Friday, December 20, 2013

What Insurance Does

The BLUF:  Paying for expected and routine health care transactions via insurance policies is expensive.  Insurance is only a smart way to get care if the care is unexpected and expensive.

This is a passionate description of the change that is coming with Obamacare, but this is the good part - more people will be paying more money out of pocket for their health care.  I don't think folks with more comprehensive insurance know this is good - it is good because it will tend to reduce consumption of health care and decrease total cost for health care and will put some market tension back into health care delivery.  however, as it stands now, many younger healthier folks will be paying higher premiums AND higher out of pocket expense.  Like this person:

"That is putting everyone under $75k a year on welfare... If u r an average family with two kids, and you each go for preventive maintenance (ie well doctor/routine visits).. Which includes two dentals a year, one vision, one doctor visit each... For women over AND UNDER forty that is also an GYN visit... Over forty add a mammogram and a prostate exam for men, which also means TYPICAL AND ROUTINE blood work once a year... And doc visits cost $150-$250 a pop, no insurance, NO TESTS...SO SAY, $200x 6 =$1200.+ 200x4=800 dental + $50x4 =$200(lowball) vision. Nobody needs glasses, nobody had any cavities, nobody had a cold or sinus infection, nobody needed prescriptions. Each member gets bloodwork once every four years, not true... But let's say it is. So basically, one person a year... Routine stuff... You increase the cost of the doc visit because of phlebotemy by at least $40, and you now have a routine labwork that costs another $200. $2,440 a year in basic costs. Nothing wrong. No sickchild visits. So, if you can't find an average of $200 extra a month to budget for medical expenses you need welfare? Now... Add your risk of having two kids and a broken arm er visit.... $10k easy. Add two doc visits for flu... The higher rate for doc visit of $250 each, $200 labs each. A cavity, $200. An irreg pap... Which happens ALL of the time... But I havent even included the labwork for gyn paps or the mammogram or prostate exam. IF you go to the doctor on a preventive care REGULAR basis, as suggested... And only get those associated labs, for parents over 40...that's another $750 cuz of radiology, higher doc visits, phlebotemy, labs, etc.... So over $3k a year, and add that flu stuff.. Another $1100... Now over $4000. Now u need meds for flu... Time off of work because one adult got it from a kid. Self-employed, no work, no money. Seriously dude... Get a grip on reality.

A respondent nails the answer:
You are doing the budgeting backwards. You do not find an extra $200 a month for medical expenses any more than you find an extra $400 a month for food. You budget that up front.

Call around, you should not be paying more than $125 for a routine doctor's visit. Flu stuff $1100?? Flu shots are $35 at Wal Mart and there is very little point in going to the doctor if you get the flu (for most people). If you are routinely spending $1100 for flu treatment a year, you are doing something wrong (or your wrote something that I did not remember).

Same with $200 per cavity, you can find dental care much cheaper than that. Dentist are amazingly competitive. Go out of town if you have to, I have found dental offices that open at 5am so you do not even have to miss work.

And even if your numbers are all correct and those are common, everyday expenses for routine medical care, WHY on earth would you want to pay EVEN MORE to have those expense covered by insurance? Insurance adds paperwork and the insurance companies make a profit on every dollar they collect.

In her response, she seems to part get it, part not get it.  I think she's just angry because now she's paying higher premiums AND more out of pocket.  I believe this is because she is young and healthy and now is paying higher premiums so that Obamacare can fund older, sicker folks.  This is the strangeness - the old are perceived as having less money and fewer options, but on average, the old are wealthier than the young.  Obamacare means the poorer young are financing their health care, the healthcare of older, and wealthier citizens, in addition to Medicare and Social Security.  It is a massive transfer of wealth from the old to the young.  Will the young get their payback?  Will this system survive the demographics of the next 50 years?  It seems unlikely.  This is the part democrats/progressives can't keep strait.  They want fewer folks on the planet because they view us as inherently damaging to the environment (they may be right about that), but they keep building government systems that only work if old folks die relatively young, or if for each old person there are 3 or more young people (IOW, they are betting on a high birth rate and an expanding population forever).  The response:

Because that is average... Because most people also have a lid get a broken arm, too. Because most People get a root canal or have a kid with a cavity... Because most people need contacts or glasses. Because many people need a chiropractic visit every now and then, or a mental health professional.

Those are not abnormal costs. Those are the things that will break your bank if ALL you are doing is trading an insurance premium for "routine" doctor visits. Not huge hospital stays and emergencies. Normal, everyday crap that just "is"... Now add in the crap like happened to me.....the stuff you would NEVER think happens... But DOES ALL OF THE TIME... Or weird things, like I was evidently born with deformed first ribs, and an extra one on one side. Caused my hands to have pain, arms shooting pains, but was worse on left side. Xrays didn't show it... Mri with dye contrast had to be done, while we scheduled the biopsy cuz doc thought it was cancer. Found out, eventually, what it was... Thoracic outlet syndrome. Went to cardiothoracic surgeon.... ONLY ONE WHO COULD do surgery at kirklin clinic, one of like five in country. They go in, and find an extra rib too... Never showed on anything.. They removed both of those ribs.

All of that was about 20 years ago... Cost ? About $100k. Nine years ago hospital stay due to birth complications? About the same... A little under. Since she was Also in NICU for 7 weeks.

My point to Donna and Carrie was this... You have KIDS.... you NEED the insurance. You cannot predict life... Especially not for them.

My point about healthcare reform? My answer would've been easy, solved the problem, not had hard to follow metal plans, would've created competition, kept government involvement without the need for an IRS oversight, reduced actual medical costs, reduced insurance spikes, made it MUCH closer to affordable, would've created some semblance of required responsibility from those receiving welfare. And that this current system is NOTHING like what medicaid and medicare were like even three years ago.

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