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Employer health plans are getting pricier and skimpier

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Re: Employer health plans are getting pricier and skimpier

#501

Post by tomp »

dredmorbius wrote: post #488
kmjg88nvf8 wrote: post #462

Earlier quoted context omitted.

Can you explain to a Non-American what forces this system of employer insurance onto the US? Why don't independent insurance companies emerge that offer other models of insurance?

There's both historical and insurance-business (underwriting) reasons. The history: wage-price controls implemented during WWII as labour was taken up by the military and companies had to find some basis other than pay on which to differentiate. Benefits, including health care, were excluded from wage consideration. Insurance itself is the business of assessing, managing, and sharing (or "pooling") risk. In the case…

I don't think the size of the pool is that relevant. The pool from the perspective of insurance company is all insured people, so it doesn't matter whether it's a company of 5 or 5 individuals joining, it's still a huge pool.

Adverse selection is the big reason. An individual signing up for insurance can be used as a signal that means "individual is sick" or "individual is likely to need insurance soon". If a company policy covers all employees (or all employees above a certain level), the signal is "person works" which is orthogonal to "person will need insurance" (in fact, it's probably slightly anti-correlated, a.k.a. "person is fit enough to work").

Re: Employer health plans are getting pricier and skimpier

#502

Post by kelnos »

JMTQp8lwXL wrote: post #200
throwaway22424 wrote: post #186

Earlier quoted context omitted.

> Not to mention the millions of people locked into careers they would otherwise get out of, if not for the health coverage. Replying with a throwaway for obvious reasons. I work at one of the big tech companies -- I'm paid well, but the benefits are very good. I just got an offer from a startup that I really like. It's a job I would like to take. I'm going to have to turn down the offer. Part of the reason I'm going…

Sounds like this could be solved, if the startup could offer a higher base salary, bonus, or a combination.

I'm assuming the unspoken point here is that, after negotiation, the startup couldn't make up for enough of the difference for the parent to be able to seriously consider them.

Re: Employer health plans are getting pricier and skimpier

#503

Post by kelnos »

madengr wrote: post #296
Turing_Machine wrote: post #219

Earlier quoted context omitted.

> Knock on wood but, myself and pretty much everybody I know has insurance covered ~75% through our full time employers. That is money that would otherwise be given to you in the form of salary, so, yeah, you're paying for it even if it doesn't seem like it. Historically, the main reason for employer-provided health insurance in the U.S. is that it provided a loophole to increase effective employee compensation in a…

My employer dropped dental insurance a few years ago. They never gave me a pay bump to compensate. Now I spend $1,600/year on cleanings for a family of 4. At least it is out of my HSA, so pre-tax.

They likely dropped it due to budget issues, so of course they weren't going to give you a pay bump. If they had dropped it simply because there was no need to give it to you, you'd probably see a pay bump, or at least faster salary growth in future years.

Re: Employer health plans are getting pricier and skimpier

#504

Post by zwkrt »

closeparen wrote: post #420
comnetxr wrote: post #360

Imagine if grocery stores forced us to choose one of a few dozen grocery "insurance" memberships to buy groceries, and negotiated directly with the insurers. No prices are labeled in store, they just detect whatever you take and send you a bill at the end of the month. (Differing brands of the same food product are not available in store of course.) Individuals are charged 3-100x more per product than negotiated rate…

From the consumer perspective, calorie needs are stable and predictable, fundamentally different from what insurance is for. From the supply chain’s perspective, there is a very sophisticated insurance system to smooth out issues with crop yields, weather, etc. called the commodity futures market.

Both of your points are true of healthcare. No, not everyone will break a leg or need major surgery, but everyone gets old and dies. Flu shots come out at the same time as pumpkin spice lattes. From an aggregate standpoint I would wager healthcare needs and costs are predictable and forecastable, just like commodities.

Re: Employer health plans are getting pricier and skimpier

#505

Post by mattkrause »

kelnos wrote: post #486
BrainInAJar wrote: post #475

Earlier quoted context omitted.

> but that it would have to be much _more_ like grocery stores to call it a free market. Except not really. If I'm poor I can choose to eat nothing but ramen. I might not like it, it might not be the best for me, but it'll keep me alive. If I'm poor and have a heart attack I can't choose to just take tylenol, I do need that bypass surgery. The ability to walk away from a transaction entirely is what makes the market…

I don't think that's a great analogy. There are plenty of medical conditions where there are several options for how to manage it. With insurance, people usually choose based on risk of failure or complications, recovery time, etc. Without insurance, someone might choose primarily based on price, and a poor person might go for the cheapest option. For some non-life-threatening issues, a poor person might refuse treat…

Have you ever actually tried to do this? It is hard.

A family friend, a smart guy with excellent insurance, was recently diagnosed with Parkinson’s Disease. Since I’m a neuroscience researcher, he asked me for advice. Despite working in an immediately adjacent field, at a Parkinson’s Centre of Excellence, with access to experts and tons of relevant training and literature, I found it very difficult to make a recommendation, even between the options his doctors had already laid out. I can only imagine how hard this would be if I had to consider the price of these treatments too.

Re: Employer health plans are getting pricier and skimpier

#506

Post by dredmorbius »

tomp wrote: post #501
dredmorbius wrote: post #488

Earlier quoted context omitted.

There's both historical and insurance-business (underwriting) reasons. The history: wage-price controls implemented during WWII as labour was taken up by the military and companies had to find some basis other than pay on which to differentiate. Benefits, including health care, were excluded from wage consideration. Insurance itself is the business of assessing, managing, and sharing (or "pooling") risk. In the case…

I don't think the size of the pool is that relevant. The pool from the perspective of insurance company is all insured people, so it doesn't matter whether it's a company of 5 or 5 individuals joining, it's still a huge pool. Adverse selection is the big reason. An individual signing up for insurance can be used as a signal that means "individual is sick" or "individual is likely to need insurance soon". If a company…

Adverse selection among groups is an issue, given adverse selection: individuals or small groups with high but non-evident risks may emerge.

"Small-group" coverage is generally 50 or fewer (in some states, 100) members:

https://www.healthinsurance.org/glossary/small-group-health-...

Re: Employer health plans are getting pricier and skimpier

#507

Post by g4omingron »

broknbottle wrote: post #496
deepaksurti wrote: post #438

Earlier quoted context omitted.

>> In Japan I have had mixed experiences: Replace ‘Japan’ with ‘metro cities in India’ and its almost the same. I can’t still fathom why there would be no walk in facilities for ailments like cold. I still remember my shock when in US I realised from a colleague that for my cold I need to wait because I can’t walk in and need to take an appointment.

There's no reason to visit a doctor for the common cold. Stay home and get some rest.. Do you take your car to the dealer or local mechanic to put air and washer fluid in your car?

>There's no reason to visit a doctor for the common cold.

That's such an american thing to say. A flu can be swine flu and fever can be Malaria or Dangue and one day delay can mean losing your life, so people in many parts of the world take fever and flu seriously.

Re: Employer health plans are getting pricier and skimpier

#508

Post by dagw »

g4omingron wrote: post #507
broknbottle wrote: post #496

Earlier quoted context omitted.

There's no reason to visit a doctor for the common cold. Stay home and get some rest.. Do you take your car to the dealer or local mechanic to put air and washer fluid in your car?

>There's no reason to visit a doctor for the common cold. That's such an american thing to say. A flu can be swine flu and fever can be Malaria or Dangue and one day delay can mean losing your life, so people in many parts of the world take fever and flu seriously.

A common cold and a flu are two different things.

Re: Employer health plans are getting pricier and skimpier

#509

Post by throwaway_law »

shkkmo wrote: post #322
throwaway_law wrote: post #266

Earlier quoted context omitted.

Sorry, I figured you were German. As long as people are covered it would be a good start (I won't bother engaging further on the single payer/private insurance/hybrid systems, not enough room and not the right forum)...it just scares me to hear the game plan to get there is political pressure after a critical mass of people are uninsured . I know that is not attributable to you, and you seem optimistic we get there a…

> it just scares me to hear the game plan to get there is political pressure after a critical mass of people are uninsured And who are you attributing this to? This seems like either a strawman or a misunderstaning to me.

Well in response to my questions about why people want to divorce insurance from employment before universal care becomes a law/right/option, one commented answered:

>>Having a critical mass of uninsured people is the foundation we need to resolve the healthcare crisis in America.

Re: Employer health plans are getting pricier and skimpier

#510

Post by throwaway_law »

zaroth wrote: post #490
js2 wrote: post #427

Earlier quoted context omitted.

And yet it manages Medicare. Poll Medicare recipients and ask them what they think of it. It also manages Social Security. And provides for the national defense. The government is entirely capable passing effective legislation, or at least half of it is. In any case, the current system is both unfair and unsustainable. Something has to give.

Just to be clear, Medicare costs are roughly 50% higher again per person than the current average US cost per person. Patient population being a major confounder in that comparison, of course. US defense spending is by far the highest of any other country in the world, and renowned for its wastefulness. Social Security is going bust whenever we talk about it, and is merely a program which confiscated money today, in…

>Medicare costs are roughly 50% higher again per person than the current average US cost per person.

The numbers speak for themselves and it is ridiculous the US spends 100% more for half the people (e.g. Medicare) than Germany spends to cover 2x as many people and their entire country.

That said keep in mind Medicare patients are the most expensive patients in that they have the highest rate of chronic diseases of any other demographic. Its not apples to apples, but more importantly a Universal coverage could probably be extremely effective in preventing untold millions of chronic conditions through preventative care. What happens now is millions of people reach Medicare eligibility who had no coverage before and as a result have all these untreated chronic conditions, and then boom Medicare has to cover the tab when they become eligible. Its such a stupid system, there are even cases of heart surgery's and cancer treatments that are delayed until a patient hits medicare age, making the issue worse and more expensive to treat.

It may sound like I am taking a devils advocate position, but I 100% agree with you on governmental waste.

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