Health Insurance 44

[tbonebanjo]

I was just wondering how many companies still have good insurance and how many have gone the way of Obamacare. I am in a small MEP firm in Maryland. Our health insurance just changed, our premiums went up and our coverage went way down. I have maximum out of pocket expenses of $12,500 per year, $4000 deductable per person, tnen start the copay schedules. Should I start looking for other employment or are all companies being affected this way?

 

[glass99]

beej: Maybe a timed run on a treadmill at the insurance companies office? You could adjust the time required to finish your mile by age.

IRStuff: Showing 10,000 steps a day on a pedometer is good idea. Though it will be unfair to bike commuters such as myself.

Agreed with you both that exercise makes a big difference to health. I know that I always feel better when exercising.

 

[glass99]

What about the $3.3BB windfall for the Cystic Fibrosis Foundation? Is this a triumph of technology, or is the $300,000/yr treatment the root of the problem?

http://www.bloomberg.com/news/2014-...-3-billion-for-cystic-fibrosis-royalties.html

 

[IRstuff]

"is the $300,000/yr treatment the root of the problem?"

How is that the problem? Is compassion "the problem?" Do you wish an early death to all those that suffer from this illness? Or are you suggesting that we abort any fetus that lacks a working CFTR gene? That would save lots of money. Should we likewise put out all the frail, aged, etc., into the wild and let them die? Where do you want to draw the line? Or do you want someone else to draw that line?

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[glass99]

IRStuff: Its a problem if you think that a big pharma company is profiteering off the backs of sick kids and beat down middle class Americans. Its also a problem if the true cost of these exotic drugs is so much that it sinks the whole system. Its a problem if a small business has to drop dental insurance because of the increase in premium for this new treatment.

On the other hand its not a problem if you believe that the technology, now invented will not get uninvented and will get cheaper in the future. We may get gouged by the drug maker for the 20 years of the patent, but when it expires the technology will be free. Or perhaps its not a problem if the $300k/yr drug cost is actually cheaper than all the other treatments the patients are currently receiving. Or if you think that the mad profit that the pharma company is making inspire them to find cures to other diseases.

 

[IRstuff]

Sounds like you want a single payer system; how else are the priorities and pricing to be set?

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[TenPenny]

If a person is concerned that 'big pharma' is profiting off the downtrodden middle class, one would hope that the same person avoids any investments in any stocks, bonds, or pension plans, because the real vultures in society are in the banking/investment business.

 

[glass99]

IRStuff: How to set priorities is a good question. I think this is a huge issue that needs to be publicly discussed. Thus far the answer is "whatever the doctor thinks", which is kind of a 19th century paternalistic answer. Equally bad is letting insurance companies decide, or even a government committee with some idiotic value of life formula. It should be people who are both paying for and receiving the treatment who decide.

It is possible that we can all be educated about what really goes into the health care costs, and buy insurance accordingly. If an individual places a priority on being kept alive with the most aggressive treatments when they have cancer at at 80, they can pay more than someone who is happy to receive palliative care and die with dignity.

A parallel issue is retirement. In the 50's through the 80's everyone was promised a pension. The amount of the pension was set by a panel of experts who were subject to various political pressures. Because of the lack of personal accountability in the decision making, some incredibly bad decisions were made. For example, Detroit promising to let its fire fighters retire at age 45. Meanwhile life expectancy ballooned and they fudged their contribution numbers. Why would a Detroit politician in 1975 bother to push back on pension demands they don't know can be paid for in 2015? Their incentive was to get re-elected in November, not avoid disaster decades after they have left office. American city, state, and federal pension funds are underfunded cumulatively in the trillions because of this dynamic.

 

[IRstuff]

re: stocks -- That's complicated. We've driven the interest markets downwards as part of Fed policies for many decades now, ostensibly to make it easier to do business investments. The (unintended) consequence is that the average person lost a significant way to build up nest eggs by having savings account interest rates less than 1%. The 1% rate results in a doubling of principal in 70 years, that's right, even if you started at birth, it would literally take your entire lifetime to double your money. This results in a number of things:
> Lower savings rate, and buying instead of saving
> Increased borrowing, because of cheap interest, for buying things
> Increased pressure on stocks to perform extremely well, since that's now the new savings account

This is all compounded by the fact that pensions have slowly gone sway to be replaced by 401K accounts, which again puts pressure on companies to get more profits.

As Pogo observed, "Yep, son, we have met the enemy, and he is us."

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[glass99]

If you think that a pharmaceutical or any other company is profiteering unethically, it is not that expensive to exclude that stock from your portfolio.

 

[TenPenny]

But if you think about anyone profiting unethically, you shouldn't have a portfolio at all, because the most unethical profiteers are those who get bonuses while their employers need government bailouts, and that pretty much rules out all investment houses.

 

[glass99]

TenPenny: Goldman Sachs and the bailout crew are sketchy for sure, but what about Novartis? Are you going to divest your portfolio of their stock? Is developing drugs and taking advantage of desperate sick people for the patent duration unethical? Would the world be net better off without theses drugs? These kind of drugs are a big part of the reason the US spends 18% of GDP on healthcare, but after they go generic they are so cheap that even starving Africans can afford them. Obviously the promise of outsized profit motivates the drug discovery. But in the case of the cystic fibrosis drug, development was paid for by a charity and the charity got a gigantic payout.
-> I am inclined to believe its capitalism at its finest, though would listen to an argument that it was craven greed on the part of the drug companies.

 

[IRstuff]

"development was paid for by a charity and the charity got a gigantic payout."

They spent $150M !!! That could have all gone into nothingness; it was a huge gamble; there are plenty of drugs that were promising and effective, but failed miserably during trials or even afterwards. COX-2 comes to mind.

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[glass99]

IRStuff: yes, it was a gamble which paid off big time. The thing people are having trouble getting their heads around is charities making so much money. You can build the World Trade Center a couple of times over for $3.3BB. Are they competitors to drug co's now? Will this much money corrupt their mission? Maybe charities are better suited to drug discovery than big pharma, and big pharma should just focus on manufacturing and marketing.

 

[IRstuff]

The charity didn't do any of the work, though.

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[glass99]

One thing which is great about this cystic fibrosis drug is it shows that caring about the actuality of a specific result is more effective than just a purely economic return or a government mandate. In some ways the cystic fibrosis foundation has usurped the role of both investment capitalism and the government. We don't need the MBA's of Novartis, the traders of Wall St, or the bureaucrats of the NIF any more. Hurray! Ayn Rand, you won!

 

[cranky108]

I still don't understand how a single payer system, or an all insurance based system will make medical treatment cheeper. Unless you have to pay the first $1000 out of pocket yourself.
It becomes a fixed cost no matter who pays for it, so why not use as much as we can. That's why there is a copay with insurance. To take a bite that should make most people think about how much health care costs.

Free medical help usually comes with a long line, because the wait is the cost (time is money).

Insurance companies have a vested interest in making as many drugs as possible non-percription. Drug makers have an incentive to develop new drugs because of the money they will make. Doctors get a kick back for perscribing the new drugs, which I think is wrong.

Yes in a perfect world medical care is free. But then again so is housing and food. The world isen't perfect, so we have to make of it the best that we can. And free, or apperently free isen't realistic. It increases demand, while decreasing supply. Basic economics.

What comes after the food police? Maybe the clothing police? Don't buy from China, Russia, etc. When the goverment does this it becomes a problem. If in a privite contract with an insurance company, you agree, then it's ok (never mind that your employer pays for half or more of this insurance).

 

[IRstuff]

A single payer is a monopoly, which means that it theoretically has the clout to force any and every doctor to get the same amount for the same treatment, which, if it's working correctly, will be the lowest possible amount the market will bear, which would apply to both primary and specialist care.

It can theoretically force specialists to make less.

It can theoretically force hospitals to become more efficient, since they will no longer be able to up their charges to cover slack in usage, i.e., the hospital has lots of fixed costs that are amortized over all of the patients treated, so if there are fewer patients, they will charge those patients more. This would be no different than factories that are underutilized and need to make changes to up the utilization rate.

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[moltenmetal]

cranky, the numbers don't lie. 11% vs 17-18% of GDP, for similar health outcomes between Canada and the US. You've been given plenty of reasons why this is the case earlier in this thread. Obviously the myth that the private sector can always do things more efficiently than government is a hard one for you to accept, but it's a MYTH and you need to get over it. A regulated market is the best way to distribute commodities which you can shop around for in a meaningful way or choose not to consume, but it is NOT the best way to distribute essentials and utilities. You can claim that it's the fault of the government portion of your system in the US and you're partially right- that fact explains part of the difference in cost. But the biggest part of the difference is simply this: your country has parasites, who are taking a huge swath of your GDP as private profit because your system permits them to do so. And they're so entrenched, and so rich, you'll never be rid of them. Our system has reduced the parasites by eliminating the middleman- the insurance company. We're very lucky we managed it, and we as a nation have to fight off the hordes of parasites who are itching to steal 7% of our GDP too- if we give them the chance.

 

[cranky108]

I believe you live under the MYTH that goverment can solve everything. The truth is goverment medical care is not that good, just look at the VA in the US. I agree regulation is needed, but not goverment control. Parasites also happen in the goverment, and the solution is free market.

At one time I wondered why companies would change from in-sourcing to out-sourcing, and back to in-sourcing, and the truth is to shake out the dead wood. But when does goverment do this? Never, just look at the post office. Yes parasites happen at every level. but when you cap doctors ability to make money, you also cap the number of people who want to become doctors.

One issue is abortion, and I am not interested in the morality at this point, but if I have to pay for, or subsidize it then I become an enablier of irresponcable behavior, sort of like the food police above. We have done nothing but exchanged one type of bad behavior for another. How is that reducing medical costs? Where are the sex police?

In that 11% vs 17-18%, have you factored in the wait times, and the number of people suffering, or dead? Or the number of people that go else where and pay out of there own pocket?

To make medical costs lower, there should be a provision to pay for medical costs performed in other countries, and there isen't. Why?

 

[TenPenny]

"One issue is abortion, and I am not interested in the morality at this point, but if I have to pay for, or subsidize it then I become an enablier of irresponcable behavior, sort of like the food police above. We have done nothing but exchanged one type of bad behavior for another. How is that reducing medical costs? Where are the sex police?"

If you're not interested in the morality, why did you make that the whole point of your paragraph?