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$27,000 a Year for Health Insurance. How Can We Afford That?

nytimes.com

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Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#41

Post by jmathai »

brianwawok wrote: post #32
jmathai wrote: post #8

Earlier quoted context omitted.

The two times I did not have employer sponsored health care AND $0 income, the ACA plans were more expensive than getting a plan directly from the insurance company. It never costed me $27,000 though. Most recently, in 2024, I had medical and dental coverage for my family of 6 for around $1,200/mo - roughly half what's quoted but again, family of 6. Wasn't the greatest insurance but it would have kept us from financi…

I assume you were young. Direct was generally cheaper for young people and ACA cheaper for older people. Which pushed the average age of ACA up and then raises the price of ACA. It’s a mess!

45 years young.

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#42

Post by scott00 »

aleph_minus_one wrote: post #30
jqpabc123 wrote: post #27

Earlier quoted context omitted.

no actuarial reserve has been built up This is laughable. Health insurance companies don't have no steenkin "actuarial reserve". Inventing one is an act of rhetorical desperation on your part. They only thing these companies consider or respond to is next quarter's profits.

> Health insurance companies don't have no steenkin "actuarial reserve". Inventing one is an act of rhetorical desperation on your part. This is how private health insurance companies work in Germany and many other countries (more precisely for Germany "private Krankenversicherung nach Art der Lebensversicherung" (Google Translate: private health insurance in the form of life insurance); formally, in Germany there al…

The key difference seems to be German private health insurance contracts are long-term affairs. Multi-year, or perhaps even lifetime? US health insurance contracts are typically a year at a time. So German companies have to reserve for costs projected to occur far in the future because they are liable for them, while US companies have no idea if their customer will still be around in 20 years.

My guess would be there's a healthy dollop of regulation pushing the German insurance market into that shape, otherwise you would probably see short-term insurers outcompeting long-term insurers since they wouldn't have to do old-age reserves and could therefore charge lower premiums. Consumers tend not to be nearly as good at rationally planning for long term expenditures as are actuaries.

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#43

Post by fellowniusmonk »

jdlshore wrote: post #24
antonymoose wrote: post #22

Earlier quoted context omitted.

When the ACA plans first came online in South Carolina, I switched over immediately. I was paying something like $300 per month as a young healthy single male with my small company plan. I got a Marketplace plan for about $120 per month. The next year my insurer went out of business but I found another insurer in the 200s, barely cheaper. The following year this insurer also went under. I was now left with Blue Cross…

Yes, health insurance costs rise every year. Partly due to increasing costs, but also due to the age of the insured. The question isn’t whether the ACA raised costs—those were always going to go up. The question is whether a the ACA made them go up less than not having it. For me, the before and after trend was remarkable. And I had higher quality insurance without lifetime maximums or arbitrary exclusions. Republica…

Over the course of my life I have seen every profession but one go through boom and bust cycles.

I've seen attorneys, professors traders, plumbers, programmers, accounting, all go through demand cycles.

But never MDs

It is my dream that before I die I see a bust cycle on MDs where the growth of supply exceeds the demand.

Uber or Airbnb for medical care is so needed, why not break some laws to reveal how protectionist the whole industry is?

I'd gladly book a "Parody Doctor" or whatever it takes if it cost 2/5ths the price.

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#44

Post by [deleted] »

ChrisRR wrote: post #4
billy99k wrote: post #2

The affordable care act doubled most people's insurance over night (This happened to me and almost everyone I know). Nobody wants to mention this, because it makes their side look bad. Until we can admit where there are problems, there will never be a solution.

As a non-american this is the first I'm hearing of this. I would've thought if the majority of americans' health insurance had double overnight then there would've been massive uproar. Can you explain what's happened?

[deleted]

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#45

Post by aleph_minus_one »

scott00 wrote: post #42
aleph_minus_one wrote: post #30

Earlier quoted context omitted.

> Health insurance companies don't have no steenkin "actuarial reserve". Inventing one is an act of rhetorical desperation on your part. This is how private health insurance companies work in Germany and many other countries (more precisely for Germany "private Krankenversicherung nach Art der Lebensversicherung" (Google Translate: private health insurance in the form of life insurance); formally, in Germany there al…

The key difference seems to be German private health insurance contracts are long-term affairs. Multi-year, or perhaps even lifetime? US health insurance contracts are typically a year at a time. So German companies have to reserve for costs projected to occur far in the future because they are liable for them, while US companies have no idea if their customer will still be around in 20 years. My guess would be there…

There exist both types of health insurances in Germany:

"Krankenversicherung nach Art der Lebensversicherung" (health insurance in the form of life insurance) and "Krankenversicherung nach Art der Schadenversicherung" (health insurance in the form of indemnity insurance).

The first one is basically an alternative to the state-mandated health insurance, while the latter one is mostly intended for more specialized health services like for example dental replacement.

There is a regulation that once you are in a "Krankenversicherung nach Art der Lebensversicherung", the health insurance company is not allowed to cancel the contract with you, but on the other hand for this restriction the health insurance company is allowed to "adjust" premiums (nearly always that means "increase premiums") if the medical costs for the agreed treatments rise (which they commonly do).

Thus having a (near-certain) cashflow over the lifetime of the whole insured person (who can only under very special circumstances get out of the insurance treaty) is quite attractive for the insurance company.

> otherwise you would probably see short-term insurers outcompeting long-term insurers since they wouldn't have to do old-age reserves and could therefore charge lower premiums

You must not compare the current premiums, but the amount of premiums that you will pay over the whole lifetime. Here, the situation is completely different.

I think considering the huge amount of money (for premiums and medical costs) that is involved here, it can only be explained with stupidity to just compare current premiums in the young age: it is very well-known that the whole actuarial reserve that the insurance company built up from the premiums of a huge part of your lifetime will be spent for medical costs in just the last few years of your life.

It is thus a really macabre truth that if we would just let patients with cancer or another expensive disease die instead of giving them expensive treatments for just few additional years it would save an insane amount of money in the health system.

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#46

Post by aleph_minus_one »

everforward wrote: post #40
aleph_minus_one wrote: post #30

Earlier quoted context omitted.

> Health insurance companies don't have no steenkin "actuarial reserve". Inventing one is an act of rhetorical desperation on your part. This is how private health insurance companies work in Germany and many other countries (more precisely for Germany "private Krankenversicherung nach Art der Lebensversicherung" (Google Translate: private health insurance in the form of life insurance); formally, in Germany there al…

I don’t think that really exists in a literal sense of “your policy has a reserve of money to pay out for you”. I think it exists in the same way social security does: money from people who pay in but don’t withdraw goes to people who do withdraw. There’s probably some reserve, but I’d guess it’s thin because withdrawals should be fairly predictable for large insurers.

> There’s probably some reserve, but I’d guess it’s thin because withdrawals should be fairly predictable for large insurers.

At least in the EU, by Solvency II, insurance companies are obliged to fulfill prescribed solvency ratios (i.e. have sufficient capital resources available). I would strongly assume that there exist similar regulations in the USA.

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#47

Post by robocat »

altairprime wrote: post #19

Our country can afford it because it’s the last reliable source of privatized growth in revenue growth per year left in our economy. (A.I., by comparison, has merely a one-time effect of reducing headcount per dollar earned, and the Internet stripped away 99% of consumer-originated postal mail so there’s no growth left from privatizing that anymore.) So from a political standpoint it’s either maintain the health insu…

> last reliable source of privatized growth

But is it productive growth?

Perhaps we should increase GDP by employing people to smash windows and burn down houses?

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#49

Post by altairprime »

robocat wrote: post #47
altairprime wrote: post #19

Our country can afford it because it’s the last reliable source of privatized growth in revenue growth per year left in our economy. (A.I., by comparison, has merely a one-time effect of reducing headcount per dollar earned, and the Internet stripped away 99% of consumer-originated postal mail so there’s no growth left from privatizing that anymore.) So from a political standpoint it’s either maintain the health insu…

> last reliable source of privatized growth But is it productive growth? Perhaps we should increase GDP by employing people to smash windows and burn down houses?

Is that a growth strategy for the second derivative of profit? Asking for a friend :)

Re: $27,000 a Year for Health Insurance. How Can We Afford That?

#50

Post by slackfan »

burnt-resistor wrote: post #48

Bikeshedding about the style of the hair of the person involuntarily buggering you. Proper healthcare is needed, because this one is unfair and too expensive compared to everywhere else with worse outcomes.

Proper healthcare is me going to the doctor and paying them an hourly rate to diagnose/work on me, please do not conflate it with health insurance.

(Here's a hint, it's actually quite affordable right now if you go to a GP out of pocket).

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