The Problem of Health Insurance
How do you handle the cost of health care?
I’ve been reading the blog Early Retirement Extreme lately, and this post got me thinking about our monthly expenses and our ability to reduce them. One area we seem to have little control over is the cost of healthcare. Sure you can ask for a generic prescription drug, but there isn’t much you can do when your copays go up. Â
Even with no debt at all, I feel that the biggest obstacle to self-employment, part-time employment, or a confident early retirement is health insurance availability/affordability. Even with our expenses at less than $1000 a month, we need good health insurance, which keeps us tied to our jobs. I think that the lack of health insurance affordability and availability is probably the greatest impediment to entrepreneurship in this country.Â
Maybe I haven’t read enough of some of these blogs yet, but I would like to know how some of the minimalist-lifestyle proponents handle healthcare. In the past 14 months, people in my extended family have had a lot of severe illnesses that have required very expensive treatment. Without insurance, they would have been screwed. I’m talking about people who did everything right. They exercised, ate right, were not overweight, and went to the doctor for regular checkups. So while I support healthy living, the fact is that chaos rules the universe and there is only so much that health living can do for you. And once you get, say…cancer, chances of being able to purchase insurance on your own are pretty slim.Â
I am hopeful that some of the new legislation that was recently passed might eventually help us out of this situation, but I’m not counting on it.Â
So what about it? Is minimalism/part-time work/early retirement only for the young and healthy?Â
I’d love to hear from anyone out there with ideas for solving this problem. How do you do it?
June 3, 2010
· 
Bob · 
5 Comments
Tags: health insurance, healthcare costs · Posted in: Economics and Money, Health
5 Responses
HSA + HDHP. The tax deductions on the HSA can almost cover the HDHP premiums for young people. Later it gets harder (like everything else with finances), but that’s why you start early. With expensive treatments, the HSA limit is $3000 and the HDHP deductible is typically $4000-$5000. This means that 1.5 years of savings is will cover one year of extreme sickness. Of course this means that one can not have a regular draw on the insurance. On the other hand, having insurance pay regular expenses is a misunderstanding of insurance. We don’t have car insurance pay regular oil changes and gasoline. Why should health insurance pay for checkups or running drug treatments then?
Yes, I agree. I think that health policies should really only cover higher cost services. I don’t mind paying $100 for my yearly checkup. it is the thought of getting wiped out financially from a severe injury or illness that worries me. The prescription drugs are another problem. Soooo expensive. You know, I have a friend with really bad R. Arthritis. Not his fault. He just has it. The medicine that allows him to funciton normally is very expensive. He could never afford it without a killer group health plan.
Thanks for the input. I like your blog a lot.
The Health Insurance Costs category was what I chose in Jacob’s survey as well. I have a pre-existing medical condition that requires monthly medications costing hundreds of dollars. As it is, the co-pays for my employer-provided group policy HMO run about $2K per year. I am reasonably certain that I could not afford the “guaranteed issue” personal policies available in CA. No amount of weight loss, healthy living, exercise, etc. will alleviate my medical condition; so “guaranteed issue” is the only way to obtain coverage if I want to choose self employment or early retirement. It is depressing to remain in a job I loathe simply to ensure that I have health insurance. It remains to be seen if the recently passed health care reform will offer a viable alternative. If it does, I can retire in 2014. I have come to the conclusion that the existing health insurance scheme is not designed for those with chronic illnesses that require drug therapy.
Maus – I appreciate your input. No, the current system doe not provide for people in your situation very well. And as you know, even if you generally maintain membership in a group policy, a gap in coverage can cause huge problems too.
One issue I have been thinking about lately is the problem of even assigning costs to the services. When everyone pays a different rate, depending on their insurer, and when providers typically bill insurance companies more than they bill you, simply to try to squeeze out a few extra dollars, how do we really even assign a cost to medical services?
Suburban Shift » Blog Archive » More on Health Care - June 16, 2010
[...] few posts ago I wrote about the problem of health insurance, as it relates to the self-employed, those with pre-existing conditions, the uninsured, [...]
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