Why Health Insurance Is A Mess
Money For the Rest of Us
J. David Stein
4.5 • 1.4K Ratings
🗓️ 18 July 2018
⏱️ 32 minutes
🧾️ Download transcript
Summary
#213 How health insurance isn't really protection against a catastrophic illness but prepayment of routine healthcare consumption, leading to overconsumption of healthcare and over treatment by medical professionals that drive up costs. What would it take to reform the health insurance marketplace so it is more fair and functions more like life insurance or homeowners insurance. Show notes and links can be found here. Thanks to Circle Invest for sponsoring today's episode.
For show notes and more information on this episode click here.
- [0:57] Why pay $20 for a doctor’s visit, when health insurance is $36,000 a year?
- [4:03] Digging into the fundamental flaw in health insurance
- [9:10] Why does health insurance pay for “routine maintenance” on our health?
- [13:20] The pros and cons of employer-based health insurance policies
- [19:35] Health insurance is a mess because it doesn’t primarily insure against a catastrophic health event
- [21:42] The current setup for health insurance limits healthcare choices and encourages overconsumption of services
- [24:50] Health insurance is an artificial market
- [27:00] The over-consumption drives the cost of health insurance
- [29:02] Here’s why you can’t figure out what medical procedures actually cost
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Transcript
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| 0:00.0 | Welcome to Money for the rest of us. This is a personal finance show. It's on money. How it works, how to invest in how to live without worrying about it. |
| 0:09.0 | I'm your host, David Stein. Today is episode 213. It's titled, Why Health Insurance is a mess. |
| 0:17.0 | Just about two years ago in episode one 23, I did an episode on health insurance and pharmaceutical cost. |
| 0:26.0 | It was prompted by the fact that my insurer, my health insurer, Blue Cross of Idaho, |
| 0:32.0 | wanted to raise my 27. my health insurance |
| 0:35.0 | insurance for our family's health insurance by 50%. |
| 0:41.0 | We were already in 2016 paying $1,162 a month for a bronze HSA plan that we bought on the Idaho |
| 0:52.1 | Exchange. We had a $6,162.00.00 into a network and outward or out-of-network deductible. |
| 0:59.4 | That $1,162 with 20% increase from 2015. |
| 1:05.0 | So we explored a little bit, but we focused mostly on pharmaceuticals. |
| 1:09.3 | I recently got on the Idaho exchange again just to see what health insurance cost. A plan in |
| 1:21.0 | 2017 at the time as I mentioned they were raising it to $731 so that would have |
| 1:28.6 | been the 50% increase as 6200 in network and out of network deductible. |
| 1:36.9 | That bronze same bronze HSA plan for 2018. |
| 1:41.8 | The price is about the same $1712. |
| 1:45.0 | Except there's a difference. |
| 1:49.5 | The in-network deductible is still $6,000. Out of network is $50,000 in individual deductible, $100,000 for a family. |
| 2:02.0 | There's a reason, and we're going to get to it, but they have essentially kept the price the same. |
| 2:07.0 | But the ability to essentially get health care paid for outside of a little area of eastern Idaho is extremely |
| 2:19.5 | limited. For 2018, a silver plan, which has $20 copay for a doctor, visit $50 for a specialist, $4,000 individual deductible, $8,000 family, out of network |
| 2:38.6 | still $50,000, $3,087 a month. |
| 2:44.8 | So over $36,000 a year for health insurance. |
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