Do you know how health insurance really works?

[kork13]

. That's why we now have 7-year car loans and 50-year mortgages.

Say WHAT?!? A 50-yr mortgage?? Never heard of that except maybe with commercial property? I assume that's not conforming, and can't imagine it's very common... Many folks wouldn't even live long enough to ever see it paid off!

[disneysteve]

Say WHAT?!? A 50-yr mortgage?? Never heard of that except maybe with commercial property? I assume that's not conforming, and can't imagine it's very common... Many folks wouldn't even live long enough to ever see it paid off!

It's not the norm (yet) but there are 40 and 50-year loans.

And I was wrong. There are now car loans as long as 10 years, and 8-year loans are increasingly common.

[TexasHusker]

See above responses

How to fix the college cost situation? That's a tough one, as once the toothpaste is squeezed out of the tube, trying to get it back in the tube is tedious, if not impossible. Once government tampering begins, things become so entangled that the government can't see its way out. This is exactly what we are seeing with manipulation of treasuries by the U.S. government to keep interest rates low. Keeping interest rates low should be beyond the purview of the government in a free market economy. Yet since really 2007, the Feds have been tampering, and tampering, and tampering. The U.S. Treasury is literally issuing new bonds (paper money), and then buying them back, itself. That is essentially like playing Monopoly with someone and suddenly, the player produces a whole new wad of fake cash from their wallet and inserts it into the game. It creates an imbalance and the destroys the integrity of the board game. Only with the Fed, the game is real, and it is a potentially catastrophic situation for all of us.

Right now, the Fed has become afraid of A) a recession, and B) a stock market selloff. Thus, they are playing even more games to manipulate interest rates to keep them artificially now, all while reassuring us that there is no inflation. Yet we all know that there is significant inflation. Housing costs are skyrocketing, as are groceries and consumer goods. So we have a fundamental problem in that we can't trust the very people that are supposed to be representing us. Yet in a free market economy, recessions and expansions, as well as stock market bears and bulls, are just a normal part of the economic cycle.

As for college costs, currently, the only real solution being discussed is forgiveness of the loans. Well, those loans are backed by investors - bond holders, and we cannot default on those, so you and I, through our taxes, will have to fund the payoffs. We cannot discharge debt with the stroke of a pen, just like we cannot create more buying power with the stroke of a pen (i.e. minimum wage). Someone pays, somewhere.

If and when the government can extract itself from higher education finance, we can return to the normal ebb and flow of buyers and sellers agreeing on a price. But we all know that the government will not walk away from college loans; it will only double down and further entangle itself in the process.

As for medical inflation, there is no doubt that it began with Medicare, as the government stepped in as the payor for the demographic that represented the largest consumer block of healthcare services. Providers were short changed through inadequate reimbursement, and were forced to "cost shift" to their other paying patients. And so it began.

Comparing the U.S. healthcare system to other countries is problematic, as care is not rationed in the U.S., like it is in most of the rest of the developed world. For example, I would guess that there are only a few places in all of the U.K. where one might receive a PET scan. In the U.S., every MSA of 100,000 or more has at least one PET scanner. Chicago probably has more PET Scanners than the entirety of the UK and Canada combined. Certainly, the U.S. could implement a significantly less expensive healthcare system with rationed care.

The only solution that I can come to - and I haven't settled on it as a solution - is to place everyone on Medicare by default, and ration care big-time. If you want a concierge plan where you can go and do this and that procedure at your pleasure, you buy that on the open market as a supplement. However, as soon as the government starts tampering with the concierge plan, we are back to where we started. So this would be a split-baby situation: The government could run health care for the masses, which it desperately wants to do, it would be cheap (er), and it would be rationed. It would be the Greyhound bus. It will get you there, but without all of the frills. If you need a knee surgery, you might literally be taking a bus to Denver to get that done. If you want to fly first class and go wherever you want for care, you go on the open market - a market not tampered with by the government, and you buy additional coverage. Everyone wins. I think.

[ua_guy]

The only solution that I can come to - and I haven't settled on it as a solution - is to place everyone on Medicare by default, and ration care big-time. If you want a concierge plan where you can go and do this and that procedure at your pleasure, you buy that on the open market as a supplement. However, as soon as the government starts tampering with the concierge plan, we are back to where we started. So this would be a split-baby situation: The government could run health care for the masses, which it desperately wants to do, it would be cheap (er), and it would be rationed. It would be the Greyhound bus. It will get you there, but without all of the frills. If you need a knee surgery, you might literally be taking a bus to Denver to get that done. If you want to fly first class and go wherever you want for care, you go on the open market - a market not tampered with by the government, and you buy additional coverage. Everyone wins. I think.

This is the system we already have, is it not? The only difference is right now there's a gap between affordable private health insurance and medicaid eligibility. Those in upper incomes just pay the deductible or out of network costs, out of pocket costs to get the care they want, where they want it, from private health systems.

[LivingAlmostLarge]

This is the system we already have, is it not? The only difference is right now there's a gap between affordable private health insurance and medicaid eligibility. Those in upper incomes just pay the deductible or out of network costs, out of pocket costs to get the care they want, where they want it, from private health systems.

I agree because people who are rich afford like Mr Money Mustache is NO insurance and concierge medicine. He even discussed how paying for a private dr was more affordable than insurance. I mean great if you can afford it and for most of us here, we'd probably afford it and probably scrimp and save to do it. But for the majority of people they couldn't.

Also the gap between affordable to middle class and the rich is huge.

[Like2Plan]

I agree because people who are rich afford like Mr Money Mustache is NO insurance and concierge medicine. He even discussed how paying for a private dr was more affordable than insurance. I mean great if you can afford it and for most of us here, we'd probably afford it and probably scrimp and save to do it. But for the majority of people they couldn't.

Also the gap between affordable to middle class and the rich is huge.

Even if you do have some money- I am wondering how that would hold up to some really serious expenses? Like how about an aortic aneurysm or a stroke that requires a life flight for care/rehabilitation?

[LivingAlmostLarge]

Even if you do have some money- I am wondering how that would hold up to some really serious expenses? Like how about an aortic aneurysm or a stroke that requires a life flight for care/rehabilitation?

That's not common. But 6 figures cancer treatment or surgery? He makes like a million a year so I think he's fine. He said he's tired of paying $20k or something a year for health insurance he doesn't use. He said it was worthless. But he never acknowledge that people like him are part of the problem. Health people refusing to buy into insurance means the insurance pool is only poor risk people. Thus why it's so expensive. But that's why pushing everyone to "have" insurance is supposed to increase pools and spread risk around. Why socialized system works.

Texas I agree we'd have to ration care. But we ration care already. We ration based on who is wealthy enough to afford care. Who is rich enough to afford to know how to use insurance. Who can take time from work and go to dr. Who can pay for medications and stuff prescribed by dr. There already is a divide about those we have good insurance and those who don't. Unfortunately it goes hand in hand with jobs. We need to decouple it and make everyone buy it. I think that would make it cheaper from a perspective. NO medicare even or make it medicare for all.

More than the government stepping in, it's EMPLOYMENT. I mean a lot of what you mentioned happened from when employment was not tied to health insurance. Before people paid the dr. But when the "middle" class rose so did this thing where employers provided health insurance. If we all had to shop around and watch costs it would be different. We'd probably all call for reform.

[HundredK]

I agree because people who are rich afford like Mr Money Mustache is NO insurance and concierge medicine. He even discussed how paying for a private dr was more affordable than insurance. I mean great if you can afford it and for most of us here, we'd probably afford it and probably scrimp and save to do it. But for the majority of people they couldn't.

Also the gap between affordable to middle class and the rich is huge.

Agreed - MMM irritates me so much because a lot of what he says is just through the lens of a wealthy white guy. I stopped reading anything from him for just that reason, it just gets tiring, his arrogance. I can definitely see how he ended up divorced, heh, who could live with that?

[TexasHusker]

This is the system we already have, is it not? The only difference is right now there's a gap between affordable private health insurance and medicaid eligibility. Those in upper incomes just pay the deductible or out of network costs, out of pocket costs to get the care they want, where they want it, from private health systems.

No, this is not the system that we already have. The government has forced itself into every orifice of healthcare finance, public and private. Look at the volumes of requirements for "private" ACA plans as an example. So onerous and cumbersome that the vast majority of individual health insurers pulled up the stakes and left town. There are many markets in the U.S. with only one insurer remaining that offers an ACA compliant plan. There is no such thing as "affordable" private health insurance, unless you are poor enough to receive subsidies, or rich enough that any amount doesn't matter. Go to healthcare.gov and get some sample pricing for a family of four. Then add up all of the coinsurances and deductibles before anything gets paid. It is an eye-opener.

[disneysteve]

There is no such thing as "affordable" private health insurance, unless you are poor enough to receive subsidies

There are plenty of people who are far from poor who are able to manage their taxable income to qualify for the subsidy. Many retirees do just that even though they may have multi-million dollar portfolios.

There may not be blatant rationing going on, but the inequalities in the system amount to just that. Somebody on Medicaid certainly isn't getting the same level of care as someone on private insurance. Access to care is very variable based on where you live, how much money you have, what insurance you have, etc.

[TexasHusker]

There are plenty of people who are far from poor who are able to manage their taxable income to qualify for the subsidy. Many retirees do just that even though they may have multi-million dollar portfolios.

There may not be blatant rationing going on, but the inequalities in the system amount to just that. Somebody on Medicaid certainly isn't getting the same level of care as someone on private insurance. Access to care is very variable based on where you live, how much money you have, what insurance you have, etc.

You make my point. Health insurance requires government subsidies to become affordable. Playing games with income so that we qualify for handouts is a big chunk of our quagmire.

Retirees should be on Medicare once they reach 62, which is fully government run.

[disneysteve]

Retirees should be on Medicare once they reach 62, which is fully government run.

Lowering the enrollment age for Medicare to 60 is one proposal that the President has supported to help expand coverage.

[Fishindude77]

No, this is not the system that we already have. The government has forced itself into every orifice of healthcare finance, public and private. Look at the volumes of requirements for "private" ACA plans as an example. So onerous and cumbersome that the vast majority of individual health insurers pulled up the stakes and left town. There are many markets in the U.S. with only one insurer remaining that offers an ACA compliant plan. There is no such thing as "affordable" private health insurance, unless you are poor enough to receive subsidies, or rich enough that any amount doesn't matter. Go to healthcare.gov and get some sample pricing for a family of four. Then add up all of the coinsurances and deductibles before anything gets paid. It is an eye-opener.

Amen !
There are only two ACA providers in our state. Since we make over $67,000 annually and aren't eligible for discounts, my spouse and I (58 & 61) pay $1450 per month for our ACA insurance coverage. Prior to ACA when you could buy health insurance on a more competitive open market, we could have purchased the same coverage for about half that amount. The ACA sure aint "affordable".

I have heard of people with sizeable net worth cheating the system by manipulating their "visible" income to a level below the threshold so they get discounts, etc. and much cheaper ACA coverage.

[TexasHusker]

Amen !
There are only two ACA providers in our state. Since we make over $67,000 annually and aren't eligible for discounts, my spouse and I (58 & 61) pay $1450 per month for our ACA insurance coverage. Prior to ACA when you could buy health insurance on a more competitive open market, we could have purchased the same coverage for about half that amount. The ACA sure aint "affordable".

I have heard of people with sizeable net worth cheating the system by manipulating their "visible" income to a level below the threshold so they get discounts, etc. and much cheaper ACA coverage.

I would be curious to know more about your $1450 per month plan. Deductibles, coinsurance, max. out of pocket. You are paying $17,400 a year for "affordable" coverage - it will be interesting to know what you actually get for that.

[Like2Plan]

Even with Medicare (and even though medicare reimbursements may not be enough to cover expenses at Dr. offices), the individual has to have additional insurance because Medicare doesn't cover the entire cost. Additional coverage is needed for prescription drugs (which may have additional co-pays). And, then not everything is covered by Medicare.

I figure those folks who sell medicare supplemental insurance must make a ton of money. They are always second payers and they only pay a percentage of the claim that is capped at predetermined rates. I received a ton of mail and literally thousands of phone calls from folks soliciting medicare supplemental insurance.