
Paul Buchheit: Not getting health insurance is a really bad idea - paul
http://paulbuchheit.blogspot.com/2007/06/not-having-health-insurance-is-really.html
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brianmckenzie
A few months back, a friend and I got hit by a car.

We were minding our own business, talking about our startup activities,
crossing on the green, and some idiot ran the light and hit us. Neither of us
saw it coming, and it hurt really, really bad. ER bills were big, I'm glad I
had insurance.

Two weeks ago I was walking to work and saw a guy collapse against a building.
I called the emergency number and tried to help him, along with several
others, but the guy was completely out, he died right there. I wish I could
say differently, but that's what happened. He wasn't particularly old, either.

Ready or not, you might as well have health insurance.

~~~
ralph
Here in the UK I've heard of people "running lights" in the USA. It doesn't
happen very often in the UK. Someone driving through red knows that they're
likely to have an accident or mow down a pedestrian.

I've long wondered if it is the USA's lack of roundabouts compared to the UK
that causes many Americans to grow frustrated sitting at red lights when
there's no traffic driving across them on green that makes them conditioned to
drive through red.

My neighbouring desk for a year for a hotdesk to the visiting American on a
two-week tour of duty. For many it was their first UK visit. The majority
liked roundabouts after a couple of days, preferring them to junction lights.

~~~
davidw
Roundabouts.... hrm. I used to work near the one of the few in San Francisco
(8th & Townsend) and occasionally people would take the shortest path around
it. Kind of scary. And what's really scary is being a cyclist in a roundabout
somewhere like Italy. I much preferred the traffic lights before they replaced
them with roundabouts in Padova. It's bad enough playing chicken in a car, let
alone a bicycle.

~~~
ralph
Well I guess roundabouts to someone not used to them are dangerous, just like
traffic lights.

I'll see your Padova roundabout and raise you The Magic Roundabout:
<http://en.wikipedia.org/wiki/Magic_Roundabout_(Swindon)>

It's five roundabouts arranged in a circle with connecting roads between them
on the edge of the circle. It effectively creates a bigger roundabout in the
middle with contra-flow.

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dhouston
that was enough of a kick in the ass to sign up for coverage (after having
intended to for a while but never really getting around to it), thanks for the
post :P

btw, other summer yc founders in cambridge (or other massachusetts residents):
go to <http://mahealthconnector.org> ; the lowest plan costs like $119/mo and
it takes like 5 mins to enroll and it's all online.

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staunch
I randomly got sick and then developed bad pneumonia. I ended up staying in
the hospital for almost a week while recovering and then was fine. Total cost
for diagnostic tests, medicine, and my stay was ~$30k. I was in disbelief when
my HMO covered absolutely 100% of it. Because I had insurance I was only in
pain for a week instead of a year.

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ced
\- Isn't that like a safe job with a 100% chance of low income vs a startup
with 10% chance of jackpot? With health insurance, you're _assuming_ bad luck,
but with a startup, you're assuming the opposite.

\- 77$/month is still quite a bit of money. Even if you absolutely want to
spend it on safety, it's not clear that insurance is the best way to go.
Upgrading those frozen dinners to bio food might be a better bet for long-term
health. Or buying a bike helmet, living in an unpolluted area, taking time to
exercise daily.

\- When you're twenty-something, there is a rather low number of incidents
which are not a) low-cost enough that you can take care of it and b) curable
at all

I have health insurance now, but I'm not sure that it's such a wise
investment. I find it hard to make an honest assessment of how much it is
really worth. Anyone have hard data on this?

~~~
paul
It's not at all the same. Do you understand the difference between buying a
lottery ticket and playing russian roulette?

Your strategy should be to seek upside while limiting downside.

~~~
ced
Well, I've got to admit that I don't see the fundamental difference. One
involves death, but death is also quantifiable.

"Your strategy should be to seek upside while limiting downside.": But it's
all a matter of degree! Taking insurance would be a dumb idea if it costed
5000$/month, wouldn't it?

Plus, there is all this business about being risk-averse or not, for which
there is no rational answer. People who stick to their safe jobs are risk-
averse. It makes absolute sense for them to get insurance, as long as its
expectation value is not _too_ negative. People who do startups, however, are
less risk-averse. They accept a game in which the EV is higher, but variance
is also high. Not taking insurance is a very similar game: higher EV
(presumably; it depends on the value and probability of death), higher
variance.

Loto and russian roulette both have low EV and high variance. They both suck.

So would you rather have a 100% chance of an exciting life, or a 99% chance of
a slightly more exciting life + 1% chance of a really bad one?

I believe there is no single answer to the question, even if you quantify
everything. It depends on how risk-averse you are.

But maybe I'm just blinded by mathematics. If so, I'd appreciate a correction.

~~~
paul
Like I said, it's about controlling downside. The downside of losing the
lottery is that you lose a dollar. The downside of losing at russian roulette
is that you die. It's a mistake to only consider expected value.

Risk is something that should be intelligently assessed and balanced, not
blindly embraced.

It's also a mistake to equate "not winning" at startups to failure. I'd rather
work at a string of unsuccessful but fun startups than some soul-crushing big
company.

~~~
ced
_"It's a mistake to only consider expected value."_

Agreed, to be precise, one has to look at the entire value range, associated
probabilities, and their effect on one's personal "happiness function". That's
what I was trying to do with my variance "estimates", since most of these
things are pretty gaussian anyway.

 _"Risk is something that should be intelligently assessed and balanced, not
blindly embraced."_

Also agreed, and that is _precisely_ what I am trying to do with regards to
the real value of health insurance (admittedly without much quantitative
data). So far, all I see in this thread is anecdotal evidence of some
catastrophic events.

 _"I'd rather work at a string of unsuccessful but fun startups than some
soul-crushing big company."_ : Me too, but that depends on a whole lot of
personal factors, and there is no one right answer for everyone. Likewise for
health insurance.

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lindsayrgwatt
If you're in NYC, check out Freelancer's Union. Like Paul, I saw a guy lying
face down on the street the other day after he was run over by a truck
crossing a perfectly normal street corner. Made me glad I had my coverage
($150/month)

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donna
there is also Catastrophe Health Insurance

~~~
uuilly
State Farm will approve you over the phone for catastrophic health care for
$40 a month. That is what our startup is on. If something goes wrong it's a
$2500 deductable but everything else is taken care of. So if you need
stitches, you're hosed, if you need a new kidney, it only costs $2500.

Godspeed.

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antirez
Sure, get insurance! But also __make sure to eat good food __, and do sport.

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nickb
After watching SiCKO, I'm less convinced that insurance is really the answer.
You get denied treatments even if you have insurance.

The whole system is messed up :(

~~~
paul
It's obviously not perfect, but the notion that it's worthless is dangerously
wrong. I can confirm from experience that it covers treatment at least some of
the time (nobody I know has been denied).

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budu3
Great post Paul. Concise and to the point.

