It was worse before Obamacare. If you had a common prexisting condition such as high cholesterol or high blood pressure you probably could not get health insurance at all on the individual market.
It's a problem with "Health Insurance in the US" as opposed to Obamacare.
I am not blaming Obamacare. I have reflected your exact sentiment in my other posts online. This is a result of the disaster that is the US healthcare system as a whole. Obamacare was a patch, but not enough to stop this from happening.
I do advise that people not write-off criticisms of ACA as right-wing hysteria right now; the 2017 increases are really unbelievable in many states (Minnesota: 50%+). Everyone can browse these rates online.
I've been saying for a while that the health care system is the biggest impediment to entrepreneurship in the US. Not only does it make it difficult to start a company, it makes it difficult to work for startups and small businesses. Employer-provided health insurance is an incredibly strong bias in favor of large corporations (that have dedicated HR and can negotiate rates and self-insure).
Its the same for investing - you /cannot/ tax defer more than $5500 a year of your income for retirement unless you have a COMPANY PROVIDED 401k. There is no such thing if you are a employee at a company that doesn't supply one.
I'd like to see Elizabeth Warren deprecate 401ks and raise the IRA contribution limits accordingly, while legislating that employers can contribute to them directly. Immediately remove employer-tied retirement plans, and you'll see expense ratios of funds plummet when you can have any fiduciary host your account.
Its absolutely silly we still tie retirement accounts and healthcare to employers.
"Allow individuals to fully deduct health insurance premium payments from their tax returns under the current tax system. Businesses are allowed to take these deductions so why wouldn't Congress allow individuals the same exemptions?"
"Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits. Now employer health insurance benefits are fully tax deductible, but individual health insurance is not. This is unfair."
Wow, who knew Trump had positions? Someone on his staff should tell him to talk about them rather than continuously drawing attention to attacks from his opponents that he should not even be mentioning. Well, actually let's not because he would not be a stable president for the US economy. Would be nice to have a president that didn't see business as an enemy and tax cuts as handouts for the wealthy though.
The problem with lowering taxes for the wealth is they invest it. which drives up asset prices. makes them feel good, because the assets values went up but it didn't create anymore actual assets or create anything more productive. Corporations are flush with cash and investing in new technology as fast as they can. Throwing money at the problem won't fix anything.
If you're already employed full time and your paychecks go directly to you its only possible if your employer is okay with paying you as a contractor, which of course makes their situation with you more complicated, and also you might have trouble getting health insurance through the company.
If SEP IRAs as mentioned above aren't an option, HSAs might be worth considering - after 65 they aren't restricted to medical expenses. I-bonds might be an interesting component for future retirement as well.
As I understand it, it doesn't help you as an employee of a small business though unless the business makes the contribution. SEP IRAs are primarily intended for freelancers and small business owners.
Europe is over-taxed and over-regulated and the US is, too. We're killing our golden goose as we speak. It was completely avoidable, but leftism just feels so good.
We should be hanging the people that caused this, but we're too nice and we won't until it all ends up like Venezuela.
Have you read pg's essay "Cities and Ambition"? He explains there why there isn't a Silicon Valley outside of Silicon Valley. Different cities have different cultures, and encourage different things. The cities of Europe are ancient. Their ambitions were set long ago.
That said, there's much more to "entrepreneurship" than tech startups! Opening your own restaurant - not a chain franchise - is entrepreneurship, too. Or a barbershop, or making custom clothing, or running a small theater, or any number of other things. Small business is mostly small, not a stepping stone on the way to being huge.
In those terms, is the US actually doing better than Europe? Do entrepreneurs - not the millionaires, just the people who don't have to answer to anyone but themselves - do better here, or in Europe?
All of our smart entrepreneurs go to Silicon Valley where the money and other talent is? I live in Toronto and can't count the number of friends I've know who moved to either SF or Seattle. The only reason I didn't move there was because I didn't have a 4yr "advanced degree" to qualify for a T1 visa (despite having a job + lawyer). Most leave right out of university. Considering jobs are $60-70k vs $150-200k I don't blame any of them.
Otherwise I believe it's a pretty good place to start a company. Our income taxes are equivalent to California and I believe our corporate taxes are lower but we have health care and relatively cheap housing downtown thanks to a housing development boom.
We also have a startup founder visa and an easier immigration policy. Access to seed capital and higher-end talent is the only constraint.
But people moving to take jobs aren't people moving to start companies. I lived in Toronto in the late '80s and found it to have a pretty decent startup culture. My wife worked for Alias at the time.
I don't understand why there is such a huge salary difference between Toronto and SF. I'd love to move to Toronto but really don't want to take that huge salary hit.
It's about even from the personal income tax side in california. Companies don't pay for healthcare so that 'tax' is gone. I don't think there is much of a difference past that.
There's a network effect. People want to live in a place where they have plenty of options if their current job doesn't work out. Employers want to have a large pool of local talent to draw from. This is all self-reinforcing and probably the reason why companies start and stay in the SF bay area even though the cost of living is insane.
Let's also not forget that a significant part of this hasn't even kicked in yet, the so-called Cadillac Tax has been kicked down the road, but is potentially enormous. Those who pay the most for their health care plan are going to be heavily taxed to subsidize everyone else. So as much as the current plan rate hikes are unbelievable, it's still going to get much worse before it (maybe) gets better.
How kicked? I remember a big internal uproar when I was at one of the big tech companies about cutting some benefits, and one of the explanations was the cadillac tax.
A quick google search brought this up, which might be accurate[1]. It suggests that 2020 is when it is supposed to be enacted now. The Wikipedia article [2] seems less concrete about it, other than to say that there's bipartisan support for not implementing it.
Maybe so, but someone has to pay for the subsidies. Whether it's this tax or a different one, the middle class is going to have to take on that burden.
Left-wing criticisms of the ACA are that it should've had a public option (or single payer) - which may get some momentum with ongoing premium hikes.
The right-wing hysteria part is the (false) idea that premiums didn't go up like this pre-Obamacare, as well as the idea that "roll it back" is a tenable solution.
10-20% rate growth was common before the ACA. Now my state is looking at a 74% hike. It is false to claim these kind of hikes were normal before the ACA.
> A new analysis from the Urban Institute found that the average unsubsidized premiums in the Affordable Care Act exchanges, commonly known as Obamacare, are actually 10% lower than the full premiums in the average employer plan nationally in 2016.
> According to the Kaiser Family Foundation the average cost of the second lowest priced silver metal plan, also known as the benchmark plan that is used to set subsidies, will see its price increase 9 percent next year. That's significantly higher than the 2 percent increase for these plans this year, but it's south of the figures provided by Trump.
It's more of a "you touched it; you're responsible" scenario. The insurance market was bad pre-ACA. Then Obama touched it. Now it's his fault. If he had left it alone, everyone could have continued to just point the finger.
It was worse before Obamacare for certain people, and better for others. ACA insurance premiums (combined with large deductibles) are causing a lot of pain for (self-employed) middle class families I know, even before the next set of rate hikes hits in a couple months. It's also sad to see that the most ''successful'' ACA insurers are running networks so narrow that some patients have called them unusable (search for Molina Healthcare in California).
The ACA was flawed from the start. My takeaway from the whole fiasco is that even the smartest, most well-educated policy analysts and lawmakers can allow some combination of enthusiasm, politics, and momentum to blind themselves to the most basic predictive models of human behavior and incentives. When the law was published it was obvious to me how insurance companies would make money - you create the narrowest, cheapest network possible in order to cherry-pick the healthiest patients, leaving competitors dumb enough to have broader (more attractive) networks to soak up the most expensive cases (and lose money). This is exactly what happened and the so-called ''death spiral'' will start next year when (my prediction) 1+ million unsubsidized middle class families refuse to pay for the next round of rate hikes.
I'm 100% for free, universal health care for all Americans. I don't think we're that far away. The bemused Federal Reserve searches for helicopter drop scenarios - Federally-funded (or re-insured) universal health care is not a bad option. I'd much rather bleed out the treasury in order to build a great health care system than in the middle east or some other boondoggle.
You're insane! It is not "free!" It can never be free. It is all who pays for it in their high-ass taxes! We're $20T in debt which isn't getting paid back. How far do you think the Fed can stretch this until it snaps? Bear in mind that if we have a collapse it will be a Mad Max type scenario--you'll wish we had just had a nuclear war. This is where we are and everyone just kind of nonchalantly goes along with their normalcy bias because they have never experienced any real hardship in their lives. It doesn't mean hardship isn't out there waiting for more stupid policy choices to seal the deal.
I think we can hit $40 to $60 trillion in debt (in real terms) before the system starts to collapse. In other words, at least 20 years from now, maybe much more. I have no faith in either political party to exercise fiscal restraint or conservatism. I firmly believe the excessive deficit spending will continue until the breaking point. Given that belief, I'd like to spend the money (the newly issued debt, as you correctly point out) as wisely as possible.
I used to be concerned about that. Look at Japan. They are monetizing absolutely everything in sight and the currency barely moves. Apparently your 'cultural equity' in the face of global chaos counts for a lot more than anyone ever realized. Time will tell.
While your point about pre-existing conditions is true, it's worse now. 3 months before ACA, I looked for an insurance plan because I was going to start my own company and we wondered if it would be cheaper than my wive's company plan. We found a $250/month $5,000 deductible plan with no co-pays (I'm fine with that). Her plan is $350. Idea was to get this plan, then add $100 to HSA (same cost but with added value). ACA comes along. Same-ish plan (ACA required more crap than we wanted) jumped to $550 without the HSA contribution. Now it's $712.
The reason it was lower is because your pre-existing condition simply wouldn't be covered, and just about any other claim would be initially denied, citing the pre-existing condition as a reason. Now that's not an option.
At least you had the option of not having healthcare and just creating a startup without it. Now with Obamacare you are forced to buy it by law which means no startup for a lot of people.
Of course if you have have preexisting conditions, you will have difficulty getting insured. Go try getting homeowners insurance while your house is on fire.
False. You could certainly get insurance. Even my dad, a 105-pack-year smoker with diabetes, emphysema, obesity, and hypercholesterolemia got insurance.
It may not have been cheap, but it was cheaper than the "insurance" I as a 37-year-old perfectly healthy individual am now paying. >:(
That's because you, as a 37 year old healthy individual, are subsidizing your father's healthcare. That was one of the main goals of Obamacare: push up and force premiums on younger people to help pay for the increasing costs of the large Boomer generation.
The worst part of Obamacare for me is the individual mandate. It essentially raises taxes on working class people or forces them to buy a high deductible plan that is of little use to them. The poor get a subsidy and the wealthy need not worry about preexisting conditions. The working class just gets screwed.
It's necessary given that the ACA restricts insurers for rejecting people for preexisting conditions. This only really works in a country where everyone has insurance. Otherwise, why not just hang around without insurance until you get really sick, then purchase insurance at that point? If this happens, it drastically distorts the insurance market and makes insurance even more affordable, because people who have insurance will be disproportionately sick.
It may seem like a tax on working people, but really, it is a payment for a very real benefit: a dramatic change in your personal healthcare risk. When you can purchase health insurance at any time even when you're unhealthy, you are essentially being granted an insurance policy for expensive, chronic conditions without even having to purchase anything.
You can't simply purchase Insurance and be covered next day. Insurance companies can have a waiting period of up to 3 months before providing you with benefits. It's not really a good idea to wait around with cancer for 3 months until you get your treatment covered
The ACA actually makes it very easy to purchase insurance only when you need it (you've moved, your employer drops your coverage), and drop it when you don't (you can go two months per year without insurance without penalty). This is a fundamental flaw in the program.
You must mandate participation through payroll taxes, but also ensure services can be affordably provided to participants. Insurance companies are still raking 20% off total premiums paid; that's money that could go directly into providing care.
It is awful but the alternative is adverse selection. That is, healthy people see high prices and drop out, leaving the prices to get higher for the sick.
One angle of the employer-based system is the "healthy worker" effect. It's almost impossible to answer questions such as "is working in a plutonium factory bad for your health?" because almost any population of workers is healthier than the average population because less healthy people don't work.
> It is awful but the alternative is adverse selection. That is, healthy people see high prices and drop out, leaving the prices to get higher for the sick.
Not exactly. Obamacare has other provisions that make this much worse. For example, Obamacare only allows insurance companies to charge older people at most three times as much as younger customers.
"But it’s worth noting that prior to 2014, there was no federal standard in terms of how rates could vary based on age. It was common for health insurance companies to charge older applicants five or six times a much as they charged younger applicants." [1]
This is a way of subsidizing the old (a better organized interest group), but it makes health insurance massively less cost effective for younger customers.
Is it fundamentally different from car insurance? It might not be very useful to them if they get in a fender-bender, but a high deductible plan can still save their bacon if they have a health catastrophe.
If you can barely afford the deductible, you will NOT be able to afford the bill at the end of the day for anything remotely complicated like a surgery. You will still end up with a >$50,000 bill you won't be able to pay, because you'll have to take time off of work to recover. There is nothing protecting someone from being fired from their job unless it was a workplace injury.
Everyone in the working class in the US is a single major medical event away from bankruptcy, insurance or not.
I can't speak to every insurance plan out there but there are typically out-of-pocket maximums and other limits on spending. A surgery does not routinely cost $50,000 out of pocket.
I learned a fun thing about out of pocket maximums - there's a thousand ways around them. You get a surgery, and they decide to use a "3rd party" doctor with this own billing that isn't in-network? You're still holding the bill.
Because entrepreneurs and small business owners is not a desired or targeted demographics by the Democrats anymore. Even though these groups provide a disproportionately large economic growth contribution, the number of votes the Democrats can realistically gather from them is relatively small. They target the lowest 30% and the salaried employees with their policy.
Very short-sighted thinking. Most multinationals were started by entrepreneurs, some even bear their names: e.g. Boeing, Ford, Dell, Bristol-Myers-Squibb. If you create a start-up unfriendly regime ( like in EU currently), they don't get started. Out of 1000 startups one becomes Boeing and 20 become sustainable medium size businesses that can be discarded for the microeconomic estimates.
I guess it depends on your definition. In my experience people who can barely support themselves make too much to be granted a subsidy most of the time. Myself when I was a cook included.
The alternative is a national Single Payer system where competition is negotiated in advance of any patients having a need (based on the historic rates of and future projections of patient needs).
You do this by making 'basic insurance' something everyone has, and a negotiating pool that more or less dutch-auctions per market with the practitioners. You might also include quality control measures like allowing patients to see any doctor they prefer from within the list (of doctors that met the group bid rate), and also allowing criminal mal-practice but not financial liability as a means of stripping titles from those who should not practice medicine. (The liability would be implicitly recognized as social; no big payout, but what life there is that is left you would be some degree of retired.)
No, the alternative is not to double down on madness. The alternative is to stop regulating healthcare out of existence while giving free handouts to billionaires.
It's a problem with "Health Insurance in the US" as opposed to Obamacare.