Is Health Insurance Even Worth It Anymore?

So you have to pay like $30k out of pocket in a year before the insurance chips in a single dollar? And if you ever ask for a dollar, I can also reject your coverage.

How can I start an insurance company?

The actual cost to treat "cancer or whatever" is extremely high in many cases. 15k a year to know you have that covered for a family isn't so bad given the true underlying cost.

A family member has a rare disease and I've gone through the details of the various treatments, how many people are involved in ongoing care and treatment etc. It's a lot of very well trained people spending a lot of time. A concrete treatment example - the process to create some blood plasma treatments is very complex, expensive etc. In the end, it will be millions of dollars of real underlying costs.

There is probably no cheap solution. Maybe GLP-1 type magic can put a real dent in the overall cost, but there will always be a desire to save people's lives even if the cost is very high.

> In other words, I'm being asked to buy a product, and the cheapest form of it is to basically pay almost $15k in a year to hedge against someone getting cancer or whatever, and actively incentivizes me to not use it[0]

You are not paying $15k to hedge against someone in your family getting cancer in a calendar year.

You are paying $15k to pay for old and sick people’s routine healthcare, due to the ACA’s requirement that the highest premium to be at most 3x the lowest premium, and the requirement that premiums be only a function of age and tobacco use (i.e. no underwriting for health risks by factoring in pre existing conditions).

So an ACA compliant health plan’s premiums are far more comparable to a tax than an insurance premium since they are explicitly a wealth transfer mechanism from young and healthy to old and sick.

New York state takes this wealth transfer even further and mandates that age not be used at all to price premiums. I think Massachusetts only allows an age rating factor of 2.

It was never sustainable. Because the model relied on healthy people subsidizing the people who make extremely poor choices (obesity, smoking, drugs or a combination of that). Obamacare's modeling predicted that significantly more healthy people would sign up, driving costs down. It didn't happen.

Now it is a system that ONLY the unhealthy benefit from. Everyone else pays for extremely bad choices.

That seems... fine? That's $14,000 annually. For an income in the $75k-$100k range, Maryland health connection shows me a premium of $700/month for two parents/two kids. Judging by your premium and assuming 2 adults/2 kids, your income is probably over $200k. With that income in Canada, you'd be paying over $20,000 in taxes attributable to healthcare: https://www.fraserinstitute.org/sites/default/files/price-of....

Now you have to account for taxes you pay in the U.S. for medicare, and a risk-adjusted share of the deductible payments, but overall it doesn't seem that crazy.

If you get a very serious and expensive problem, insurance may not help nearly as much as you'd think. My mother had great insurance, but when she got cancer, the insurance didn't stop her from getting absolutely destroyed by the medical bills (not to mention having to constantly fight with the insurance company while being extremely ill).

It drove her to bankruptcy anyway. In hindsight, she commented that had she known that the insurance wouldn't be all that helpful, she would have just saved up all the money she poured into premiums over the decades.

In a perfect world, a healthcare plan should pay for cancer treatments or crucial medical procedures. In the United States, I'm not sure this is a guarantee[0][1]. Going without healthcare seems to be the riskier gamble, but it's a gamble either way.

[0]: https://www.startribune.com/unitedhealthcare-part-of-95m-set...

[1]: https://www.propublica.org/article/unitedhealth-healthcare-i...

Author here. I'm definitely not advocating going without health insurance. Just running simple numbers to get some perspective.

I'd like to see health insurance act like insurance again though. Right now it covers absolutely everything, meaning it's more like pre-payment for routine care + insurance.

Insurance isn't for routine, predictable, or low-cost expenses. But we've mandated that our health insurance cover all of those things.

The comparison to car insurance is overused, but it's a good one. Catastrophic coverage + dedicated savings with lower premiums looks more attractive to a lot more people.

Pre-ACA my mother got cancer in a short window where the University my Dad was president of got wound down for financial reasons.

Destroyed my entire trajectory in life.

The prior system was mega fucked, our current system is still fucked.

If you had a congenital condition prior to the ACA you were a wage slave once you hit 18, no private insurance and couldn't get public. Literally founded a successful startup the minute I got ACA.

Over 40+ years I've seen nearly every profession go through a bubble and lean years, lawyers, mechanics, academics.

But never doctors, in retrospect I should have joined that protectionist racket, but my family couldn't afford to let me at the time.

Do you mean a life-time $50k? Otherwise an annual deductible of $50k sounds ludicrous. Maybe if they tied it to yearly income, it would make more sense.

$50k would probably still be outrageous, like your car insurance doesn't have that generally.

Study after study finds that a health care model where you can visit a doctor frequently leads to much better overall heath for people.

The system we have here forces people to wait until minor issues turn into life or death situations that require much more intensive and expensive care.

Author here.

DPC is terrific if you have an option near you! Paired with catastrophic insurance, it's a great bet for relatively healthy people.

The DPC Alliance map is well worth a visit: https://mapper.dpcfrontier.com/

And I wrote about DPC a while back: https://church.substack.com/p/direct-primary-care

I'm on the other side. A high deductible plan for me means I'm guaranteed to have to pay that amount, due to medication and visits.

If I take the low deductible plan with the higher Max OOP I am actually spending less on a yearly basis because the insurance kicks in immediately.

Of course, when something catastropic happens, like cancer, yea, the high-deductible plan would've been better, but that (knocks on wood) doesn't happen every year.

if this were true why is it that countries w universal healthcare spend less per patient and get better health outcomes with a longer life expectancy?

This happened because of inflation. Costs rose so much that people had to make claims.

Third option is pay what you can reasonably pay and file for bankruptcy. Which sucks, but is an option.

Try to get assets into bankruptcy protected holdings when possible (401k, house, etc, depending on state of residence), so you have more flexibility post bankruptcy.

> I don't know if there is a 3rd option that would be more reasonable.

There may be something less extreme, but leaving the US is one way out of that mess.

The third option that becomes more tantalizing every year in the US is to not have insurance, pay OOP for routine matters, and when something catastrophic happens let the medical debt go to collections and settle for pennies on the dollar. It doesn't feel right, but it's the direction the medical-pharmaceutical-insurance cartel is pushing us.

> I wonder how many incredible founders and companies we're missing out on

The many countries that don't have this healthcare issue do not seem to be producing a notable excess of incredible founders or companies.

There are all manner of health conditions that can occur that have little to do with your own healthy living, and don't incapacitate you or make life not worth living, but will cripple you financially.

You might end up with Crohn's or all manner of autoimmune conditions where patented biologics easily costs north of $100k US a year just in medication, but your quality of life if you find a medication that works is not particularly degraded from the average person.

CrossFit will not prevent you from getting into that situation, and I think it would be a vast overreaction to commit suicide in response to such a diagnosis.

I have buried many pets, but last year my wife got cancer and while insurance was a huge headache, it came through in terms of protecting our wealth. She's currently in remission a year later after a very, very difficult fight that she nearly lost multiple times. It was extraordinarily stressful. I learned not to worry about the insurance crap, it all eventually worked itself out despite how frustrating it all was. So I'm not sure 9mm, 45, 357, or any other caliber for the "Hunter S. Thomson" solution, would have been a smart move for us. I totally understand the sentiment, because there are fates worse than death for sure.

What didn't hold up was not our insurance but my employer, who found a sneaky way to get rid of me and not have to deal with an employee who needed to dip out for his wife's numerous medical appointments.