's only true if children cease to exist. Similarly here, your point only has value if sickness and accidents cease to exist. But that won't happen. The market for health insurance naturally exists already. And the incentives for increasing health care costs are very much what the ACA is about - those incentives are being affected by things like the ACA rewarding quality-of-care instead of fee-for-service, etc.
Quality of care is a good direction but doesn't go far enough. We need to get real price transparency into the market so people understand what it costs to treat lung cancer and what the probabilities are that they'll actually get better.
Do you think the average person on the street really knows what it costs to undergo a round of chemotherapy? Does the EXACT SAME procedure performed in different hospitals across town cost the same? These are important questions and there doesn't seem to be any political will to actually answer them.
And my suspicion for this state of affairs is that the interests of the players in this game is for nobody to really know what things cost because if they did the game would change.
Interestingly, Medicare is a slight counterexample to your comments, because you can -- given motivation to sit down and collate the necessary public data sources and understand the rules -- calculate what rate Medicare allows for a given procedure. And since providers who accept Medicare have agreed to those rates, it means that for Medicare, at least, you can find out the price (or the ceiling of the price, which is what people often want to know anyway).
Note that this doesn't mean the same procedure costs the same at every provider, though; Medicare rates include a geographic adjustment, among quite a few other factors, but it does mean you can work it all out for yourself.
I'd encourage you to read pages 23-28 of the following paper from the Mercatus Center. You'll find that prices for Medicare reimbursement are set by a committee largely stacked by the AMA, a de-facto lobbying group for doctors. They aren't likely to support any schema that cuts reimbursement rates for their members.
Unless medical care is cheap enough for everyone to always afford all the care they might require with the cash in their pockets or the money in their checking accounts, I believe my fundamental question is relevant. Since some medical care currently, and for the forseeable future, requires the time of extremely smart, talented, and highly-trained individuals, I don't believe it's possible to make it that cheap.
I agree with everything else you said though. Costs are too high and are a major reason this is so hard to solve and price transparency is a big part of the problem. A related (because it distorts the market in a similar way) problem is that most people don't see the true cost of their insurance, because they get it as a benefit from their employer. I would be highly in favor of any credible attempts to fix these issues. But that's not what I've been hearing from the party that's about to be completely in power.
You see the lack of honesty on both sides of the aisle. You're right in that Republicans don't just come out and admit that they believe that healthcare is not a right and that people should have to deal with their own health issues.
Democrats don't just come out and admit that they want a wealth redistribution program that they can use to show voters how compassionate they are with other people's money.
They're politicians. They just aren't honest and voters aren't perceptive or concerned enough to call them on it.
> Democrats don't just come out and admit that they want a wealth redistribution program that they can use to show voters how compassionate they are with other people's money.
I want a wealth distribution program that means that thanks to a genetic condition I had no role in acquiring (if you're "doing a good job taking care of yourself" and never get cancer or some other nasty expensive disease, why don't you count your fucking blessings that you're healthy instead of bitching about having to subsidize others) means that I don't get a death sentence if I ever am sick enough to lose my job for long enough to lose coverage and get fucked over in the future on preexisting condition exclusions. Or fucked over due to lifetime benefit caps.
And I want one that protects other people in similar situations too.
So maybe not everyone's motivations are as cynical as you make them out to be.
You might want a redistribution program, just like I don't want healthcare to be a right, but none of that changes that no politician will speak about their support for some healthcare policy in those terms. It would be electoral suicide if they're from a competitive district.
I want a wealth redistribution program as redress for past injustices. Current concentrations of wealth and property are the result of force and fraud, and I do not see how anyone should support preserving those distributions, let alone enshrining their preservation as a moral imperative.
Personally, I thought the ACA was a very honest plan. The individual mandate is a very clear statement of: healthy people must get insurance so that we can offset the cost of requiring that sick people can get insurance. I never had any illusions that, as a healthy young person, this would do anything besides increase medical costs (including insurance premiums) for me, as a trade-off against the possibility that I may one day be one of the older and/or sick people that it would benefit. I hoped it would decrease costs because we would no longer need to subsidize the uninsured by making up for care providers' lost revenue, but I didn't think that would (especially in the short term) be anything besides shifting that subsidy from being included in the cost of care to being included in premiums and federal taxes.
I was pretty sure it was going to make things more expensive for me, and I don't think it was sold any differently than that. I was not in favor of it, largely because I didn't think it would survive politically long enough for me to switch from the "loses" to the "benefits" category. We're sort of seeing that now, except that I'm actually sort of optimistic that its 6-year (or so) survival has enshrined it or something like it.
I believe a repeal-without-replace plan will be completely disastrous for the incoming government and that whatever government is next will have popular support to backtrack, and that a repeal-and-replace plan will end up settling on something very similar, maybe even with some free-market-based improvements!
At what point does your friend not say "f-it" forgo ACA individual mandate, pay the $2085 fine and not put the difference from paying 450x12 premium into a Health Savings Account?
Edit: It looks like you need to be enrolled in a plan to be eligible for a HSA
In my opinion, this idea that someone may only need "catastrophic" insurance because they "work hard to stay healthy" seldom works out without costing everyone a lot of money. Often these plans don't cover enough, and people end up with no real insurance at all. Perhaps a stroke or heart attack would be covered in the immediate sense (ambulance and initial hospital stay) but does it cover physical and occupational therapy?
These are the situations the ACA is trying to avoid and it was clear from the beginning that these types of plans (a nominal fee for virtually no care) would not be allowed.
Even if plans like this were allowed, we'd be in a situation where the healthy essential chose the equivalent of no insurance for the smallest amount possible. That's nearly the same as not having insurance at all.
> So, if your good coverage went from $175/month to $450/month and covered less and less with each passing year
But that's not the case, because that $175/month insurance didn't meet current standards of "good." While the ACA made it happen a lot faster for health insurance, this is kind of like me bitching about how high my car payments are because they keep adding on stupid useless things like bumpers, seatbelts, airbags and antilock brakes and I don't need ANY of those because "I don't get into accidents and if I do I have enough savings to cover it."
As for the question of him not being able to get subsidies for himself as a matter of law, I'm 99% positive that the way you become ineligible for subsidies is by making too much money to qualify. It has nothing to do with owning your own business, and if he's telling you it does then he's blowing smoke up somewhere.
As for the amount you're paying before you get benefits, yeah, there are plans in there like that, and they tend to be cheaper. You might almost consider them catastrophic care plans, except they cost more than $175/month and cover things beyond hospitalization. They're the ones with "20% coinsurance after deductible" for regular doctor's office visits, while what you're probably looking for are the ones with a "$40/75 copay" for primary care/specialist visits. That coinsurance/copay bit is one of the things insurance companies can still do to game the system.
The thing that those plans all have in common though is a maximum out of pocket number. That means if your friend the lawyer has a heart attack, is hospitalized, needs a couple of stents put in immediately or god forbid a bypass and doesn't have the time to shop around for other hospitals that might be cheaper, he's not going to be leaving the hospital with $250,000+ in medical bills that he's personally responsible for. Sure, $10-15k is a lot of money to take on as unexpected debt, but for an awful lot of people that's not bankruptcy money it's "payment plans for a few years that are going to kind of suck" money.
Let's start with how much money you need to make to see your subsidies completely extinguished: $50,000. That's the limit no matter if you live in Buffalo or Westchester.
Let's then get into the regulations associated with ownership of a company. Did you know that as the owner of a company no matter the size or organization, you're NOT considered an employee of your own company? Nor is your wife?
From the NY state website:
"Under 29 CFR 2510.3-3, an employee would not include a sole proprietor or the sole proprietor's spouse. The definition for Common Law employee can be found here.
The structure of the business does not matter. For example, the business could be a corporation, LLC or d/b/a.
Employees
(1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and
(2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership.
Specifically, 29 CFR 2510.3�3 states the following:
(c) Employees. For purposes of this section:
(1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and
(2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership."
So it does matter that the self-employed seem to get screwed a bit harder than the popular opinion acknowledges.
So, tell me again, which part of shifting costs from people who didn't go to law school and dropped out to work at McDonalds to those who finished school and did sounds like a fair deal to you?
Does shifting costs to those more conscientious sound like a great plan for national unity? How do you feel when your co-workers play hookey, sleep in, and write bad code? Do you think those folks deserve the same promotion opportunities you do? Do you think that any society that punishes achievers is one that is set up for success?
Let's discuss facts and not opinions. Show me the costs for insurance and where the subsidies end and tell me if you think it sounds like a good deal to you in a county where the property taxes for a small condo run about $25K per year.
Great, so he's making more than $50k/year, I'd hope that to be the case if he was able to make it through college and get a J.D.
> [ownership of a company & employee status]
I'm not disputing that, though I suppose if he really wanted to he could form a C Corporation and give or sell a small percentage of the shares to someone else to make it possible for him to become an employee. He's an attorney, he'd have a far better idea of the legal issues surrounding that kind of thing than I would. It seems logical to me (though possibly not in NY law) that if by law he's not an employee that it then follows that he is also not an employer since there are no employees.
I don't see how any of the above is actually relevant. All it really means to me is that he'd be purchasing coverage in the "Individuals & Families" portion of the exchange. I've never lived in NY, but in my experience with the Illinois/Federal exchange I don't think I've never been asked whether I was an employer, only whether I was an employee of a company that provided health insurance (or was required to provide health insurance by virtue of being >50 people).
And quite frankly if he's paying more than twice my annual mortgage amount just in property taxes, my sympathy over his premium increasing from $175 to $450 is very limited.
Admittedly, I'd be perfectly happy to see a return to Kennedy-era tax rates for incomes over $4 million/year and I'd be ecstatic to have those rates apply to me (because it'd mean I was making at least that much in annual income, but my needs and wants are simple and easily met with less than $100,000/month of income), so maybe I'm not the kind of person likely to be incredibly sympathetic here.
Guess what, you can't just "form a C corp" and go from there. The rules specifically exclude that kind of structure.
Look, it all looks great but when you REALLY DIG down into the rules, what you see is a recipe for disaster. The plans in NY that had to shut down were staffed by a roster of amateurs because the laws SPECIFICALLY EXCLUDED people who had worked in the healthcare insurance industry from splitting off and starting their own companies.
They quite literally expected a bunch of community activists to run an insurance company and it failed MISERABLY.
Regarding C corps, that's why I noted diversifying the ownership of the company and "he's a lawyer, he'd know better than I."
Exchange-created co-ops bit the dust elsewhere as well. In Illinois it was Land of Lincoln Health, which was closed by the state because it was going to be unable to make a required payment into the program designed to help keep the newly-created companies stable. I believe whatever remains of LLH may actually still be suing the Federal government, because part of what drove them under was not getting ~$70m that they should have received through those same cost-sharing systems. (caveat: Not an insurance industry person and I didn't watch it that closely). Still, I'm sure that there were a lot of amateurs who got involved. I'm also sure there were a lot of professionals and investors who got involved and in many cases lost money because even minor fixes became impossible after the law was passed. NOTHING that was going to make the ACA's implementation better was going to make it through Congress, particularly the Senate.
The problem is that when you dig down into the rules you may find a recipe for disaster, but you also found the only way it could possibly work. There are minor nuances, but when you really dig down you find that the "liberal dream of Obamacare" is really "Romneycare" is really at its core a design created by the Heritage Foundation[1]. That's not to say that it's great or terrible or doomed because it was championed by Democrats or doomed because it was written by Republicans, it's just the only viable structure that doesn't have single-payer as its core. If the Republicans in Congress actually do come up with a replacement it's going to look almost identical to the ACA except for cosmetic differences and name changes, and if Democrats stick with "You broke it, YOU fix it" then it'll also never pass and we'll be right back where we were in 2008.
Yes this is what both sides of the aisles won't admit. You can't have 20% of the people use 80% of the services and make things fair without forcing the users to eat the costs.
Same things with:
1. The US (like most Western countries) has a huge post WWII baby boom now approaching old age. The younger generations will have to pay for this.
2. The US refuses to allow chronically sick and dying patients to let death takes it course, managed only with pain killers. Instead, vast amounts of money (some say 80% - there's that number again) are spent on the last year of a person's life carrying out procedures that only prolong a few more painful months, with no chance for recovery.
The costs could be reduced by taking away some of the huge profits of the medical and pharmaceutical industries. But in the end, there will need to be societal changes.
That's the root of the problem. The moment we say that healthcare is a universal right, it's meaningless to talk about insurance. It's not really insurance if everyone can get it for an affordable price, regardless of their risk level. Calling it insurance just muddies the picture at that point. It's tax-subsidized healthcare, and that's how it should be described, planned, and discussed.
I think the chance that Trumpcare will protect people with pre-existing conditions is close to zero. Maybe there will be a lip-service clause which prohibits outright refusals to cover, but allows the coverage to be offered at any rate. There's no financial incentive to do so from the perspective of an individual corporation, and I find it impossible to imagine a law engineered by the current legislature will put the public good above corporate bottom lines in any way.
Perhaps if the mechanisms by which these goals would be achieved were made clear to us, people would be for it. The fact that any details can't be shared(because they don't exist) is illustrative of the fact that there is no real plan to fix these issues while maintaining coverage of pre-existing conditions.
I don't think it's true that "details can't be shared(because they don't exist)". It is a political imperative for Republicans to repeal the ACA now, and worry about replacing it after the positive PR. Without doing that, Democrats have no reason to come to the table to work on bipartisan reform (not that Republicans necessarily want this), and any replacement will be spun as a minor modification to Obamacare, which causes big political problems for the GOP both among its base and among swing voters. Details of a replacement aren't being shared right now because it would be tactically damaging to Republicans and Democrats don't want to attempt reform.
The top two Democratic presidential contenders as well as many of the Democrats in Congress campaigned on specific reforms to healthcare. The thing is, Democrats and Republicans have nearly diametrixally opposed goals in reform.
It's difficult to express sympathy for Republicans' political imperative to destroy healthcare coverage when the only thing that stands between it and people dying is... a Republican promise that they will expand healthcare coverage with a secret plan.
I'm coming at it from the other angle. Republicans know they're stuck with an intractable problem. You can't cover people with large costs without raising the costs for everyone. The problem for Repubs at this point is that those with large costs have already been granted access. It's much easier for them to deny those with pre-existing conditions access than it is for them to now take that away. Futhermore, Repubs can repeal ACA without Dems help but can't pass a new bill without Dems. I believe the goal at this point is to repeal ACA without Dems then push a hyper-partisan ACA replacement which the Dems will not vote for. Then Repubs can successfully lay the blame at Democrats feet for not coming to the table and passing the replacement.
I mean it's been the primary campaign issue in 2010, 2012, 2014, and the non-presidential 2016 races. Not repealing Obamacare would be a political catastrophe for them. If you haven't noticed, it's also the very first item on the docket of the new legislature too. It's very, very important to them.
"It literally saved my life" is an argument that could justify anything you want it to, no matter how bad it actually is. It'd be a little like saying nobody should ever leave their house because you never left your house and avoided any number of catastrophes that could have killed you. If preventing people from dying is the only metric by which a health care system is judged then pretty much anything can be justified at the detriment of other less tangible benefits, like insanely high prices, non-coverage of therapies used to treat non-life threatening conditions, no provisions for birth control, etc. Health care isn't simply about keeping people alive - it's about helping them live a high quality of life.
Before ACA, as a full-time worker at decent companies I paid maybe $50 a month for my insurance, my employer picked up the rest. When I went to the doctor, filled a prescription, or anything else routine, it was $10-$20 max. In the one year where I had a lot of care (broken wrist), I think I paid my out-of-pocket max of about $750 and that was it.
After ACA:
Catastrophic plan at pretty much every company I work for now (same for many of my friends in non government jobs). Minimum deductible of $1500-$2000 as a single guy. Probably 5x that for someone with a child and wife. When I go to the doctor, I pay for everything out of pocket at full price: $300 for a prescription (in the US they push up the drug prices to astronomical levels - we cannot buy from foreign sources), $200 for a simple doctor's visit. I have never hit my deductible which would then pay 80% of my costs.
Oh and I can't actually just go and get things like a hearing test or sleep study - I first need a referral from my primary physician at $200 / visit. In exchange, I get to put $100 away each month tax-free into a 'FSA' account. It is mostly use-it-or-lost-it by the end of the year, and will go back to my employer (i.e. a perk for them, not for me). At the end of this year, it basically turned into a $200 gift from me to my employer.
I think you hit the nail on the actual issue with health care in the USA. The problem is not as much insurance companies but medical providers' price-gouging.
Edit: sometimes it's a good idea to call ahead and ask for "uninsured quote", you would be surprised your $200/visit physician might only charge $50 to someone without insurance.
It's an unfortunate feedback cycle. Medical providers charge high numbers because they know insurance companies will only pay out a percentage of the billed amount.
Hospitals and insurance companies are co-dependent. In my experience, hospitals price everything high so that they have more room when they negotiate with the various insurance companies. No one is meant to pay these prices.
Hospital billing is also pretty awful. I've seen them place every possible reimbursable item on every bill, full well knowing that some insurance companies would cover some items and others different things. This resulted in inflated bills that were never paid in full regardless of a person's insurance coverage.
Many hospitals will negotiate with the uninsured but it's rare for them to make this easy to do.
This article is pretty weak, but the best I could find on this relatively arcane subject:
There have been plenty of reports showing something even worse - that pricing usually has no basis in reality, and you can have a 1,000% price difference by going to a hospital across the city.
Most hospitals can't even quote you a price. We were researching a procedure our insurance doesn't cover. One non hospital place quoted $750 cash price within 20 minutes on the phone. We called a nearby hospital and after over 10 hours on the phone spread over a week, and claiming that we don't have insurance (because their policy is you MUST use insurance even if they don't cover it), they quoted us $350 cash price.
We chose the hospital, and when we got there they said that price didn't actually include everything. WTF? It's a frigging mess.
It's true, I can't argue with you. There are people at the hospital (or their parent organization) that know actual dollar amounts and then argue them with insurance companies. Outside of that person it's pretty hard to get any numbers, let alone numbers you should feel confident about.
I am a software developer, I worked for a mid-sized community hospital. "It's a frigging mess" is a reasonable summary and also heart-breakingly accurate.
This is one area in which the ACA is making progress: providing an incentive to the hospital to know what a particular procedure actually costs. Your example, while disappointing and frustrating, was extremely rare in the 90's. High deductible insurance has given every customer a reason to shop for the hospital with the most reasonable rates. I can't say if that incentive is strong enough, but I believe it is progress.
Forgot to mention FSA. Employers love them because unused money deducted from your paycheck (i.e. YOUR MONEY) goes back to them. I suggest you look into HSA accounts instead.
FSAs are also risky for employers, though, because you can get your entire FSA balance on Jan 1, use it Jan 2, and resign Jan 3. They can't make you pay it back.
I'll trade your anecdote for mine: I have been working for Decent Companies for 15 years. Every year my payments went up, the company's prices went up, my copayments went up, and my coverage went down.
The real nadir for coverage was in the end of the Bush years: I worked at Home Depot as a developer. That means that the plan covers a lot of badly paid people, and a lot of old people. I was paying hundreds a month, my doctor visits were $75, 20% coinsurance in hospital visits up to 10K, and a maximum lifetime benefit of 1 million: So if something really bad happened, like a stroke, they'd stop covering before it was all said and done!
Since, my payments kept going up at similar rates, but at least things like maximum lifetime coverage has gone away.
The one and only time things have dropped in price was last year, now that I work at a place where the average employee's age is 26. The company still pays $1600/mo for their side of the coverage, but since it's mostly developers, they can afford it. No company in their right mind will pay that when the employees are making $15/hr
Healthcare has been less and less affordable since the Clinton years, it's just that it started very affordable. the ACA didn't make things noticeably different for the good plans overall: It's all still very expensive, and picking an employer that either has a young, healthy workforce, or has so much money they can pay for expensive plans, is the big difference between having good health coverage or not.
So I guess that what I am trying to say is that if you had the insurance you claim to have had in the bush years, you were incredibly fortunate, and your situation was not common.
So what gets me is that people seem to think healthcare should cost less than $1000/person/year and I just can't see how that's reasonable. If anything remotely serious happens it will cost hundreds of thousands if not millions, and I just can't see how it's possible to cover that kind of situation when we know from our own lives that things like Diabetes, Cancer, Stroke, Heart Attack, and even Car Accidents and such are common enough.
I had childhood cancer and at the time it'd have costs millions without insurance.
While the healthcare market is hopeless opaque and corrupt and no doubt that does drive costs somewhat (or a lot), and probably there are things to do about it, but I think fundamentally the success of complex and expensive treatments is also driving costs - things that you'd have gotten painkillers and left to die even in '50s and '60s now can be cured/improved/fixed, it's just ridiculously expensive compared to popping some pills and expiring. Or look at prosthetics. There was a time you might have made do with crutches or a peg leg and now there are specially designed, fitted, and crafted prosthetics for various activities... that don't come cheap. Not to mention improvements to the standard of care or the sheer man-power requirements of health-care. A normal doctor's visit requires interaction with 3+ employees, across ~45 minutes, all of whom are presumably being payed more than $10 an hour, and possibly a lot more. It may actually be reasonable that budgeting $5k/person/year for healthcare is sane in terms of both risk and what you get, but just far more than people are used to thinking about or seems intuitively reasonable.
> I had childhood cancer and at the time it'd have costs millions without insurance.
This is the entire theoretical reason for insurance: to spread costs out across a large group, so that by having everyone pay a little nobody has to pay a lot.
It's also why the logic of modern healthcare makes single-payer systems the ones that work the best; they spread the costs across the widest possible "risk pool." And why the ACA had to include a (deeply unpopular) mandate that everybody buy some form of health insurance -- as long as your system is based on private insurance, such a mandate is the only way to get the young and healthy into that pool.
> It may actually be reasonable that budgeting $5k/person/year for healthcare is sane in terms of both risk and what you get, but just far more than people are used to thinking about or seems intuitively reasonable.
Remember that most Americans' income has been stagnant in real terms for nearly 40 years now, while health care costs have done nothing but increase and seem set to keep on doing so. So, barring some major change in how the economy works, whatever figure you set for "a reasonable amount to save for health care" is only going to seem less and less reasonable as it grows to consume a greater and greater share of those stagnant incomes.
In other words, if peoples' wages increased by $5K a year at the same time as they were expected to bear $5K a year of health care costs, it'd feel a lot less painful than just expecting them to pull that $5K out of the couch cushions.
Median household income is around $50k/year. At $5k/person/year that's $20k for a family of 4 per year which is probably 40%-50% of their take home pay. It's an insane number.
I agree in terms affordability it is problematic, but I was referring more to how there seems to be some idea that the cost of medical care itself couldn't reasonably add up to a number that expensive.
Sounds like your employer used ACA as an excuse to switch to cheaper plans and cover less of the costs. Are you sure you're laying blame on the right culprit here?
What I think your actually complaining about is High Deductible Health Plans and HSAs which came into law in 2003. It's just taken time for them proliferate.
The reason they are becoming popular is that they are intended to incentivize the consumer to pick and choose their providers since they have to bear the brunt of the initial cost. (And cheaper for employers to fund over non high deductible plans).
As just one anecdote for rebuttal, my insurance premium increased by 20% this year--not even mentioning the additional deductibles they hid in the renewal options.
I, for one, am very much looking forward to purchasing insurance from the best provider in any of the 50 states, not just the few available to me in CA.
I agree that opening up across state lines is a very good thing. However, if the marketplace goes away and there's not a good way to force companies to be competitive, we're really not in a better place either. Hopefully we can have the best of both worlds.
> I agree that opening up across state lines is a very good thing.
When this was done with credit card companies, they all moved to the state with the least regulation and started instituting consumer-hostile stuff like mandatory arbitration.
I'd really rather not have this happen with my health insurance.
Premiums also saw a large increase due a cynical and intentional move by the GOP congress to withhold funds from insurers that were initially promised for the first few years while they sort their pricing out.
Part of the initial law were "high risk corridors" to limit the losses for insurers that initially mispriced their ACA plans. The insurance companies had to make a ton of assumptions about the age, health, and wealth of the populations who would sign up for their plans. To make sure they didn't accidentally bankrupt themselves, the law provided funds to limit their losses for the first three years of the exchanges (2014-2016). In the first year, they had a shortfall as the population was older and sicker than expected, so CMS was going to cover the $2.5 billion gap but congress refused to let them pay these user fees.
The GOP knew that the premium changes would come during the election season, so they denied funding for the high risk corridors last year. To give themselves room against mispricing, the insurance companies predictably raised premiums beyond where they would otherwise have been. Other insurance companies decided they didn't want the risk, so they pulled out of the marketplaces.
The election season was rife with announcements about "20% premium increases" and "xx Insurance company exits the exchange market". Millions of people get to pay more for health insurance but at least their guy won the race.
The present state of affairs is that everything is a red herring. The health care system is so convoluted, with business entities inside business entities paying other business entities, that it's impossible to know where the money goes, so we have no idea what makes it so expensive.
Somebody is gouging us, but we will never know who, and everybody can point to somebody else, or to "society," but we just don't know.
Chances are, everybody who can make money while covering their tracks through a web of business entities, is gouging us.
One potential advantage of the government owning the whole system, is that it would facilitate figuring out what the costs actually are. This may be why other civilized countries pay half what we pay. It's a saying in business, that you can't manage what you can't measure.
Yes. Check out the pharmacy benefit management industry. That's a multi-billion dollar industry which does something that should be entirely unnecessary. Drug companies overcharge for prescription drugs, then pharmacy benefit management companies make bulk deals to negotiate them down while taking a cut.
And for-profit insurance profit--what's the word--Greed, has nothing to do with the huge deductibles, and ever increasing premiums?
Anyone who followed this Act knew what power this bill would give to insurance companies. We just hoped they woudn't abuse the gift.
They abused it, and blamed the Act, and their customers.
(Obama wanted private/public health care system. The Rebublicans, and their boys(the Insurance Lobbiests) did everything to scare, block maybe a bill that would have brought in competition, and provided sensible health care to all. I remember it because it has been my pet peeve for years. I followed that fight since Hillary was fighting for Heath care. I remember looking at Ronmey's state's Heath plan, and thinking the premiums are too high? Way too high. "It looks like the Insurance companies are in direct communication?" I told my uninsured girlfriend 8 years ago. But--in--no--way would we get anything if Obama didn't cave into Rebublican strong arming.
Between April 1, 2009, and today 8/16/2016, Aetna's share price has increased 525%. (Probally due to the free money corporations/funds have to invest, but come on?)
I put some of this blame on the hospitals themselves as well. The fact is that I have no idea what I'm going to pay when I get to a hospital or doctor's office. They won't tell you anything up front. By the time you know what they cost, you're on the hook for some ridiculous amount. They won't give estimates, you can't shop around.
And medical coding to figure out what you're paying for and what a normal price should be is ridiculously hard to understand. Some of this is going to be their response to a litigious society, but you can't use that excuse for all of it.
Also, if someone doesn't have insurance, the fact that the hospital puts you on the hook for the full bill is ridiculous. Insurance isn't paying 100%, they are discounted crazy amounts, even only paying 20% in some cases. But you don't get this discount from the hospital. If you show up without insurance, you will be charged the full amount, less what you can negotiate on the spot. And most people don't know they can even try to negotiate it.
I agree that the insurance companies are a huge problem, but I don't think the hospitals and doctors' offices themselves should be absolved from their share of the blame.
> Also, if someone doesn't have insurance, the fact that the hospital puts you on the hook for the full bill is ridiculous. Insurance isn't paying 100%, they are discounted crazy amounts, even only paying 20% in some cases. But you don't get this discount from the hospital. If you show up without insurance, you will be charged the full amount, less what you can negotiate on the spot. And most people don't know they can even try to negotiate it.
And what happens with the majority of people who don't have insurance, they don't pay it. So the costs get eaten by the hospital and eventually by everyone else that can pay.
In that respect, we have socialized healthcare already. It's just a horrible implementation.
> the majority of people who don't have insurance, they don't pay it
Exactly so. They don't pay it because they can't. And they're ruined. Even people who have insurance -- good insurance -- can be ruined. This system is the ultimate form of price discrimination, perfectly tuned to extract the optimal amount of money from the consumer who has literally no pricing information, and maximize the profits of the business. When insurance companies pay out, it's referred to as "loss".
Markets and the profit motive may be "efficient", but they're not optimizing for health outcomes, and certainly not optimizing for morality. Insurance companies ultimately cannot be part of the equation.
Wrong. The main problem with the US system is the outrageous level of corruption and greed being displayed by the Health Industrial Complex of pharma, hospitals, service providers, device makers, and insurance companies. All of them together infiltrate the government and collude to fix prices and line their pockets at the expense of the taxpayer, and at the human cost of literally hundreds of thousands, of not millions of lives.
In advanced Western countries, you see many different configurations for functioning health care systems. Some do insurance based models, others do single payer, others are hybrids. The issue is not about choosing which configuration of system, it is about rooting out the disgusting level of corruption that exists currently in the system.
The ACA did nothing to tackle this underlying issue.
I've always thought that the famous line about "let customers shop across state lines" should be better formulated as
"let insurance companies shop for the best state"
Meaning, when customers have the ability to buy across state lines, the true competition becomes not consumers shopping for insurance, but STATES competing for health insurance COMPANIES to set up shop in their state- offering whatever it takes-- handing over amazing liability protections, tax giveaways, dropping regulatory standards-- all to get them to create jobs in the state.
The result is that (A) one or two financially strapped state governments give the industry whatever they ask for, promising them minimum regulation/oversight and low/no taxes, then (B) the entire industry moves there, where they further consolodate power. (C) companies regulated in other states (with safer products and actual responsibility to their customers) can't compete fairly, so they either move to that state or go out of business, resulting in (D) fewer choices for customers, poor quality products, higher prices, and more abuse and negligence from the companies.
I've heard this expressed as a "race to the bottom", which I always thought was a really confusing way to say it without context.
What makes me think this is going to happen? Watch the Secret History of the Credit Card documentary on Frontline about how this exact same thing happened in that industry.
The CC industry "state-shopped" to find a state (South Dakota I think it was) that would let them get away with just about anything. At that point, every major player moved there, and suddenly credit cards became super abusive to customers and there was no recourse (until very recently with the consumer financial protection bureau...)
Or instead of coming up with our own lists, just look at what other countries are doing?
The UK is doing OK with the NHS at half the US cost as a fraction of GDP. Singapore is doing at least as good at about a quarter of the costs.
American combines the worst of government and private healthcare. The UK does a decent job with government healthcare. And Singapore combines the best of government and private healthcare.
Selling across state lines is a horrible idea. It's a race to the bottom in terms of regulation, which leads to adverse selection, and therefore more expensive premiums for the sick, poor, and elderly.
There's a lot of material out there about the likely effects of selling across state lines. To the point it is not even actually seen as a viable option, it's more something that Republicans say because it sounds reasonable at first. But it's not workable.
You say: "It's a race to the bottom in terms of regulation"
Consider your assumption that regulation is good. In point of fact pernicious and arbitrary regulation within states brought us as a nation to this desperate situation.
You say: "To the point it is not even actually seen as a viable option"
Check your prejudice at the door and look at reality. You may need to understand markets and human nature more clearly. You may "see" and understand other, better options.
What's the desperate situation you're referring to w/regard to health care? Do you mean the imminent dismantling of the "pernicious and arbitrary" system which brought 20 million people health care who didn't have it previously, saving untold thousands of lives per year?
As another anecdote, the premium increases per year my company has to pay has (mostly) dropped since Obamacare - the highest increase was a year or two prior to ACA.
Insurance for just my family went from $1400/month (already expensive!) to $1850 per month. I live in the midwest, so it's not like we have crazy high prices. I keep thinking of the mansion I could live in with that much going towards a mortgage.
AND, until we hit our $5K premium, it doesn't really pay anything. So we've got to pay $27K to get a real benefit. And it's not like we're young and healthy (nearly 50). Feels like we're getting shafted.
Where in the Midwest? Near a big city? I'd agree with your assessment (no crazy high prices). But if you live in a smaller city (like I do, not Midwest but Southeast), you may also have a disproportionately unhealthy population compared to the national average, along with being disproportionately poor. This means that our regional medical costs are higher both by need (unhealthy population needs more than average care) and scarcity of resources (difficulty in persuading doctors to come here).
Allowing insurance to be sold across state lines only creates a short-term arbitrage opportunity. In practice rates are just going to meet at the middle - states with lower premiums will see rates go up and states with higher premiums will see go lower.
The problem is what "best" means. In an unregulated environment it would mean what's best for the insurance company, not the patient.
There are substantial challenges. One is that insurance companies don't actually provide care, of course. Any company wishing to do business with people in a particular state would have to actually obtain a network in that state -- partner with an existing network, or negotiate deals and sign contracts with hospitals, urgent care centers, pharmacies, labs, and doctors. They'd presumably have to be licensed to do business in that state, and adhere to that state's own regulations and requirements for doing so. (Because the US is a federal system, the federal government itself is unlikely to be able to strip away all of each state's specific laws and regulations.) This process would have to be repeated for every state in which they plan to do business. Insurance companies would probably set up state-specific legal entities or subsidiaries to provide financial and legal compartmentalization. So selling insurance "across state lines", as a practical matter, may not differ much from the current system. State-specific legal work and shoe-leather network-building would still be required. There's nothing stopping a national company from setting up a state-specific entity and selling insurance this way right now.
Another issue is that if local regulations were somehow stripped, as some in congress wish, insurance companies, as profit-seeking entities, would all gravitate to the most favorable and least regulated business environment. After the Supreme Court ruling in Marquette v First of Omaha, credit card providers migrated to Delaware, South Dakota, or Arizona because those states have the weakest usury laws and allow them to charge rates of 29% or more to borrowers in any other state. A similarly deregulated and "efficient" market for health insurance would have all the companies set up entities in whichever state would allow them to offer plans that provide the least care reimbursement (known internally as "loss control") and charge the highest premium. This could lead to a situation where a few very large companies offer only high-deductible plans without guaranteed issue, excluding procedures that carry risk of being expensive or are politicized, with lifetime or annual caps, thin networks, and retroactive drops. Lip service would be paid in the form of seemingly cheap policies that actually provide little real coverage, but allow insurance companies and politicians to claim "all Americans now have access to affordable health insurance". As bad as the credit card system may be, lending is at least a business that can be conducted at a distance. Health care is the most local of concerns.
What's needed is not a guarantee of "access to efficient health insurance markets". What's needed is actual health care. In a moral society, everybody should have access to that actual care itself without risk of ruin. The US system forces people to make terrible decisions. People remainining in hated jobs, empowering employers and distorting the employer/employee market. Not taking medicine, or half-dosing, because, even with insurance, the costs are too high. Not visiting the doctor after an injured ankle because of fear of the costs, then suffering forever after due to a poorly healed fracture. Especially pernicious: seeing a doctor but not reporting problems because of fear they'd be labeled as pre-existing conditions for which future coverage would be denied. And employers themselves have higher costs because of the historical accident of employer-based insurance, reducing their competitiveness with foreign companies who have no such obligation.
It's a huge political problem, but this focus on insurance, and access to insurance, begs the question.
You say: "The problem is what "best" means. In an unregulated environment it would mean what's best for the insurance company, not the patient."
No. I don't buy auto insurance on that basis. It is required by my state in order for me to legally operate a motor vehicle. I buy what is "best" for me (and my family).
Only in our closed highly regulated environments that
denigrate personal responsibility and individual liberty do we get this extraordinary markets dislocations that come with the bizarre healthcare system that we have today.
For many people, health care is a service that must be consumed or they will die, or their children will die. Demand is highly inelastic. People in this situation are looking for a way to stay alive.
Your selection of the best auto insurance policy is qualitatively a different kind of choice. Many millions have no car or need of one. You could live without one. I mean that literally -- it will not end your life if you don't have a car. There are alternatives to owning one, even if one of those is moving somewhere where you don't need one. Likewise, you may never use your auto insurance, and auto insurance doesn't pay for maintenance. But everyone needs health care, including its "maintenance" form. There's nowhere to move that obviates the need for health care.
The part I don't like about ACA is the mandate. I really don't think the government should be mandating people purchase a product from a private company. There is a simple solution to this though. Just expand Medicare and make everyone in the country eligible for it. No one is forced to participate in Medicare, but if you delay your enrollment you have to pay penalties when you join. This is a simple way to handle the healthy people won't join until they need it problem. Most people will join to avoid paying the penalties. Medicare is one of the most popular government programs. I don't understand how this isn't being talked about as a solution.
It is being talked about, and has been talked about for years. But the reality is that to expand Medicare, you need around 65 Democratic Senators, a comfortable Democratic majority in the House, and a Democratic President.
I think that's on you. The purpose of the government is not to protect you from making monumentally bad life choices. If the government doesn't bail those people out then that will just strengthen the incentive to sign up when you become eligible.
I don't understand how this isn't being talked about as a solution.
It is being talked about but there is significant opposition from those that don't want to raises taxes to the level that would be required to finance such a proposal.
It could end up being a cost savings overall, or at the very least be cost neutral. Most people are paying for health insurance now anyway. If that shifts from a premium paid to your insurer to a tax payed to the government is that really a big deal?
It's not a mandate, it's a tax incentive. I'm not forced to buy a house, but if I choose not to have a mortgage, then I forgo the federal tax benefits. If you accept that the mortgage deduction is within the scope of the government's powers, then I am not really sure I see the difference. Am I missing something?
As an aside, I agree that Medicare expansion would have been a better policy. Good luck getting that through congress, though.
Yes, tax rates are arbitrary so not qualifying for an exemption is mathematically equivalent to being fined. It's just presented in the reverse.
You are being fined for not paying mortgage interest. You are being fined for each kid you don't have. Buy your house and have your kids or you will continue paying more in taxes!
I don't think the issue is purely semantic. The government provides a financial incentive to buy houses. I can decide whether I want to be $x richer and have a mortgage to pay. I can similarly decide if I want to be $y richer and have a health insurance plan.
I don't mean this as a rhetorical question, so I apologize if it comes across as snide, but from the point of view of economics, what is the difference? I'm trying to understand why one kind of tax incentive is objectionable and not the other.
There is a huge difference between a fine and not receiving an incentive.
If I have $1000 in my pocket right now, I will still have $1000 in my pocket if I choose not to go after an incentive.
But if I have $1000 in my pocket right now, I will not have $1000 in my pocket even if I choose not to buy any health insurance.
In my eyes, being punished for peacefully doing absolutely nothing is as anti-American as it comes. That's another argument, but my point is that the analogy is off the mark.
Suppose Person A lives in a house with a mortgage, and Person B lives in an apartment with a lease. Suppose -- it's unlikely, but for sake of the hypothetical -- Person A's monthly mortgage and Person B's monthly rent payment are the same dollar amount and their gross annual income is the same.
Person B -- the renter -- will pay more income tax, because Person B does not get to deduct mortgage interest while Person A does.
In much the same way, if Person A carries insurance all year and Person B doesn't, Person B will pay more income tax.
So yes, you do get "fined" for not buying a house. We just spin it as "encouraging the dream of home ownership" instead of as a "fine", a "penalty", as "the government holding a gun to your head and forcing you to buy a house", etc.
How would a renter feel if their rent increased because their landlord was unable to take a mortgage deduction? In other words, is the deduction implicitly distributed pro-rata to the supporting renters via market force?
In the US, the home mortgage interest deduction does not apply to rental properties. To qualify for the deduction, you either have to use the home as your residence for a minimum period each year, or rent only part of it (and meet requirements for renting part of the home: you can't have more than two tenants, and the part of the home they live in can't have its own separate kitchen or toilet facilities).
But that's the home deduction. Apartment buildings, for example, are investment property for which mortgage interest is a deductible expense. https://www.irs.gov/publications/p527/ch01.html
Then you concede that taking away the home mortgage interest deduction (making the homeowner-who-resides-in-the-owned-home and the renter equal for tax purposes) would not drive up rents, and your original comment was at worst wrong and at best a non sequitur.
I'm positing false equivalence. Taking away the home mortgage interest deduction would make the homeowner and renter unequal. Doing so would not drive up rents, just as eliminating the mortgage deduction on investment property wouldn't impact house prices.
How would a renter feel if their rent increased because their landlord was unable to take a mortgage deduction?
I countered that the home mortgage interest deduction doesn't apply to rental properties. Renters and homeowners are thus currently unequal from a tax standpoint, since renters effectively pay a higher tax rate than homeowners. Removing the deduction would thus not create a new inequality; it would remedy an existing one.
If I choose to live rent-free in my parents' basement, I will not get fined for doing so. I keep ALL of my cash. But I'll STILL get fined for having not buying myself insurance.
I'm not sure what logical fallacy you're throwing here, some form of "Denying the antecedent" or something along those lines, but it's not the same situation.
Just because you don't understand the difference between a penalty and an incentive doesn't make your analogy suddenly correct.
There's an incentive for having a home mortgage under certain conditions only, and you do not owe anyone additional money if you have no outstanding mortgages on properties.
The same is not true for the ACA. You are fined for not owning something - e.g. if your net worth was $0, you could go into the negative for not having insurance.
If you don't own a mortgage, you cannot be fined into the negative.
> Just because you don't understand the difference between a penalty and an incentive doesn't make your analogy suddenly correct.
There is no difference between a tax penalty and a tax incentive (more precisely, a tax incentive is exactly identical to a general tax cut plus a tax penalty for everyone who doesn't qualify for the incentive, and a tax penalty is equivalent to a general tax increase plus a tax incentive for everyone not subject to the penalty; so, except as concerns the general level of taxation, penalties are exactly the same as incentives.)
> If you don't own a mortgage, you cannot be fined into the negative
Since having a mortgage or not can make the difference between owing net income taxes or not, if you have $0 net worth before a particular year's taxes are considered, you absolutely can be "fined into the negative" for not paying interest on a mortgage (lenders, not borrowers, own mortgages.)
Not to go off on a tangent, but I actually don't agree with the mortgage deduction either. I don't think the government should be using the tax code to try and incentivize or disincentivize behavior. The congress has shown itself to be monumentally incompetent in choosing what behavior should and should not be rewarded. The mortgage tax deduction being one. We found out the hard way during the mortgage crisis that not everyone should be incentivized to own a home, and even now it continues to survive.
The mortgage interest deduction is in fact federal spending, as it is a subsidy.
The healthcare mandate is a tax. What many people object to here is that most taxes tax an activity (making money, buying things, owning things, etc.), such that one does not HAVE to do any of those things, but if one CHOOSES to, they become subject to the tax. Here on the other-hand they are being TAXED for NOT doing something.
Using your analogy, the healthcare mandate is the same as taxing people for not owning a home.
Yes and I do think more needs to be done to incentivize people to live healthier. It's one thing for all of us to cover the costs of others for congenital defects and accidents outside their control. It's another thing entirely if they cannot be bothered to exercise at all, eat even remotely healthy, or smoke cigarettes (I think you do in fact get charged a higher premium in a separate pool in some/all? states if you're a smoker; but smoking mitigation is not subject to any co-pay fees or deductible it's 100% covered including some reasonable number of psych eval) or engage in very risky activities. This can't be a life guarantee for the old either. After a certain age, you kinda need to stop looking for problems or you gonna find something and it's pointless to do anything but manage quality of life rather than remaining quantity.
One problem on top of the getting it passed part..
Many doctors don't take Medicare. Over a situation where say there are 3 doctors for a specialty in a town... the two better ones do not take it, and the new less good one will take it. So if that flat answer is let everyone take medicare, I think there are some serious quality of care problems.
(I have no better solution though, every angle seems bad).
They would immediately start taking Medicare when nearly all available patients moved to it. They can only afford to not take it now because other customers are available.
If we hit a point where nearly all people were on Medicare, we'd be bankrupt anyway.
But continuing with your theoretical environment: no, they would consider adding new patients until they had a critical mass and then stop accepting new patients.
> If we hit a point where nearly all people were on Medicare, we'd be bankrupt anyway.
No we wouldn't, we'd be in a much better position and we'd be paying much less for healthcare. Medicare has far less overhead than private insurance and it'd be the logical move to establish a far more effective and cheaper system of socialized medicine.
Yes, taxes would go up, but would most people really notice? You are basically shifting from paying a premium to a private insurer to paying a tax to the government. It's kinda six one half dozen the other.
Yes, but not always. He opposed the government option. Quoting the article [0]:
> ... "if the bill remains what it is now, I will not be able to support a cloture motion before final passage." In other words, Lieberman will support a filibuster. "I can't see a way in which I could vote for cloture on any bill that contained a creation of a government-operated-run insurance company," Lieberman said.
That was one of the arguments for the ACA. Hospital emergency rooms are a very expensive way to treat minor problems, and an very ineffective way to treat chronic ones. This is why each homeless person in SF costs the medical system about $10K a year.
Prior to 1986, hospitals were not required to treat the uninsured, but most nonprofit hospitals did anyway.[1] For-profit hospitals tried to dump them on nonprofit and charity institutions. The 1986 law makes all hospitals that take any Federal funding treat uninsured people with emergency conditions.
It's been talked about extensively, but there wasn't enough political will to push it through in 2010, and—as others have pointed out—it would take a comfortable Democratic supermajority in the Senate and House, and a Democratic President to make this happen.
The mandate -- i.e., forcing healthy people to carry insurance -- is the only way to make the risk balance out. Otherwise, no insurer would stay in the individual market.
Because Republicans hate Medicare too and want to privatize it as their compromise? If they didn't have to compromise, they'd destroy it along with Social Security. But they know full well they'd pay too high a political price, so that's why their policy is to make government programs suck as much as possible so they can keep up the government blame game.
Or, why not just go to a full single-payer system? This would basically be medicare for everyone, but you get rid of the insurance companies which add no value to the system but consume massive amounts of it's resources.
I posted a ASK HN[1] a few days ago related to signing up for health care through CoveredCA as a single bootstrapped founder.
If you're self employed and make over $50,000 a year no matter where in California you live, you'll have to pay full retail premium prices without any discount. My company as a whole makes over 50k a year, but less than 100k a year (still getting off the ground). Thus a monthly premium of $460 a month for a standard decent PPO plan puts a large burden on me. Additionally, if I don't get health coverage I'll have to pay a heavy tax penalty at the end of the year. Essentially as a bootstrapped small business owner, health insurance is a large burden of cost and I was forgotten in the Affordable Care Act. Instead my cost to purchase a plan skyrocketed as I subsidy other people's care. That is not fair, everybody is not paying their fair share. Middle class self employed are the one's who got hurt the most.
Finally go compare CoveredCA.com and then go use https://www.blueshieldca.com. CoveredCA literally is one of the worst designed and functioning apps I've ever seen. It constantly errors and doesn't keep state that I am logged in. The UI/UX is terrible. I'm guessing CoveredCA was outsourced to a non-technically competent contractor overseas. Compare that to BlueOfCalifornia which is a great site, beautifully designed, and functions as it should. This is why government can't have nice things.
I'm a single founder 100% owner LLC, personal and business income is combined. Plus on CoveregedCA they ask for personal income and self employed income when seeing if you qualify for discounts. Finally, dealing with sending them tax and finance documents to get the discounts would be a huge hassle and I'm almost certain a hair-pulling frustrating experience. By the time that is all done, I'll probably be out of their discount bracket anyway.
As far as I understand, while I can write off deductibles my personal and business income is combined at the end of the year since I am 100% owner of my California LLC thus giving my inflated annual income.
Your total income that you would report on your personal income tax return should be your personal salary plus your business profit for a single member LLC.
Between my employer and myself, we pay $1806 a month for my family of 3. My employer has 3000 employees, so it isn't a weird situation with poor purchasing power.
Wow, both of you are paying a lot, I am sorry. Basically your high premium payments are going to pay for other people's care. Not a fair system. Everybody is not paying their share, middle class is though.
You don't know that. You have no idea what kind of health issues their families face. And yes, sometimes you are just paying for other people's care, right up until the time that you need it. That is, after all, the point of insurance.
For years, I paid much more out in insurance than I would ever spend that year. Last year, I had a $35,000 surgery. Heck, I spent so much on medical care last year that I had a "luxury colonoscopy" in December, because I knew I'd hit my out-of-pocket cap for the year.
That colonoscopy was $6000, btw. This, for preventative care that could save hundreds of thousands of dollars from colon cancer (and quite possibly my life) down the road. In a well designed system, price controls would put preventative care like colonoscopies below actual cost (and make the money up elsewhere), to save money at the macro level.
I make much more than you and pay more in taxes than you. I'm paying more for national defense, police, roads, etc. I'm subsidizing you. Not a fair system.
And here I thought the Netherlands was expensive.. 100 bucks a month + a 385 deductible. And our level of care is top of the world. Man do I completely un-envy Americans.
Without trying to defend or criticize the ACA, I would just say that this is too simplistic of a comparison. How much of your general taxes are redirected towards healthcare, for example?
One of the reasons that the ACA is broken from a financial point of view is that the Democrats didn't want to simply raise general taxes and redistribute to fund the program. Instead they played all sorts of games with the 'individual mandate' to try to force participation without 'raising taxes'. But this is just a way for healthy individuals to avoid participating in the insurance pool -- which is a great way to destroy the actuarial basis of insurance.
It is entirely possible to be for nationalized health care and still think the ACA is structurally unsound and needs to be replaced.
For someone making less than $100K, $460 a month is not fantastic, and $1800 for a family of 3 likewise total income less than $100K is an obscenity. I wouldn't pay these amounts for a car, why should I consider it reasonable to pay this much for health care? Insurance did not used to be this expensive. This is a product that's losing its usefulness compared to the cost.
And it's wrong to call this insurance. It's not insurance, it's a health care payment plan.
Before ACA I was paying 1/3 the price, and had 1/4 the deductible. These higher rates are basically a tax to subsidize others, which is fine in principle, I just don't like the idea that this is going largely to a massive for-profit private bureaucracy. My problem with ACA is the private insurance industry is shit, and ACA made the expansion of shit mandatory. It should have been single payer, destroy the perversion that is the private insurance industry who have lobbied for all the anti-competitive behaviors they engage in to ensure near monopoly status in the vast majority of counties in the country. But the political capital just wasn't there to see how treacherous the insurance industry has been.
I don't see how the next round of politicians actually fix this though. Preexisting conditions are made feasible by mandates, mandates are made feasible with subsidies, subsidies are made feasible by some people paying more under mandate. So you can't take away any single one of those without the whole system unraveling entirely. Even the insurance companies have said this. They just don't want to say it loud enough that the blowhard in chief gives them a tweetirade.
The US has the highest healthcare costs in the world. There's simply no escape in the US unless the government steps in a regulates medical fees like the rest of the western world.
The US is the only modern country without cost controls. Providers set prices and insurance companies do little other than pass those costs onto consumers.
When will we get cost controls? Likely never. It's very anti-capitalism to restrain free trade. (Yes, there's some sarcasm there. This issue pisses me off.)
There are no cost controls like other nations have. Japan has a single book that details the costs of all medicines and procedures. It is agreed to by both sides, under threat that the government will step in if there is no agreement.
This is what we need in the US. I should not pay a different price if I have insurance or pay cash. People that pay cash are routinely charged far more than people with insurance.
That's misleading. First of all, medicare is set by the government, and healthcare organizations cater service only to what is covered for medicare patients.
Secondly, hospitals charge people with insurance more. Typically if a patient is uninsured and paying cash, the hospital will work out ways to charge them less, because they are personally liable for way more than what insured are. Hospitals still want to get paid, and charging a patient into bankruptcy is not a way to achieve that.
Here's an idea: Democrats agree to any Republican ACA change with a condition that existing insurance company shareholders and bondholders are destroyed and replaced by US citizens as the new shareholders/bondholders inversely proportional to their wealth (not income).
The ACA did, though, limit participating insurance companies to making 20% off premiums. If they have a good year and make more, they have to issue refunds. The insurance industry hated that, and the GOP proposes to get rid of that provision.
In Australia, Medicare is 1-1.5% of your income tax.
On the assumption you're making ... $100K a year, this is 20% of your income.
Hard to imagine how it could be done less efficiently. Of course, the issue is then going to be "Say we reduce costs to even 5% of income", "think of the physicians/hospitals/etc"...
Correct. Though it's now 2% (I moved to the US a decade ago):
"Medicare gives Australian residents access to health care. It is partly funded by taxpayers who pay a Medicare levy of 2% of their taxable income.
Your Medicare levy is reduced if your taxable income is below a certain threshold. In some cases you may not have to pay the levy at all.
If you don’t have private hospital health insurance, you may have to pay the Medicare levy surcharge (MLS) in addition to the Medicare levy. This depends on your income for MLS purposes."
Yeah I feel your pain I'm in the same problem, in an early stage startup making 80% under market rate, barely making my rent and living off ramen, absolutely can't afford ACA.
Even at 80% under market rate living on ramen (presumably, in the Bay Area as a developer), you may be over the income cap for Medicaid.
Of course, choosing to accept work for 80% under market rate in a place where the high market rate for labor drives high cost of living is going to have short-term negative economic consequences.
What I don't get is, what would you do if there wasn't ACA? Not have insurance?
If anything happened you'd be in the emergency room and would either pay outrageous amounts magnitudes more than $460/mo, or declare bankruptcy making your hospital debt a burden for everyone else.
I think the ACA was responsible for temporarily suppressing rates. Now that the costs are better understood, we're back to around where we would have been without it.
The fact my nation is as wealthy as it is but it does not want to invest in the health of its people is insanity to me. Health insurance is essentially a bet that someone's health cost will be less than their monthly premium. Why would my country not take on that bet? It seems like something that would be way more effective if it was orchestrated on a national level. (ノಥ,_｣ಥ)ノ彡┻━┻
Considering every single TV spot is selling us things to make us Fat or die sooner, I would not want to take the otherside of the bet against people getting sick.
Americans, we are all about freedom. Freedom to kill ourselves and eat twinkies. But we expect help when we are sick.
One side or the other has to budge a little. Do we give up being able to get the same insurance despite unhealthy habbits? Do we give up helping the poor and the sick?
This is why we need fact based research to understand these costs, and use a direct tax on those items to recoup those costs from those who engage in those risks.
Go skiing? Well there's a higher tax for the ticket because you have X% higher risk of breaking a leg. Twinkies right now are a grocery food so in fact it has less tax, where it probably should be taxed like booze or cigarettes (in effect a sin tax). Of course sin taxes get abused, where the money goes to the general fund rather than going to mitigation for the undesirable behavior.
Reinventing American Health Care (https://www.amazon.com/Reinventing-American-Health-Care-Outr...) is a great read on the history of health care in America and how we arrived at the ACA. It also highlights known issues that the author somewhat over optimistically expected congress to try and address.
> Furthermore, premiums have gone up year-over-year every year almost every year since I've been paying for my own insurance -- and that's well before ACA.
I've been paying my own premiums for 9 years. Before ACA, premiums went up ~5% per year - 8% one year, perhaps. Since ACA, I've seen increases of 25%, 20%, 20%, 25%, then 11% then 13%. OK, yes, it's anecdotal. But "it goes up every year regardless" is missing data there - pre-ACA there were inflationary increases - post-ACA there are increases to cover millions of people who weren't included before.
- not able to keep my existing health plan. I had a great low-ish deductible plan with good benefits cancelled due to ACA.
- not able to continue seeing my family doctor (that my folks and sister still see). I'm pretty sure the current doctor I have hates all his patients and staff.
And yes, it costs a lot more in terms of premiums, deductibles and prescription meds. But also in travel time because the other physicians in my town that accept CoveredCA stopped accepting new patients.
I quit my job and moved to Colorado ("Health First Colorado" === medicaid). Over the winter holiday I broke my collarbone.
If it weren't for medicaid, I would be flat broke. my bills start at $5k... that's only the first bill I've seen. My savings would be dissolved, and I would be forced to find work for somebody else.
Instead, because of this coverage, and in spite of limitations on the amount of time I can work at a computer with a busted arm, I am able to continue my entrepreneurial efforts. My partners and I are all hopeful that this will be a very valuable use of our time, and our investor's money. I hope to be able to pay Colorado & the USGov back in spades, through taxes.
* - edited to correct Colorado Cares --> "Health First Colorado"... because I didn't know what I was talking about.
edit 2 - HFC is medicaid for those who qualify... Thanks HN for educating me :P
Sry... I'm new to CO. Your'e right... Amendment 69 failed (72% against or something?!?! who knows... I voted in favor).
The correct name is "Health First Colorado". I signed up the day I was hurt, they backdated the signup to the month prior. It took less than 15 minutes to become covered.
I've been working for 20+ years, with spats of insured or not-insured throughout... mostly uninsured. After I left my SF gig, I gave up my insurance & didn't get any more since I'd already had 6 months for the year.
I'm in colorado.. just to be clear, we definitely do not have any type of universal coverage here, and Health First Colorado is not open to everyone. It's just normal medicaid.
They didn't care if you signed up when you were injured because you would have qualified for it anyway... you just didn't complete the paperwork. You definitely cannot do this when you exceed the income limit for medicaid and have to get normal health insurance.
The ACA increased the limits to qualify for medicaid. I know there were a few states balking at increased medicaid costs.. but you could have gotten this in most states, including CA.
Which states have universal Medicaid? I'm surprised this hasn't become a bigger thing.
Having insurance tied to employment is utterly terrifying. You'll stick it out in a sub-standard job to maintain coverage. You'll be fearful of taking risks on self-employment. It's the exact opposite thing you'd do if you wanted to encourage entrepreneurship.
Nice post, the stories echo multiple people I know as well. Having health insurance tied exclusively to a job is anti-entrepreneurial. That should be fairly obvious.
The ACA has flaws but it also has some great features that need to persist: minimum care requirements, pre-existing condition exclusions banned (having a pulse is a pre-existing condition BTW), no lifetime caps on treatment.
What's the alternative? Still haven't heard anything.
I am unconvinced that healthcare affects the number of startups as this have been going down also after Obama got on board and is going down also in Europe (ex Denmark where healthcare is completely free)
But I am all for an alternative to what we have now or what we had.
The most important thing IMO is to make sure that people don't get hit by pre-existing conditions.
I am a Republican. More in fact, Fiscal Constitutional conservative.
Now that thats out of the way.
I hate the ACA. Its overreach by what the government should be doing. No where in the constitution does it say the government is allowed to force law abiding citizens to do something. ACA does exactly that. It forces people to do things against their will. Or they will be forced to pay a fine. Alright, don't down vote me just yet.
Lets repeal the ACA. But I certainly see things that should be quickly made into law.
* Preexisting conditions cannot be denied and should be slightly elevated costs compared to the average user.
* Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
* Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
* Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
* Lastly, I want hospital prices published. I want to shop around.
* I am business friendly, but these are common sense laws.
I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere. Complete overreach and strictly unconstitutional.
How did you just read a long list of young entrepreneurs who were enabled and encouraged to start businesses because of having their healthcare covered, and you're still writing dumb shit like "GET A JOB!!"?
Because they are in fact living off the backs of their parents. They are in fact living off the money that was funded to them by people who earned that money. Either ask for more money, or work your way through it. Its not too hard.
> I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere.
The problem with this POV is that young, healthy people end up having no insurance and thus leave the older, unhealthier population to pay all the bills, whereas a full-insured population would distribute the financial load.
Also, it would lead to young, healthy people foregoing insurance in order to save money, and then when catastrophes happen (you're talking about living on the land, so imagine something as harmless as scratching yourself on rusty farm equipment, being bitten by an animal... both can send you to the hospital for weeks!), these people would face financial ruin.
The purpose of mandatory healthcare thus is to protect elderly or otherwise pre-conditioned people from having to pay devastatingly high premiums, and to protect people literally from their own short-sightedness.
By what I read (admittedly, on Wikipedia, I'm not US-based), a HSA is voluntary and so subject to the same problem that young, healthy people will skip payments.
Also, if there's only 50k in the account and the bill is 100k, you're still straight screwed.
>> * Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
I think this is something that a lot of small-government conservatives don't want--it's moving responsibilities from the state governments to the federal government.
Incorrect--both insurers and providers are regulated primarily at the state level. Allowing insurers to sell across state lines would be a federal action overriding state sovereignty which is typically not thought of as a "conservative" position.
I agree with you on vaccines. I'm not sure, legally, that you are correct about education (look into truancy laws).
Now, you can homeschool if you choose, or place your children in a private school. But I'm not sure, legally, that you can leave them completely uneducated.
In general you make good points, but I am curious about a few potential gaps:
1: If people choose not to get health insurance and then have to go to the ER, who pays for that? You and me. In most cases, it is cheaper for people to get preventative care and reduce their chances of a very expensive ER visit.
2: Preexisting conditions. Sure, but without a guaranteed customer base supported by subsidies then those people will be effectively denied insurance by having to pay insane premiums and deductibles. I have seen no evidence thus far that effectively counters this argument.
Lastly, you say you want to live off the land in some small town somewhere and you don't want the government to force you to pay for other people. Splendid! Say hello to Thomas Jefferson for me. But who builds the roads that lead to your house? What about utilities, water, internet? If you slip and fall down the stairs and break your leg who do you call, 911? If so, who pays for the 911 service, let alone the ambulance to take you to the hospital?
Again, I do agree with your premise, but since in my experience most libertarian arguments tend to crack under the pressure of public goods (like national security), where do you draw the line between independence and the needs of the populace as a whole?
1. Like ALL companies, which a hospital is, They can write it off, but ALSO they allocate that already into their budget..... All companies have expected losses. What gives the right of the govt to take charge of hospitals and say otherwise. All companies have expected losses and they allocate those into their budget.
2. Then prices will increase within each insurance company and as a user, I will pay for the insurance I want, rather than be forced.
3. Oh Stop. I didn't say I wouldn't pay taxes.
When did Healthcare become a government problem, rather than something that can be done through businesses. Its a business! If you can't afford to pay the bills then work a little harder to do something better with your life.
Your solutions rely on something that does not exist in health care: information parity. A true free market requires information parity. Health care is complicated, thus information parity does not exist. Regulation is the answer to dealing with that lack of information parity.
A hospital cannot "publish prices" because prices vary wildly based on many factors. Even if they did, how am I supposed to know what I need for my healthcare? If I go to the doctor and they say "you need a surgery and it will cost 10,000" the posted prices do not tell me if I need that surgery at all, just what they cost. And, of course, the most expensive medical care is emergency, a time when price shopping is not possible.
> Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
I'm not opposed to this, but it does remove state control over insurance regulation, which is an anathama to Republicans. I also have no idea how it will drive down costs? Are some states that much healthier than others?
> Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
I don't even know where to start. If I can opt out of paying for some medically approved procedures, where does it end? Can I say that I want to opt out of ob/gyn care for unmarried women?
> A hospital cannot "publish prices" because prices vary wildly based on many factors.
Here's a question: Dentists routinely publish prices. If you ask them how much some procedure will cost, they will tell you. If there is uncertainty, they will give you a range (e.g. to account for the possibility that complications will arise during an oral surgery). What is different in the hospital situation, apart from some rather extreme measures taken to obfuscate pricing?
> And, of course, the most expensive medical care is emergency
Is it? Or is it end-of-life? Genuinely curious to see numbers here!
> I also have no idea how it will drive down costs
Prices, not costs. The current situation is that in a lot of states there are somewhere on the order of 1-3 companies offering insurance of certain types at all. For example, for Maryland, I believe there is only one company offering an ACA-compatible PPO (everyone else has HMOs or even EPOs). See https://news.ycombinator.com/item?id=13393287 for where I got that data.
Of course in a monopoly situation there is absolutely no incentive for a monopolist to cut prices. Why would they? So to the extent that prices represent excessive profits (as opposed to the actual costs of health care), allowing cross-state insurance sales should drive them down. People who believe insurance companies are price-gouging should be _very_ in favor of removing restrictions on such sales.
Insurance companies don't really make that much money. Neither do hospitals. The median profit margins are between 3-4%. The problem isn't an insurance monopoly.
Pharmaceutical and medical equipment companies are raking in double digit profits. And they can sell wherever they want.
There's a lot of argument as to how much money insurance companies make, and whether the right thing to measure is profit margin, or return on capital, or something else. For example, an insurance company that gets $100 in income, then spends $90 on medical care and $7 on lobbying to keep its monopoly has a profit margin of $3, which is not very much. But it's not obvious to me that a company that spent $90 on care, nothing on lobbying, and got $2.50 in profit by charging $92.50 would not be viable, absent the lobbying.
And you're right: by no means are insurance companies the only ones in this sector that engage in attempts at regulatory capture and creation of monopoly profits.
Though I should note that pharma companies have a lower return on capital than insurance companies last I checked, because pharma is so capital-intensive in practice. I haven't really looked into medical device manufacturers.
So should they explain the pricing schedule while you're still unconcious from the accident at the crash site or when your eyes are fluttering in the ambulance? Then at the E.R., they can talk you through your various choices in surgery, a menu of blood products, and let you peruse through a catalog of doctor histories. If you decide this isn't the place you'd like to have the steering wheel removed from your rectum, you can always go online and browse a few local options from the dozens of hospitals in your area until you find a price point and payment plan that's right for you and your intestinal needs.
Similarly, when your diagnosis comes in and surgery is required, you can take time off from your three jobs to carefully research the pros and cons of various procedures to determine which is most financially appropriate for you. I mean, it's not exactly heart surgery we're talking about here. Well, technically and literally it is, but it shouldn't be too hard for anyone to understand the pros and cons of different surgical equipment and procedures to evaluate the risks and cross-compare with the clear apples-to-apples data sets to arrive at a medically and economically responsible decision while blood is pouring out of your extremities and your body feels like it's on fire. Take the time and shop carefully. You are a model fiscal actor and will make the right call.
Free market forces will make this system work and work well. The invisible hand has been after all such a huge success in setting health care prices and has proven to be the model every modern industrial country has taken because it's so intuitive and has great proven results.
> So should they explain the pricing schedule while you're still unconcious
A lot of hospital care is non-emergency, but they don't explain pricing schedules for _that_ either, now do they? I think everyone understands the impossibility of comparison-shopping on emergency care.
> I mean, it's not exactly heart surgery we're talking about here
No, it's hip replacement surgery. And people _already_ do comparison shopping on things like that as much as they can, including comparing to and shopping in other countries. See medical tourism.
More to the point, people do comparison shop just like that for oral surgery. Yes, they may not have all the data they might like. Yes, they don't always make the right decisions. But by and large, dentistry works OK.
Again, the "stuff that must be done RIGHT NOW" thing is a strawman: there's plenty of hospital care that is not that sort.
> The invisible hand has been after all such a huge success in setting health care prices
The invisible hand has absolutely nothing to do with most health care prices today (at least in the US). There are some exceptions: plastic surgery, laser eye surgery, dentistry, some forms of occupational therapy, and maybe family medicine.
> and has proven to be the model every modern industrial country has taken because it's so intuitive
Various industrial countries have price transparency for their medical care. If want to know how much my hip replacement will cost in the UK not via the NHS, I go to http://www.privatehealth.co.uk/conditions-and-treatments/hip... and I get all the data I could want, including prices and the hospitals charging those prices. Importantly, those hospitals publish their prices. If I did go via the NHS, I suspect there is no real difference in the pricing, but would welcome data on how it really works.
Anyway, knowing how much medical procedures will cost you is not an uncommon situation. Except in the US, of course, where hospitals will never tell you ahead of time how much a procedure will cost.
Note that price transparency is necessary, but not sufficient, for some sort of sanity in the discretionary medical care market.
Politics aside, is birth control is really a drug that is used to make people healthy? Fertility == healthy. Health insurance should be for getting medical care in the event that someone gets sick. It's like mandating car insurance companies to block the A/C from working. It blocks normal, healthy functioning. It just doesn't seem to make sense. There are cases where it is required for health reasons, but isn't it mostly used as a lifestyle drug?
I'm going to assume you're being purposefully contrarian but in case you're not, or for the benefit of anyone reading your comment and considering agreeing, know that hormonal birth control medicine has many, many benefits aside from preventing pregnancy:
Also consider the case of a woman who does not want to become pregnant due to genetic or physiological issues that would make pregnancy dangerous for her or the baby.
I know this is a common retort, but are pills to give men erections worthy of medical coverage? What about hair loss medications? If your rubric is based on fertility, should we not cover women once they reach menopause?
Finally I have a critique of your rhetorical strategy, "let's face the truth" is lazy and weak. For example, "Let's face the truth, jimlawruk hates women."
Ouch, that's pretty harsh. I really don't. And I would agree your examples fit medical care and are excellent points. I just wanted to people to consider, is artificial hormones really more healthy? Is healthcare an accurate term?
> We should be able to opt out paying for it, especially if it goes against my religion and frankly it does
Does this exception generalize? From the start, I felt it was immoral to go into Iraq, topple the government, get 4000+ US soldiers killed and cause the deaths of hundreds of thousands of Iraqis. The pennies you pay for birth control a nothing compared to what I as compelled to pay for a war I didn't support from the get go. Can I get my money back for that one? I'm sure my objection to it is/was as sincere and deeply felt as your objection to birth control.
I don't know if you realized it, but you are close to saying "government should tighten its belt unless it's stuff I believe in". Then, both sides can make the argument, and there is never any deficit reduction, we keep spending on things we want.
Do you not realize how awful that is? How much of a hypocrite it makes you to hide behind freedom of religion as a means to try to force your religious beliefs on others? Especially via their health care.
How would you feel about tying health in to praying to Mecca multiple times a day?
How about if you work on the sabbath you lose your coverage?
Divorced? No health care for you sinner.
STD coverage should probably be banned. I mean sure, there are other ways to get AIDS but if you were having sex in a nice normal marriage then you probably wouldn't get it.
Oh wait, you mean that someone made a personal choice to use it. A choice that has exactly nothing to do with you, but you see an opportunity to oppress their freedom to choose so you are going to take it.
I'm sorry but you can't criticize the ACA for being unconstitutional, while also arguing that the law should allow you to opt out of supporting policies that are against your faith. The First Amendment states:
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof."
Also known as the Separation of Church and State.
You are free to exercise your religious beliefs by not using birth control. But you cannot demand that Congress write the laws to fit your belief system.
edit: By the way, I downvoted you not because I disagree with you, but because of your hypocrisy.
Separation of church and state doesn't apply here. The original founders didn't want church to control the state. Maybe you need to think about this a bit more, since your understanding is faulty.
As for being a Christian, fine, but my faith defines how I think. It doesn't mean the church controls my way of thinking. Just influences it. That in no way has anything to do with the separation of church and state. ESP for founders that were all very religious.
Why does your faith trump someone else's personal belief? That is, why does faith, which is a belief without any proof, often with proof to the contrary, trump a belief that might actually be grounded in some form of reasoning? In both cases it's simply what you believe vs what someone else believes.
Apologies in advance for cherry-picking points to respond to, but ...
> * Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
I don't think you can simply equate having a job to "do[ing] something with yourself". Neither can you equate not having a job to not "do[ing] something with yourself". As always, situations (especially in the macro) are complex and subtle and solutions can't be boiled down to a simple directive.
Adults < 26 are often not the ones responsible for not being able to obtain a job. Yes, they may have chosen a field of study that's not in demand (even though many were probably told to "do what you love"), but they've also likely had very little opportunity to impact things like domestic economic policy, employment trends, or even employers not recognizing shifts in demographically driven skill-sets.
> * Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
In a system where much (most?) health insurance is provided as an employer paid benefit, why should my employer get to decide whether I'm opted in or out of a particular thing based on religion?
Ideally (from my point of view), religion plays zero part in health care. What is wrong with a benefit being available to all and only used by those that want to use it? Is this so different from the "in the privacy of my own bedroom" argument?
If you're running over someone's conscience on a matter involving human life and death, why do you care that their conscience is based on religion?
Personally, if someone is morally opposed to what they perceive as killing, I don't care if their morals are based on religion, atheism, or just squeamishness. Preserve their moral objection to killing. It's too valuable to society for us to trample on it.
I am not religious in any reasonable sense of the word. What possible reason can you give that your religion should have any sort of say in what care is available to me or, much more importantly, my children?
And, while you're at it, please answer my original question rather than throwing out strawman arguments.
> why should my employer get to decide whether I'm opted in or out of a particular thing based on religion?
I am also not religious (and generally agnostic about the so-called supernatural), but it seems pretty obvious to me why religious beliefs play a major role in the debate over abortion. It all comes down to my favorite subject: the Explanatory Gap.
Setting aside arguments that abortion is permissible even if the fetus has a right to life (e.g. Thomson's "A Defense of Abortion"), for many people the crux of the matter is whether or not a fetus is a living human being. The problem is that current science cannot tell us exactly when a clump of cells becomes conscious; we don't fully understand consciousness, so assigning it to a given object can be contentious. We simply have no good way of knowing when there is a person "in there", so to speak.
Since science cannot answer this question, religion has filled the void with beliefs about when someone's life actually begins. If we understood consciousness and could detect when it "starts", I suspect this debate would be much less dramatic.
I am sorry but your plan would result in people with preexisting conditions not being able to get coverage. The premium increase would make preexisting conditions insurance unaffordable for most people. Also realize that the system ends up bearing part of the cost any way because they would ultimately end up in the ER without insurance. Does the Republican tenant then support throwing people out on the streets without even emergency care? I only ask because most Republicans seem to think the poor are poor out of choice and should suffer the consequences of being poor.
No one seems to understand that preexisting coverage without universal mandate is infeasible.
> but damnit kid, get a job. Do something with yourself.
I graduated just before 25, and my first job didn't have benefits because although I was working 40 hours they called it casual.
> Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
No, you shouldn't have the right to decide what your employees get to do with their health care. You don't have the right to decide who they sleep with and how. This is the theocratic, forcing my bullshit voodoo beliefs onto others crap that makes the republican party so repugnant.
Not quite so fast. If it's their healthcare, paid for with their money, then you have a point. If it's "their" healthcare, but paid for with my (the employer's) money, and I have moral objections to abortion and birth control, but you're going to require me to pay for it anyway? Who's forcing their beliefs on others now?
No, paychecks are compensation given by you to them in exchange for work performed.
Health care benefits are also part of that compensation. Why should you have any say in how your employee uses that compensation.
Your employees use of their health care plan is none of your damn business. Trying to use health care to regulate their behaviour based on your religious views is a particularly nasty form of oppression.
But trying to force me to buy something that is against my conscience isn't a nasty form of oppression? Trying to regulate my behavior based on your non-religious views is just fine?
>Preexisting conditions cannot be denied and should be slightly elevated costs compared to the average user.
If pre-existing conditions can't be denied, and insurance can't be mandated, how do you prevent people from only picking up insurance when they get sick/hurt?
The preexisting conditions ban is what messes up the math of affordable healthcare. Or any minimum coverage provisions for that matter. Either you'll pay for it anyways in subsidies or it's going to effectively outlaw health insurance (not enough people are going to want it).
> We should be able to opt out paying for it, especially if it goes against my religion and frankly it does
First, separation of church and state, your faith doesn't get to be part of government decisions.
Second, do Jehovah's Witnesses get to not pay for blood transfusions in other people? And before you cite that blood transfusions are far more necessary, I think you should hold fast to your fiscal conservative tenets and help prevent unwanted burdens on the state from being born.
Making sure citizens are as healthy as possible while paying as little as possible (as a population) seems to me like exactly one of the things a government should be doing.
I think the problem is that healthcare after years of this broken system is now seen as private consumption rather than a public interest (like infrastructure and basic education).
> I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere. Complete overreach and strictly unconstitutional.
Well, let's put that to the test. I consider myself pretty liberal. Here's what I think about your bullet list.
* Re: individual mandate
I actually agree with you very strongly on this. When the government wants to force me to pay for something, there's already a long-established way to do that: taxes, with services rendered by the government and thus fully accountable to the people. Forcing us to pay for private services sounds awfully similar to forcing us to pay for British tea, which isn't supposed to be how our country works. If the government wants to force us to pay for health insurance, they should tax us and provide universal coverage.
* Preexisting conditions cannot be denied and should be slightly elevated costs compared to the average user.
Agreed on preexisting conditions, disagreed on higher costs for the affected. "Slightly" quickly becomes a loophole that enables "outrageous". And anyone who lives long enough will eventually acquire a condition anyway. Seems kinda redundant to optimize for that. Just distribute the cost evenly with the understanding that everyone will eventually receive the benefit.
* Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
That's what the original post is about. When kids have health care, it's easier for them to make their own jobs instead of going out and begging someone else for them. Sounds like a win for this audience on HN, no?
* Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
The goal of health-related regulation should be to improve health-related access and outcomes. There is no question, based on data, that birth control improves women's health, allows them to finish school or further their careers in greater numbers, and eventually increases their lifetime earnings potential, which of course contributes back. If you make exceptions for people's precious feelings, you're looking at an awfully slippery slope. I envision a bunch of assholes declaring that they will opt out of vaccines for religious reasons, then everyone else starts opting out of paying for vaccines and, well, hello again Mr. Measles. No, terrible idea. You don't have to like the latest military campaign to acknowledge the need to pay for a military, and likewise, you don't need to approve of the way others behave to acknowledge the social benefits of birth control.
* Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
Sure.
* Lastly, I want hospital prices published. I want to shop around.
This just doesn't work unless you publish a single price list at the national level and force all health providers to honor that list (Japan). There are two problems. One, sometimes your health needs are too immediate to allow shopping, and you're beholden to whoever happens to pick you up and treat you. If you're bleeding out on the road, you're not gonna stop someone from calling the ambulance just so you can go on yelp and find the best service. Seems like a bad idea to build policy around the assumption that buying health care is like shopping for shampoo. Two, as a person who is likely not a medical professional, you probably wouldn't be able to make sense of any such price list with respect to your needs. Any such list would be detailed beyond the common person's understanding (see Japan), and anyway, you would need to seek diagnosis to know what to pay for in the first place.
Basically you want the ACA. Don't you think if all those things were possible without the mandate, people would have chosen it ? Let's face it, it is not possible to cover pre-existing conditions, children till 26, and poor people without expanding the insured pool dramatically
> Remove the boundries of the state borders. This is regulation.
Yep, and I hope it's to prevent "lowest common bidder" syndrome on plans. Why does Delaware get all the Corps? Why does a East Texas Court get all the patent cases ?
Frankly, my Texas health care plan sucks. Doesn't cover "anything".
> Lastly, I want hospital prices published. I want to shop around.
> No where in the constitution does it say the government is allowed to force law abiding citizens to do something.
Nowhere does it say it's not? Surely you see the mistake in this reasoning.
> We should be able to opt out paying for it, especially if it goes against my religion and frankly it does
Too bad. You can't force your shitty beliefs onto others.
> This is regulation.
You say that as if regulations are bad. This particular one probably is though.
> I am business friendly, but these are common sense laws.
Ah yes, I forgot that common sense means hating poor people.
> I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere. Complete overreach and strictly unconstitutional.
Okay at this point I'm beginning to think you're trolling. This is too much of a Republican caricature.
It's constitutional because it's a tax and the government is allowed to tax its citizens. You can either buy health insurance to fulfill the tax or you can pay the fine to fulfill the tax. Also, as many people have said, you just picked all the good parts of the ACA and said you want to keep those. It doesn't work that way. In order to get those good things, you need healthy people signed up. The only way to get a lot of healthy people signed up is to mandate insurance.
Something just seems wrong about a lot of these stories citing the provision that they're allowed to remain on their parents insurance until they're 26. Because the story is really, "not having to worry about the high cost of health insurance afforded me the luxury of taking more financial and career risks." Surely we can do better for people who are older than 26 or who don't have the option of getting insurance through their parents. If we wanted to give everyone this kind of benefit we would just have universal healthcare with the state acting as everyone's 'parent'.
The counterpoint is course you're able to take more risks when you have fewer life-dependent expenses, so we should just pay for everyone's utilities, food, and housing too. You might even throw expenses for dependents in there too for older folks. What's special about healthcare except that it's expensive?
> What's special about healthcare except that it's expensive?
Great question. Everyone needs food, everyone needs shelter, everyone needs medical care, but this deep passion only exists for the last item.
My opinion is because the system we have today is basically a wealth transfer from the taxpayers to large interest groups (nurses' unions, big pharma, etc).
> Everyone needs food, everyone needs shelter, everyone needs medical care, but this deep passion only exists for the last item.
Programs exist to make food and shelter universally available, as well, and while imperfect, the proportion of the population unable to afford food or shelter is lower than the pre (or even post) ACA rate of people being unable to afford healthcare.
The fact that the problem is less solved for healthcare is probably why there is more visible passion on the issue.
I could decide to live in a tiny apartment, turn off the heater and eat ramen. With a chronic condition, there's no way I could have made healthcare a similarly manageable expense (other than maintain a full-time job and limit my entrepreneurship to nights/weekends).
Deaths due to lack of medical care (2009)[3]: 45,000
What's different is the magnitude. Although the United State's patchwork of services for the homeless is ostensibly supposed to give everyone access to food and shelter, people do fall through the cracks. But it is not an endemic problem like lack of health care.
[1] Debatable, and I can't find a solid source. The only malnutrition related deaths I can find are in elderly populations and abused children.
Yeah, I think it's hilarious that most of these were "I am and/or was under 26 so I can freeload off my parents' employer-provided plan! Thanks Obama!"
The healthcare system is totally a disaster, and it really should be fixed, but giving college-aged kids a free pass for a few more years isn't really a solution.
Having health insurance be offered by employers/ tied to employment is one of the biggest mistakes in American healthcare policy. It encourages a "consume as much as possible" mindset for employees and disguises the true cost of care. Creating clarity of price and cost in healthcare would be one of the most beneficial shifts.
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[ 3.3 ms ] story [ 258 ms ] threadThis list of founders who were able to make the leap thanks to ACA's safety net is a case in point. Under Republican policies, these businesses would not exist.
I would also personally rather have health insurance actually act as insurance, where you are granted the coverage at the time of diagnosis, rather than having the insurer gradually pay for treatment, but this is unlikely to come to pass.
It also provides for those who may never be able to earn enough working to pay for current health insurance, those who are retraining latter in life, and those starting a company.
We should not have to have an insurance policy for a doctor check out that weird lump on our thigh or come in and spend 10 seconds pretending to talk to us before scribbling out a prescription for something that vaguely sounds appropriate and walking out.
Insurance is what distorts these markets. Patients need to pay doctors directly again. Real competition needs to be returned. Right now, the doctor inflates their bill 5x because they know the insurance is going to talk them down, the insurance talks them down because they know they're going to inflate the bill and not worry about it since it's an insurance company paying out, and round and round we go.
There's no reason the market for medical care needs to be different than the market for food, which is cheap and abundant. People often say that you can't can have an efficient medical marketplace because medical care is emergent, but that's usually not true; most medical care, like most meal times, can wait long enough to allow the patient to make a choice between competitors, and providers who charge more than the average demographic in their area can afford will go out of business.
The incentive to overcharge for emergent care is countered by the incentive to compete, which has already lead to many "urgent care centers" arising throughout the U.S. Good government regulations that prevent cartels from organizing and causing the markets to freeze up/fail can help. These regulations should include outlawing medical insurance.
Whatever the solution is, the current situation is an abject failure. ACA band-aids a couple of warts but it gave us new wounds in the process. Whole thing needs to be torn down and rebooted based on sound market principles.
The FDP (Free Democratic Party) claims to go for liberal rules so businesses can strive. Somehow this mostly includes rules for big corps, with the remark that they provide employment.
Funny thing is, the head of FDP is a guy who burned about 3,4M€ of investment money and federal credit.
There are always parties with nice ideas, but when you see who donates money to them, you understand why they can't realize them :\",
The total cost of my health insurance premiums is about 20k/year; some of this is subsidized by my employer. I have a $4500 deductible. The insurance does not pay for anything, outside of preventative care, until I've paid $4500. After that, they contribute 80% up to some number, $7500 I think, and then they contribute 100% until the end of the calendar year.
Because I have such a high deductible, and due to the opacity of medical billing, I am not going to the doctor unless I'm pretty sure that not going to the doctor means I'm going to be put out of work or going to die. "Preventative" care is defined very strictly: you get a physical. For example, "preventing" the development of pneumonia by treating your respiratory illness early does not count as preventative care.
The best I can do is squirrel away what I can in my HSA...but that's one health catastrophe from being blown away. God forbid I come down with any kind of chronic illness that lasts longer than the calendar year.
That said, for the poor population, this is definitely true - Medicaid is a dream compared to private insurance. At least in my state, if you're on Medicaid, you don't even see medical bills. It's really lamentable the states were allowed to turn down the Medicaid expansion - the expansion of public health insurance was the best part of the ACA, in my opinion, and the most regrettable part of the bill is that the public option is not available to everyone.
That doesn't sound right - What is your maximum out of pocket?
Also, those numbers include only in-network providers. If I am given out-of-network care - which isn't always under my control - then I could potentially be on the hook for tens of thousands more dollars.
- An out-of-network providers gives you medical attention at an in-provider facility - maybe your ER doctor, surprise, is not in-network, even though the hospital is in-network. [1] [2] [3]
- Maybe you have a medical emergency and the closest facility at the time is out-of-network. (In some states and with some insurers under some circumstances, you can get them to pay the difference for emergency out-of-network care.)
The biggest risk factor is the "normal" <= $7500 medical bill from an in-network provider, but inadvertent out-of-network care is still something you have to be concerned about.
Also, I'm not sure if I'm reading you right, but "in-network" does not necessarily have anything to do with geography - sure, there exist in-network providers for my insurance throughout the country, but the second-closest hospital to me is still out-of-network.
[1] http://justcareusa.org/beware-of-out-of-network-er-bills/ [2] http://www.consumerreports.org/cro/news/2014/10/protect-your... [3] http://www.realclearhealth.com/articles/2017/01/09/in_throug...
EDIT: The HN backoff must be crazy high - 40 minutes later, and I still can't post, and I'll be offline the rest of the day.
Because the ACA didn't fix it. From my perspective, it was largely a giveaway to private insurance companies with some fortunate side effects.
The total cost for my health insurance premiums are 20k a year.
My in-network deductible is $4500.
My in-network out of pocket is $7500.
My out-of-network out of pocket is $20k.
Those are not hypotheticals, and because of those costs, I avoid medical care unless it is absolutely necessary. I'm afraid we're getting into the weeds - my main point is that the ACA's preventative care provisions are really quite weak and don't mean what we might think they'd mean; the preponderance of high deductibles and out-of-pocket maximums mean that people will continue to avoid getting prompt medical care until their condition becomes serious. The preventative benefit, mainly, is that everyone gets a yearly physical and a few other narrow types of preventative care.
You also said that your costs were 20k a year, but now you're talking about hypotheticals?
Well, you can make the argument for preventive care on medical grounds or even moral ones, but you can't say it actually saves money. When people have access to preventive care, they also tend to consume more, which means greater costs (although better overall care)[0].
This has borne out with the ACA[1], as the data shows that preventive costs increased faster than chronic and acute care costs dropped, by a very significant margin.
[0] https://prescriptions.blogs.nytimes.com/2009/09/03/when-prev...
[1] https://www.nytimes.com/2015/08/06/upshot/no-giving-more-peo...
The ACA report last month shows the opposite of what you're saying, that oupatient costs have dropped more than inpatient costs have risen, and that medical prices have not risen more than inflation.
Page 58+ here: https://www.whitehouse.gov/sites/default/files/page/files/20...
That's not actually the opposite of what I said. Outpatient vs. inpatient isn't the same comparison as preventive vs. responsive care. You're comparing apples and oranges.
> You should really read articles before you cite them
From the Hacker News guidelines:
> Avoid gratuitous negativity.... Please don't insinuate that someone hasn't read an article. "Did you even read the article? It mentions that" can be shortened to "The article mentions that."
The majority of inpatient treatments are responsive healthcare, e.g. emergency, major surgeries, ICU/NICU, burn unit, etc.
Also, when you present an article as a source for something that it is not, then it is valid to question if you read it and present why, like I did. The full sentence of what I said is valid by HN rules, even if you attempt to quote it out of context:
>You should really read articles before you cite them, because neither use data after 2014, when the ACA provisions took effect.
This is absolutely not true, and in fact some of the things you list aren't even preventive care.
>Many Medical Investigations and treatments for acute and chronic illnesses and preventive health care can be performed on an ambulatory basis
Moreover, in the case of expensive or catastrophic coverage, society is picking up those costs anyway (or alternately, just letting people die). Your premiums then go to cover the costs of people who wound up declaring bankruptcy. And no insurance (or bad insurance) cuts into preventative care that can detect problems early, when they're much cheaper to treat.
I support the ACA (or better yet, much more socialized models) because I want to optimize for overall economic productivity.
I agree an employer based model does discriminate against startups, but my point is that the ACA also makes it harder for the median entrepreneur to succeed. The fact that the fringe cases can start companies does not to me justify the drain on all other entrepreneurs.
Without ACA, a software engineer with a chronic illness wouldn't be able to start a business. Meanwhile, a healthy software engineer will start a business regardless of ACA because a minor difference in healthcare premiums is not material to that decision.
People pay into a pool and if one day they too become ill they'll need to draw on that. Prior to the ACA it was in the best interest of insurers to simply eject all the "sick" people from the pool. What use is insurance if when you really need it they cut you off?
This hurts everyone. It's not about paying more in premiums. It's about insurance that sticks around when the shit hits the fan.
There is a big distinction between "pro free enterprise" and "pro business". The former supports capitalism, the latter crony capitalism.
> Under Republican policies, these businesses would not exist
I think the GOP has yet to figure out what their health care policy even is. They really need to figure out how to be for something again.
Neither party is really in favor of free markets in any meaningful sense. The GOP happens to use that rhetoric more than the Democrats do in order to gain support for their policies, but knowing how to leverage the rhetoric doesn't mean that's what they actually support, if you look at their actions.
I'm not sure what the policy is, but I know they don't have a plan. I can't find the link, but I heard a spot on NPR (either Fresh Air or Here & Now) talking about the plan to repeal the ACA. The purported goal was to vote immediately to repeal it but delay the effective date. There's no plan. In the mean time, they're supposed to figure it all out.
A few years ago Ted Cruz and company very nearly shut down the government and defaulted on the national debt, insisting that raising it was irresponsible and laying it at the feet of President Obama. They insisted any increase in spending had to be offset by a cut somewhere else. Sounds like a really bold, principled stand. Then this:
http://www.patheos.com/blogs/dispatches/2017/01/11/republica...
Now that Republicans are fully in charge, they just authorized an escalating increase of the debt limit, running from $580B/year (2017) to $946B/year (2026), or a $10T increase over the next 10 years. There was no dissent, it was just quietly passed. I'm not saying it was wrong or irresponsible to do -- I'm just saying the politics are transparent, if they weren't already.
edit: what I said is 100% correct, so I will assume that the downvotes are simply political in nature.
I think it's pretty clear at this point that both parties love getting involved in the private affairs of individuals. Obama continued Bush-era spying policies, and in fact just this week (https://news.ycombinator.com/item?id=13390511) expanded the power of the intelligence community to snoop on Americans.
Blaming just one political party is demonstrable nonsense.
Growing the deficit from $580bn to $950bn over 7 years means it is growing at over 6.2% per year. To be fair, the median nominal GDP growth rate between 1933 and 2015 was 6.4% [1]. That said, forecasted near-term growth is expected to come in between 2.5 and 3.5% [2].
The difference between the 6.2% deficit growth rate and 2.5 to 3.5% nominal GDP growth rate will need to be made up with a mix of tax increases (austerity), inflation (redistribution) or, while unlikely, default.
[1] http://www.multpl.com/us-gdp-growth-rate
[2] http://www.tradingeconomics.com/united-states/gdp-growth
Rand Paul dissented.
https://www.youtube.com/watch?v=SBWJ_LW_hBI
As a liberal-leaning person, I disagree with Rand Paul on many policy issues, but respect the fact that his actions are consistent with his stated ideals, which is becoming increasingly rare.
I think the anti-ACA lobby sees this as a feature not a bug.
So what's the answer? How can health insurance providers help people with pre-existing conditions, and also not gouge young healthy customers?
Is the healthcare industry just charging too much money?
Certainly there is some waste, fraud, and abuse in the healthcare system which could be cut. But ultimately the only way to significantly cut costs would be to ration care. It's a hard issue and no one likes to talk about it.
In terms of insurance, it's perfectly possible to write healthy young people a significantly cheaper policy that has limits and is no longer available as they age. It's probably pretty stupid for the young people to opt for that policy, but whatever.
As far as I know, Western European countries spend about half (per capita) on health care as what USA spends. I don't know if US health care is that much better. And if it's not, then in theory there is a way to get the same results cheaper.
Parts of the ACA are necessary but I can't help but feeling, based on the price increases, the Act itself is horribly inefficient. We didn't increase the supply, we just increased the demand for a product which is very inelastic, resulting in skyrocketing premiums. A reform must involve increasing the supply of care.
* Taxes go up, but they go up less than health insurance premiums would. Remove insurance companies as an industry. [1]
* Price controls on providers (inelastic demand of healthcare means "the market" sets the price to "you pay whatever it costs so you don't die") [2]
* Allow Medicare to negotiate with drug manufacturers, otherwise buy from other countries [3]
That's about it. If Sam and YC want to see this fixed, start advocating for politicians who support single payer.
Startups will not fix this problem. Blog posts will not fix this problem. Political activism will fix this problem.
[1] https://www.youtube.com/watch?v=LtplKTHa4TA
[2] https://www.cms.gov/Research-Statistics-Data-and-Systems/Res...
[3] https://www.nytimes.com/2016/02/02/upshot/the-real-reason-me...
From the international perspective, I get the impression that Americans are against this because then you are "paying for other people" (as though insurance doesn't count, but through a private company is somehow 'better').
The financial incentive helps preserve that property: If a company can identify the cheaper customers, then they can offer lower premiums than the companies that can't. The customers left behind are more expensive, forcing those premiums to rise in order to remain solvent.
Yes. Twice as much as the rest of the world in fact. Mostly due to lack of competition (25 year monopolies for simply adding a antacid to an existing drug) and zero negotiation on pricing.
The President Elect said as much yesterday.
https://www.washingtonpost.com/amphtml/news/wonk/wp/2017/01/...
One of his proposed solutions is to outlaw these monopolies and let the providers compete between themselves to lower costs.
The reality is that the policies that companies will be willing to sell across state lines are likely to be truly awfully shitty, by doing things like not having a coverage agreement with most hospitals (which will at least drive up out of pocket costs and complicate claims, if not enabling the companies to outright deny claims).
[0]https://en.m.wikipedia.org/wiki/McCarran–Ferguson_Act
I believe that single payer systems can bring prices lower with more efficiency, but there are plenty of things that can be done that are less controversial (combating waste, increasing administrative efficiencies, etc).
One personal example from my life that put health care costs into perspective was surrounding the issue of Midwives vs. OB/GYNs when we were having our first child. We were approved by our insurance to have an OB/GYN deliver our child, which would cost the insurance company about $5,000 if everything went well (more if there were complications). But they wouldn't cover us at all if we delivered the child with a midwife, which cost about $1,500 and has been shown in study after study to reduce the likelihood of more costly intervention.
In our case, we paid the midwife out of pocket, but there are so many people that don't have the economic freedom to make that choice and the result is that their insurance companies pay far more money for child births than they would have otherwise had to.
Again, just one example, but I'm sure there are thousands more.
PS health cost is US are not just stupid expensive, it is broad day light extortion. the victims for some reason prefer not to see it as robbery, but rather to argue about qualities of their robbers. charging $600 to empty the urine bag is possible only because the whole hospital system is rigged (i.e. excessively regulated and monopolized).
Now you can hurt yourself no problem, or you can hit by a bus if you want! What a stupid thought. Having no insurance is not an excuse for being active.
Given that cars are obliged to have insurance, said insurance will pay for victims' healthcare costs. In Germany, there is a special state fund to pay for the rare case of an uninsured vehicle being involved in an accident.
"Health Care’s Bipartisan Problem: The Sick Are Expensive and Someone Has to Pay"
http://www.wsj.com/articles/health-cares-bipartisan-problem-...
I'm not convinced that's providing productive selection criteria.
From someone too old to be on their parent's insurance, while I'm 100% behind the reform that disallows previous conditions from affecting ability to get coverage, the ACA was effectively a shake-down that made me delay taking the risk to go full time on my startup -- the options for coverage in my state were expensive and very low-quality, and the penalty for opting-out would have been $4000 for my domestic partner and I (on top of the additional taxes we paid to support ACA).
My claim is this: For the median entrepreneur, there is more financial drag due to insurance now than there was before the ACA. For those who are sick or young, there is less financial drag. Your story anecdotally supports that claim.
The reform surrounding pre-existing conditions for people that let their health coverage lapse is the only good thing that came out of the ACA, and it was very expensive for the taxpayers and continues to be. This should have just been a piece of legislature and not a terrible government shakedown of the American public; a simple reform was needed, not another way to subsidize the non-working while compelling the public to give money to private corporations.
That way analysis becomes easier and all perceived sample biases can be alieviated.
If that's the case, addressing the cost is the foremost issue, instead of forcing everyone to join a universal plan. That does not help addressing the root problem above.
Good luck trying to get political support for anything that hurts the insurance companies.
The Japanese system is not terribly different from ours - it still depends on private employer-provided health insurance. But per capita costs are less than half the US cost, with higher utilization and far better outcomes. The key difference is that Japan has strict national-level price controls. The price of identical products and procedures is identical in every facility. This eliminates both complexity and negotiation between insurance and providers. A government board carefully tracks costs for profiteering and makes adjustments.
Do that, and you get rid of the whole "in network/out of network" nonsense of the American system.
We spend several times more in hospitals and clinics than what we spend on prescription drugs:
http://www.beckershospitalreview.com/finance/17-fascinating-...
(nearly $1.6 trillion to large providers, $300 billion to drugs)
So the costs are not concentrated in drugs and insurance. There are certainly some drugs that are very lucrative, it's just that they aren't the dominant spending.
https://ycharts.com/indicators/us_health_care_inflation_rate
Health care is not becoming more affordable. The rate of inflation in health care is significantly higher than the US inflation rate.
https://fred.stlouisfed.org/series/T5YIFR
How is that affordable? How are $600 epi-pens affordable?[1] How is a 4000% price hike on a 62 year old generic affordable?[2] Google for "snake bite hospital bill." $153,000. That's not affordable. That sounds downright fraudulent.
It seems they should have named it something more appropriate, like the Universal Health Insurance Act. Insurance that is no more affordable than the overpriced health care available in the country. But point this out, and everyone starts their partisan bickering and nothing gets done at all.
[1]https://www.bloomberg.com/news/articles/2016-08-29/mylan-to-...
[2] https://www.washingtonpost.com/news/to-your-health/wp/2015/0...
Mandatory Purchase of Service from Private Industry Act ?
either way it was a redistribution to some at the expense of others. decide yourself which moral side you sit on.
the two sides were 1) it being redistribution to people who cant afford insurace, or 2) it being redistribution to insurance stock holders
I didnt even pick a stance, and youre assuming my position. or they arent mutually exclusive choices.
https://data.bls.gov/pdq/SurveyOutputServlet
It's up to a historic rate of growth that has been typical since the early 90s.
I don't intend any snarkiness, but am I somehow misreading those numbers? I'm reading that statement as "an inflation rate of 2.95% for the last year compared to the long term average of 5.40% could be equated with 'more affordable'".
[1] https://ycharts.com/indicators/us_health_care_inflation_rate
That is the core issue. That was not solved by the ACA. How do we solve it? Ideas? Oh yeah, you know what? Let's argue about Obama and Trump instead. That will surely work. Look at the comments in this thread.
If I asked you how to solve a sorting problem, I'd have a dozen good solutions presented. If I ask how to solve a healthcare cost problem that many other countries don't seem to have, everyone's brain switches off and they go into arguing about politics.
http://ritholtz.com/2012/03/comparing-medical-procedure-cost...
It seems they should have named it something more appropriate, like the Universal Health Insurance Act.
The name of the bill is a lot less important to most people than the substance. If you read Sam's post, there is a man in there with a heart condition who is essentially uninsurable without the ACA. For him, the word "Affordable" definitely applies, but he doesn't care what the bill's title is. In my opinion, you shouldn't either, because the bill's substance is what is important.
>In my opinion, you shouldn't either
It's clear to me, I need to leave and go to a country with a higher average IQ. They, unsurprisingly, have figured out how to deliver actual affordable care. The people here are too ignorant to actually solve this problem. Even "smart" people have been completely brainwashed by propaganda.
Affordable care is more expensive. War is Peace. Ignorance is Strength.
Making healthcare actually affordable -- as in, reining in costs -- is where we should be looking.
Other ways to lower healthcare costs:
* Increase med-school acceptance rates & fund more residency programs/additional slots to increase supply of MD's
* Subsidize med-school tuition so MD's don't graduate drowning in debt
* Allow PA's and NP's more authority in primary care and non-trauma emergent care situations without an attending physician having to sign for every order and discharge - some states are ahead of others here, we have a lot of NP's in GA ER's that work without an attending
Oh, and single payer healthcare would do wonders too. Administrative costs for hospitals and billing companies would drop dramatically not having to manage dozens of different insurance contracts just to get paid, would love to pass that savings onto patients.
http://imgur.com/a/ShbpW
The ACA wasn't a bad attempt given the constant efforts of the opposition to sabbotage it.
Actually, it was, given that many of the misfeatures of the ACA were premptive compromises to gain the support of opposition that never accepted it anyway.
But even so, it's better than the status quo ante was, and there's no sign of anything better on the horizon amidst the rush to repeal it.
From the wiki[1]:
By the design of the program, the federal government is not permitted to negotiate prices of drugs with the drug companies, as federal agencies do in other programs
The bill forces the government to pay whatever the pharma manufacturers will charge. If you were selling a product and there were a law preventing your largest customer from negotiating the prices which you set, why wouldn't you heavily inflate your prices?
[1]https://en.wikipedia.org/wiki/Medicare_Part_D
Oh good, let's see you present to me evidence that the inflation rate of health care in the US is below that of the inflation rate of the country as a whole. Can you do that? Because that's my point.
Health care is not affordable. Hospitals are charging tens of thousands of dollars for treatments that cost a couple hundred dollars 2 hours away across the border.
http://archive.azcentral.com/business/articles/20120831scorp...
That's fraudulent. Put those people in jail.
No, because the cost increases were not due to the affordable care act, they were due to Medicare Part D. The goal of the ACA was to reduce the number of people without insurance. Controlling pharmaceutical costs is outside of the scope and for that you can blame the law that specifically forbids the government from controlling pharmaceutical costs.
You're distracting from the real issue with a different argument. I didn't say the ACA caused the increases. I am saying the Affordable Care Act failed to make health care more affordable.
You can tell because while some premiums have increased, the overall healthcare costs (including premiums) for all Americans has been reduced.
You should only focus on a low-deductible plan if you know you're going to be in and out of the hospital (e.g. elderly, chronic, etc.). I also don't think you know what your out of pocket maximum is now compared to what it was before.
You're correct that I don't know the difference in out of pocket maximums, but I do know it's a great deal higher than it used to be.
As for "what type of plan I should be on", I really don't have a choice. My employer offers what amounts to basically the same plan through two different insurers, and the main difference seems to be which doctors are on which insurer's network, so in practice, it doesn't matter which one I pick-- the out of pockets maximums are broadly similar, and the deductibles are identical.
And that's not counting specialists-- my daughter had a heart defect at birth, so now she has to see a cardiologist every other year, which has the happy(?) benefit of pretty much eating up my entire deductible in one fell swoop right there; before the ACA, I paid $50 for a specialist visit and maybe a few hundred extra depending on which tests that particular specialist ordered.
If only there was some large body that was able to negotiate reasonable rates for health care on behalf of consumers... it's amazing nobody in the world has figured this out before!
I think healthcare has become a jobs project. As manufacturing employment decreased, many found replacement jobs in an ever-expanding health care industry.
There is no incentive for anyone to get medical costs under control. The health care delivery system has every incentive to use the "blank checks" offered by the insurance industry. The insurance industry makes a certain percentage off whatever they pay out in claims, so their incentive is to pay as much as possible.
Patients want to feel better, and aren't in a position to evaluate whether the recommended treatments are actually their best option.
> But point this out, and everyone starts their partisan bickering and nothing gets done at all.
In the early days of medicare the government's costs quickly got out of control. The first reform was to figure out what a procedure should actually cost. It's been "trench warfare" between doctors and payers ever since.
I have some anecdotes from my passengers and friends that would hopefully sidestep the bickering to point out that the status quo is quite harmful to the health industry's customers...
Iatrogenic conditions are exceedingly common. These are conditions caused (or worsened) by the treatment provided.
For example, hospitalists (doctors who manage patients' care in a hospital) are starting to look at old patients' pile of prescriptions to figure out which ones are actually necessary [1].
[1] When less is more: De-prescribing medications - http://www.acphospitalist.org/archives/2016/05/deprescribing...
I'm sick of these stupid names in general.
If you put the starting date at 1970/1980/1990.. it really puts things in perspective.
[0]: Here's one source, although there may be better ones http://www.latimes.com/business/hiltzik/la-fi-hiltzik-obamac...
I'm sure there's more as well, but this definitely helped several friends of mine. Seems like these kind of things would have been impossible without large swaths of the ACA.
Even if you have a rep that favors the ACA it gives them an idea how much effort in to saving it.
However, missing, as far as I can tell, is the critique of health care that startups and the open source movement stand to make - a point which the ACA ignores:
Health care has a gatekeeper problem. And an IP problem. Many people find that medical doctors are only a part - maybe a small part - of their health care regiment. And that being and staying healthy has little in common with the official positions of agencies from HHS (especially FDA) to EPA.
The ACA enshrines insurance, pharma, and hospital companies, including those that are the biggest parts of the problem in health care in the USA.
For my part, I need to hear how we can move away from the credentialist model of care toward an open source model before I can become impassioned about any plan.
Absolutely agree. The ACA (or repealing the ACA) are both "solutions" to the wrong problem. So much potential innovation in the health care space is illegal. If it wasn't illegal, someone might (gasp!) find a way to provide a valuable service for less money than in the current system.
It will not, and cannot, be fixed by regulation, because of what you said - any regulation MUST be approved by the big companies. They'll never approve something that goes against their interests.
We are now on an ACA plan. $270 with subsidies. Think about that. The government doubled the price of the plan or more, and is paying with our tax dollars the difference between my $270 and $780.
The ACA helped many people. It helped people under 26. It helped people with pre-existing conditions. It helped give free or low-cost health care to people that couldn't afford it because now the government is picking up the lion's share of the tab.
As much as people like to rag on the Republicans, and they deserve it, I don't think they will throw out the good parts. I think they will look at the industrial recommendations such as expanding risk pools across states (Commerce Clause allows this regulation), and other rational plans. Will it be perfect? No. Will it be better than the current ACA? Maybe.
It's a second-order effect; there was minimal cost control in the ACA, and plenty of room for companies to raise their prices. In a lot of ways, it was a sweetheart deal to insurance companies: they had essentially a mandate for people to buy their insurance, demand was through the roof, so they could charge more.
My evidence is that the premiums for my insurance went up even before ACA passed just in anticipation. That is exactly what the health insurance representative told us.
It was pretty clear why it happened. After ACA passed it kept going up a higher rate for us than in previous years (I have data for 3 years before).
> What evidence is there that the government itself doubled the price of the plan? The government doesn't collect the money, and it certainly goes somewhere...
Isn't it a bit disingenuous to suggest that the increase in health insurance is unrelated to legislation regulating health insurance. Or to put it another way is there evidence that government regulation didn't affect the prices and something else did?
http://blogs-images.forbes.com/mikepatton/files/2015/06/Heal...
Now, if one were to claim that the government failed to do anything that had the effect of reducing the cost of health care or health insurance, then I would completely agree.
For example, there is nothing to prevent someone from signing up for insurance, having some expensive medical procedures performed, and subsequently dropping the insurance. I have personally heard reports from insurance agencies that some people do in fact do this. And I can't say I'm surprised, either; even after factoring in the tax penalties, it's probably a completely economically rational thing to do in a lot of cases.
Premiums in states which refused federal money to expand Medicaid generally rose much, much more than states (like CA) which did not[1].
Cynically, this was likely a designed play by Republicans to kneecap the effectiveness of the ACA by skewing the risk pool towards the elderly (who require more medical care, in general).
[1] https://www.consumeraffairs.com/news/health-insurance-indust...
In the linked article most of their profit would be coming from the large group market. The individual exchange is a separate segment and where they would be suffering those loses. So the desire to not remain in an unprofitable segment is not really negated by being profitable in a completely different segment.
https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-In...
But there aren't any real cost controls on providers, drug companies, medical device companies, and other suppliers.
That's what I said.
That's not a cost control. That's a price inflater!
If the only way for them to make more money is to have the price of things go up, what do you expect they're going to be in favor of? In a perfect world (from the perspective of the insurance company), everything from premiums to procedures goes up X% so that their profits go up X%.
That's a seriously messed up system and may be the most egregious part of the entire ACA.
It would politically unpopular to "throw out" the parts you spoke of. But the question is can we keep those parts and not keep the insurance mandate?
American's don't follow the actual machinations of the senate much so it's not "politically unpopular" to do this. We think electing a President every 4 years who's a radical departure from what we had before will fix all our problems and prevent us from actually having to pay attention to the details.
They can remove funding for subsidies through budget reconciliation, and let the system collapse on its own, but they don't have the votes to overcome the filibusterer they'd get if they tried to remove those protections directly.
1 of 2 things will likely happen.
1. They will repeal and delay. Meaning they will remove funding through reconciliation, but delay implementation until 2020. Then depending on what happens in 2018 who knows what might happen. This is the bad option because it could cause the collapses of the individual market even before it takes effect.
2. They will repeal and replace. Most likely they will replace it with the new Health and Human Services Secretary's plan to keep the preexisting conditions protection plan, as long as you maintain coverage. If you don't maintain coverage you'll go into a high risk pool with higher rates until you maintain coverage for 18 months.
Plan 2 is very similar to what we currently have, but it replaces the punishment for not maintain coverage with higher premiums instead of a tax penalty.
What they should do is to increase the tax penalty to force more people into the pool and simultaneously add a public option, but that's not going to happen.
That's a repeal of the pre-existing condition protection, because it goes back to how pre-existing conditions worked pre-ACA (HIPAA -- remember the "P" is for "Portability", not "Privacy" -- guarantees you can avoid denial of pre-existing conditions so long as you maintain coverage continuously or with no break longer than 63 days).
You do that by requiring everyone to have insurance when they're well to help cover those that are sick. That's the mandate. If you try to separate them, the system collapses under the weight of even more cost.
You weight until you have cancer to sign up? Well then you have to pay for the cancer treatment, but if you break your leg tomorrow, the insurance company has to pay.
Again previous conditions are not an issue, because they won't cost the next insurance company anything. If you get diagnosed with, say, aids and need treatment for the rest of your life, then it should be the company you were with at the time of your illness that has to paid, even if you are no longer with them.
Couple this with payment in cash for treatment, so that you can shop for the best/cheapest/whatever doctor (just as you would with car work), a mandatory disclosure of prizes and untangle health insurance from your employer and the system should be much more manageable.
Most people develop many pre-existing conditions as they get older. By the time you're 70 you'll have 5 different insurance companies all treating different conditions that you developed at various times in your life.
Not to mention what happens when companies go out of business. This plan isn't workable at all.
Are you even remotely aware of what something like that would typically cost?
Unless you're rich, you either die from lack of treatment, or declare bankruptcy and let the rest of us pay for your treatment. Neither option is particularly good for any of us.
That bankruptcy is not a magic free moment - it simply means someone else pays. Depending on the case, this might be the state through medicare/medicaid, it might be the health care provider, or it might be third party creditors.
Eventually, though, those defaults are all factored into operating costs of hospitals, the government, banks and so on - meaning you and I pay for them.
So, in the old system, we were all forced to pay for health coverage, whether we liked it or not. In the new system, we're all forced to pay for health coverage, whether we like it or not. ACA is explicit and, with extreme certainty, cheaper, since it expands preventative care on a systemic level.
But, of course, since people didn't realize they were paying for it previously, they now throw fits because the cost is made explicit.
But, as with many things, the politics around this issue is all about feels over reals.
Which, of course, is the most expensive way to go. You have people who can't pay visiting the emergency room for an ear infection or the flu. And that cost gets passed on to everyone else, which is why that single Tylenol tablet in your hospital room costs $10.
The state of Washington tried that in the '90s. Passed an ACA-like system. Republicans repealed the mandate, kept the preexisting conditions. Result: within a few years every single insurance company stopped selling individual health insurance in Washington.
Seattle Times article from yesterday about this: http://www.seattletimes.com/seattle-news/politics/dismantlin...
HN submission for discussion: https://news.ycombinator.com/item?id=13393537
The ACA lowered the costs of people with insurance by reducing the pool of people without insurance adn thus the free rider costs. Free markets however continued to raise prices just like they have for the last 30 years. http://www.motherjones.com/files/blog_premium_growth_2014.jp...
HSA require a deductible of at least $1,300 for one person, so people have starting calling that a 'high' deductible from 2003 or so.
Before ACA you could by health insurance with a 15,000$ deductible as an individual. After, ACA the individual out of pocket maximum is $7,150 per year for an individual. So, now legally the maximum is below the old pre HSA threshold for 'high' deductible.
It is certainly insane to expect people who are incapable of paying for their own health care to be capable of paying for their own health care. But the health insurance market is not there for people who are incapable of paying for their own health care.
They need an effective government and socialized medicine. Charity is not a workable solution.
> It is certainly insane to expect people who are incapable of paying for their own health care to be capable of paying for their own health care. But the health insurance market is not there for people who are incapable of paying for their own health care.
Sure it is, that's exactly why it's there, hence the subsidies. It's a shitty system, better than it was, but still crap that needs to be replaced with socialized medicine.
Whether the charity comes through government or private organizations is not relevant to my point. The point is that they need someone else to pay for it, and not via a normal market transaction.
>Sure it is, that's exactly why it's there, hence the subsidies.
Allow me to rephrase: The health insurance market is not there to ensure everyone is able to afford to pay for their own health care needs. It is not broken because some people are not able to afford to participate in it. That is not its purpose. Judging it to be 'broken' or 'insane' because it doesn't do something that it's not intended to do is ridiculous.
The HSA-tied minimum was the old threshold for "high-deductible" since the HSA/HDHP pairing was created, which was several years before Obama was elected.
This also added a lot of confusion as what was considered normal was suddenly called high.
It's not 'people', it's the government, for what that's worth.
https://www.irs.gov/publications/p969/ar02.html#en_US_2015_p...
That depends on how you define "high deductible".
For example, let's start at https://secure.marylandhealthconnection.gov/AHCT/LoadExplore... then click "Get an Estimate". Put in a family of 3, ages 63, 61, 21, no pregnancies, no dental. Income $100k. You get a list of 21 plans. The very first one on the list has a $12,400 deductible and a $13,100 out of pocket max.
In fact, there is not a single option on this list with an annual out of pocket max below $9000.
Granted, these are family plans. Your cited number is for an individual; the number is $14,300 for a family. But note that there are plans on this list that have out of pocket maximums larger than $14,300 (e.g. "BluePreferred PPO HSA Bronze $6,550" has a $26,200 out-of-pocket max). How to reconcile that with your link, I don't know: the theory says they should not exist, but experiment says they do.
Note that I picked on Maryland because they allow you to get this data without creating an account.
In any case, most of the plans on this list would have been considered "high deductible" before the advent of the ACA.
Anyway, what's the definition of "high deductible"? The standard definition used for HSAs is $1300 for an individual or $2600 for a family, which is almost hilariously low in today's marketplace. And the maxium out-of-pocket max for HSAs is actually _lower_ than the overall caps. I have no idea how that $26,200 out-of-pocket plan is "HSA-qualified", as it's claimed to be....
> The ACA lowered the costs of people with insurance by reducing the pool of people without insurance.
That's not true. The ACA raised the costs of people with insurance by pooling them together with people who used to be uninsurable because their estimated care cost so much. This effect completely dominated the effect of adding healthy people to the pool. One reason for that is that for healthy people paying the penalties is way cheaper than actually getting insurance, so a lot of them stayed uninsured, but even that is not the full story. The main upshot is that caring for some people is _really_ expensive and the cost has to come out somewhere.
We can proceed to an argument about whether the tradeoffs were worth it, of course, whether there were other ways of achieving the laudable goal of getting rid of the preexisting condition problem, etc. But let's not pretend that the reason prices went up is just "gouging". Prices went up to a large extent because the risk structure of the insured pool skewed towards more risk.
Now there is certainly _some_ gouging going on, largely abetted by the restrictions on interstate sale of health insurance, which leads many states to have a very small number of companies providing insurance. For the Maryland case above, there are precisely 3 companies represented in the list. And only one of those companies offers PPOs. Which is why the price of the PPOs in Maryland about doubled in the last two years: no competition, why not? This is hardly a "free market" behavior, though; it's a highly regulated, in a dumb way, market, that encourages monopolist behavior. Which is what we get.
So yea, for a tiny slice of the population ACA did make things worse, but frankly the tiny minority that where negatively affected don't really care about the new premiums either. Because, for most families having a 30k deductible is approximately the same thing as not having insurance.
PS: The ACA allowed some people without insurance because of health issues to get insurance. But, it also added a lot of young healthy people that would not have had insurance. The net gains and losses depended significantly on age. https://www.valuepenguin.com/how-age-affects-health-insuranc... So, people looking back on cheap insurance also look back when they where younger. New York and Vermont do not permit any use of age as a factor when determining health insurance rates, so younger workers do significantly subsidize older workers. Masschusetts limits cost increases to 2x so there is a significant subsidy.
For my hypothetical family with the ages I listed, insurance cost about doubled in the last two years in the state of Maryland for an equivalent (PPO) plan. Deductibles also rose significantly. I know a specific family like that, and they are _very_ unhappy about it.
> but frankly the tiny minority that where negatively affected don't really care about the new premiums either
Really? You think people don't care about $25k/year in premiums instead of $12k/year in premiums?
What makes you think this is a tiny minority? What I listed is a basic baby boomer family with one child still in college.
> The net gains and losses depended significantly on age.
Sure. I'm aware of all that. The upshot of the ACA is that people with preexisting conditions are _much_ better off (which is good), but people who are relatively healthy, independent of age, are generally worse off. This is almost a tautology, of course.
I should note that the price cited at your link is way too low for the states I know of, in the "64" age range, assuming you want a PPO. For an HMO, it's perhaps doable.
HSAs are from 2003 and it's overloading a reasonable definition with a new a silly one. You can see people in the mid 90's talking about high deductible and meaning something very different. ACA also capped out of pocket so you need to compare everything about a plan not just it's deductible.
PS: Find me a family plan with a 50k deductible under ACA. They used to exist.
We may be violently agreeing here. ;)
The limits are more sane than they used to be, but a lot of people that are getting subsidies aren't going to have an easy time coming up with $10,000 more in a given year. It's high enough.
The cost to collect and the collection rates themselves are abysmal and the increase in deductibles has amplified the problem to the point that many hospitals are closing due to patients' inability to pay their bills.
Consider the percent of Americans who don't have ready access to $5000 (or even $500) for an unexpected medical event that causes them to hit their deductible. I work in patient payment technology and this is an all too common situation that providers are forced to accommodate.
And the cost is being borne by everyone else.The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
I do not understand why the US can't join most of the western world in instituting single-payer public healthcare. It would be a huge boon for small business and startups, who would no longer have to factor in medical benefits into their compensation structure and whose owners would no longer have to risk being uninsured for an extended period when they start the business.
Moreover, it's the morally right thing to do. It's shameful that the world's premier economic superpower does such a poor job of looking after its most vulnerable citizens.
Until and unless we can get people to examine the facts, this will continue.
http://www.gallup.com/poll/191504/majority-support-idea-fed-...
Opposition comes from the wealthy, whose taxes would go up, and insurance company execs (and employees) since it keeps them in business.
Maybe we could, I dunno, create a government run health care system to show everyone just how super-awesome healthcare can be when DC runs it. We need a demographic... hummm, how about retired military? We'll create a healthcare system for ex-military and their families, show everyone how well these things work, and then the public will be convinced that... oh, wait!
/sarcasm
So, no, you can't just walk into a hospital and get the same care you would if you actually had insurance, and then just stiff them with the bill later.
People without insurance don't go to hospitals. They don't go to doctors for routine checkups. They don't go to doctors to deal with chronic conditions. They go to ERs because they can't afford healthcare, but they know that the hospitals can afford their emergencies.
For example, Kaiser's huge new Santa Clara (CA) complex kept its ER from opening until the very day they closed the ER at the prior site on Kiely. There are fewer ERs in the San Jose area than there were 200,000 people ago.
You are mistaken. The good parts, like covering pre-existing conditions is exactly what causes your insurance to go up. It's basic economics. The Republicans do not have a plan to fix that.
If there was a way to fix it, don't you think it would already be implemented? You think they're purposefully keeping your rates high just to fuck with you? Not to mention suffer all the political fallout of it?
Don't forget. Obamacare is the Republican plan. This repeal and objection to Obamacare is all politics, not an attempt to fix a broken system.
Here's one with 8 million members:
https://www.bcbsil.com/company-info/who-we-are
The real behind-the-scenes debate in DC this month is about, first, the best mechanism to transfer funds (direct subsidies, state subsidies, Federal reinsurance pool for the sickest cases, etc ... each of which create distinct winners and losers whose lobbyists are currently out in force), and second, how much of an annual budget deficit the fiscal-hawk Republicans (now led by Rand Paul) are willing to tolerate.
The longer-term solutions have much more to do with diet, lifestyle management, and other behavioral health issues than with access to providers and drugs (e.g. look up how much of last year's medicaid/medicare budget was spent on type 2 diabetes treatment alone). Unfortunately it doesn't seem like we can tackle these issues at scale until after the current debate on affordable universal access to care is settled.
Excuse me? What money? The government does not generate net positive economic benefit, and therefore has no [real] money. You might be confused and talking about "taxpayer money" — but then why bother with the gov't at all, why not just say your plan amounts to "we should increase healthcare costs so we're, you know, throwing more money at the problem".
Furthermore, there's an enormous information asymmetry in healthcare, so it's hard for it to function as a market.
Because we already have "free" healthcare in the form of emergency rooms, this is ultimately a conversation about how to best allocate health spending. Emergency care is the absolute most expensive form of non end of life care, so we should focus on minimizing that send. There's a well known path for doing so, regular check ups, vaccinations, preventative care, and chronic disease management. All of which cost money now, but reduce future expenditure. And if we already pay for sick broke people in the emergency room, why not optimize the expenditure of those tax dollars by shifting it to more effective health interventions?
You yourself admit that end of life care is incredibly expensive. Why are we pushing people to live longer, when it incurs a much much greater cost to keep people alive? Why not just let them die young?
In part, this is a huge reason (the other reason is pregnancy cost) why pre-ACA healthcare prices were much much cheaper for <30 men than women - most things that seriously hurt men under 30 just completely off them, and dead boys don't incur major medical cost.
I don't know about your characterization that "Basically all research..."
http://www.nejm.org/doi/full/10.1056/NEJMp0708558
Healthcare is different because consumers often don't know what anything ought to cost, rarely in a position to shop around, and will never be able to afford some big ticket items without insurance regardless.
And the economic consequences are non-obvious. For example, many conditions are much cheaper to treat if caught early; if access to a doctor has an inconvenient cost attached, overall costs go up. The ability to see a doctor for cheap – ideally free – is the most effective way to lower the risk of expensive procedures in the future.
But if I get pregnant or cancer, I have no choice - I have to get treatment or die.
I've been through chemo and radiation once, if I ever am told I need to do it again, to scrape and cling to another few months of life, I'm going to laugh in their faces, put my affairs in order, go on a hell of a vacation, and Old Yeller myself.
If it happens, it'll be interesting to see how my resolve holds up as I stare into the face of mortality.
If you look at the Federal budget it's clear that the Federal Government, beyond national defense, is simply becoming a giant healthcare and pension fund administrator, re-distributing wealth via social security, medicaid, and medicare. All other expenses are dwarfed by these. I'd expect this trend to continue until the singularity occurs and we enter our long-awaited post-capitalist utopia.
"MLR measures the share of health care premium dollars spent on medical benefits, as opposed to company expenses such as overhead or profits. For example, if an insurer collects $100,000 in premiums and spends $85,000 on medical care, the MLR is 85%. In general, the higher the MLR, the more value a policyholder receives for his or her premium dollar. The ACA requires an annual, minimum 80% MLR for individual and small group insurance plans, and an annual, minimum 85% MLR for large group plans." [1]
Source: https://fas.org/sgp/crs/misc/R42735.pdf
Seriously, something is wrong with the whole setup. ACA does address some of it but it has jacked my premiums sky high. Single Payer is the answer in my estimation. The sooner we come to this and stop fiddling around trying to make people we shouldn't happy the better off we will be.
Some business (like insurance) have a fair bit of tail risk they need to take into account.
Some are seasonal (like a ski resort) and need to make sure the profits they make in their high season can carry them in the low season.
Some are cyclical (like furniture stores) where people buy one piece and don't buy anything else for years.
Grocery stores have consistent customers and can generally predict their income and expenses day-to-day for the foreseeable future.
Second, a profit margin will take into account risk. So for the ski resort or the furniture store that includes the overhead of keeping the store open while you have no customers.
Third, if the risk is so insanely high why are these firms so consistently profitable? Shouldn't we expect to see them coming in and out of existence regularly? Restaurants are a truly high risk business venture, the majority fail to exist after the first year. Perhaps they have longer runways but it's rare to hear of an insurance firm shutting its doors. The large and consistent profit seen on their end of year reports belies the risk claim.
I don't think you can deny there are cost risks for insurance companies that a lot of other markets don't have. However, to back you up a bit, their profits are extremely good which probably means they are largely overstating the risk in order to gouge their customers.
The personal auto insurance combined ratio rose by 1.4 percentage points in 2015 to 97.3 percent for a group of 10 publicly traded insurers.
http://www.insurancejournal.com/magazines/features/2016/03/0...
When interest rates are higher car insurance runs > 100% loss ratio. They stay profitable by earning short term interest on premiums before paying out claims.
In a different insurance vertical fixing loss ratios at 80% would be called a cartel, and would put involved executives into prison for a good long time.
In healthcare the government forms the cartel, fixes the prices, gives money to poor to become consumers, and then fines everybody who won't become the consumer.
said Brer Rabbit. "Only please, Brer Fox, please don't throw me into the briar patch."
Sunlight is an amazing disinfectant and it is my hope that our government mandates every doctor and facility publish the total cost of every prescription and procedure they employ. We will collect that data and disinfect the high cost of health care.
[1] https://www.fisherbroyles.com/marketers-for-compounded-pain-...
By comparison, Bush's Medicare Part D prevented the Feds from even negotiating drug prices. Its author, Billy Tauzin, is now a Big Pharma lobbyist.
I mean, this is a constant joke in professional circles. If you are hourly billing and you can use your shitty talent to create something in 8 hours that your good talent would create in 1 - it's usually economically beneficial to have the worse employees do the work as it's more profitable overall. Up until the point where you lose the customer - but in this case that's not a concern.
You may be mishearing the term "excise tax". An excise tax is a tax on any specific good, such as tobacco or gasoline. Those taxes are included in the cost of the good (it just costs more at the pump or on the shelf). Yes, they are typically used to reduce consumption, or to pay for costs associated with consumption (eg roads).
An alternative income source might be luxury taxes. There are a number of luxuries where consumption correlates positively with price - but it would be politically difficult to implement a tax on extravagance.
Why? It seems that if premiums are rising relentlessly for one company that the insured will seek out other companies, and hence that one company will "lose the customer".
Or am I missing something?
They're defence contractors now! :joy:
[1] http://www.factcheck.org/UploadedFiles/2015/02/kff-chart.png [2] http://data.worldbank.org/indicator/SH.XPD.PCAP?end=2014&loc...
http://blogs-images.forbes.com/theapothecary/files/2016/04/S...
It was the recession.
Before ACA, our premiums went up ~5% per year - 8% one year - every year was under 10%. Since ACA, I've seen increases of 25%, 20%, 20%, 25%, then 11% then 13%. This is in NC with Blue Cross - the numbers possibly were different elsewhere (was in Michigan before that but wasn't paying as much attention, unfortunately).
The price increases I was seeing seemed primarily in line with inflationary numbers pre-ACA; post-ACA they seem to have no correlation to inflation, and seem to have more to do with a much larger overall cost for the insurance company covering more people, no lifetime caps, more services covered, etc.
EDIT: On, that factcheck chart - that looks to be showing premium increases for employer-provided health insurance. Employers cutting back their contributions to the premium would account for much/most of those increases. Effectively, it doesn't say anything about the actual insurance premium increases, only what employer-covered workers were having to pay - in my view, that's a big difference.
Unfortunately, I think it's percentage cap, not an absolute cap. So, if you're an insurer and want to increase profits by a dollar, you need to increase costs by a few dollars.
I know that adding infirmed people increases costs. The trouble is that the health insurance system of the US is not focused on individuals managing their own health insurance costs. Most Americans get their health insurance from their employers. This makes the ACA markets problematic because the limited risk pools above are further limited by the people utilizing the markets.
Does this mean that the US should ban company sponsored health insurance? Maybe. I don't know. What I do know is that the Democrats tried to stifle debate and thought on the bill. It went so far as Pelosi saying you can only know what's in the bill once you pass it [2].
Overhauling the risk pool will be huge. That's probably in the realm of repeal and replace. What I doubt we'll see, since it would probably destroy the Republicans in two years, is the total gutting of the ACA and the meaningful, unstable gap. The people wouldn't like it, nor would the business community.
1 - http://www.npr.org/sections/health-shots/2014/05/05/30982695...
2 - https://www.youtube.com/watch?v=hV-05TLiiLU
I think this is a justifiably correct presumption if you assume that costs are normally distributed. Are healthcare costs and risks normally distributed?
We had this problem where the cost of financial risk was assumed to be normally distributed and we built a lot of policy on that, including pooling financial entities into bigger and bigger codependent pools, but everyone seemed to have forgotten the known-for-centuries-fact that financial risk has infinite variance. Of course it turned out okay after we bailed out a bunch of rich people.
No...
The way to "fix" the exorbitant cost of healthcare is to allow young and/or healthy people to sign up for the bare minimum: a dirt-cheap catastrophic plan that covers the absolute basics and prevents personal bankruptcy. Unfortunately, this hasn't been done.
The first is because the administrative costs are much higher than in other developed countries (about 25 percent). The second is because the U.S. spends much more than other developed countries for the same things (e.g., drugs, doctors, medical equipment, services). The third is because people in the U.S. receive more medical care than people do in other developed countries (for example, they're much more likely to get expensive surgeries).
A cheap, catastrophic insurance coverage plan for young, healthy people addresses all three of these reasons.
No it doesn't. This is insurance, if the young healthy people aren't paying more than a bare minimum, there isn't enough money to cover the sick. You can't mandate care must be given and allow those unlikely to get sick to barely contribute, that's not the purpose of insurance which is to spread the cost and risk across the whole pool. What you propose does nothing to solve the actual problem, providing care for those who actually need it.
No, that's just the way to transfer the costs back to older/sicker people, it doesn't do anything to fix the overall costs (and might drive them up by delaying care.)
It is really as simple as that. Could you imagine a system in which car insurance wasn't mandated but car insurance companies were required to repair your car regardless of its preexisting condition? No smart person would preemptively buy insurance. You just wait until your get into an accident and then bring the already damaged car to the insurance company and demand a policy to repair it. No insurance company can work like that.
Insurance only works when the costs of the most expensive customers are shared among the cheapest customers. You need incentives to encourage the cheap customers to sign up or the whole system falls apart. Rejecting preexisting conditions is the old capitalist way of incentivizing people, but as soon as that is prohibited nearly all incentives disappear for a healthy person to buy into the system.
Our failure to find a non-insurance 'hammer' with which to hit all of the health 'nails' is a larger issue.
You can offer insurance against an event that has already occurred, but the insured price will always be slightly higher than the uninsured price. One could call that insurance, but it'd be a degenerate case, so at that point it's more of a word puzzle than a real question.
> Our failure to find a non-insurance 'hammer' with which to hit all of the health 'nails' is a larger issue.
Exactly - the problem is that people talk about health insurance like it's supposed to solve the problems that a wealth redistribution program would. Except, insurance is not a wealth redistribution mechanism - it has a completely different goal - and trying to turn it into one just results into the worst of all worlds (expensive and ineffective at achieving either goal).
Pretend for a moment that everyone receives their annual physical, as medical guidelines recommend. (They don't, but it makes our example simpler.) And let's say that the fair-market price of providing the physical, accounting for all costs borne by the provider and their practice, is $100. (That is an arbitrary number I have chosen, also to make our lives easier). What will be the co-pay for the annual physical for an insured patient?
The answer is that it will be $100 - there is absolutely no risk involved in this situation, so the expected payouts of the insurance company will be $100, and therefore they will incorporate that into their price. (The consumer will actually pay a bit more than $100 in total, because the insurance company has overhead costs, which are ultimately paid by the consumers as well). But of course, that's not the case, because the expectation is that health insurance will reduce these costs, and that people who can't necessarily afford $100 will still be able to have their physical. That's why health insurance isn't really insurance, except in name - we talk about it as insurance, but in reality, it's a wealth redistribution program tacked onto a risk smoothing product.
By definition, insurance is literally not intended to save the insured person money, in expectation. The expected value of all claims will always be less than the expected value of all money paid to the insurer by the insured entity. (This does not hold for every individual, but it does hold in the aggregate - that's where the risk smoothing comes in). The insured person pays the insurer a premium[0] in order to reduce the uncertainty in how much they would have to pay on any given month without insurance.
[0] Not as in "monthly premium", but as in "a premium on top of the expected value"
It also ignores a number of other selection criteria and behavioral issues, which you are honest enough to note in your pretend for a moment intros.
However, people who proactively care for their health carry "upside risk" as well as downside, which your scenario does not account for.
You fundamentally misunderstand the concept of insurance. Group insurance is, by definition, a way to spread the cost of rare catastrophes around the group so that the affected individuals don't bear the full brunt. There is the full expectation that in the event of a major medical event you will save money.
Try reworking your example around major medical events (e.g. a $500K hospitalization) rather than preventive care (the function of which is to reduce the risk of certain controllable medical events).
> The answer is that it will be $100 - there is absolutely no risk involved in this situation, so the expected payouts of the insurance company will be $100, and therefore they will incorporate that into their price.
No. Even pre-ACA, insurance companies offered low co-pays. How did they do that? Because your monthly fees will over the course of a year add up to far more than the cost of an annual physical. The purpose of insurance is to protect yourself against rare, but catastrophic events: you will probably not experience a wide variety of expensive medical ailments, but if you do they will likely leave you in financial ruin if you're uninsured, so you pay an insurance company money to protect yourself against that risk.
(Or, alternatively, your employer pays a health insurance company money to protect you against that risk, and offers that benefit to you as part of your total compensation package. Which is essentially the same as you paying for it, with some amount of risk differences and thus potentially lower costs due to the pooled employee health insurance policies, but that's outside of the scope of this discussion. TL;DR: it's still regular market economics.)
You might wonder why insurance companies offered low co-pays at all — was it just some marketing gimmick? But no, you can explain that with regular economics too: insurance companies are incentivized to make annual physicals affordable and attractive, because they can catch potentially-expensive medical issues when they're still much less expensive, thus lowering costs for the insurance company.
Yes, this is what I am saying. However, that has nothing to do with the price of co-pays for routine care, which is by definition predictable.
> But no, you can explain that with regular economics too: insurance companies are incentivized to make annual physicals affordable and attractive, because they can catch potentially-expensive medical issues when they're still much less expensive, thus lowering costs for the insurance company.
See, this is another pervasive myth. For healthy individuals, the annual physical is not cost-effective - it is very unlikely to result in long-term benefits to the patient, and it is far more likely to result in unnecessary care (such as follow-up tests and differential diagnoses for false positives): https://sciencebasedmedicine.org/re-thinking-the-annual-phys...
Also, I don't know why you're drawing a dichotomy between what I'm saying and "regular market economics". Everything I have said is standard, textbook economic theory. There's nothing obscure or even controversial about it about economists.
> Everything I have said is standard, textbook economic theory. There's nothing obscure or even controversial about it about economists.
Claiming that "health insurance isn't really insurance, except in name - we talk about it as insurance, but in reality, it's a wealth redistribution program tacked onto a risk smoothing product" is definitely non-mainstream. An insurance company takes in payments to insure you against high-risk events, and that's exactly what a health insurance company does: you pay them a monthly fee regardless of whether you need medical care (or your employer pays them for you as part of your compensation package), and when you do need expensive medical care, they pay for it. In fact, many plans explicitly only pay for expensive medical care: anything under your deductible, aka inexpensive medical care, you're required to pay for. You might be able to make some sort of weaker claim about wealth redistribution post-ACA, but — co-payments existed pre-ACA.
Actually, some of the largest insurance companies and the vast majority of risk-bearing providers (hospitals that act as insurers) are non-profits. Though I never said that their pricing was based on charity; I said it was based on the fact that the product they offer is not really insurance (and that it exists in a marketplace in which prices are incredibly distorted by the existence of other factors, which would have been too long to explain in that simple example).
> Claiming that "health insurance isn't really insurance, except in name"... is definitely non-mainstream
On the contrary, that's the overwhelming consensus among economists. Which isn't surprising, because the economics of insurance are generally covered even at the undergraduate level, and the ways in which health insurance differs from a true insurance program are pretty glaring.
Equating risk-bearing providers and health insurance companies for the purposes of arguing that health insurance isn't insurance might as well be tautological. Sure, blueberry pancakes aren't really pancakes if you include blueberry muffins in the category of blueberry pancakes, but who cares?
That is not insurance. That is a wealth redistribution. Those are not the same thing, although the current discourse around health insurance conflates those two concepts, for obvious political reasons.
> Could you imagine a system in which car insurance wasn't mandated but car insurance companies were required to repair your car regardless of its preexisting condition? No smart person would preemptively buy insurance. You just wait until your get into an accident and then bring the already damaged car to the insurance company and demand a policy to repair it. No insurance company can work like that.
Actually, this would be completely feasible to implement. The insurance company would price you based on your risk. In this case, P(risky event | all available information) = 1), so there wouldn't be much of a point to buying the insurance, but it absolutely would work.
The problem is that the ACA also forbids insurers from underwriting plans based on anything other than age, income, zip code, and whether or not they smoke. That's guaranteed to increase the cost both for healthy and for unhealthy patients, because they have to make overly conservative estimates when evaluating the risk level of their patient pool.
Yes, they are the same thing. Insurance is fundamentally a redistribution of risk with money being shifted from those who have not fallen victim to that risk to those who have. If you have a problem with that aspect of the ACA, you have a problem with the general idea of insurance.
>The insurance company would price you based on your risk (in this case, it would be 100%), so there wouldn't be much of a point to buying the insurance, but it absolutely would work.
You do realize that this is functionally the same as getting rid of the preexisting conditions protection, right? Whether someone pays tens of thousands to a doctor for care or to an insurance company for coverage are in practice exactly the same. The whole point is that many of us think that is a fundamentally unfair system to force someone to face in that situation.
No, they are not the same thing. The fact that a transfer of money happens is not a sufficient criterion for defining insurance.
Take two people with different risk profiles but who are both insured. If you can tell a priori which one is expected to have lifetime claims that exceed their lifetime premiums, then you don't have insurance - you have a wealth redistribution scheme[0].
Note that I didn't specify which person had the greater risk profile, or whether they both purchased the same "tier" of plan, or even whether they purchased their insurance from the same insurer. This property of insurance still holds even if the two people have completely different risk profiles, if one purchases a gold plan and the other a bronze, and if one person purchases from MegaInsurance in New York and the other purchases from AcmeInsurance in California - as long as they are both insured at risk-adjusted rates.
> You do realize that this is functionally the same as getting rid of the preexisting conditions protection, right? Whether someone pays tens of thousands to a doctor for care or to an insurance company for coverage are in practice exactly the same. The whole point is that many of us think that is a fundamentally unfair system to force someone to face in that situation.
First, nobody is paying tens of thousands of dollars to a doctor, because there's an out-of-pocket maximum cap. (And that cap could still exist under a risk-based pricing world.)
Second, it's not, functionally the same, because that doesn't mean that you can't separately provide income- or wealth-based subsidies if you're aiming to redistribute wealth. But that happens at a completely different layer from the risk underwriting - and because the underwriting process is allowed to properly account for a person's risk profile, you end up with lower aggregate premiums (pre-subsidy). Lower unsubsidized premiums means that you don't need to subsidize as much money in order to achieve the same sticker-price premiums that consumers see - in other words, the entire process is significantly cheaper for what appears to be the same result to the patient.
The reason we don't do this, even though it would be significantly cheaper, is because it's politically infeasible.
[0] Which, you may note, is currently the case - and that's because health insurance as it stands is a mishmash of two completely unrelated products ("insurance" and "wealth redistribution") that we happen to try to stuff into the same box.
If they have insurance. Without guaranteed issue they may not. With guaranteed issue they may have "access" to insurance but can't afford it, or the insurance they can afford may exclude the procedure they need. Retroactively. And even with insurance they may pay 25K a year in premiums plus that 10K max. Then 28K and 15K the next year... It's a system designed for optimal profit, not efficient (or moral) distribution of resources that every person will require. Debating whether it's insurance or insurance-like, or how the underwriting works, begs the question. Insurance companies should not be involved.
It sounds like you are trying to respond to a different sort of discussion altogether.
This whole subthread is in reference to the (implied) statement "requiring insurers to cover pre-existing conditions requires a mandate [and it will necessarily increase premiums to the extent that we have seen]"
Your responses is tangential to that, addressing either (a) what would happen if we didn't require insurers to cover pre-existing conditions, or (b) other potential failure modes which could potentially occur, and which already occur under the ACA.
>The reason we don't do this, even though it would be significantly cheaper, is because it's politically infeasible.
I agree with your point here, but it is the whole perfect being the enemy of the good thing. Like the original article states, this system isn't perfect. Even Obama admits this. I do however believe the current system is unquestionably better than the system we had previously. I therefore think it is a bad idea to return to the previous system while we hope to eventually come up with a better one. It is not hyperbolic to say lives literally depend on it.
Probably more than anyone, Obama understands that politics is the art of the possible. The fact that the ACA was passed by a margin of one vote is some evidence that, in the face of raging blind opposition, they didn't leave anything on the table. If congress weren't in thrall to gerrymandered hyperpartisanism and effectively unlimited donor money, the law would have had at least some bipartisan support, been revised numerous times, had bad parts improved, good parts enhanced, and concerns of both parties and various constituencies addressed in light of the empirical evidence gathered over the last seven years. I don't think there will be a return to the previous system. Instead, for several million Americans, they'll try to demolish the first four floors of a building and disingenuously point to the doctor's office on the fifth.
This comment is so profoundly misguided that I have to comment.
Insurance does not work the way you describe. When companies do a fundraiser where someone gets to take a half-court shot with a basketball and win $1M if they make the shot, an insurance policy sells the company doing the fundraiser a policy that reflects the odds that a person chosen at random from the audience will sink the shot. That policy might cost $7K, since the shot will very likely be missed.
The insurance company makes a profit by charging a bit more than the actual odds reflect, so that over time if 200 shots are taken, it pays the $1M once and profits $400K. In a competitive market, the price of insurance will approach the probability.
Similarly, an insurance company might offer insurance that it will not rain on the last weekend in July. Perhaps an outdoor wedding facility wishes to buy that policy, but a farmer wishes to buy the other side of that risk. In such cases, the insurance company can charge less because there is a market for both sides of the uncertain event. Futures markets are also used for this purpose.
Most of our modern health care is not really risk-driven, it's based on markets that are highly regulated and prices that are influenced by lobbyists from various industries etc.
The key problem with your assertion is that at the time insurance is purchased, nobody knows who will be the victim or whether there will be a victim. Purchasers of insurance would rather spend a little bit of money just in case a bad outcome occurs, so they don't bear the full brunt of that bad outcome. Those who don't end up with a bad outcome don't get their money back, which is why the system works.
We all know there is a need for social services to provide healthcare for those who can't afford it or who have really bad luck. That's not insurance, however, it's social services.
You say that my comment was profoundly misguided, but your comment right here is just a rephrasing of mine Someone with risk spends a little bit of money to help absolve themselves of that risk. If a bad outcome occurs and they fall victim to that risk, they don't bear the full brunt of that bad outcome because money is shifted from people who didn't fall victim to that risk.
Regarding you point about probability based pricing of insurance, we have collectively decided that we don't want health insurance to function that way. If it did, it would lead to the preexisting condition problem in which a person cannot afford insurance because they have a condition that requires expensive care. We instead subsidize their policy with a price increase on everyone else's policy.
> we have collectively decided that we don't want health insurance to function that way.
I agree this is the case, the problem is that it's not really insurance any more it's a bundle of insurance, prepayment, etc.
True. And the ACA now levies a tax penalty for those that don't sign up for insurance (2.5% of income, max ~$2K).[1]
[1] https://www.nerdwallet.com/blog/health/how-much-is-the-obama...
And they screwed that part up. As a healthy young person, there is no incentive to buy massively overpriced, shitty high-deductible ACA plans, when one month of coverage costs more than the IRS penalty.
What are you going to do? Not let me die?
Some context for people who don't know about this:
http://www.npr.org/sections/itsallpolitics/2015/10/23/451200...
Now think about who is buying ACA plans off the marketplace. First, it's almost entirely people eligible for subsidies (86%) since the plans are cost prohibitive without them. Second, it's people who didn't previously have or couldn't get insurance, unemployed, or who aren't offered insurance through work.
You can see immediately the problem... ACA subscribers will overwhelmingly be high-cost subscribers. There aren't any healthy subscribers to ACA because healthy Americans are working and get their insurance through their employer and therefore aren't eligible for subsidies and have no reason to look at the high-cost exchanges.
The ACA is effectively cornering the market for super-high risk pool, and premiums on ACA markets will continue to rise to reflect it.
If the subsidies were available regardless of availability of a so-called "affordable" employer sponsored plan, and if they employer's contribution could be taken by an employee and applied to an ACA plan in addition to subsidies, it would fix this all in an instant. Suddenly healthy Americans would be shopping on the exchanges, fundamentally altering the risk pool and drive down premiums for everyone.
It's not nearly enough to counter-balance to huge influx of high risk subscribers. You're being hung out to dry with the high risk pool, which is why your costs have skyrocketed.
"Most people are healthy most of the time, and as a consequence, health care expenditures are heavily concentrated in a small share of the population: about 50 percent of the health care spending in a given year by those below age 65 is attributable to just 5 percent of the nonelderly population. The lowest spending half of the population accounts for only about 3.5 percent of health care spending in a year." [2]
If you want to fix ACA, you have to fix the risk pool. So what's the best way to get healthy people signing up for ACA in droves?
Imagine if you could take your employer contribution, and legally apply it to any plan of your choosing. As-in, sure the employer could arrange a group plan for the office, and you could take it or leave it, but you got to apply the exact same employer-contributed dollars to any plan you chose if you wanted.
Then on top of that, if you could get ACA income-based subsidies, regardless of the amount of the employer cost-share. Because, why on earth should you get less subsidy at the exact same income level, just because you have an employer who is also good enough to contribute?! That's just penalizing employers for contributing. Employer contributions would be an add-back to MAGI for purpose of calculating the subsidy, but nothing more. Currently, today, the meagerest employee contribution will disqualify an employee from all subsidies altogether, almost regardless of income. So-called "affordable" employer-sponsored coverage disqualifies an employee from all subsidies, is defined as an employee share of less than ~10% of household income for an individual plan. WTF?!)
What you would end up with is some extremely cheap plans which a lot of very health workers would flock to. The Fed would pay out significantly more in overall subsidies, but the payment of subsidies would be significantly more fair because it would not penalize an employee for working for an employer who is actually willing to contribute to a share of health costs.
In practice, it would in quick order eviscerate the group market for employer-chosen plans, and see employees taking proper responsibility for choosing their own plans for themselves, while still preserving the ability for employers to share in health care costs with tax-advantaged dollars. It would save millions of small/medium sized businesses the arduous task of trying to negotiate group health plans for their employers evey single year. But most of all, it would fix the risk pool by getting everyone across America actually buying through the marketplace, and not the skewed microcosm we have now.
Early on after ACA passing, I think it was Zenefits was actually trying to sell employers on paying employees to purchased their own plans on ACA marketplaces years ago, until the IRS shut it down. But it was an extremely appealing model at the time.
[1] - http://kff.org/other/state-indicator/total-population/?curre...
[2] - http://healthaffairs.org/blog/2016/03/15/dont-let-the-talkin...
Pre-ACA a non-group plan that wasn't some government mandated high risk pool would typically be much cheaper than group coverage, simply because of the fact that it went through underwriting and you could be denied.
It was priced similar to life insurance where a healthy young subscriber could get a very cheap premium because the expected value was so low.
Back when it was legal to charge 10x more for a 55yr olds plan than a 25yr old, people paid more in line with their expected utilization. Flattening the rate curve shifted massive costs to young middle class families, which IMO is shit policy. When you're 55 you are generally done raising the kids and saving for their college, so it's actually not a bad time for your health care premiums to skyrocket.
(This just to counteract my overly weighty response as sibling to this)
Kinda, sorta, not really [1].
1 - http://www.politifact.com/punditfact/statements/2013/nov/15/...
This was the Republican proposal until Obama took them up on it. Anyone who remembers poor Mitt Romney having to bend himself into logical contortions during the presidential campaign knows that: it was his signature achievement as governor, previously praised by many in his party when advocating against single-payer systems, and suddenly so politically incorrect within his own party that he felt obligated to attack it or invent incredibly fine distinctions to say the ACA was different.
True story:
Pre-ACA, I had never been without insurance. I also have asthma. Never been a problem. No pre-existing condition issues. Then, I became a contractor and had to pay for my own insurance. The insurance refused to pay for anything asthma related. Fine; I was making enough to pay for the hideously expensive inhalers (think an epi-pen ever couple of months), but with those, the asthma was well controlled. Then I left that position and became a regular employee with employer provided insurance. Suddenly, no pre-existing condition limit. Weird.
Which is why it's named after Reagan.
So it works as a totality but not in pieces
So it works as a totality but not in pieces
Those private plans you researched had crap coverage compared to the standards that the ACA set for all health insurance.
By raising the standard, premiums have gone up on some private plans and overall healthcare costs have been reduced for all Americans.
Costs have gone way up; they've just re-arranged where the money comes from, and punish you for not putting more money into the system.
Ensuring everyone is covered by making it illegal to not be covered is not an acceptable solution.
Maximum out of pocket for a family on an ACA bronze plan is $14,300, including drug costs.
http://obamacarefacts.com/health-insurance/deductible/
> The maximum deductible is equal to the maximum-out-of-pocket limit each year ($7,150 for an individual and $14,300 for a family for 2017).
That's the theory. As I noted in https://news.ycombinator.com/item?id=13393287 experiment suggests otherwise for the out-of-pocket limit, at least....
https://content.carefirst.com/sbc/APHMMN5DRXCMMN5MN012017.pd...
The explanation is "it's a typo".
Medical and Prescription Drug combined: $6,550 individual/$13,100 family for In-Network Providers; $13,100 individual/$26,200 family for Out-of-Network Providers.
Eliminating networks is certainly something the US should do if it wants to do more than pretend that people have good access to healthcare.
But the out-of-network deductible can still apply, as far as I can tell. So can the out-of-network out-of-pocket maximum.
You've also confused deductible with out of pocket in your original post, on top of rounding up by 15%.
Can you provide any proof of that? According to Obama, an average insurance will be as affordable as a cellphone bill. Perhaps your plan had some perks in it, no?
Also there was a lot of fake stories about people getting tripled their insurance cost, all have been pretty much debunked as not real. Even Harry Reed was mentioning that in his speech.
For those that don't know, in an hmo, you have to go see your gp for a referral for everything. In grown tonail, go to gp when you know he will refer you to a podiatrist. With a ppo, you can go directly to the specialist. But ppo under aca are the "premium" plans.
I personally prefer HSA backed plans since I have a real asset. We've saved heavily over the years. Now I can't really do that. I think there is only one such program in Florida. It was a high premium and high deductible.
The Senate has already voted to remove provisions that your praise in your post...
From the NYT: "Senate Republicans took their first major step toward repealing the Affordable Care Act on Thursday, approving a budget blueprint that would allow them to (gut the health care law) without the threat of a Democratic filibuster."
So take out the editorial "gut the healthcare law" and replace with "repeal and replace" and you have a clear reporting of what actually happened.
Two paragraphs down the actual non-editorialized reporting states the real truth; "The action by the Senate is essentially procedural"
Here's one: http://www.cnn.com/2016/01/08/politics/obama-vetoes-obamacar...
Now that the vote counts just see what actually happens.
The GOP has been talking about repeal for year(s) now and has nothing to show for a replacement plan. Meanwhile, as part of the resolution passed, they took aim at specific provisions that, again, were things praised in the grandparent comment.
In case you're not familiar with the details -- the cost sharing subsidies are payments which reduce co-pays and deductibles for low-income subscribers. These are a step beyond the subsidies, this doesn't reduce the premiums, but rather siginificantly reduces out-of-pocket expenses. The law is written in a way which requires insurers to grant these cost reductions to low income subscribers, regardless of whether the funds to reimburse the insurers are actually appropriated by Congress and paid out to the insurance companies. In other words, every year if the money isn't voted in to fund it, the ACA would immediately collapse because companies would be allowed to flea the marketplaces mid-year, and they certainly would, because they would be facing additional billions of losses due to the now unfunded discounts to low-income subscribers.
To work around this fatal flaw in ACA (one of many) Obama has been using executive orders to "appropriate" the money to pay the subsidies. This is of course an obvious violation of separation of powers (power of the purse is for Congress alone). And the House took the incredible step of suing the Executive branch, and they won. The ruling in the Federal Circuit court would immediately end the $9 billion of cost-sharing payments which Obama has been ordering the DHHS to make to insurance companues... was stayed upon appeal to the Supreme Court. If Trump decides to drop the appeal on January 21st, the payments cease, and ACA self destructs.
So, no, the Senate didn't vote to repeal anything, nor would they have to if anyone wanted to watch the ACA crash and burn. Of course very few elected representatives actually want to see a lot of very needy people lose their health insurance mid-year, as much as they didn't cause this dumpster fire, they will need to try to put it out. So we're likely to see more votes to prop up the failing ACA over the coming months until the replacement can be made ready.
For the most part, the insurance companies are huge, and they operate nationally already. There's really not any economies of scale that are going to produce direct savings. The savings come by slashing everyones coverage.
Going to the doctor for an annual physical is not something that should be insured. It's a known cost. You, as the individual, should pay that out of pocket, or get another extended coverage policy or rider to covert that. It's like my auto insurance paying for oil changes.
As a result, our costs are too high.
A health disaster is several orders of magnitude more expensive than an automotive disaster, and you can't just total out a human being and pick up a new one at the local dealership if it's too expensive.
Preventative maintenance is a money saver long term.
https://sciencebasedmedicine.org/re-thinking-the-annual-phys...
I was born and raised in a single payer country where healthcare is free (or close to it) and we are seriously considering a move back there. If we lose our jobs here in the US we would be screwed due to my wife's ongoing mental health needs.
Like, I don't have mental issues so I don't need the mental health parts. I don't have cancer so I don't need the cancer coverage.
Previous to the ACA people would buy "health insurance" with a deductible so high they realistically couldn't use it anyway. I'm talking working class people with $10k deductibles and $2000 in actual savings. And they were freely sending insurance companies $100-200/month knowing there is no way they could actually use it.
Insurance, as a product, was highly customizable. You could get riders and other policies to cover various risks. You see this all the time with fleet insurance. Health insurance use to be the same.
The ACA set a floor on the offerings. If you don't those features, you can get a non ACA approved plan. You then have to pay the tax penalty. Now the penalty is an oddity. There is no lean. The government removes from your refund $X until you either pay the penalty or have no refund.
I looked at such a plan. Best I found was $438. Assuming an income of > $100,000 (I thought that 2017 insurance rates were set using 2016 actual income, I was wrong), the penalty was north of $3.5k total for my wife and I. This made the ACA plan cheaper since I didn't have to worry about filing quarterly estimates since I always have a refund (I'm giving a price to the time and effort required to file).
So the subsidies make the ACA plan cheaper that the non-ACA plan. I went with that. The question I pose to society is "Should we require government, funded through taxes, handout to make medical costs affordable?"
You are ignorant and heartless.
In the worst and most expensive cases, patients do not even have a choice.
And your subtext is completely clear here.
No, you should not get to pick and choose what conditions are worthy of treatment because you don't have them and don't think they are legitimate, and therefore make coverage more expensive or unobtainable for others.
I don't buy that "I won't ever use" thing. People change their minds, and sometimes you're not capable or competent to decide for yourself.
> People change their minds, and sometimes you're not capable or competent to decide for yourself.
This means one of two things. 1st, I should be able to upgrade my policy or pickup a secondary one. 2nd, my family will have to live with the results of my earlier decision to not include mental health in my coverage. Decisions have consequences. The government shouldn't force me to pickup coverage just because they think it might be a bad decision to forgo it.
So, one of a few things will happen. You may forego treatment and recover, in which case great. You may forego treatment and remain ill, meaning we all lose out due to the loss of a productive member of society. (Or, worse, you hurt a bunch of people.) You may seek treatment and be able to afford it, in which case great. Or you may seek treatment and be unable to afford it, meaning the rest of us get to pay for it for you.
That last one in particular is why we like to force people to have insurance. It's basically the same as forcing you to have liability insurance for your car. You can end up costing others a bunch of money, so we want to make sure you're able to pay it back.
Decisions have consequences. So long as the consequences remain confined to the person making the decision, I don't care much. But once they start impacting others, there's trouble.
You do a disservice by calling everything you don't agree with cadillac coverage. Clearly you've never had it.
You must be wonderful to have as a family member.
Mother: Hey, crazy cousin virmundi is coming to stay with you because he does not have mental health insurance and there is no government social safety net!
Me: Uh, what!?
Mother: Can you clear the guns and knives out of your house?
Me: Uh, what!?
I don't blame you there, it's probably a wise decision. I don't think I would ever want to have that listed in my medical records, for fear that it would be used against me in some circumstance down the road.
I thought brain tumors were for old people and people who didn't take care of themselves. If you asked me at the time I got the tumor my odds of a brain tumor were zero.
It's not a "personal choice" to get sick. You can only prevent illness to an extent.
>Why should I be forced to purchase something I have no intention of using?
I don't intend to ever use the liability coverage I purchase. In fact, I hope I never have to use it. I don't mind I have to purchase it though because it makes society better off as a whole. I would hope if someone caused me injury they would be insured just the same.
I find your attitude extremely disturbing.
And yes mild to moderate depression can often be treated on your own with lifestyle changes. I'm glad that worked for you (honestly) but not all mental health issues are mild depression.
From what I've seen in my volunteer work I doubt you had severe depression,as rarely can severe depression be treated soley with diet and prayer (unless substance abuse was the underlining cause). Let me ask you, were you able to sleep? Eat? Get out of bed? Shower? Dress yourself? Go to work? Leave the house? Brush your teeth? Get through the day? If so your depression was mild to moderate.
Not that dietary change and prayer aren't useful in treating depression, they absolutely are! Depending on the patient we would encourage both as part of recovery. It's just very few severely depressed patients are able to "pull themselves up by their own bootstraps."
I talked to the CEO of a small rural non-profit hospital and asked if ACA had helped since they traditionally wrote off a lot of the care they provided. I figured that everyone being required to have insurance would really help them stay afloat.
She said it actually hurt them because they had an influx of people coming in with subsidized insurance that never paid any portion of the deductible. So the hospital was now struggling even worse than before because they were writing off more than previously.
For me, this was a counter-intuitive result of ACA that I hadn't expected.
If the patient doesn't pay the deductible, does the insurance company not pay anything at all?
My assumption would be that the insurance company has to pay, and then has to work out the deductible payment with the patient. What's the point of asking for an insurance card if the patient can simply not pay anyways?
I fail to see how the amount uncollected could go up from this interaction. Before, uninsured people would have to pay full price (hospitals tend to charge uninsured people more), now they only have to pay a deductible...
Though chances are any time the uninsured rate goes down, the default rates of insured people will go up. Newer insured people are less likely to have their finances intact after all. So anything that lowers the uninsured rate will cause this issue I suppose
Maybe new healthcare revisions should offer FDIC-style insurance for deductibles for hospitals. Wouldn't want people refused from hospitals despite having insurance.
As a sidebar, it's awesome when you have a situation as described, and then never go to the doctor again for the rest of the year, and so get no cost reductions on anything, despite paying out-of-pocket for the services you did use, plus whatever your premiums are.
I understand that this saves people who go way over, but if the deductible is $2500, what's to stop a $25000 operation from becoming a $35000 one?
There's the hospital-insurance relation but given how flexible hospitals end up being on pricing it sure doesn't feel like enough
> Sure it had more bells and whistles, but I didn't want nor need them.
Like FREE preventative care. That's not a bell and whistle. That's worth more than your $20/month right there. Go to the doctor already.
And more importantly, that premium is identical regardless of what condition you were in. Without ACA, if you had cancer, you would die and/or be financially ruined. Worse yet, if you just had something like depression, or high blood pressure, or diabetes, then you'd be screwed out getting affordable insurance even in the event you got cancer or something unrelated but deadly.
My taxes, and everyone else's taxes go to pay this $500 dollar difference. The Federal government didn't some how magically create the gap funds. They have to increase taxes through fines and other sources to pay this.
They've effectively hidden these costs for the subsidized individuals. I'm not paying $780 per month with a large refund at the end of the year. I'm paying a few hundred. Most people don't think about the revenue impact this has on the country. We now have to fund these subsidies. We now remove even more money from people that could have go into stocks, local economies, or services.
The plan should be $280. That's it. Not $280 + subsidies. Just $280.
Maybe, maybe not. Here's a case of a death that cost $250k for want of a $80 tooth extraction: http://www.washingtonpost.com/wp-dyn/content/article/2007/02...
We were already paying for uninsured folks via bankruptcies etc.
It didn't "cost" $250,000. That's the sticker price of what they billed for the services, but that's not what they expected to be paid by insurance. That's a crucial distinction.
Just as you don't pay sticker price for a new car, the insurance company doesn't pay what the provider bills them for; they pay some agreed-upon rate, which is specified as a multiple of what Medicare pays.
> We were already paying for uninsured folks via bankruptcies etc.
Not exactly. Contrary to public misconception, it's well known in the medical world that preventive care is not cheaper in the long-run. (It generally results in better care, but not always, and it always results in greater utilization either way, so the end result is more expensive).
You can make the argument in favor of routine and preventive care on the grounds that it's the right thing to do, medically or morally. But it does result in greater costs overall, and that still has to be paid for.
But it didn't and doesn't provide care. It provides free or low-cost health care insurance to people that couldn't afford the insurance. They still have to pay for their actual health care with high, up front deductibles. Which many probably still can't afford. But the insurance companies are running to the bank with the mandated policy coverage and flow of federal tax dollars (via subsidies).
I don't see how Republicans could not throw out the good parts. When you boil it down, the good parts of the ACA are the requirement to cover pre-existing conditions, and the individual mandate. The former is what's needed to ensure people aren't completely fucked over at the slightest opportunity, and the latter is needed to avoid destroying the insurance industry in the presence of the former. Republicans appear to be fundamentally opposed to both of those. Without them, what's left?
- a cap on profits on insurance companies, enforcing that a certain amount of revenue is going towards client coverage
- Allowing people up to the age of 26 to stay on their parents plan
There's a couple other bits like this as well.
You don't want them now but you might want or need them later.
> The ACA helped many people. It helped people under 26. It helped people with pre-existing conditions. It helped give free or low-cost health care to people that couldn't afford it because now the government is picking up the lion's share of the tab.
There are a few important things it did that you missed. It ended lifetime maximum caps and it capped the difference in what you can charge the based on age to 3x. That last one in particular is greatly under appreciated. Yes, the young are now paying more than before but they will also pay less than otherwise when they get older. Everyone gets older so everyone eventually benefits from it.
> I think they will look at the industrial recommendations such as expanding risk pools across states
Nothing prevented them from passing this since they were in control of Congress. My guess is this is much harder to accomplish than it sounds.
Insurance companies did not know the health, and thereby the cost, of previously uninsured people buying coverage under ACA. To reduce risk of the unknown, the government committed to reimbursing money lost due to underestimating risk (conversely, insurance companies would pay into a pool if they earned above certain thresholds). Over time, prices would meet an equilibrium as policy costs stayed low, allowing more healthy people to join the pool, which lowers coverage costs, which then lowers policy costs. Prices could be raised modestly to account for the difference, and government payments to insurers would ultimately end.
However, Congress rejected payment into the risk pool and ultimately paid out only 12.6% of the promised funds. Many co-op insurance groups had to fold, others needed to dramatically increase premium costs to account for (a) the lost money, (b) the increased cost of the uninsured, and (c) the increased risk that the government wouldn't fulfill its obligations.[1]
The current situation - limited choices, high premium costs, and resultant lower healthy person participation potentially leading to a "death spiral" collapse - is a direct consequence of these actions, not an inherent failure of the ACA.
However, Obamacare gets the blame and Republicans can point to a failing market that they can repeal and, perhaps, replace. Very effective politics indeed. Just ignore the human cost, which certain politicians seem to have no trouble doing.
[1] https://www.nytimes.com/2015/12/10/us/politics/marco-rubio-o...
On the inverse, I see many people on the left pointing to the number of people who have signed up as the primary indication of it's success as well. Which contains it's own notes of ignorance.
Was the government not handing out fines to people who didn't sign-up? So they were basically forcing people onto the program? How could the numbers of sign-ups be meaningful then?
Also, I couldn't imagine going without health care. You have to take what you can get otherwise the risks are significant. So considering it's an essential service, saying "look at the number of people using it" as an success indicator is like saying "plenty of people are calling the firemen, clearly they are doing a good job".
There is a serious human cost here when people have their health plans doubling in cost... while the rest of the world has worked out far more functional systems. So those cost calculations should be relative to this high level reality, not some internal benchmarks between stages of mediocrity.
It seems by not deciding to be free market nor socialized that the US is getting the worst of both worlds. It's easy to blame the republicans for this but the half baked socialized system that the democrats put forward was hardly a good solution.
> Far too few people realize that much of the ACA plans' cost increases is due to Congress reneging on a government promise
Have you considered that maybe the entire Democrat plan of getting to a socialized system via cuts and slivers in one direction, knowing full well that cuts and slivers will be done in the other direction is a terrible idea?
Stop pretending that private companies can function efficiently in an ever more legislated environment, as if only more thousand page bills get passed that it will finally start working well... history has continued to indicate otherwise. Either a) embrace markets or b) go hard on selling the public on the idea of single payer public insurance.
(I should note I'm in favour of public health insurance after living with it in Canada, despite typically being in favour of markets elsewhere)
If you do want my personal opinion, I'll give it here:
1. From an economic standpoint, single-payer healthcare fundamentally makes sense. Put everyone in a single pool to reduce risk, drive efficiency, and maximize negotiating power.
2. From a free market standpoint, the current model of tying healthcare coverage to your employer hurts both employers and employees. As an employer, why am I responsible for paying this "benefit"? If too many of my employees get horribly ill, my premiums go up to the point that I can't provide a competitive benefit; my costs increase, my employees' contribution increases, and my ability to recruit talent suffers. As an employee, why must I forego an entrepreneurial opportunity because I can no longer afford healthcare for my children without an employer footing the majority of the bill?
3. From an efficiency standpoint, the current model wastes tremendous medical resources (bureaucracy, physician time, lack of cost transparency, treatment limits, etc.). I have friends in the medical industry (doctors, executives, med tech providers), all of whom dream of a single-payer system.
4. From a constitutional standpoint, I believe healthcare falls under "promote the general welfare" and "secure the blessings of liberty to ourselves and our posterity." A national, taxpayer-funded health program is no different than any number of other government-funded programs that free us to maximize our potential as citizens. And yes, we pay taxes to fund those services whether we use them or not.
So yes, I'm a believer in a single-payer model. Yes, I believe the ACA is essentially a handout to insurance companies. And yes, I was very disappointed when Obama took single payer "off the table."
However, I also think it's better than pre-ACA, despite its flaws. And at this point, it's certainly better than the chaos that will arise from simply abandoning it. Understanding its compromises, I can't really envision a "replacement ACA" that will pass a Republican congress that can be better.
If Congress delivers a better ACA, I'll happily embrace it. Heck, I'd even give credit to the Republicans if they just tweaked the ACA, renamed it "Winningest Solid Gold Trumpcare" and fully backed the result to make it successful. But I see no positive outcome if they go down the "repeal and delay" path.
Like the U.S. military has maximum negotiating power with its contractors? I mean, who else is going to pay for the F-35?
Monopsonies aren't inherently more efficient than monopolies.
Do you truly feel military procurement is equivalent to healthcare delivery?
Have you ever sold products to the US government?
Do you believe the primary financial gains would come from negotiating power? (Hint, the list I provided is in order of impact.)
Are you familiar with the impact Medicare Part D had on prescription drug prices? (Spoiler alert: it "substantially lowered the average price and increased the total utilization of prescription drugs by Medicare recipients" [1].)
Do you believe the decisions behind funding defense are in any way influenced by non-economic factors? (Hint: defense budgets increase even when the military itself requests lower funding. Does government healthcare funding follow the same pattern? Why not?)
Are you familiar with the many estimates of the cost of a single payer program in the US? [2]
I could go on, but won't. This is not Reddit. Sound-bite caliber anecdotal arguments are a problem, not a solution.
[1] http://faculty.som.yale.edu/FionaScottMorton/documents/TheEf...
[2] http://www.pnhp.org/facts/single-payer-system-cost
"Less efficient" is actually a nonsensical term to economists[0], but monopsonies are inherently inefficient, and it's rather straightforward to demonstrate that economically, the same way it's straightforward to demonstrate that a monopoly is always inefficient, even in cases of so-called "natural monopolies".
> Are you familiar with the impact Medicare Part D had on prescription drug prices? It "substantially lowered the average price and increased the total utilization of prescription drugs by Medicare recipients
You can't use Medicare Part D as an example of the impact that negotiating power would or would not have, because Medicare doesn't "negotiate" (read: unilaterally determine by fiat) the prices it pays for drugs, which it does do for providers.
> Are you familiar with the many estimates of the cost of a single payer program in the US? [2]
Yes, and most of those (including the ones you linked) are based on Medicare's reimbursements as a baseline. But that's totally baseless, because according to Medicare's own financial reports, they pay below-sustainable reimbursement rates to providers[1], which means that they are essentially subsidized by the premiums paid by privately insured patients. If Medicare were expanded to include everyone, they would have to massively increase their reimbursement rates, because the private insurance market wouldn't exist.
[0] Efficiency is best explained to a non-economist as a binary property; there does not exist a total (or even partial) ordering of inefficient states.
[1] They pay below COGS, which means that even if all doctors, nurses, and staff worked for free, they would still make a loss on Medicare patients in the aggregate, if they were not able to charge the difference to private insurers. Incidentally, that's why uninsured patients see such high bills - those are the prices that are used as a starting point when negotiating with insurers, and they're massively inflated to cover the gap.
The flaws of ACA are not inherent to a privatised system, they are the result of this specific implementation.
Second, I can't figure out what your insurance was that was only $250 before the ACA. The only people I know who pay that little were on catastrophic plans. Insurance for me in NY state as a healthy (I was never without insurance so the kidney donation didn't count against me) single male in my 30s on a private insurer was creeping up to nearly $10,000 a year for complete coverage under an HMO like I used to get when I worked for a Fortune 500. Under the ACA, I pay half that for similar coverage.
Do you have evidence that the government is the main cause of the increase of the price of the plan? It could have merely been the companies using the ACA as an excuse to raise prices.
But that plan was only available to healthy people without any pre-existing conditions.
Now, the $780 version of that plan is available to everyone.
You are a healthy person who could get healthcare before and still can for roughly the same price. The ACA wasn't meant to change things much for you: it was meant to increase coverage. Now people who are older or who have a chronic condition or a bad family history can get the same health insurance as you. That's what your tax dollars are paying-for.
> Now, the $780 version of that plan is available to everyone
But you're making a political statement that the government should ensure sick people should have access to health care (which is fine, e.g., I support welfare). It's just odd that you think this program should be paid for primarily by middle class Americans, unlike most other government safety nets which come from taxes which mostly target higher income individuals.
> [...]
>this same plan today is $780 a month without subsidies
The problem with your comment is that your prices are very exact but the consumed goods (insurances) are described only vaguely.
The country I live in, introduced obligatory health insurance 1996. The first proposition by our Democratic Party goes back to 1960. After 30 years of intense political fight we now have a system that is supported by all of the parties. So I think our system is as balanced as it gets. Plus we have a highly competitive system between insurence companies, and you are allowed to switch the insurance company every year, which then is done by lot of people.
The absolute most important thing is a rock-solid legal description of the minimun that every insurance company has to deliver.
Here are the + and - after 10 years of practical experience with obligatory healthcare:
+ High competition, disciplines insurance companies to work efficiently, and allows new, small and innovative companies to enter the market.
+ It's a pretty fair non-discriminatory system, nationwide and across all insurance companies
+ Simple system once it is established
+ Vulnerable persons are well protected.
+ The common health of the people is rising.
- The costs are rising every year because the is no direct interest in keeping the costs down
- The insurance companies get more powerful every year due intense lobbying, this not in our interest.
- There is explosion of special health services, very expensive treatments, rising salaries in the health economy
TLDR: Obligatory healthcare is good and you live longer. But it comes with a price.
Oh yeah? Where do they get their money from?
I ended up taking a job at a start-up when I turned 30 because I figured at 30 I should probably start going to the doctor more often and it was the only way I could afford health insurance.
I was finally able to go back to freelance a little over a year ago because a decent plan only cost about $700 total per month for both me AND my wife, and She has pre-existing conditions, which is to say she had gone even longer without insurance before we'd met. I was merely hedging bets according to my age. She actually needs it.
Of course, BCBS-IL keep cancelling our plans as is their apparent loophole to raise rates. Because even though the non-profit had a surplus of 14B in early 2016, the absolutely perfect plan we were on wasn't making enough money for them, so they killed it. That's twice in a row, so we switched to Cigna this year, which I don't assume will be much better.
It's expensive,. They're all expensive, whether I use the marketplace or not. But they're nowhere near as expensive as they were four years ago. Especially for my wife who literally could not be insured before the ACA.
A healthcare plan where you get dumped the second you have a preexisting condition removes the de-risking benefit of insurance. The only benefit then left is the negotiating leverage of an insurance company able to pay $50k for a surgery that would out of pocket be $100k, lower ambulance bills, etc.
[0] http://www.pbs.org/newshour/rundown/new-peak-us-health-care-...
Similarly, if you want to avoid the problem of expensive drugs that sell for significantly less in Canada, legally require Big Pharma to sell in the US for the lowest 'negotiated' price among all the national healthcare systems.
Improvements definitely need to be made though, I'd rather have Medicare like my grandparents and I have a hard time understanding why people are so against national healthcare or even exploring the idea.
Have you been to a doctor before? Then you might have a pre-existing condition.
If you don't have employer-provided health insurance, you're still basically screwed even under the ACA.
The federal government imposed limitations on the ability of private firms to offer higher wages, so that the government could more easily recruit workers for war industry. Private employers found a loophole. Offering health insurance.
Still, we all know what it's like to have a major design flaw in the legacy codebase.
I am a bit confused by this story. Was Zach not covered under his families' health coverage? He also went to: Westminster School - one of the most expensive private high schools in the US.
Now, one could argue he had a pre-existing condition and thus, was not covered under any health care providers plan, but he states: "I was virtually uninsurable." This tells me there were options, but none that covered the entire cost of the surgery. Honestly, this story alone makes me seriously question the purpose of this post.
It's unfortunate that we're not able to get these conversations going in a way that's ... what? "unbiased"? I don't know what I'm asking for, but I think it's some variant of honesty and openness. And I think that we're missing a lot of the truth, for ourselves and others, by having to couch our statements in ways that aren't entirely forthcoming.
That said... I'm still glad that medicaid covered my uninsured ass when I broke myself trying something I'm not good at (skiing). I remember thinking (as I was bundled up in the medic's sled) that I was not too different from some New Zealander with a busted body part... about to be carted off to free medical care, to get me back on my feet and working as quickly as possible.
Thanks, Obama.
It's unfortunate that we're not able to get these conversations going in a way that's ... what? "unbiased"? I don't know what I'm asking for, but I think it's some variant of honesty and openness. And I think that we're missing a lot of the truth, for ourselves and others, by having to couch our statements in ways that aren't entirely forthcoming.
That said... I'm still glad that medicaid covered my uninsured ass when I broke myself trying something I'm not good at (skiing). I remember thinking (as I was bundled up in the medic's sled) that I was not too different from some New Zealander with a busted body part... about to be carted off to free medical care, to get me back on my feet and working as quickly as possible.
Thanks, Obama.
A friend was virtually uninsurable for having once been diagnosed as clinically depressed. Flat out denied coverage.
Source: I know someone for whom this was the case pre-ACA.
Pre-existing condition. Anthem denied me coverage.
My ortho guy said, I don't understand. It was a good outcome.
- It cost me money
- It's not perfect
Arguments in favor of ACA:
- It literally saved my life
Regarding increasing premiums, the complaints tend to be anecdotal. According to the National Conference of State Legislatures, in 2016, the average monthly net premium increased just $4 -- or 4% -- from 2015 to 2016 among the insured that take advantage of subsidies.[1]
Furthermore, premiums have gone up year-over-year every year almost every year since I've been paying for my own insurance -- and that's well before ACA.
There's an interesting chart on the Kaiser Foundation website, where it shows the average plan prices and percent increase year-over-year broken down by state. It also shows that, after tax credits and with very few exceptions, plan prices have remained stable (0% change) between 2015 and 2016.
I understand and sympathize with the high premium prices, but I have serious reservations about the assertion that the high premiums are due to the ACA and not external factors.
[1] http://www.ncsl.org/research/health/health-insurance-premium...
[2] http://kff.org/health-reform/issue-brief/2017-premium-change...
Not only that, but they were increasing at a much faster rate before the ACA. Of course, most people didn't notice, because those who were employed were covered by their employer, and the unemployed were uninsured.
Could you expand on this?
The caveat is that it only works if you're collecting a paycheck, but not if you're bootstrapping from savings.
There are thousands of people whose lives were saved by this. Nitpicking over on example seems rather unproductive.
If Obamacare is repelled at the Federal level, could a state just implement its local ACA? what prevents California for instance of giving health coverage for its residents? California is a good example since it "the world's sixth-largest economy" (If California was a country) I'm sure healthcare companies wouldn't want to cut themselves out of this market?
This would give California and SV an even bigger advantage regarding what is described in Sam's post.
Btw, San Francisco has essentially had universal health care since 2007 (via Healthy San Francisco), though it doesn't cover non-residents on I-94.
It would be interesting to see if citizens and permanent residents represented a high proportion of founders in SF than, say, Silicon Valley.
Ah the classic "if you are middle class F U" program
https://en.wikipedia.org/wiki/Massachusetts_health_care_refo...
Some parts of the ACA could be implemented in state law, some would be either illegal or impractical at the state level. It's also likely that a repeal would be accompanied or followed by federal policies which would make state-specified versions of the ACA less practical than they are now.
> what prevents California for instance of giving health coverage for its residents?
California already provides state-run send healthcare beyond the requirements of the federal programs it participates in.
That's my poor understanding of U.S. Federal vs State government that fails me here: what exactly would be illegal, what would be impractical? If a state ACA is challenged in court, couldn't they use the supreme courts rulings of Obamacare as a strong defense?
Other comments here mentions that Massachusetts already had it (and I assume would likely keep it even after Obamacare is repealed), Couldn't California copy the Massachusetts implementation?
> California already provides state-run send healthcare beyond the requirements of the federal programs it participates in.
But I assume those state-run programs aren't providing as strong of a coverage as Obamacare was? Now would seem a good time to update it to match Obamacare?
Mandating coverage, which is basically a requirement of affordable universal healthcare.
"What happens if I don't pay the fee?
The IRS will hold back the amount of the fee from any future tax refunds. There are no liens, levies, or criminal penalties for failing to pay the fee."
https://www.healthcare.gov/fees/fee-for-not-being-covered/
The fee structure is different (just a missed deduction on the state taxes, not a separate monthly charge), but it still works.
You wouldn't just copy and paste "IRS" into the state law that a state might decide to create. You would use the state's taxing authority.
Yes, state sanctions don't generally sting as much.
But each state would have to independently decide, with its own constituents, if it could economically offer subsidized health care for all of its residents.
Many states already have some form of parallel subsidized/free health care system for certain segments of the population. Like their school teachers and their children as an example.
Anyway, hope that helps.
Massachusetts had Obamacare (RomneyCare) years before the federal law existed (it acted as a model for the federal plan).
And we (in Massachusetts) are still trying to figure out how to pay for it.
Massachusetts already had an incredibly low uninsured rate to begin with, which helped, but even then, the costs have been unsustainable. In each of the last three governor's races, the major issue on both candidate's platforms were their respective promises to find a way to pay for it all.
Most recently, MA elected Charlie Baker, a former health insurance executive who has promised to find a way to make the program sustainable.
There are a lot of details, though, that make this complicated and not necessarily viable for all states (MA is both relatively wealthy, has relatively wealthy neighboring states, and has a somewhat unusual healthcare market).
No, because the Constitution mandates that states engage in a "race to the bottom." California could create their own healthcare program, but they couldn't preclude neighboring states from free-riding on their system by not having their own healthcare and enjoying lower taxes, and simply driving across the border when they needed care.
Finally, in Saenz, the Court breathed new life into the Citizenship Clause of the Fourteenth Amendment in finding that clause to be violated by a California law that set lower welfare benefits for newer residents than for long-term residents. The Court says the clause "does not allow for degrees of citizenship based on length of residence."
(http://law2.umkc.edu/faculty/projects/ftrials/conlaw/newresi...)
Does this strike people as a long-term sustainable model?
Smaller states may have not big enough to have a healthy market.
Assuming that it requires residency, that requires that the sick person quit their job, find a place in the new state to live and work for say a year or two while staying alive with a dire sickness. It's not just a bus ticket that you need to relocate, there are many more significant costs associated with a move.
And even in that case, unless the state is already overcrowded, this is essentially a way to grow the state's residency and thus it's tax base.
First off, keep in mind the following:
1. Populous states like California pay far more in Federal Taxes than they get in return in return. [1]
2. California must have a supermajority in the legislature to approve taxes. [2]
So it's a complex issue, but simply put, there's not a lot of wiggle room for California to add billions of dollars of health subsidies to it's state budget.
Medicaid is basically one big government subsidy for the poor. When the Obamacare medicaid expansion goes away, millions will fall out of health insurance instantly. [3]
As for the managed plans, subsidies were used to make the plans more affordable to the taxpayers which made it easier for people to afford coverage. [4]
It's possible that some things may stay in tact like the pre-existing condition clause, but unfortunately the health insurance companies won't be able to cover everyone without the individual mandate. [5] Also, before the pre-existing clause, health care companies were rejecting people for health insurance with pre-existing conditions. [6]
The options besides subsidies for California are:
1. Government mandate of costs at doctors offices and hospitals, which may become illegal if the US Congress votes against it.
2. Government mandates on the behavior of insurance companies. This might drive many insurance companies out of California.
Neither appear to be a viable option.
1: https://goo.gl/paMrzG 2: https://en.wikipedia.org/wiki/California_Proposition_13_(197... 3: https://www.healthinsurance.org/california-medicaid/ 4: https://goo.gl/JVkaN0 5: https://goo.gl/STciup 6: https://goo.gl/Uoljhx
That said, the Democrats have full supermajorities now.
Quote:
"In addition to decreasing property taxes and changing the role of the state, the initiative also contained language requiring a two-thirds (2/3) majority in both legislative houses for future increases of any state tax rates or amounts of revenue collected, including income tax rates and sales tax rates."
* Preserve some form of protection for people with pre-existing conditions (this covers the "save my life" part)
* Lower costs of health insurance for both individuals and the public (perhaps dramatically)
* Actually address the underlying healthcare issues directly, i.e. implement policies that will reduce the cost of healthcare itself, not just the cost of insurance
In particular, the risk of losing some important things (like coverage of preexisting conditions) seems extraordinarily low.
Likewise, the ACA repeal efforts are disingenuously framed as "enhancing access to insurance".
If insurance companies have to take all comers, that makes the system easy to game: don't get insurance until you're sick, and then jump onto the system. This would essentially destroy insurance markets.
What's the obvious solution? Mandate everyone sign up for insurance, at risk of facing penalty fees. Then you're always paying into the insurance industry, and insurance companies can survive and provide value to the healthy and the sick.
But this is tough: not everyone can afford health insurance. So, you provide subsidies to those who can't.
So, if you start from the 2008 status quo and want to add protections for pre-existing conditions, that game plan is pretty much set in stone. But the issue is that that essentially is the ACA. There are other aspects, but that's the core mechanic.
It's pretty much impossible to build a system from 2008 to cover pre-existing conditions without re-implementing the ACA. You can play with how high fees should be and how high subsidies should be, but that's pretty much it. And most of the Republican "alternatives" (insofar as they exist at all) work by putting a ton of loopholes in the pre-existing conditions protections, a strategy widely regarded as revolting and that only works because people are being bamboozled about what protections they would actually receive.
For example, one of my good friends is a lawyer with a very simple single-member law practice. He has no employees and is self-employed.
As I understand it, BY LAW, he cannot apply for coverage or subsidies for himself or his family (wife and single child) and the only way they can provide for their health care is to purchase it via the New York exchange.
Every year, their chosen coverage provider has closed up shop to be replaced by a new provider with worse insurance terms involving premium increases and higher deductibles.
The plan they had before ACA (essentially catastrophic coverage) was deemed illegal by NY state and is no longer offered as it didn't meet the guidelines for suitable coverage for a family.
SO...by his words:
"I had a hospitalization plan I liked that was $175/month. Covered only catastrophic shit. I loved that since I do a lot to be healthy and no deductible. ACA banned that. First ACA plan was 300 a month or so - w 2500 deductible. Then that company went out of business. New company HealthConnect - price 350 a month - but 6500 deductible for bronze plan. They went bankrupt. Now i have CareConnect - 450 a month - 10,000 deductible $80 co-pay"
So, if your good coverage went from $175/month to $450/month and covered less and less with each passing year and you had no choice to go elsewhere because as a "business owner" you were deemed ineligible for any subsidies or other assistance from the government that was pushing these changes down your throat, you'd probably think it was a shitty deal.
The part that people don't seem to get is that these deductibles are HUGE for the kinds of people that ACA is supposed to help.
If you're paying $450/month and don't even get a single dollar of benefit until your family needs more than $10K of healthcare, would you feel like the government made your situation better or worse?
The reasoning is that, if you allow bare bone plans, then someone could offer plans that let you pay a nominal fee but cover nothing. That, of course, is pretty much nixing the mandate, and you run into the same issues with pre-existing condition protections destroying the insurance market.
Neither of us really know enough about your attorney friend's exact situation to know what went on, but that $450/month plan certainly covers a lot more than the $175/month one. Before, he was essentially self-insuring for the less costly situations, and now that insurance is required to be externalized.
Not perfect, and I'd like if Republicans came up with a solution to ease your friend's situation. But if it comes to a tradeoff between people dying and an attorney being forced to purchase a more comprehensive health insurance plan, it's really not a hard decision.
Big Fortune 500 companies that used to offer 'PPO' plans (i.e. you paid your rate and then had $10-$20 copays) now only offer catastrophic plans.
So we are paying the same (and higher) for the plans as we used to, but now we don't actually get anything for them until we reach the deductible, which is higher and higher every year.
I pay the same as a few years ago every month, but get absolutely nothing until I hit $2K or so.
Regulatory capture and conflict of interest made it impossible for government (itself the largest payer for healthcare) to find ways to drive down costs. All the incentives are lined up to deliver worse or less care for more money. That's a recipe for disaster.
I know people who are literally alive today because of the ACA. Do their lives have no value?
What I'm arguing is that the ACA, as written, has established a non-sustainable model for healthcare in this country. It's done so at a huge risk to future populations and seems to try and legislate an outcome instead of working with stakeholders to solve the ACTUAL problem: rampantly rising costs for healthcare.
HOW do you explain the crazy high costs for care in this country relative to almost every single industrialized neighbor? What are the factors for that high cost? Overconsumption? Regulatory capture? Lifestyle factors? Perverse incentives? Administrative overhead? PROFIT?
We've done very very little with the ACA to tackle these problems head on because every problem seems to be owned by an interest group that is incentivized to keep that problem alive.
That's the point I'm trying to make here.
Going back to 2008 would make things worse, not better. And sure, improve the ACA, but build on it or in parallel to it, don't tear it down and cost lives in the process.
What did happen was that a whole lot of people suddenly became the beneficiaries of a brand new government welfare program that wasn't paid for in any way by cost savings anywhere. I've got CBO studies to back that up.
Yes, we raised taxes on some rich people. Big deal. A pittance on what the spending required.
What we DID do was shift a whole lot of insurance costs onto people who were already paying a bunch: the middle-class.
If you want to know who really carries the weight of the ACA, look no further than a family of 4 with two incomes making about $125K between them. They saw their premiums rise, their deductibles grow, and their choices shrink.
There were winners: primarily, under or unemployed adults and those with pre-existing conditions that couldn't get coverage anywhere. Single mothers in some cases who couldn't otherwise get coverage under Medicare.
Everyone else who already had coverage they were paying for got screwed.
I helped get him elected. I wanted reform. I wanted better outcomes. I wanted people to participate.
Consider me disillusioned.
You're not the guy actually footing the majority of the bill, so it doesn't really matter as much to you, right?
BUT, if you own a small tire shop and some guy just tripled your healthcare costs, well....he might have a different opinion.
> if you own a small tire shop and some guy just tripled your healthcare costs, well....he might have a different opinion.
I have a few friends and family who can get insurance due to ACA, so no, I wouldn't. I don't fall in that group (thankfully), but I'm more than happy to pay the costs so they can not go bankrupt or have to play the emergency room shuffle.
Hell, we'll all be there someday. It's the unicorn individual who is never sick throughout their life until they simply drop dead.
The main political/democratic value codified into the law is that no one should have to go bankrupt from treatment costs. That means outlawing those practices, which meant a lot of plans no longer qualified. That was the moral argument part that Republicans generally disagreed with. We're all paying a little more so that a family we don't know doesn't go bankrupt from a family member getting cancer. (And we're all also paying a little less due to other parts of the ACA.)
There's a moral question at the heart of this, the answer to which defines the solution space: do we, as a society, think it is important that all sick people receive care? If yes, there are a bunch of potential solutions, but they all involve healthy people subsidizing care for sick people. If no, there are, of course, a lot more options.
The thing that frustrates me about the current Republican approach is that they seem to want to answer "yes" to this question, while telling voters they will not have to subsidize care for the sick in any way.
Depending on your point of view, either the best feature, or the biggest failure, of the ACA was that it made this subsidy for the sick visible to anybody buying their own insurance, rather than hiding it behind taxes or complicated dynamics between governments, insurers, employers, and hospitals.
A little more succinctly: either we decide to let emergency rooms turn sick people away, or somebody will be paying for their care. There's no magical solution.
The way to make care available is to drive down costs. We haven't done a single thing with the ACA to improve the affordability of care, we've just made the un-affordability a problem borne by the people who were already doing a good job of taking care of themselves. That's not a scalable solution.
The ACA got us a lot of short-term benefit for a small group of people but set in motion a chain of events that will only drive UP costs while driving affordability down.
And I'd like to argue that until we do something to improve the market dynamics of healthcare we are very likely to see this sort of thing continue to get worse until it's so unsustainable that it's like trying to legislate away the force of gravity.
One thing I'd like to see in any future version of ACA reform is RIGOROUS price transparency by healthcare providers. It should be absolutely illegal for any healthcare provider to conceal, obfuscate, or otherwise obstruct the price discovery mechanism of the market.
Even if you argue that consumers aren't the best people to decide what services are necessary or needed, they can rely on the advice of trusted advisors and popular understanding to shop for healthcare at providers known for offering good value.
SO MUCH of health care isn't of the "emergent" kind but the kind that is for chronic issues that are the result of unhealthy living or plain bad genetic luck. We need to redouble our efforts to drive those costs of care down and start paying for results and not treatment. Paying for treatment encourages overconsumption. Paying for outcomes encourages optimizing for cures.
I will tell you that I've seen scant evidence that it's working.
A wishlist of initiatives isn't a plan for action that drives down costs. Allowing Medicare to NEGOTIATE prices for drugs is a plan to drive down costs.
The insurance companies wanted to GROW the per-capita spend on healthcare. That benefited them. It's really really unclear if it benefited the public right now.
Forcing people into a market they don't want to be in isn't reform. The way to solve this problem is to make being a part of the market ATTRACTIVE.
IMHO we really missed an opportunity to affect behaviors. For one thing, Romneycare incentivized people to skip insurance until they needed it. That was a recipe for adverse selection.
The way to help this is to provide incentives for people to get in WAY EARLY and pay for their OWN care long before they may need it while also providing a measurable benefit to those who get in early right away.
People are capable of responding to incentives and I'm convinced that there exists a Nash equilibrium in healthcare that helps everybody win.
Remember, the same people who gave you "the Internet is not a truck" are the same people you're expecting to solve healthcare affordability. Think about that.
A provision of the ACA sets a minimum medical loss ratio for us. In simpler terms: it puts a legal cap on our profit margin, by requiring a minimum percentage of the money we take in to be spent on benefits to our members (such as paying their claims).
That is almost certainly going to get repealed.
If your incentive is to maximize the absolute amount of actual profit you earn and the ONLY way you can do that is to push more money towards healthcare providers, then what do you think will actually occur?
Because once you have achieved that spend level on provider care, you're in the clear. The ONLY way for you to increase profit is to ensure that more procedures happen.
We profit when people are healthy.
In a perfect world, you'd keep 100% of the premiums and never pay a cent to a healthcare provider because everyone is healthy, right?
In a terrible world, every single one of your insured has a chronic, long-term expensive to treat condition that requires you to pay tons of money to providers.
In the first/perfect case, premiums are zero, right? In the second/terrible/worst case, you're not making zero money because your (collected premiums - minimum payout) > 0.
See where I'm going with this? In a world with healthy people, there is little need for health insurance and spending trends towards zero. There isn't a need for an insurer. Your company can only exist in a world with sick people.
Quality of care is a good direction but doesn't go far enough. We need to get real price transparency into the market so people understand what it costs to treat lung cancer and what the probabilities are that they'll actually get better.
Do you think the average person on the street really knows what it costs to undergo a round of chemotherapy? Does the EXACT SAME procedure performed in different hospitals across town cost the same? These are important questions and there doesn't seem to be any political will to actually answer them.
And my suspicion for this state of affairs is that the interests of the players in this game is for nobody to really know what things cost because if they did the game would change.
And we can't have that, now, can we.
Note that this doesn't mean the same procedure costs the same at every provider, though; Medicare rates include a geographic adjustment, among quite a few other factors, but it does mean you can work it all out for yourself.
I'd encourage you to read pages 23-28 of the following paper from the Mercatus Center. You'll find that prices for Medicare reimbursement are set by a committee largely stacked by the AMA, a de-facto lobbying group for doctors. They aren't likely to support any schema that cuts reimbursement rates for their members.
https://www.mercatus.org/system/files/Feldman-Medicare-Role-...
I agree with everything else you said though. Costs are too high and are a major reason this is so hard to solve and price transparency is a big part of the problem. A related (because it distorts the market in a similar way) problem is that most people don't see the true cost of their insurance, because they get it as a benefit from their employer. I would be highly in favor of any credible attempts to fix these issues. But that's not what I've been hearing from the party that's about to be completely in power.
Democrats don't just come out and admit that they want a wealth redistribution program that they can use to show voters how compassionate they are with other people's money.
They're politicians. They just aren't honest and voters aren't perceptive or concerned enough to call them on it.
I want a wealth distribution program that means that thanks to a genetic condition I had no role in acquiring (if you're "doing a good job taking care of yourself" and never get cancer or some other nasty expensive disease, why don't you count your fucking blessings that you're healthy instead of bitching about having to subsidize others) means that I don't get a death sentence if I ever am sick enough to lose my job for long enough to lose coverage and get fucked over in the future on preexisting condition exclusions. Or fucked over due to lifetime benefit caps.
And I want one that protects other people in similar situations too.
So maybe not everyone's motivations are as cynical as you make them out to be.
I was pretty sure it was going to make things more expensive for me, and I don't think it was sold any differently than that. I was not in favor of it, largely because I didn't think it would survive politically long enough for me to switch from the "loses" to the "benefits" category. We're sort of seeing that now, except that I'm actually sort of optimistic that its 6-year (or so) survival has enshrined it or something like it.
I believe a repeal-without-replace plan will be completely disastrous for the incoming government and that whatever government is next will have popular support to backtrack, and that a repeal-and-replace plan will end up settling on something very similar, maybe even with some free-market-based improvements!
Edit: It looks like you need to be enrolled in a plan to be eligible for a HSA
These are the situations the ACA is trying to avoid and it was clear from the beginning that these types of plans (a nominal fee for virtually no care) would not be allowed.
Even if plans like this were allowed, we'd be in a situation where the healthy essential chose the equivalent of no insurance for the smallest amount possible. That's nearly the same as not having insurance at all.
But that's not the case, because that $175/month insurance didn't meet current standards of "good." While the ACA made it happen a lot faster for health insurance, this is kind of like me bitching about how high my car payments are because they keep adding on stupid useless things like bumpers, seatbelts, airbags and antilock brakes and I don't need ANY of those because "I don't get into accidents and if I do I have enough savings to cover it."
As for the question of him not being able to get subsidies for himself as a matter of law, I'm 99% positive that the way you become ineligible for subsidies is by making too much money to qualify. It has nothing to do with owning your own business, and if he's telling you it does then he's blowing smoke up somewhere.
As for the amount you're paying before you get benefits, yeah, there are plans in there like that, and they tend to be cheaper. You might almost consider them catastrophic care plans, except they cost more than $175/month and cover things beyond hospitalization. They're the ones with "20% coinsurance after deductible" for regular doctor's office visits, while what you're probably looking for are the ones with a "$40/75 copay" for primary care/specialist visits. That coinsurance/copay bit is one of the things insurance companies can still do to game the system.
The thing that those plans all have in common though is a maximum out of pocket number. That means if your friend the lawyer has a heart attack, is hospitalized, needs a couple of stents put in immediately or god forbid a bypass and doesn't have the time to shop around for other hospitals that might be cheaper, he's not going to be leaving the hospital with $250,000+ in medical bills that he's personally responsible for. Sure, $10-15k is a lot of money to take on as unexpected debt, but for an awful lot of people that's not bankruptcy money it's "payment plans for a few years that are going to kind of suck" money.
https://nystateofhealth.ny.gov/
Let's start with how much money you need to make to see your subsidies completely extinguished: $50,000. That's the limit no matter if you live in Buffalo or Westchester.
Let's then get into the regulations associated with ownership of a company. Did you know that as the owner of a company no matter the size or organization, you're NOT considered an employee of your own company? Nor is your wife?
From the NY state website:
"Under 29 CFR 2510.3-3, an employee would not include a sole proprietor or the sole proprietor's spouse. The definition for Common Law employee can be found here.
The structure of the business does not matter. For example, the business could be a corporation, LLC or d/b/a.
Employees (1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and (2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership.
Specifically, 29 CFR 2510.3�3 states the following: (c) Employees. For purposes of this section: (1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse, and (2) A partner in a partnership and his or her spouse shall not be deemed to be employees with respect to the partnership."
So it does matter that the self-employed seem to get screwed a bit harder than the popular opinion acknowledges.
So, tell me again, which part of shifting costs from people who didn't go to law school and dropped out to work at McDonalds to those who finished school and did sounds like a fair deal to you?
Does shifting costs to those more conscientious sound like a great plan for national unity? How do you feel when your co-workers play hookey, sleep in, and write bad code? Do you think those folks deserve the same promotion opportunities you do? Do you think that any society that punishes achievers is one that is set up for success?
Let's discuss facts and not opinions. Show me the costs for insurance and where the subsidies end and tell me if you think it sounds like a good deal to you in a county where the property taxes for a small condo run about $25K per year.
Great, so he's making more than $50k/year, I'd hope that to be the case if he was able to make it through college and get a J.D.
> [ownership of a company & employee status]
I'm not disputing that, though I suppose if he really wanted to he could form a C Corporation and give or sell a small percentage of the shares to someone else to make it possible for him to become an employee. He's an attorney, he'd have a far better idea of the legal issues surrounding that kind of thing than I would. It seems logical to me (though possibly not in NY law) that if by law he's not an employee that it then follows that he is also not an employer since there are no employees.
I don't see how any of the above is actually relevant. All it really means to me is that he'd be purchasing coverage in the "Individuals & Families" portion of the exchange. I've never lived in NY, but in my experience with the Illinois/Federal exchange I don't think I've never been asked whether I was an employer, only whether I was an employee of a company that provided health insurance (or was required to provide health insurance by virtue of being >50 people).
And quite frankly if he's paying more than twice my annual mortgage amount just in property taxes, my sympathy over his premium increasing from $175 to $450 is very limited.
Admittedly, I'd be perfectly happy to see a return to Kennedy-era tax rates for incomes over $4 million/year and I'd be ecstatic to have those rates apply to me (because it'd mean I was making at least that much in annual income, but my needs and wants are simple and easily met with less than $100,000/month of income), so maybe I'm not the kind of person likely to be incredibly sympathetic here.
Look, it all looks great but when you REALLY DIG down into the rules, what you see is a recipe for disaster. The plans in NY that had to shut down were staffed by a roster of amateurs because the laws SPECIFICALLY EXCLUDED people who had worked in the healthcare insurance industry from splitting off and starting their own companies.
They quite literally expected a bunch of community activists to run an insurance company and it failed MISERABLY.
Facts are sometimes inconvenient things.
Exchange-created co-ops bit the dust elsewhere as well. In Illinois it was Land of Lincoln Health, which was closed by the state because it was going to be unable to make a required payment into the program designed to help keep the newly-created companies stable. I believe whatever remains of LLH may actually still be suing the Federal government, because part of what drove them under was not getting ~$70m that they should have received through those same cost-sharing systems. (caveat: Not an insurance industry person and I didn't watch it that closely). Still, I'm sure that there were a lot of amateurs who got involved. I'm also sure there were a lot of professionals and investors who got involved and in many cases lost money because even minor fixes became impossible after the law was passed. NOTHING that was going to make the ACA's implementation better was going to make it through Congress, particularly the Senate.
The problem is that when you dig down into the rules you may find a recipe for disaster, but you also found the only way it could possibly work. There are minor nuances, but when you really dig down you find that the "liberal dream of Obamacare" is really "Romneycare" is really at its core a design created by the Heritage Foundation[1]. That's not to say that it's great or terrible or doomed because it was championed by Democrats or doomed because it was written by Republicans, it's just the only viable structure that doesn't have single-payer as its core. If the Republicans in Congress actually do come up with a replacement it's going to look almost identical to the ACA except for cosmetic differences and name changes, and if Democrats stick with "You broke it, YOU fix it" then it'll also never pass and we'll be right back where we were in 2008.
[1] http://americablog.com/2013/10/original-1989-document-herita... And a countervailing argument that "[The ACA is from the Heritage Foundation is bunk]" http://www.forbes.com/sites/johngoodman/2016/02/15/where-did...
Here is a nice summary: http://www.newsmax.com/Newsfront/wsj-nyc-insurance-market/20...
There is no way he had any kind of health plan for $175/month, not in New York pre-ACA.
Yes this is what both sides of the aisles won't admit. You can't have 20% of the people use 80% of the services and make things fair without forcing the users to eat the costs.
Same things with:
1. The US (like most Western countries) has a huge post WWII baby boom now approaching old age. The younger generations will have to pay for this.
2. The US refuses to allow chronically sick and dying patients to let death takes it course, managed only with pain killers. Instead, vast amounts of money (some say 80% - there's that number again) are spent on the last year of a person's life carrying out procedures that only prolong a few more painful months, with no chance for recovery.
The costs could be reduced by taking away some of the huge profits of the medical and pharmaceutical industries. But in the end, there will need to be societal changes.
Then they're not insurance companies any more.
The top two Democratic presidential contenders as well as many of the Democrats in Congress campaigned on specific reforms to healthcare. The thing is, Democrats and Republicans have nearly diametrixally opposed goals in reform.
The positive PR of... 20 million people losing health insurance?
Before ACA, as a full-time worker at decent companies I paid maybe $50 a month for my insurance, my employer picked up the rest. When I went to the doctor, filled a prescription, or anything else routine, it was $10-$20 max. In the one year where I had a lot of care (broken wrist), I think I paid my out-of-pocket max of about $750 and that was it.
After ACA:
Catastrophic plan at pretty much every company I work for now (same for many of my friends in non government jobs). Minimum deductible of $1500-$2000 as a single guy. Probably 5x that for someone with a child and wife. When I go to the doctor, I pay for everything out of pocket at full price: $300 for a prescription (in the US they push up the drug prices to astronomical levels - we cannot buy from foreign sources), $200 for a simple doctor's visit. I have never hit my deductible which would then pay 80% of my costs.
Oh and I can't actually just go and get things like a hearing test or sleep study - I first need a referral from my primary physician at $200 / visit. In exchange, I get to put $100 away each month tax-free into a 'FSA' account. It is mostly use-it-or-lost-it by the end of the year, and will go back to my employer (i.e. a perk for them, not for me). At the end of this year, it basically turned into a $200 gift from me to my employer.
Edit: sometimes it's a good idea to call ahead and ask for "uninsured quote", you would be surprised your $200/visit physician might only charge $50 to someone without insurance.
Hospital billing is also pretty awful. I've seen them place every possible reimbursable item on every bill, full well knowing that some insurance companies would cover some items and others different things. This resulted in inflated bills that were never paid in full regardless of a person's insurance coverage.
Many hospitals will negotiate with the uninsured but it's rare for them to make this easy to do.
This article is pretty weak, but the best I could find on this relatively arcane subject:
http://truecostofhealthcare.net/hospitalization/
Most hospitals can't even quote you a price. We were researching a procedure our insurance doesn't cover. One non hospital place quoted $750 cash price within 20 minutes on the phone. We called a nearby hospital and after over 10 hours on the phone spread over a week, and claiming that we don't have insurance (because their policy is you MUST use insurance even if they don't cover it), they quoted us $350 cash price.
We chose the hospital, and when we got there they said that price didn't actually include everything. WTF? It's a frigging mess.
I am a software developer, I worked for a mid-sized community hospital. "It's a frigging mess" is a reasonable summary and also heart-breakingly accurate.
This is one area in which the ACA is making progress: providing an incentive to the hospital to know what a particular procedure actually costs. Your example, while disappointing and frustrating, was extremely rare in the 90's. High deductible insurance has given every customer a reason to shop for the hospital with the most reasonable rates. I can't say if that incentive is strong enough, but I believe it is progress.
The real nadir for coverage was in the end of the Bush years: I worked at Home Depot as a developer. That means that the plan covers a lot of badly paid people, and a lot of old people. I was paying hundreds a month, my doctor visits were $75, 20% coinsurance in hospital visits up to 10K, and a maximum lifetime benefit of 1 million: So if something really bad happened, like a stroke, they'd stop covering before it was all said and done!
Since, my payments kept going up at similar rates, but at least things like maximum lifetime coverage has gone away.
The one and only time things have dropped in price was last year, now that I work at a place where the average employee's age is 26. The company still pays $1600/mo for their side of the coverage, but since it's mostly developers, they can afford it. No company in their right mind will pay that when the employees are making $15/hr
Healthcare has been less and less affordable since the Clinton years, it's just that it started very affordable. the ACA didn't make things noticeably different for the good plans overall: It's all still very expensive, and picking an employer that either has a young, healthy workforce, or has so much money they can pay for expensive plans, is the big difference between having good health coverage or not.
So I guess that what I am trying to say is that if you had the insurance you claim to have had in the bush years, you were incredibly fortunate, and your situation was not common.
I had childhood cancer and at the time it'd have costs millions without insurance.
While the healthcare market is hopeless opaque and corrupt and no doubt that does drive costs somewhat (or a lot), and probably there are things to do about it, but I think fundamentally the success of complex and expensive treatments is also driving costs - things that you'd have gotten painkillers and left to die even in '50s and '60s now can be cured/improved/fixed, it's just ridiculously expensive compared to popping some pills and expiring. Or look at prosthetics. There was a time you might have made do with crutches or a peg leg and now there are specially designed, fitted, and crafted prosthetics for various activities... that don't come cheap. Not to mention improvements to the standard of care or the sheer man-power requirements of health-care. A normal doctor's visit requires interaction with 3+ employees, across ~45 minutes, all of whom are presumably being payed more than $10 an hour, and possibly a lot more. It may actually be reasonable that budgeting $5k/person/year for healthcare is sane in terms of both risk and what you get, but just far more than people are used to thinking about or seems intuitively reasonable.
This is the entire theoretical reason for insurance: to spread costs out across a large group, so that by having everyone pay a little nobody has to pay a lot.
It's also why the logic of modern healthcare makes single-payer systems the ones that work the best; they spread the costs across the widest possible "risk pool." And why the ACA had to include a (deeply unpopular) mandate that everybody buy some form of health insurance -- as long as your system is based on private insurance, such a mandate is the only way to get the young and healthy into that pool.
> It may actually be reasonable that budgeting $5k/person/year for healthcare is sane in terms of both risk and what you get, but just far more than people are used to thinking about or seems intuitively reasonable.
Remember that most Americans' income has been stagnant in real terms for nearly 40 years now, while health care costs have done nothing but increase and seem set to keep on doing so. So, barring some major change in how the economy works, whatever figure you set for "a reasonable amount to save for health care" is only going to seem less and less reasonable as it grows to consume a greater and greater share of those stagnant incomes.
In other words, if peoples' wages increased by $5K a year at the same time as they were expected to bear $5K a year of health care costs, it'd feel a lot less painful than just expecting them to pull that $5K out of the couch cushions.
The reason they are becoming popular is that they are intended to incentivize the consumer to pick and choose their providers since they have to bear the brunt of the initial cost. (And cheaper for employers to fund over non high deductible plans).
I recommend reading up on the history here: https://en.wikipedia.org/wiki/Health_savings_account
For profit corporations will always find a way to game the system? Just like the whackamole with tax cheats?
That trying to regulate a broken marketplace doesn't work very well?
Perverse incentives lead to perverse behavior?
I, for one, am very much looking forward to purchasing insurance from the best provider in any of the 50 states, not just the few available to me in CA.
When this was done with credit card companies, they all moved to the state with the least regulation and started instituting consumer-hostile stuff like mandatory arbitration.
I'd really rather not have this happen with my health insurance.
The reason premiums are high is that costs are high, and our population is obese, disease prone and litigious.
If we want to contain costs we have some options:
1) Public option/Medicare for all could save us 10-20% in parasitical insurance company costs/administrative overhead.
2) We find solutions for obesity. Obesity is the #1 driver of increased health costs in America.
3) We stop holding doctors/pharma financially responsible for bad outcomes outside of their control through the legal system.
Part of the initial law were "high risk corridors" to limit the losses for insurers that initially mispriced their ACA plans. The insurance companies had to make a ton of assumptions about the age, health, and wealth of the populations who would sign up for their plans. To make sure they didn't accidentally bankrupt themselves, the law provided funds to limit their losses for the first three years of the exchanges (2014-2016). In the first year, they had a shortfall as the population was older and sicker than expected, so CMS was going to cover the $2.5 billion gap but congress refused to let them pay these user fees.
The GOP knew that the premium changes would come during the election season, so they denied funding for the high risk corridors last year. To give themselves room against mispricing, the insurance companies predictably raised premiums beyond where they would otherwise have been. Other insurance companies decided they didn't want the risk, so they pulled out of the marketplaces.
The election season was rife with announcements about "20% premium increases" and "xx Insurance company exits the exchange market". Millions of people get to pay more for health insurance but at least their guy won the race.
Aragorn: Ride out with me. Ride out and meet them.
Theoden: For death and glory.
Aragorn: For Rohan. For your people.
Theoden: The Horn of Helm Hammerhand will sound in the deep, one last time!
Somebody is gouging us, but we will never know who, and everybody can point to somebody else, or to "society," but we just don't know.
Chances are, everybody who can make money while covering their tracks through a web of business entities, is gouging us.
One potential advantage of the government owning the whole system, is that it would facilitate figuring out what the costs actually are. This may be why other civilized countries pay half what we pay. It's a saying in business, that you can't manage what you can't measure.
Anyone who followed this Act knew what power this bill would give to insurance companies. We just hoped they woudn't abuse the gift.
They abused it, and blamed the Act, and their customers.
(Obama wanted private/public health care system. The Rebublicans, and their boys(the Insurance Lobbiests) did everything to scare, block maybe a bill that would have brought in competition, and provided sensible health care to all. I remember it because it has been my pet peeve for years. I followed that fight since Hillary was fighting for Heath care. I remember looking at Ronmey's state's Heath plan, and thinking the premiums are too high? Way too high. "It looks like the Insurance companies are in direct communication?" I told my uninsured girlfriend 8 years ago. But--in--no--way would we get anything if Obama didn't cave into Rebublican strong arming.
Between April 1, 2009, and today 8/16/2016, Aetna's share price has increased 525%. (Probally due to the free money corporations/funds have to invest, but come on?)
And medical coding to figure out what you're paying for and what a normal price should be is ridiculously hard to understand. Some of this is going to be their response to a litigious society, but you can't use that excuse for all of it.
Also, if someone doesn't have insurance, the fact that the hospital puts you on the hook for the full bill is ridiculous. Insurance isn't paying 100%, they are discounted crazy amounts, even only paying 20% in some cases. But you don't get this discount from the hospital. If you show up without insurance, you will be charged the full amount, less what you can negotiate on the spot. And most people don't know they can even try to negotiate it.
I agree that the insurance companies are a huge problem, but I don't think the hospitals and doctors' offices themselves should be absolved from their share of the blame.
And what happens with the majority of people who don't have insurance, they don't pay it. So the costs get eaten by the hospital and eventually by everyone else that can pay.
In that respect, we have socialized healthcare already. It's just a horrible implementation.
Exactly so. They don't pay it because they can't. And they're ruined. Even people who have insurance -- good insurance -- can be ruined. This system is the ultimate form of price discrimination, perfectly tuned to extract the optimal amount of money from the consumer who has literally no pricing information, and maximize the profits of the business. When insurance companies pay out, it's referred to as "loss".
Markets and the profit motive may be "efficient", but they're not optimizing for health outcomes, and certainly not optimizing for morality. Insurance companies ultimately cannot be part of the equation.
In advanced Western countries, you see many different configurations for functioning health care systems. Some do insurance based models, others do single payer, others are hybrids. The issue is not about choosing which configuration of system, it is about rooting out the disgusting level of corruption that exists currently in the system.
The ACA did nothing to tackle this underlying issue.
"let insurance companies shop for the best state"
Meaning, when customers have the ability to buy across state lines, the true competition becomes not consumers shopping for insurance, but STATES competing for health insurance COMPANIES to set up shop in their state- offering whatever it takes-- handing over amazing liability protections, tax giveaways, dropping regulatory standards-- all to get them to create jobs in the state.
The result is that (A) one or two financially strapped state governments give the industry whatever they ask for, promising them minimum regulation/oversight and low/no taxes, then (B) the entire industry moves there, where they further consolodate power. (C) companies regulated in other states (with safer products and actual responsibility to their customers) can't compete fairly, so they either move to that state or go out of business, resulting in (D) fewer choices for customers, poor quality products, higher prices, and more abuse and negligence from the companies.
I've heard this expressed as a "race to the bottom", which I always thought was a really confusing way to say it without context.
What makes me think this is going to happen? Watch the Secret History of the Credit Card documentary on Frontline about how this exact same thing happened in that industry.
http://www.pbs.org/wgbh/pages/frontline/shows/credit/
The CC industry "state-shopped" to find a state (South Dakota I think it was) that would let them get away with just about anything. At that point, every major player moved there, and suddenly credit cards became super abusive to customers and there was no recourse (until very recently with the consumer financial protection bureau...)
The UK is doing OK with the NHS at half the US cost as a fraction of GDP. Singapore is doing at least as good at about a quarter of the costs.
American combines the worst of government and private healthcare. The UK does a decent job with government healthcare. And Singapore combines the best of government and private healthcare.
http://econlog.econlib.org/archives/2008/01/singapores_heal....
There's a lot of material out there about the likely effects of selling across state lines. To the point it is not even actually seen as a viable option, it's more something that Republicans say because it sounds reasonable at first. But it's not workable.
You say: "It's a race to the bottom in terms of regulation"
Consider your assumption that regulation is good. In point of fact pernicious and arbitrary regulation within states brought us as a nation to this desperate situation.
You say: "To the point it is not even actually seen as a viable option"
Check your prejudice at the door and look at reality. You may need to understand markets and human nature more clearly. You may "see" and understand other, better options.
AND, until we hit our $5K premium, it doesn't really pay anything. So we've got to pay $27K to get a real benefit. And it's not like we're young and healthy (nearly 50). Feels like we're getting shafted.
There are substantial challenges. One is that insurance companies don't actually provide care, of course. Any company wishing to do business with people in a particular state would have to actually obtain a network in that state -- partner with an existing network, or negotiate deals and sign contracts with hospitals, urgent care centers, pharmacies, labs, and doctors. They'd presumably have to be licensed to do business in that state, and adhere to that state's own regulations and requirements for doing so. (Because the US is a federal system, the federal government itself is unlikely to be able to strip away all of each state's specific laws and regulations.) This process would have to be repeated for every state in which they plan to do business. Insurance companies would probably set up state-specific legal entities or subsidiaries to provide financial and legal compartmentalization. So selling insurance "across state lines", as a practical matter, may not differ much from the current system. State-specific legal work and shoe-leather network-building would still be required. There's nothing stopping a national company from setting up a state-specific entity and selling insurance this way right now.
Another issue is that if local regulations were somehow stripped, as some in congress wish, insurance companies, as profit-seeking entities, would all gravitate to the most favorable and least regulated business environment. After the Supreme Court ruling in Marquette v First of Omaha, credit card providers migrated to Delaware, South Dakota, or Arizona because those states have the weakest usury laws and allow them to charge rates of 29% or more to borrowers in any other state. A similarly deregulated and "efficient" market for health insurance would have all the companies set up entities in whichever state would allow them to offer plans that provide the least care reimbursement (known internally as "loss control") and charge the highest premium. This could lead to a situation where a few very large companies offer only high-deductible plans without guaranteed issue, excluding procedures that carry risk of being expensive or are politicized, with lifetime or annual caps, thin networks, and retroactive drops. Lip service would be paid in the form of seemingly cheap policies that actually provide little real coverage, but allow insurance companies and politicians to claim "all Americans now have access to affordable health insurance". As bad as the credit card system may be, lending is at least a business that can be conducted at a distance. Health care is the most local of concerns.
What's needed is not a guarantee of "access to efficient health insurance markets". What's needed is actual health care. In a moral society, everybody should have access to that actual care itself without risk of ruin. The US system forces people to make terrible decisions. People remainining in hated jobs, empowering employers and distorting the employer/employee market. Not taking medicine, or half-dosing, because, even with insurance, the costs are too high. Not visiting the doctor after an injured ankle because of fear of the costs, then suffering forever after due to a poorly healed fracture. Especially pernicious: seeing a doctor but not reporting problems because of fear they'd be labeled as pre-existing conditions for which future coverage would be denied. And employers themselves have higher costs because of the historical accident of employer-based insurance, reducing their competitiveness with foreign companies who have no such obligation.
It's a huge political problem, but this focus on insurance, and access to insurance, begs the question.
No. I don't buy auto insurance on that basis. It is required by my state in order for me to legally operate a motor vehicle. I buy what is "best" for me (and my family).
Only in our closed highly regulated environments that denigrate personal responsibility and individual liberty do we get this extraordinary markets dislocations that come with the bizarre healthcare system that we have today.
Your selection of the best auto insurance policy is qualitatively a different kind of choice. Many millions have no car or need of one. You could live without one. I mean that literally -- it will not end your life if you don't have a car. There are alternatives to owning one, even if one of those is moving somewhere where you don't need one. Likewise, you may never use your auto insurance, and auto insurance doesn't pay for maintenance. But everyone needs health care, including its "maintenance" form. There's nowhere to move that obviates the need for health care.
Insurance is not the right model.
It is being talked about but there is significant opposition from those that don't want to raises taxes to the level that would be required to finance such a proposal.
As an aside, I agree that Medicare expansion would have been a better policy. Good luck getting that through congress, though.
Because you do get fined for not buying health insurance.
We can argue the semantics of the word 'mandate' all day, but your analogy is upside down.
You are being fined for not paying mortgage interest. You are being fined for each kid you don't have. Buy your house and have your kids or you will continue paying more in taxes!
I don't mean this as a rhetorical question, so I apologize if it comes across as snide, but from the point of view of economics, what is the difference? I'm trying to understand why one kind of tax incentive is objectionable and not the other.
If I have $1000 in my pocket right now, I will still have $1000 in my pocket if I choose not to go after an incentive.
But if I have $1000 in my pocket right now, I will not have $1000 in my pocket even if I choose not to buy any health insurance.
In my eyes, being punished for peacefully doing absolutely nothing is as anti-American as it comes. That's another argument, but my point is that the analogy is off the mark.
Person B -- the renter -- will pay more income tax, because Person B does not get to deduct mortgage interest while Person A does.
In much the same way, if Person A carries insurance all year and Person B doesn't, Person B will pay more income tax.
So yes, you do get "fined" for not buying a house. We just spin it as "encouraging the dream of home ownership" instead of as a "fine", a "penalty", as "the government holding a gun to your head and forcing you to buy a house", etc.
How would a renter feel if their rent increased because their landlord was unable to take a mortgage deduction?
I countered that the home mortgage interest deduction doesn't apply to rental properties. Renters and homeowners are thus currently unequal from a tax standpoint, since renters effectively pay a higher tax rate than homeowners. Removing the deduction would thus not create a new inequality; it would remedy an existing one.
https://www.irs.gov/publications/p527/ch01.html
If I choose to live rent-free in my parents' basement, I will not get fined for doing so. I keep ALL of my cash. But I'll STILL get fined for having not buying myself insurance.
I'm not sure what logical fallacy you're throwing here, some form of "Denying the antecedent" or something along those lines, but it's not the same situation.
Why people insist the two cases are conceptually different (i.e., that one and only one of them is a "fine" for not doing the thing), I do not know.
There is a tax penalty for not having a home mortgage, so it's mandatory in exactly the same sense that health insurance under the ACA is.
You have to spend money on interest to have a portion of that reduced in taxes. It's not a penalty.
It's not a 'tax penalty'. You're keeping more of your money by not paying interest, and pay normal taxes on those. It's not a penalty.
That's really bizarre (although unfortunately, common) thinking.
There's an incentive for having a home mortgage under certain conditions only, and you do not owe anyone additional money if you have no outstanding mortgages on properties.
The same is not true for the ACA. You are fined for not owning something - e.g. if your net worth was $0, you could go into the negative for not having insurance.
If you don't own a mortgage, you cannot be fined into the negative.
There is no difference between a tax penalty and a tax incentive (more precisely, a tax incentive is exactly identical to a general tax cut plus a tax penalty for everyone who doesn't qualify for the incentive, and a tax penalty is equivalent to a general tax increase plus a tax incentive for everyone not subject to the penalty; so, except as concerns the general level of taxation, penalties are exactly the same as incentives.)
> If you don't own a mortgage, you cannot be fined into the negative
Since having a mortgage or not can make the difference between owing net income taxes or not, if you have $0 net worth before a particular year's taxes are considered, you absolutely can be "fined into the negative" for not paying interest on a mortgage (lenders, not borrowers, own mortgages.)
The healthcare mandate is a tax. What many people object to here is that most taxes tax an activity (making money, buying things, owning things, etc.), such that one does not HAVE to do any of those things, but if one CHOOSES to, they become subject to the tax. Here on the other-hand they are being TAXED for NOT doing something.
Using your analogy, the healthcare mandate is the same as taxing people for not owning a home.
Many doctors don't take Medicare. Over a situation where say there are 3 doctors for a specialty in a town... the two better ones do not take it, and the new less good one will take it. So if that flat answer is let everyone take medicare, I think there are some serious quality of care problems.
(I have no better solution though, every angle seems bad).
But continuing with your theoretical environment: no, they would consider adding new patients until they had a critical mass and then stop accepting new patients.
No we wouldn't, we'd be in a much better position and we'd be paying much less for healthcare. Medicare has far less overhead than private insurance and it'd be the logical move to establish a far more effective and cheaper system of socialized medicine.
Without a mandate for everyone to carry insurance, we have one industry footing the bill for what should really be paid by the government.
Instead, the indigent have insurance (in theory), and they can get healthcare other than at the emergency room, hopefully at lower cost.
The alternative is to end the mandate for hospitals to treat everyone.
> ... "if the bill remains what it is now, I will not be able to support a cloture motion before final passage." In other words, Lieberman will support a filibuster. "I can't see a way in which I could vote for cloture on any bill that contained a creation of a government-operated-run insurance company," Lieberman said.
[0] http://www.slate.com/articles/news_and_politics/prescription...
Prior to 1986, hospitals were not required to treat the uninsured, but most nonprofit hospitals did anyway.[1] For-profit hospitals tried to dump them on nonprofit and charity institutions. The 1986 law makes all hospitals that take any Federal funding treat uninsured people with emergency conditions.
[1] https://en.wikipedia.org/wiki/Emergency_Medical_Treatment_an...
Except that Medicare more like ACA with a public default option than true single payer.
If you're self employed and make over $50,000 a year no matter where in California you live, you'll have to pay full retail premium prices without any discount. My company as a whole makes over 50k a year, but less than 100k a year (still getting off the ground). Thus a monthly premium of $460 a month for a standard decent PPO plan puts a large burden on me. Additionally, if I don't get health coverage I'll have to pay a heavy tax penalty at the end of the year. Essentially as a bootstrapped small business owner, health insurance is a large burden of cost and I was forgotten in the Affordable Care Act. Instead my cost to purchase a plan skyrocketed as I subsidy other people's care. That is not fair, everybody is not paying their fair share. Middle class self employed are the one's who got hurt the most.
Finally go compare CoveredCA.com and then go use https://www.blueshieldca.com. CoveredCA literally is one of the worst designed and functioning apps I've ever seen. It constantly errors and doesn't keep state that I am logged in. The UI/UX is terrible. I'm guessing CoveredCA was outsourced to a non-technically competent contractor overseas. Compare that to BlueOfCalifornia which is a great site, beautifully designed, and functions as it should. This is why government can't have nice things.
[1] - https://news.ycombinator.com/item?id=13353755
Between my employer and myself, we pay $1806 a month for my family of 3. My employer has 3000 employees, so it isn't a weird situation with poor purchasing power.
Insurance is expensive.
That colonoscopy was $6000, btw. This, for preventative care that could save hundreds of thousands of dollars from colon cancer (and quite possibly my life) down the road. In a well designed system, price controls would put preventative care like colonoscopies below actual cost (and make the money up elsewhere), to save money at the macro level.
One of the reasons that the ACA is broken from a financial point of view is that the Democrats didn't want to simply raise general taxes and redistribute to fund the program. Instead they played all sorts of games with the 'individual mandate' to try to force participation without 'raising taxes'. But this is just a way for healthy individuals to avoid participating in the insurance pool -- which is a great way to destroy the actuarial basis of insurance.
It is entirely possible to be for nationalized health care and still think the ACA is structurally unsound and needs to be replaced.
And it's wrong to call this insurance. It's not insurance, it's a health care payment plan.
Before ACA I was paying 1/3 the price, and had 1/4 the deductible. These higher rates are basically a tax to subsidize others, which is fine in principle, I just don't like the idea that this is going largely to a massive for-profit private bureaucracy. My problem with ACA is the private insurance industry is shit, and ACA made the expansion of shit mandatory. It should have been single payer, destroy the perversion that is the private insurance industry who have lobbied for all the anti-competitive behaviors they engage in to ensure near monopoly status in the vast majority of counties in the country. But the political capital just wasn't there to see how treacherous the insurance industry has been.
I don't see how the next round of politicians actually fix this though. Preexisting conditions are made feasible by mandates, mandates are made feasible with subsidies, subsidies are made feasible by some people paying more under mandate. So you can't take away any single one of those without the whole system unraveling entirely. Even the insurance companies have said this. They just don't want to say it loud enough that the blowhard in chief gives them a tweetirade.
The US is the only modern country without cost controls. Providers set prices and insurance companies do little other than pass those costs onto consumers.
When will we get cost controls? Likely never. It's very anti-capitalism to restrain free trade. (Yes, there's some sarcasm there. This issue pisses me off.)
Until we treat healthcare like we treat our regional monopolies (electricity, education, etc.) the the government won't be able to set prices lower.
This is what we need in the US. I should not pay a different price if I have insurance or pay cash. People that pay cash are routinely charged far more than people with insurance.
Secondly, hospitals charge people with insurance more. Typically if a patient is uninsured and paying cash, the hospital will work out ways to charge them less, because they are personally liable for way more than what insured are. Hospitals still want to get paid, and charging a patient into bankruptcy is not a way to achieve that.
Haha fat chance. But there is the subsidy.
On the assumption you're making ... $100K a year, this is 20% of your income.
Hard to imagine how it could be done less efficiently. Of course, the issue is then going to be "Say we reduce costs to even 5% of income", "think of the physicians/hospitals/etc"...
In the USA, income tax is a marginal rate, while Social Security and Medicare taxes are fixed rate (and therefore regressive).
"Medicare gives Australian residents access to health care. It is partly funded by taxpayers who pay a Medicare levy of 2% of their taxable income.
Your Medicare levy is reduced if your taxable income is below a certain threshold. In some cases you may not have to pay the levy at all.
If you don’t have private hospital health insurance, you may have to pay the Medicare levy surcharge (MLS) in addition to the Medicare levy. This depends on your income for MLS purposes."
Of course, choosing to accept work for 80% under market rate in a place where the high market rate for labor drives high cost of living is going to have short-term negative economic consequences.
If anything happened you'd be in the emergency room and would either pay outrageous amounts magnitudes more than $460/mo, or declare bankruptcy making your hospital debt a burden for everyone else.
Rates for 2017 increased significantly, from -3% to 116% depending on the state: http://www.thefiscaltimes.com/2016/11/01/Here-s-How-Much-Oba...
I think the ACA was responsible for temporarily suppressing rates. Now that the costs are better understood, we're back to around where we would have been without it.
Americans, we are all about freedom. Freedom to kill ourselves and eat twinkies. But we expect help when we are sick.
One side or the other has to budge a little. Do we give up being able to get the same insurance despite unhealthy habbits? Do we give up helping the poor and the sick?
Go skiing? Well there's a higher tax for the ticket because you have X% higher risk of breaking a leg. Twinkies right now are a grocery food so in fact it has less tax, where it probably should be taxed like booze or cigarettes (in effect a sin tax). Of course sin taxes get abused, where the money goes to the general fund rather than going to mitigation for the undesirable behavior.
I think for most things we are too stupid to really calculate the extranalaties of products.
I've been paying my own premiums for 9 years. Before ACA, premiums went up ~5% per year - 8% one year, perhaps. Since ACA, I've seen increases of 25%, 20%, 20%, 25%, then 11% then 13%. OK, yes, it's anecdotal. But "it goes up every year regardless" is missing data there - pre-ACA there were inflationary increases - post-ACA there are increases to cover millions of people who weren't included before.
- not able to keep my existing health plan. I had a great low-ish deductible plan with good benefits cancelled due to ACA.
- not able to continue seeing my family doctor (that my folks and sister still see). I'm pretty sure the current doctor I have hates all his patients and staff.
And yes, it costs a lot more in terms of premiums, deductibles and prescription meds. But also in travel time because the other physicians in my town that accept CoveredCA stopped accepting new patients.
If it weren't for medicaid, I would be flat broke. my bills start at $5k... that's only the first bill I've seen. My savings would be dissolved, and I would be forced to find work for somebody else.
Instead, because of this coverage, and in spite of limitations on the amount of time I can work at a computer with a busted arm, I am able to continue my entrepreneurial efforts. My partners and I are all hopeful that this will be a very valuable use of our time, and our investor's money. I hope to be able to pay Colorado & the USGov back in spades, through taxes.
* - edited to correct Colorado Cares --> "Health First Colorado"... because I didn't know what I was talking about.
edit 2 - HFC is medicaid for those who qualify... Thanks HN for educating me :P
http://www.denverpost.com/2016/11/08/coloradocare-amendment-...
The correct name is "Health First Colorado". I signed up the day I was hurt, they backdated the signup to the month prior. It took less than 15 minutes to become covered.
I've been working for 20+ years, with spats of insured or not-insured throughout... mostly uninsured. After I left my SF gig, I gave up my insurance & didn't get any more since I'd already had 6 months for the year.
By the end of December, I needed it.
Edit - link: https://www.colorado.gov/hcpf/colorado-medicaid
They didn't care if you signed up when you were injured because you would have qualified for it anyway... you just didn't complete the paperwork. You definitely cannot do this when you exceed the income limit for medicaid and have to get normal health insurance.
The ACA increased the limits to qualify for medicaid. I know there were a few states balking at increased medicaid costs.. but you could have gotten this in most states, including CA.
Yeah... my income === 0. Hopefully, not for too much longer.
Having insurance tied to employment is utterly terrifying. You'll stick it out in a sub-standard job to maintain coverage. You'll be fearful of taking risks on self-employment. It's the exact opposite thing you'd do if you wanted to encourage entrepreneurship.
The ACA has flaws but it also has some great features that need to persist: minimum care requirements, pre-existing condition exclusions banned (having a pulse is a pre-existing condition BTW), no lifetime caps on treatment.
What's the alternative? Still haven't heard anything.
But I am all for an alternative to what we have now or what we had.
The most important thing IMO is to make sure that people don't get hit by pre-existing conditions.
https://www.washingtonpost.com/opinions/why-is-the-number-of...
Now that thats out of the way.
I hate the ACA. Its overreach by what the government should be doing. No where in the constitution does it say the government is allowed to force law abiding citizens to do something. ACA does exactly that. It forces people to do things against their will. Or they will be forced to pay a fine. Alright, don't down vote me just yet.
Lets repeal the ACA. But I certainly see things that should be quickly made into law.
* Preexisting conditions cannot be denied and should be slightly elevated costs compared to the average user.
* Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
* Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
* Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
* Lastly, I want hospital prices published. I want to shop around.
* I am business friendly, but these are common sense laws.
I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere. Complete overreach and strictly unconstitutional.
The problem with this POV is that young, healthy people end up having no insurance and thus leave the older, unhealthier population to pay all the bills, whereas a full-insured population would distribute the financial load.
Also, it would lead to young, healthy people foregoing insurance in order to save money, and then when catastrophes happen (you're talking about living on the land, so imagine something as harmless as scratching yourself on rusty farm equipment, being bitten by an animal... both can send you to the hospital for weeks!), these people would face financial ruin.
The purpose of mandatory healthcare thus is to protect elderly or otherwise pre-conditioned people from having to pay devastatingly high premiums, and to protect people literally from their own short-sightedness.
Also, if there's only 50k in the account and the bill is 100k, you're still straight screwed.
I think this is something that a lot of small-government conservatives don't want--it's moving responsibilities from the state governments to the federal government.
2) Sam Altman agrees with you that it's okay to repeal it as long as we maintain the best parts of it.
> "If Congress ends up repealing it, I hope they earnestly try to preserve the best parts, and put in place something better."
We have to start somewhere. The provision about preexisting conditions, and by extension the ACA, is literally life-saving.
The government doesn't require me to get vaccines. Nor does it require me to educate my children.
Now, you can homeschool if you choose, or place your children in a private school. But I'm not sure, legally, that you can leave them completely uneducated.
Private schools can also require vaccines.
These are good things. We want people to be vaccinated and literate.
We want everyone to be able to receive medical care. In the US, that means we want everyone to be insured.
Well, correct as far as healthcare goes, even with the ACA "mandate". You can choose not to get insurance, and you get some extra taxes in return.
1: If people choose not to get health insurance and then have to go to the ER, who pays for that? You and me. In most cases, it is cheaper for people to get preventative care and reduce their chances of a very expensive ER visit.
2: Preexisting conditions. Sure, but without a guaranteed customer base supported by subsidies then those people will be effectively denied insurance by having to pay insane premiums and deductibles. I have seen no evidence thus far that effectively counters this argument.
Lastly, you say you want to live off the land in some small town somewhere and you don't want the government to force you to pay for other people. Splendid! Say hello to Thomas Jefferson for me. But who builds the roads that lead to your house? What about utilities, water, internet? If you slip and fall down the stairs and break your leg who do you call, 911? If so, who pays for the 911 service, let alone the ambulance to take you to the hospital?
Again, I do agree with your premise, but since in my experience most libertarian arguments tend to crack under the pressure of public goods (like national security), where do you draw the line between independence and the needs of the populace as a whole?
2. Then prices will increase within each insurance company and as a user, I will pay for the insurance I want, rather than be forced.
3. Oh Stop. I didn't say I wouldn't pay taxes.
When did Healthcare become a government problem, rather than something that can be done through businesses. Its a business! If you can't afford to pay the bills then work a little harder to do something better with your life.
A hospital cannot "publish prices" because prices vary wildly based on many factors. Even if they did, how am I supposed to know what I need for my healthcare? If I go to the doctor and they say "you need a surgery and it will cost 10,000" the posted prices do not tell me if I need that surgery at all, just what they cost. And, of course, the most expensive medical care is emergency, a time when price shopping is not possible.
> Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
I'm not opposed to this, but it does remove state control over insurance regulation, which is an anathama to Republicans. I also have no idea how it will drive down costs? Are some states that much healthier than others?
> Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
I don't even know where to start. If I can opt out of paying for some medically approved procedures, where does it end? Can I say that I want to opt out of ob/gyn care for unmarried women?
Here's a question: Dentists routinely publish prices. If you ask them how much some procedure will cost, they will tell you. If there is uncertainty, they will give you a range (e.g. to account for the possibility that complications will arise during an oral surgery). What is different in the hospital situation, apart from some rather extreme measures taken to obfuscate pricing?
> And, of course, the most expensive medical care is emergency
Is it? Or is it end-of-life? Genuinely curious to see numbers here!
> I also have no idea how it will drive down costs
Prices, not costs. The current situation is that in a lot of states there are somewhere on the order of 1-3 companies offering insurance of certain types at all. For example, for Maryland, I believe there is only one company offering an ACA-compatible PPO (everyone else has HMOs or even EPOs). See https://news.ycombinator.com/item?id=13393287 for where I got that data.
Of course in a monopoly situation there is absolutely no incentive for a monopolist to cut prices. Why would they? So to the extent that prices represent excessive profits (as opposed to the actual costs of health care), allowing cross-state insurance sales should drive them down. People who believe insurance companies are price-gouging should be _very_ in favor of removing restrictions on such sales.
Pharmaceutical and medical equipment companies are raking in double digit profits. And they can sell wherever they want.
And you're right: by no means are insurance companies the only ones in this sector that engage in attempts at regulatory capture and creation of monopoly profits.
Though I should note that pharma companies have a lower return on capital than insurance companies last I checked, because pharma is so capital-intensive in practice. I haven't really looked into medical device manufacturers.
Similarly, when your diagnosis comes in and surgery is required, you can take time off from your three jobs to carefully research the pros and cons of various procedures to determine which is most financially appropriate for you. I mean, it's not exactly heart surgery we're talking about here. Well, technically and literally it is, but it shouldn't be too hard for anyone to understand the pros and cons of different surgical equipment and procedures to evaluate the risks and cross-compare with the clear apples-to-apples data sets to arrive at a medically and economically responsible decision while blood is pouring out of your extremities and your body feels like it's on fire. Take the time and shop carefully. You are a model fiscal actor and will make the right call.
Free market forces will make this system work and work well. The invisible hand has been after all such a huge success in setting health care prices and has proven to be the model every modern industrial country has taken because it's so intuitive and has great proven results.
A lot of hospital care is non-emergency, but they don't explain pricing schedules for _that_ either, now do they? I think everyone understands the impossibility of comparison-shopping on emergency care.
> I mean, it's not exactly heart surgery we're talking about here
No, it's hip replacement surgery. And people _already_ do comparison shopping on things like that as much as they can, including comparing to and shopping in other countries. See medical tourism.
More to the point, people do comparison shop just like that for oral surgery. Yes, they may not have all the data they might like. Yes, they don't always make the right decisions. But by and large, dentistry works OK.
Again, the "stuff that must be done RIGHT NOW" thing is a strawman: there's plenty of hospital care that is not that sort.
> The invisible hand has been after all such a huge success in setting health care prices
The invisible hand has absolutely nothing to do with most health care prices today (at least in the US). There are some exceptions: plastic surgery, laser eye surgery, dentistry, some forms of occupational therapy, and maybe family medicine.
> and has proven to be the model every modern industrial country has taken because it's so intuitive
Various industrial countries have price transparency for their medical care. If want to know how much my hip replacement will cost in the UK not via the NHS, I go to http://www.privatehealth.co.uk/conditions-and-treatments/hip... and I get all the data I could want, including prices and the hospitals charging those prices. Importantly, those hospitals publish their prices. If I did go via the NHS, I suspect there is no real difference in the pricing, but would welcome data on how it really works.
Anyway, knowing how much medical procedures will cost you is not an uncommon situation. Except in the US, of course, where hospitals will never tell you ahead of time how much a procedure will cost.
Note that price transparency is necessary, but not sufficient, for some sort of sanity in the discretionary medical care market.
https://www.asrm.org/FACTSHEET_Noncontraceptive_Benefits_of_...
Also consider the case of a woman who does not want to become pregnant due to genetic or physiological issues that would make pregnancy dangerous for her or the baby.
I know this is a common retort, but are pills to give men erections worthy of medical coverage? What about hair loss medications? If your rubric is based on fertility, should we not cover women once they reach menopause?
Finally I have a critique of your rhetorical strategy, "let's face the truth" is lazy and weak. For example, "Let's face the truth, jimlawruk hates women."
Does this exception generalize? From the start, I felt it was immoral to go into Iraq, topple the government, get 4000+ US soldiers killed and cause the deaths of hundreds of thousands of Iraqis. The pennies you pay for birth control a nothing compared to what I as compelled to pay for a war I didn't support from the get go. Can I get my money back for that one? I'm sure my objection to it is/was as sincere and deeply felt as your objection to birth control.
Do you not realize how awful that is? How much of a hypocrite it makes you to hide behind freedom of religion as a means to try to force your religious beliefs on others? Especially via their health care.
How would you feel about tying health in to praying to Mecca multiple times a day?
How about if you work on the sabbath you lose your coverage?
Divorced? No health care for you sinner.
STD coverage should probably be banned. I mean sure, there are other ways to get AIDS but if you were having sex in a nice normal marriage then you probably wouldn't get it.
Oh wait, you mean that someone made a personal choice to use it. A choice that has exactly nothing to do with you, but you see an opportunity to oppress their freedom to choose so you are going to take it.
It's on the fuckin' money!
You want to talk about faith being shoved down people's throats, the Christians are the worst at it.
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof."
Also known as the Separation of Church and State.
You are free to exercise your religious beliefs by not using birth control. But you cannot demand that Congress write the laws to fit your belief system.
edit: By the way, I downvoted you not because I disagree with you, but because of your hypocrisy.
As for being a Christian, fine, but my faith defines how I think. It doesn't mean the church controls my way of thinking. Just influences it. That in no way has anything to do with the separation of church and state. ESP for founders that were all very religious.
> * Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
I don't think you can simply equate having a job to "do[ing] something with yourself". Neither can you equate not having a job to not "do[ing] something with yourself". As always, situations (especially in the macro) are complex and subtle and solutions can't be boiled down to a simple directive.
Adults < 26 are often not the ones responsible for not being able to obtain a job. Yes, they may have chosen a field of study that's not in demand (even though many were probably told to "do what you love"), but they've also likely had very little opportunity to impact things like domestic economic policy, employment trends, or even employers not recognizing shifts in demographically driven skill-sets.
> * Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
In a system where much (most?) health insurance is provided as an employer paid benefit, why should my employer get to decide whether I'm opted in or out of a particular thing based on religion?
Ideally (from my point of view), religion plays zero part in health care. What is wrong with a benefit being available to all and only used by those that want to use it? Is this so different from the "in the privacy of my own bedroom" argument?
Personally, if someone is morally opposed to what they perceive as killing, I don't care if their morals are based on religion, atheism, or just squeamishness. Preserve their moral objection to killing. It's too valuable to society for us to trample on it.
I can't opt-out of supporting the military with my taxes - how is this any different?
And, while you're at it, please answer my original question rather than throwing out strawman arguments.
> why should my employer get to decide whether I'm opted in or out of a particular thing based on religion?
Setting aside arguments that abortion is permissible even if the fetus has a right to life (e.g. Thomson's "A Defense of Abortion"), for many people the crux of the matter is whether or not a fetus is a living human being. The problem is that current science cannot tell us exactly when a clump of cells becomes conscious; we don't fully understand consciousness, so assigning it to a given object can be contentious. We simply have no good way of knowing when there is a person "in there", so to speak.
Since science cannot answer this question, religion has filled the void with beliefs about when someone's life actually begins. If we understood consciousness and could detect when it "starts", I suspect this debate would be much less dramatic.
Not when pro life means human life begins at conception.
Of course. What part of
> but damnit kid, get a job. Do something with yourself
did you not understand.
Our economy is switching from full time employment to a gig based(lyft,postmates,uber). How do contract workers get health insurance?
I graduated just before 25, and my first job didn't have benefits because although I was working 40 hours they called it casual.
> Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
No, you shouldn't have the right to decide what your employees get to do with their health care. You don't have the right to decide who they sleep with and how. This is the theocratic, forcing my bullshit voodoo beliefs onto others crap that makes the republican party so repugnant.
Now, I'll ask again. Are you going to place restrictions on what I (the business owner) buy with my money?
Health care benefits are also part of that compensation. Why should you have any say in how your employee uses that compensation.
Your employees use of their health care plan is none of your damn business. Trying to use health care to regulate their behaviour based on your religious views is a particularly nasty form of oppression.
Pot, meet kettle.
If pre-existing conditions can't be denied, and insurance can't be mandated, how do you prevent people from only picking up insurance when they get sick/hurt?
First, separation of church and state, your faith doesn't get to be part of government decisions.
Second, do Jehovah's Witnesses get to not pay for blood transfusions in other people? And before you cite that blood transfusions are far more necessary, I think you should hold fast to your fiscal conservative tenets and help prevent unwanted burdens on the state from being born.
I think the problem is that healthcare after years of this broken system is now seen as private consumption rather than a public interest (like infrastructure and basic education).
Well, let's put that to the test. I consider myself pretty liberal. Here's what I think about your bullet list.
* Re: individual mandate
I actually agree with you very strongly on this. When the government wants to force me to pay for something, there's already a long-established way to do that: taxes, with services rendered by the government and thus fully accountable to the people. Forcing us to pay for private services sounds awfully similar to forcing us to pay for British tea, which isn't supposed to be how our country works. If the government wants to force us to pay for health insurance, they should tax us and provide universal coverage.
* Preexisting conditions cannot be denied and should be slightly elevated costs compared to the average user.
Agreed on preexisting conditions, disagreed on higher costs for the affected. "Slightly" quickly becomes a loophole that enables "outrageous". And anyone who lives long enough will eventually acquire a condition anyway. Seems kinda redundant to optimize for that. Just distribute the cost evenly with the understanding that everyone will eventually receive the benefit.
* Age 26 under the parents health care plan, fine, but damnit kid, get a job. Do something with yourself.
That's what the original post is about. When kids have health care, it's easier for them to make their own jobs instead of going out and begging someone else for them. Sounds like a win for this audience on HN, no?
* Birth Control, yes and no. We should be able to opt out paying for it, especially if it goes against my religion and frankly it does, but I won't stop others from opting in and paying for it.
The goal of health-related regulation should be to improve health-related access and outcomes. There is no question, based on data, that birth control improves women's health, allows them to finish school or further their careers in greater numbers, and eventually increases their lifetime earnings potential, which of course contributes back. If you make exceptions for people's precious feelings, you're looking at an awfully slippery slope. I envision a bunch of assholes declaring that they will opt out of vaccines for religious reasons, then everyone else starts opting out of paying for vaccines and, well, hello again Mr. Measles. No, terrible idea. You don't have to like the latest military campaign to acknowledge the need to pay for a military, and likewise, you don't need to approve of the way others behave to acknowledge the social benefits of birth control.
* Remove the boundries of the state borders. This is regulation. Not allowing companies to work and provide across state lines is ridiculous and again government overreach that could quickly drive down costs.
Sure.
* Lastly, I want hospital prices published. I want to shop around.
This just doesn't work unless you publish a single price list at the national level and force all health providers to honor that list (Japan). There are two problems. One, sometimes your health needs are too immediate to allow shopping, and you're beholden to whoever happens to pick you up and treat you. If you're bleeding out on the road, you're not gonna stop someone from calling the ambulance just so you can go on yelp and find the best service. Seems like a bad idea to build policy around the assumption that buying health care is like shopping for shampoo. Two, as a person who is likely not a medical professional, you probably wouldn't be able to make sense of any such price list with respect to your needs. Any such list would be detailed beyond the common person's understanding (see Japan), and anyway, you would need to seek diagnosis to know what to pay for in the first place.
Yep, and I hope it's to prevent "lowest common bidder" syndrome on plans. Why does Delaware get all the Corps? Why does a East Texas Court get all the patent cases ?
Frankly, my Texas health care plan sucks. Doesn't cover "anything".
> Lastly, I want hospital prices published. I want to shop around.
Can't shop around in an ambulance.
I like this self awareness :)
> No where in the constitution does it say the government is allowed to force law abiding citizens to do something.
Nowhere does it say it's not? Surely you see the mistake in this reasoning.
> We should be able to opt out paying for it, especially if it goes against my religion and frankly it does
Too bad. You can't force your shitty beliefs onto others.
> This is regulation.
You say that as if regulations are bad. This particular one probably is though.
> I am business friendly, but these are common sense laws.
Ah yes, I forgot that common sense means hating poor people.
> I think EVERY Republican can get behind these thoughts as every other Democrat, but forcing me to pay for it, when I just want to live off the land in some small town somewhere. Complete overreach and strictly unconstitutional.
Okay at this point I'm beginning to think you're trolling. This is too much of a Republican caricature.
Healthy people already sign up for it. Go look at the math before the aca.
The counterpoint is course you're able to take more risks when you have fewer life-dependent expenses, so we should just pay for everyone's utilities, food, and housing too. You might even throw expenses for dependents in there too for older folks. What's special about healthcare except that it's expensive?
Great question. Everyone needs food, everyone needs shelter, everyone needs medical care, but this deep passion only exists for the last item.
My opinion is because the system we have today is basically a wealth transfer from the taxpayers to large interest groups (nurses' unions, big pharma, etc).
Programs exist to make food and shelter universally available, as well, and while imperfect, the proportion of the population unable to afford food or shelter is lower than the pre (or even post) ACA rate of people being unable to afford healthcare.
The fact that the problem is less solved for healthcare is probably why there is more visible passion on the issue.
(I'm the first story in the article)
Deaths due to homelessness (2010)[2]: 700
Deaths due to lack of medical care (2009)[3]: 45,000
What's different is the magnitude. Although the United State's patchwork of services for the homeless is ostensibly supposed to give everyone access to food and shelter, people do fall through the cracks. But it is not an endemic problem like lack of health care.
[1] Debatable, and I can't find a solid source. The only malnutrition related deaths I can find are in elderly populations and abused children.
[2] http://www.nationalhomeless.org/publications/winter_weather/...
[3] http://news.harvard.edu/gazette/story/2009/09/new-study-find... this is a higher end estimate from 2009, the lowest estimate I could find was 18,000 from a study done in 2002
The healthcare system is totally a disaster, and it really should be fixed, but giving college-aged kids a free pass for a few more years isn't really a solution.