
Health care 'job lock' stifles entrepreneurship - timr
http://seattletimes.nwsource.com/html/opinion/2008562578_opin27mccarthy.html
======
thinkcomp
This is a very real problem, and probably the biggest problem I face right now
running my company. Through no fault of my own, I'm uninsurable as an
individual, but I'm also an entrepreneur. It makes life rather difficult, and
it's an obvious disincentive for people to start businesses. It's also one of
many reasons why I'm hiring right now!

------
incomethax
Is there some kind of startup association that startups could join to
negotiate better healthcare insurance plans as a collective?

Seems to me like it would provide many startups a large cost savings if one
were to join.

------
hs
over my 9 years studying in usa, i never used my health insurance (always paid
due to school regulation)

then 4 years in my country, i never buy one

actually over my lifetime, i never ever go to hospital and ask my insurance to
pay for it (too much hassle and i hate meeting doctor)

the fud tactic used (you will pay 1 million dollar when you visit a hospital)
always amuses me

maybe a better way is to take care of yourself, exercise, read health
textbooks, read wikipedia on generic OTC drugs, eat real food, avoid extreme
sports, don't smoke, use common sense etc

never ask an insurance company, "do i need coverage?"

~~~
russell
One of the things that nearly everyone here is missing is that insurance plans
cap costs. Hospital costs for an uninsured person are 2 to 4 times that which
an insurance company will pay. I had a heart attack. The hospital billed
$80,000, but the insurance company paid only $18,000, and I paid $2,000. Same
for dental plans. They cap the amount that provider can charge and stipulate
that he can't bill you for the excess.

The idea that you can negotiate as an individual with health care providers is
silly. When I had my heart attack, I was in no position to call half-a-dozen
hospitals to get the best price. Try going to your pharmacy to get the price
of a prescription knocked down. Individuals have very little negotiating power
against corporations. If you doubt that, take a look at the history of the
labor movement.

That said, if you are low income and need expensive meds, many pharmaceutical
companies have plans for certain drugs. Costco gives a small discount for
people with no insurance.

~~~
yummyfajitas
You can't shop around for _trauma_ care. But why can't you shop around for the
cheapest non-emergency MRI, chemo-therapy center or dermatologist?

Hint: you can, I've done it. Now that I have insurance, I just pick the guy
closest to me. Why should I bother to price shop when I don't get the savings?

When consumers price shop, corporations compete on price. See for example
Walmart, Jetblue and Dell. And a lot of medicine is delivered by individuals
or small businesses (i.e., 5 doctors in 1 office), not by corporations.

------
payne92
I've never had trouble getting health insurance as an individual/family -- you
just have to be willing/able to pay the premiums. It sometimes helps to
incorporate as a small business, but that's easy to do and doesn't cost much.

If you can afford COBRA, you can usually afford to pay directly for a plan.

(BTW, I'm not suggesting that healthcare is screwed up in a number of
dimensions, I just think the premise of the article is flawed).

~~~
tednaleid
I'm guessing neither you, or any of your family members covered by your
insurance have any significant pre-existing conditions.

The premiums are much less "affordable" if this is an issue for you or your
family.

~~~
yummyfajitas
Insurance is there to protect you against high cost, low probability events;
basically events where you can afford the _expected_ cost, (probability of
becoming sick) x (cost of treatment), but you can not afford (cost of
treatment).

If you have a pre-existing condition, (probability of becoming sick) == 1. In
this case, insurance is pointless.

~~~
jerf
I sometimes think that half the problem with employer-provided health care is
that people have stopped thinking of it as _insurance_ , as you describe.
Instead, you get people who think that they have some sort of right to pay $10
and get $100 of treatment in return, every year, for perpetuity.

The vision plan at my recent open enrollment demonstrated this clearly. You
pay $X, and everyone's sitting there determining if they get $X+ back from the
plan. And in this case, the vision plan isn't even _insurance_ , because
basically the only people going on it have a 100% chance of paying out. And it
turns out that if you work the math, for one person, or one person +
spouse/SO, you pay in $X and the max payout is $X-, precisely because the
probability of payout is so very close to 100%. (This is because the plan only
covers glasses and routine eye exams; catastrophic eye damage is covered by
normal health insurance.)

(I further note that vision coverage has been one of the most free market of
medical endeavors, precisely because of this math.)

How do we know the system is distorted? Because almost nobody actually
realizes that this is an _insurance_ system, that you _should_ be expected to
pay routine costs out-of-pocket, and that the system is physically incapable
of giving everybody in the pool more than they pay in. Unfortunately, this
attitude is so ingrained that every government plan I've ever seen also
reifies this mindset too, and I think _any_ plan that is conceptualized that
way will fail because from the very beginning, you've built it on a shoddy
foundation.

We have _got_ to pry insurance away from the employers. (Once again, I note
that we've managed to export this problem to the rest of the world. Similarly,
I often think that the US would be really screwed by our crappy school system,
except that we managed to export it to the entire rest of the world first, so
nobody actually has a _good_ system, just slightly different iterations of the
same crappy model. "Fortunately" for the US!)

~~~
jbjohns
When you say "exported to the rest of the world" what countries do you mean? I
live in western Europe and health insurance _must_ be covered by the
individual, and the school system is a _lot_ better then what I experienced in
the US.

~~~
jerf
Your school system is the same _fundamentally_ broken system of corralling
children into a pen and expecting them all to learn the same basic things at
the same basic rate. Every industrial society seems to do it this way. I'd
argue that some systems are slightly less broken and some slightly more, but
compared to what could be, none of them are even close to their potential.

And maybe you should specify your exact country. For instance, France
([http://www.npr.org/templates/story/story.php?storyId=9241927...](http://www.npr.org/templates/story/story.php?storyId=92419273)
): "France, like the United States, relies on both private insurance and
government insurance. Also, just like in America, people generally get their
insurance through their employer." Government health care as seen in the UK is
hardly any different from employer health care in practice... it's _slightly_
more disconnected from feedback, but employer health care is already pretty
disconnected. So, exactly which country has fully individual health care with
no government or employer involvement?

~~~
jbjohns
I agree that the basic kind of school system everyone uses is broken (though
the quality of pre-university education is low in the US), but the US exported
that? I think it predates the US.

I live in Switzerland. No government involvement is not realistic, but in
Switzerland you are required to have your own health insurance (changing jobs
has no effect on it). The government gets involved by putting a cap on how
much insurance companies can make, which makes it less useful for them to use
sleazy tricks to try and maximize profits.

As far as the UK being basically the same thing, what system would you
suggest? I personally like the Swiss system the best of everything I've seen,
but it could be argued that it is just a variation of what the UK has. That
is, we all _must_ have insurance, therefor we all _must_ pay for it and the
major expenses that people I don't know end up costing _me_ more money. The
only real difference is that the insurance isn't government owned and there is
some competition in it.

But I can't imagine a system that could work better then these. The only other
thing you could do is simply not cover some percentage of the people, but the
US is a pretty solid example case that this doesn't work well. I believe that
the reason employers are paying insurance is because the plans are already
quite expensive and the employers can get a major group discount.

~~~
jerf
"I agree that the basic kind of school system everyone uses is broken, but the
US exported that? I think it predates the US." - it's... complicated. The
ideas originated in Europe, but took hold here strongest, then spread with the
industrial revolution (later phase, not early phase). That's the short-short
version.

"what system would you suggest?" - The Swiss system you describe is what I
would suggest. Perhaps not in every detail, because I'm sure you don't capture
the full complexity in two sentences :).

The way in which it is _not_ the same lies in the individuals ability to
punish their provider, thus closing the feedback loop that markets critically
depend on. (Where there is no feedback loop, there is no market, period.
Another example: Monopolies are bad because they destroy the feedback loop,
because there is no "elsewhere" to take your business.) When the health-care
provider is your government, it basically has no reason to care whether you
are being served well. (Odds are, the health-care providing part is not even
elected so even the only feedback loop a government has is not in play.) It
has no competition. In the US, there is only ever so slightly more feedback;
technically, if enough of the company complained to HR, they might consider
changing the plans they offer, but that's still a very diffuse feedback loop
with a central point of failure (HR, easily bribed, or even just overloaded to
the point where they can't afford to look at alternatives).

If you're buying insurance individually, and you have the ability to change it
as easily as changing my car insurance would be, then you have a market
feedback loop, even if you've got the government fiddling around the edges.
(I'm only a little-l libertarian, so I'm not necessarily opposed to that, even
as I think the US and UK systems are grossly flawed.) For all the rhetoric
about the coldness of the capitalist system, you generally get more caring and
concern from an entity you can abandon at will than one that gets your money
regardless of what you think and has no real incentive to care.

(I also observe this doesn't fix _every_ problem. But what I think it would do
is get things moving in the right direction, and create forces that could help
resolve the rest. Right now, the dominant forces tend to make things worse and
worse over time, instead, as we continually move farther and farther towards
_guessing_ what will work... and _politicians_ guessing, no less... instead of
actually having the information necessary to figure it out.)

~~~
jbjohns
Fair enough, looks like we're in agreement. Oh, and I'll be stealing some of
your arguments here next time I'm talking to my swiss friend who supports the
Socialist party (not sure how socialist they actually are, but anyway that's
what they're called). :)

I too think it would be a good idea to have every individual required to have
their own insurance (or the government pays for those who can't) in the US,
but first something has to be done about the corruption. I didn't deal with a
lot of insurance companies while I lived/worked there, but from the ones I
did, more than half tried all kinds of things to get out of paying claims.

