Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

rand.org

Post reply on HN
Print view View original

21–30 of 91 posts

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#21

Post by auctiontheory »

Matti wrote: post #14

Looking at the Nordic countries you might possibly make the counterpoint that publicly funded health care implies a taxation model that makes it economically unrewarding to become an entrepreneur.

You imply that entrepreneurs do it primarily to get rich. That may be true for some, but it's not universally true. Many of us want to do interesting work to create something meaningful, while maintaining some control over our own lives. The way the US healthcare system is set up, leaving a big employer is incredibly hard after the age of 30-35. (I've done it myself.)

It's also not obvious that Nordic countries (e.g. Finland) have less entrepreneurship than the US does. If they do (I couldn't find hard data), it's as likely to be for cultural reasons as economic ones.

Scandinavia has produced a disproportionate number of artists and athletes - another kind of "entrepreneur." No doubt access to healthcare made it easier for them to pursue their passion.

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#22

Post by mjn »

mgkimsal wrote: post #6
pixelmonkey wrote: post #2

+1 this research being done. When I bootstrapped Parse.ly by doing consulting in 2009/2010, my biggest costs were rent and healthcare. I wrote about this in my blog post, "Startups: not for the faint of heart". http://www.pixelmonkey.org/2011/04/02/not-for-the-faint-of-h... To get a good "sole proprietorship" plan for me cost >$1,100 a month. My healthcare cost nearly as much as my rent in Astoria, NYC. I've spoken t…

was this just for yourself, or a family? $1100 seems steep - a 'high deductible' HSA plan for a single person should be < $500/month - it's currently < $350 for two of us.

When I was looking (a few years ago, in California) I had trouble finding HSA plans that included prescription-drug coverage (even with a very high deductible) for less than ~$400-500/mo. There were plans cheaper than that with no drug coverage (starting around $200), but that leaves you on the hook for unlimited liability if you end up needing an expensive prescription (and some can be very expensive). I was looking for something where I self-insure the first $10k in an HSA, and then the plan covers hospitalization+drugs past that. And those exist, but not at the lowest end.

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#23

Post by j2d3 »

brm wrote: post #4

Yes. It's a hindrance to most life paths that don't involve full-time employment. As someone with a chronic auto-immune condition I'm effectively tethered to an employer or a spouse if I want health coverage. Should I choose pursue an art as my vocation or start a company I'd have to be willing to endure a lag in my insurance until whatever I was pursuing became successful enough that I was eligible to be covered by…

I'm in pretty much the same situation, and it's absurd and also should be obvious.

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#24

Post by phaemon »

Daniel_Newby wrote: post #15
jjoonathan wrote: post #8

Earlier quoted context omitted.

You beat me to it! (For those who don't know, the PPACA is sometimes called "Obamacare" although it should be noted that the name is more a result of political maneuvering than the result of particularly close affiliation with Obama.) I still think we should go all the way to single-payer. Other countries have had such success with this model that it's becoming very difficult to argue that it's inherently flawed (rat…

> Other countries have had such success with this model that it's becoming very difficult to argue that it's inherently flawed ... The British NHS discovered that by not feeding hospitalized patients they could realize tremendous savings in food, shortened length of hospital stay, followup costs, etc. > half the price per person Health care spending will dramatically increase under Obamacare. Americans spend a lot on…

> The British NHS discovered that by not feeding hospitalized patients they could realize tremendous savings in food, shortened length of hospital stay, followup costs, etc.

That's a lie. Try checking your facts next time:

http://fullfact.org/factchecks/nhs_malnutrition_death-28806

Oh, and by the way, the NHS costs us less than US public healthcare costs. Meanwhile, I can get zero deduction, all additions, money for any nights spent in an NHS hospital, private health insurance for $150 a month. How much does yours cost?

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#25

Post by j2d3 »

Daniel_Newby wrote: post #15
jjoonathan wrote: post #8

Earlier quoted context omitted.

You beat me to it! (For those who don't know, the PPACA is sometimes called "Obamacare" although it should be noted that the name is more a result of political maneuvering than the result of particularly close affiliation with Obama.) I still think we should go all the way to single-payer. Other countries have had such success with this model that it's becoming very difficult to argue that it's inherently flawed (rat…

> Other countries have had such success with this model that it's becoming very difficult to argue that it's inherently flawed ... The British NHS discovered that by not feeding hospitalized patients they could realize tremendous savings in food, shortened length of hospital stay, followup costs, etc. > half the price per person Health care spending will dramatically increase under Obamacare. Americans spend a lot on…

Any references to support any of your claims?

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#26

Post by j2d3 »

tarikjn wrote: post #16

I am from France and moved to the US over five years ago. I have been altering between working for an employer and taking time off to work on my projects. Within the first 2 years, I realized how cumbersome it was to switch healthcare and be covered between jobs, so I signed up for a private healthcare at once. I chose to have a low general coverage but a good one for accidents, I pay $20-40 for a doctor visit, nothi…

That's great for you, obviously you have no documented chronic health conditions that would exclude you entirely from private insurance. Unfortunately for me, I do, and am considered uninsurable as am individual, leaving only employer sponsored group coverage as a viable option until next year.

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#27

Post by mjn »

tarikjn wrote: post #16

I am from France and moved to the US over five years ago. I have been altering between working for an employer and taking time off to work on my projects. Within the first 2 years, I realized how cumbersome it was to switch healthcare and be covered between jobs, so I signed up for a private healthcare at once. I chose to have a low general coverage but a good one for accidents, I pay $20-40 for a doctor visit, nothi…

> for expensive drugs, the same drugs from the same labs are still cheaper in Mexico than a good insurance copay

If you're lucky enough not to get any major condition, sure, you can buy antibiotics or whatever from Mexico. But even at Mexican prices you will probably not be able to pay out of pocket for something like Avastin (cancer) or Copaxone (multiple sclerosis).

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#28

Post by Matti »

nawitus wrote: post #20
Matti wrote: post #14

Looking at the Nordic countries you might possibly make the counterpoint that publicly funded health care implies a taxation model that makes it economically unrewarding to become an entrepreneur.

At least in Finland entrepreneurs are taxed less than many full-time employees. Corporations are taxed at a flat percentage (about 28% of the profits), while income taxes are progressive and up to 50%. In fact, your argument doesn't make much sense. High taxation doesn't logically imply that it's necessarily unrewarding to become an entrepreneur but rewarding to be a full-time employe. You can have high taxes for ent…

A 2010 headline from Arctic Startup read: Killing Finnish Entrepreneurship With Tax

http://www.arcticstartup.com/2010/02/24/killing-finnish-entr...

Skim through the comments to the article: what are the general themes that are brought up?

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#29

Post by mjn »

Matti wrote: post #14

Looking at the Nordic countries you might possibly make the counterpoint that publicly funded health care implies a taxation model that makes it economically unrewarding to become an entrepreneur.

Is taxation actually higher in the Nordic countries for entrepreneurs?

If you bootstrap yourself to $100k as a 1-man company in the Valley, the taxes come out to something like:

    $7,000 CA income tax
   $14,000 self-employment payroll tax
   $16,000 federal tax (after deducting eligible portions of the above two)
   -------
   $37,000 (37%)
In Copenhagen, it would come out to [1]:

    $8,000 labor-market contribution (AM-bidrag)
   $24,000 municipal tax (kommune + healthcare tax)
    $7,000 national tax (grundskat+topskat)
   -------
   $39,000 (39%)
The tax is 2% higher, but the Danish version of the healthcare tax buys you healthcare coverage starting now, while the American one only buys you Medicare in the future. So I think you actually come out ahead in the Danish system.

[1] http://www.tax.dk/beregn/skat13.htm

Re: Is Employer-Based Health Insurance A Barrier To Entrepreneurship? (2010)

#30

Post by [deleted] »

Matti wrote: post #28
nawitus wrote: post #20

Earlier quoted context omitted.

At least in Finland entrepreneurs are taxed less than many full-time employees. Corporations are taxed at a flat percentage (about 28% of the profits), while income taxes are progressive and up to 50%. In fact, your argument doesn't make much sense. High taxation doesn't logically imply that it's necessarily unrewarding to become an entrepreneur but rewarding to be a full-time employe. You can have high taxes for ent…

A 2010 headline from Arctic Startup read: Killing Finnish Entrepreneurship With Tax http://www.arcticstartup.com/2010/02/24/killing-finnish-entr... Skim through the comments to the article: what are the general themes that are brought up?

[deleted]
Post reply on HN