Health insurance

Other discussions not related to the Permanent Portfolio

Moderator: Global Moderator

User avatar
Maddy
Executive Member
Executive Member
Posts: 978
Joined: Sun Jun 21, 2015 8:43 am

Re: Health insurance

Post by Maddy » Thu Feb 13, 2020 10:26 am

Would the federal government step in and pay for people's medical bills if (say) Humana went under? Seems likely. Would they do the same if an HCM went under? Hard to say. I'll admit it's less likely the government would step in than with a traditional insurer, mostly because the traditional insurers are all so enormous these days.
Samaritan Ministries Intl. is an example of an HSM that acts as the administrator of a program whereby members make payments directly to other members. So a particular member's "need" of $5,000 might typically be met with the receipt of 20 different checks from 20 different members. If one of those 20 members fails to pay, then their share is assigned to another member. This way of structuring things removes the concern about insufficient reserves and greatly reduces the risk of non-payment.
User avatar
pugchief
Executive Member
Executive Member
Posts: 3458
Joined: Tue Jun 26, 2012 2:41 pm
Location: suburbs of Chicago, IL

Re: Health insurance

Post by pugchief » Thu Feb 13, 2020 4:01 pm

Xan wrote:
Thu Feb 13, 2020 10:14 am
pugchief wrote:
Thu Feb 13, 2020 9:07 am
I don't know that the author is necessarily an advocate of ACA; he is just not a fan of HCMs. Your point about not having a health incident bankrupt you is I think what his article all boils down to. If they reneged and went out of business, what would happen to all of the members expecting reimbursement? And do you want to be the one they decide not to pay on when you need it most? I don't disagree with your points, but his are also very valid.
Honest question: what happens if your traditional health insurance company goes bankrupt? Maybe it depends on who the president is. Under Obama, the federal government took care of everybody's car warranties when the manufacturer went under. (What a joke.) Would the federal government step in and pay for people's medical bills if (say) Humana went under? Seems likely. Would they do the same if an HCM went under? Hard to say. I'll admit it's less likely the government would step in than with a traditional insurer, mostly because the traditional insurers are all so enormous these days.
The likelihood that a major insurer would go bankrupt is minuscule. They are required to keep reserves and the government would most certainly bail them out in some fashion if it happened. At least currently, if an HCM went under, you'd prob be SOL.
User avatar
InsuranceGuy
Executive Member
Executive Member
Posts: 279
Joined: Sun Mar 29, 2015 1:44 pm

Re: Health insurance

Post by InsuranceGuy » Thu Feb 13, 2020 11:31 pm

There are multiple mechanisms to protect policyholders from insurer insolvency:
1) rating agencies and reserve requirements have been improved substancially since the financial crisis
2) every state has guarantee funds that insurers must contribute to as a condition of doing business in that state that pay for shortfalls if an insurer becomes impaired
3) as we saw in 2008, TARP was used to bailout insurers including "too big to fail" AIG

Sadly, none of the above apply to HCMs as HCMs are not regulated.
User avatar
blackomen
Executive Member
Executive Member
Posts: 204
Joined: Wed Nov 23, 2011 5:41 pm
Location: Dallas
Contact:

Re: Gold's Time To Shine?

Post by blackomen » Sat Feb 15, 2020 1:12 pm

pugchief wrote:
Fri Jan 31, 2020 7:22 am
vnatale wrote:
Thu Jan 30, 2020 10:43 pm
Smith1776 wrote:
Sun Dec 29, 2019 8:14 am
My perspective is that I'd still rather go with the Canadian health care system than the American one if given a binary choice. Though, obviously, there is bias in my perspective.

The waiting time issue is not as bad as portrayed in my humble opinion. We follow a triage system in Canada. If it's a medical emergency, you'll get in right away. If it's a bad knee that acts up when you do sports, then yeah, you'll wait a while for a surgery.
A few days ago I made reference to what Smith1776 wrote above. That the Canadian "wait" times are not as Americans seem to think that they are. That the Canadian system works on a triage system, which does seem sensible.

Vinny
IDK about you, but I have lots of friends that have had various joints replaced, and from what I hear, you don't want the government deciding how much pain you are in or how you should walk 20 yards without a cane. I'd rather do the surgery when *I* think it's time, not some lackey with zero medical background. Ever been to the DMV? That's what government run anything will look like here. :'(
Can't we have a system like the Canadian system but with the added option that if you don't want to wait, you can pay full price to have the surgery now, just like in America?
D1984
Executive Member
Executive Member
Posts: 426
Joined: Tue Aug 16, 2011 7:23 pm

Re: Gold's Time To Shine?

Post by D1984 » Sun Feb 16, 2020 3:40 am

blackomen wrote:
Sat Feb 15, 2020 1:12 pm
pugchief wrote:
Fri Jan 31, 2020 7:22 am
vnatale wrote:
Thu Jan 30, 2020 10:43 pm
Smith1776 wrote:
Sun Dec 29, 2019 8:14 am
My perspective is that I'd still rather go with the Canadian health care system than the American one if given a binary choice. Though, obviously, there is bias in my perspective.

The waiting time issue is not as bad as portrayed in my humble opinion. We follow a triage system in Canada. If it's a medical emergency, you'll get in right away. If it's a bad knee that acts up when you do sports, then yeah, you'll wait a while for a surgery.
A few days ago I made reference to what Smith1776 wrote above. That the Canadian "wait" times are not as Americans seem to think that they are. That the Canadian system works on a triage system, which does seem sensible.

Vinny
IDK about you, but I have lots of friends that have had various joints replaced, and from what I hear, you don't want the government deciding how much pain you are in or how you should walk 20 yards without a cane. I'd rather do the surgery when *I* think it's time, not some lackey with zero medical background. Ever been to the DMV? That's what government run anything will look like here. :'(
Can't we have a system like the Canadian system but with the added option that if you don't want to wait, you can pay full price to have the surgery now, just like in America?
AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
User avatar
pugchief
Executive Member
Executive Member
Posts: 3458
Joined: Tue Jun 26, 2012 2:41 pm
Location: suburbs of Chicago, IL

Re: Gold's Time To Shine?

Post by pugchief » Sun Feb 16, 2020 8:31 am

D1984 wrote:
Sun Feb 16, 2020 3:40 am



AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
::) ::) ::)
This defeats the whole purpose and incentive for opting out as a provider (capitlism!). If you can't charge more for delivering a better (or, in this case, more timely) service, you may as well stay in the system for the increased volume. The only reason the concierge model works here is because of supply and demand coupled with un restrictive pricing.

We already basically have socialized medicine here in the US in most cities, it just looks different. If you practice here in Chicago in a non-concierge practice, you are limited to charging the fees set by insurance contracts or medicare since almost all of your patients have one or the other, and if you don't participate in the PPOs, you won't have any patients at all as they will just go to the guy 2 doors down who is in-network. And the premiums of the wealthier people help pay for those receiving subsidies. Voila: defacto sociailzed medicine.
D1984
Executive Member
Executive Member
Posts: 426
Joined: Tue Aug 16, 2011 7:23 pm

Re: Gold's Time To Shine?

Post by D1984 » Sun Feb 16, 2020 10:34 am

pugchief wrote:
Sun Feb 16, 2020 8:31 am
D1984 wrote:
Sun Feb 16, 2020 3:40 am



AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
::) ::) ::)
This defeats the whole purpose and incentive for opting out as a provider (capitlism!). If you can't charge more for delivering a better (or, in this case, more timely) service, you may as well stay in the system for the increased volume. The only reason the concierge model works here is because of supply and demand coupled with un restrictive pricing.
I guess if you asked Ontario's Minister for Health he/she would say that was the whole point; they want to avoid as much as feasible a two-tiered system and by keeping as many doctors practicing in the public system as possible (and incentivizing as few of them as possible into cash-only practices) this helps to ensure that the vast majority of the wealthy use the same system everyone else does and thus have an incentive to want to see it working well just like the poor and middle class do.

Most countries with universal healthcare don't regulate what cash-only doctors can charge but EVERY country with universal healthcare does directly or indirectly regulate what providers can charge those insured under the system (whether that system is socialized medicine a la the NHS, single-payer like in Canada, single-payer with additional optional private insurance for stuff the public system doesn't fully cover like France, single-payer but with the ability for those who can afford and wish to to buy a private insurance policy and totally bypass the public system like Australia, government-funded hospitals, government catastrophic insurance and private health savings accounts like in Singapore, or a mandatory private but not-for-profit system like Switzerland where you are required/mandated to buy insurance--and subsidized if you are too poor--but can choose from a variety of not-for-profit private insurers and switch if you are unsatisfied); we alone in America do not have universal healthcare and don't do any kind of nationwide or statewide regulation of what providers can charge and thus we get ripped off by some of the highest prices for medical care in the world....see the IFHP reports if you don't believe this.
We already basically have socialized medicine here in the US in most cities, it just looks different. If you practice here in Chicago in a non-concierge practice, you are limited to charging the fees set by insurance contracts or medicare since almost all of your patients have one or the other, and if you don't participate in the PPOs, you won't have any patients at all as they will just go to the guy 2 doors down who is in-network. And the premiums of the wealthier people help pay for those receiving subsidies. Voila: defacto socialized medicine.
If a doctor doesn't like the prices the private insurance companies offer and doesn't like what Medicare offers either he/she can just run a cash-only practice. They would likely have plenty of cash-only patients if they charged, say, from $11 to $45 for an office visit--which is the range of prices for an office visit (not copayments...actual prices in full...and this is to see a regular GP, not an NP or a PA) in other countries (again, as per the IFHP reports...granted, this is from the 2013 and 2010 reports--they issue a report every few years but not every report includes the cost of a routine office visit--so prices may be a little higher in other countries since then due to inflation....but I'd be willing to bet US prices rose just as fast if not faster). And yes, I know that to do this (have doctors charge such low prices for a basic GP office visit) we would have to be more like other countries and revamp our whole education system and have heavily subsidized (or free) college and medical education so that doctors didn't graduate med school with a $260K (or more) millstone around their necks that makes them see the need for much higher salaries than in other countries and we'd also have to start paying them decent wages during internship/residency rather than 45K or so a year (and while we're at it, also stop working them so many crazy excessive hours during said internship/residency which means we'd need to lift the Medicare MCE cap and fund training of several thousands or tens of thousands of doctors more each year so we'd actually have enough docs without overworking/burning out the ones we have during the immediate postgrad training like we do now)...all of which I'd be fine with BTW; it would cost more upfront but it would likely save money over the long term.

We don't have de facto socialized medicine; socialized medicine is when the government runs the hospitals/clinics directly and the doctors/nurses are all salaried government employees. We do have a system of quasi-price regulation by insurance companies and Medicare but Medicare cannot negotiate as low of prices as the universal systems in other countries because it is not the monopsony buyer--since it does not cover everyone but only covers the elderly and those with ESRD-- and because since private insurance exists as well (private insurance exists in plenty of other countries too but in all of those countries private insurers negotiate with providers on a nationwide/provincewide/cantonwide basis and so have some serious negotiating clout owing to the fact that in such a situation these private insurers are negotiating all as one and are thus a quasi-monopsony buyer as well) so if Medicare offers too little in the eyes of providers they can just say no and refuse Medicare and only take privately insured patients; private insurers have little/no negotiating clout here in the US because there are typically ten (or more) of them competing whereas in many/most areas providers are effectively a monopoly or an oligopoly and so the providers (hospitals/doctors/drug companies/medical device makers) can name their price and the private insurer has little choice but to take it.

If we had universal Medicare for all (or at least all-payer rate setting where all the private insurers + Medicare + Medicaid negotiated prices all as one on a national or regional basis and thus functioned as a monopsony buyer de facto even if not de jure) then the power would be back in the buyer's lap and medical prices would likely come down to be somewhat closer to the prices in the rest of the OECD countries. We don't so we get stuck with some of the highest healthcare prices in the developed world.
Last edited by D1984 on Sun Feb 16, 2020 12:17 pm, edited 1 time in total.
User avatar
sophie
Executive Member
Executive Member
Posts: 3496
Joined: Mon Apr 23, 2012 7:15 pm

Re: Gold's Time To Shine?

Post by sophie » Sun Feb 16, 2020 11:40 am

pugchief wrote:
Sun Feb 16, 2020 8:31 am
D1984 wrote:
Sun Feb 16, 2020 3:40 am



AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
::) ::) ::)
This defeats the whole purpose and incentive for opting out as a provider (capitlism!). If you can't charge more for delivering a better (or, in this case, more timely) service, you may as well stay in the system for the increased volume. The only reason the concierge model works here is because of supply and demand coupled with un restrictive pricing.

We already basically have socialized medicine here in the US in most cities, it just looks different. If you practice here in Chicago in a non-concierge practice, you are limited to charging the fees set by insurance contracts or medicare since almost all of your patients have one or the other, and if you don't participate in the PPOs, you won't have any patients at all as they will just go to the guy 2 doors down who is in-network. And the premiums of the wealthier people help pay for those receiving subsidies. Voila: defacto sociailzed medicine.
Actually, Medicare isn't the source of delayed treatment in the American system. It's the private insurers that play the preauthorization game that results in delays and denials. Yet another reason to avoid Medicare Advantage plans like the plague.

I agree that an insurance model that covers routine, low-level expenses is idiotic and makes about as much sense as, say, getting haircut insurance, but I'm resigned to that being fixed in stone. If you accept that, then a Medicare for all system may in fact be our best solution. I wish medical insurance could work more like it does in veterinary medicine, where the added costs of a full coverage insurance policy for a pet are necessarily greater than what you'd spend for the routine care that it covers - so those policies basically amount to a stupidity tax. Also, because insurance isn't nearly so intrusive in the pet world (minimal documentation requirements, no preauths), office visit costs are a lot lower. Gives you an idea of what they would be in the human world without that added layer of insanity.
User avatar
technovelist
Executive Member
Executive Member
Posts: 5584
Joined: Wed Sep 15, 2010 11:20 pm

Re: Gold's Time To Shine?

Post by technovelist » Sun Feb 16, 2020 3:06 pm

sophie wrote:
Sun Feb 16, 2020 11:40 am
pugchief wrote:
Sun Feb 16, 2020 8:31 am
D1984 wrote:
Sun Feb 16, 2020 3:40 am



AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
::) ::) ::)
This defeats the whole purpose and incentive for opting out as a provider (capitlism!). If you can't charge more for delivering a better (or, in this case, more timely) service, you may as well stay in the system for the increased volume. The only reason the concierge model works here is because of supply and demand coupled with un restrictive pricing.

We already basically have socialized medicine here in the US in most cities, it just looks different. If you practice here in Chicago in a non-concierge practice, you are limited to charging the fees set by insurance contracts or medicare since almost all of your patients have one or the other, and if you don't participate in the PPOs, you won't have any patients at all as they will just go to the guy 2 doors down who is in-network. And the premiums of the wealthier people help pay for those receiving subsidies. Voila: defacto sociailzed medicine.
Actually, Medicare isn't the source of delayed treatment in the American system. It's the private insurers that play the preauthorization game that results in delays and denials. Yet another reason to avoid Medicare Advantage plans like the plague.

I agree that an insurance model that covers routine, low-level expenses is idiotic and makes about as much sense as, say, getting haircut insurance, but I'm resigned to that being fixed in stone. If you accept that, then a Medicare for all system may in fact be our best solution. I wish medical insurance could work more like it does in veterinary medicine, where the added costs of a full coverage insurance policy for a pet are necessarily greater than what you'd spend for the routine care that it covers - so those policies basically amount to a stupidity tax. Also, because insurance isn't nearly so intrusive in the pet world (minimal documentation requirements, no preauths), office visit costs are a lot lower. Gives you an idea of what they would be in the human world without that added layer of insanity.
So let me see if I understand this.
The current "Medicare for some" (mostly over 65 with a few others) is completely and utterly bankrupt, having unfunded liabilities in the tens of trillions of dollars (see https://www.marketwatch.com/story/the-f ... 2018-06-15).
Therefore expanding it to five times its current size is a good idea.
Is that right?
D1984
Executive Member
Executive Member
Posts: 426
Joined: Tue Aug 16, 2011 7:23 pm

Re: Gold's Time To Shine?

Post by D1984 » Sun Feb 16, 2020 4:05 pm

technovelist wrote:
Sun Feb 16, 2020 3:06 pm
sophie wrote:
Sun Feb 16, 2020 11:40 am
pugchief wrote:
Sun Feb 16, 2020 8:31 am
D1984 wrote:
Sun Feb 16, 2020 3:40 am



AFAIK you can do that in Canada too. Canada doesn't fully ban full price up front in cash-on-the-barrelhead private medical practice; it bans private health INSURANCE. Physicians (whether singly or in group practice), surgicenters, clinics, imaging centers, etc can opt out of the public payment system (their province's Medicare system) but in doing so they forfeit the right to bill Medicare for ANYTHING for a certain period; also, in some provinces (Ontario does this and I presume at least some of the other provinces do as well) physicians who opt out of Medicare and bill patients privately for cash cannot charge said patients above the agreed-upon provincial Medicare fee schedule anyway unless they are treating non-insured persons (i.e. persons for whom Medicare would not be the first-line payer...stuff like workmen's comp cases, auto accident victims, persons who are not Canadian citizens or PRs, etc).

Again, as far as I know both the Single Payer bill by Bernie and the one by Jayapal do similarly as above in allowing cash-only medicine but prohibiting providers from billing Medicare for a set period (IIRC it is 3 years) should they choose to be cash-only/prepaid/concierge practices.
::) ::) ::)
This defeats the whole purpose and incentive for opting out as a provider (capitlism!). If you can't charge more for delivering a better (or, in this case, more timely) service, you may as well stay in the system for the increased volume. The only reason the concierge model works here is because of supply and demand coupled with un restrictive pricing.

We already basically have socialized medicine here in the US in most cities, it just looks different. If you practice here in Chicago in a non-concierge practice, you are limited to charging the fees set by insurance contracts or medicare since almost all of your patients have one or the other, and if you don't participate in the PPOs, you won't have any patients at all as they will just go to the guy 2 doors down who is in-network. And the premiums of the wealthier people help pay for those receiving subsidies. Voila: defacto sociailzed medicine.
Actually, Medicare isn't the source of delayed treatment in the American system. It's the private insurers that play the preauthorization game that results in delays and denials. Yet another reason to avoid Medicare Advantage plans like the plague.

I agree that an insurance model that covers routine, low-level expenses is idiotic and makes about as much sense as, say, getting haircut insurance, but I'm resigned to that being fixed in stone. If you accept that, then a Medicare for all system may in fact be our best solution. I wish medical insurance could work more like it does in veterinary medicine, where the added costs of a full coverage insurance policy for a pet are necessarily greater than what you'd spend for the routine care that it covers - so those policies basically amount to a stupidity tax. Also, because insurance isn't nearly so intrusive in the pet world (minimal documentation requirements, no preauths), office visit costs are a lot lower. Gives you an idea of what they would be in the human world without that added layer of insanity.
So let me see if I understand this.
The current "Medicare for some" (mostly over 65 with a few others) is completely and utterly bankrupt, having unfunded liabilities in the tens of trillions of dollars (see https://www.marketwatch.com/story/the-f ... 2018-06-15).
Therefore expanding it to five times its current size is a good idea.
Is that right?
Medicare's unfunded liability over a 75 year period (the next 75 years) is $37 trillion as per the article. Well....that sounds scary. Actually, that is only around 2.27% of GDP per year. That doesn't sound quite as scary, does it? Think tanks that publish articles like this use the 75 year or 100 year or even (if the Trustees are still making it as of 2020; I thought they quit making that one for SS and Medicare back in the mid-2000s) the "infinite horizon" period in order to scare people. In actually it is likely even less than 2.27% of GDP per year since I derived that figure using today's GDP (and assuming per capita GDP will never grow in real terms since then....i.e. it will grow with inflation but total GDP will never grow beyond inflation and population growth i.e. I assumed ZERO productivity growth which I think we can agree is just a wee bit unrealistic), dividing $37 trillion by 75, and dividing that number by today's GDP (which again, I assumed no real increase whatsoever in except for via population growth and inflation) and projecting today's GDP out 75 years. Finally, most of the unfunded liabilities are going to occur in later years (the Trust Funds don't even start running a deficit until the mid to late 2020s) so given the time value of money it would be even less in terms of a % of GDP if we had to raise taxes enough immediately to fund it since we would be building up extra money in the trust funds staring from right now--and it would be earning interest--for at least the next several years before we spent even one extra cent out of the revenue the new taxes would generate.

Also, if you calculated private insurance companies' liabilities the same way they calculated Medicare's liabilities (IIRC the Trustees--likely quite correctly--assume costs will increase in line with the aging of the population and assume medical cost inflation will continue to outpace regular inflation) and calculated said insurance companies' income to service those liabilities by assuming premiums were never allowed to increase other than through inflation, population growth, and GDP per worker output growth (when calculating unfunded liabilities the Trustees AFAIK are assuming current tax rates and no increase in FICA or income taxes at all; the total amount of taxes can grow with more people or inflation or real output/GDP growth but tax rates themselves are assumed to stay at whatever current rates are) and that if insurance payouts for medical care increased faster than said premiums well then...too bad, too sad...you still won't be allowed premium increases enough to offset this....I'd bet that you'd come up with a pretty hefty "unfunded liability" estimate for private insurance as well. Needless to say private insurance companies do not have this problem because they can increase premiums as needed in order to stay solvent; Medicare has to rely on Congress and the White House OKing tax increases; it can't just increase its own funding stream (taxes) with the ease which insurance companies can increase their funding stream (by hiking premiums).

The problem that creates such a huge "unfunded liability" in either case is that medical costs keep increasing faster than inflation and usually they even increase faster than inflation plus real GDP per capita growth. FWIW Medicare seems to be better at controlling costs per beneficiary than private insurance; see https://www.modernhealthcare.com/articl ... study-says ; presumably this is because it has more bargaining power than private insurers.

EDIT - given that the Trustees projected the present value of Medicare's "unfunded liabilities" was $37 trillion then perhaps they should've contextualized that by comparing it to the present value of all GDP over that same 75-year period. Back in late 2010 the projected present value of 75 years worth of GDP (what you would have to pay now to receive the discounted value of 75 years worth of GDP paid to you) was $791 trillion ( https://seekingalpha.com/article/207272 ... iabilities ). Given that real inflation-adjusted GDP has increased around 23 percent or so since then we can presume the 75 year discounted present value of all the GDP for that timeframe (for the next 75 years starting today rather than starting in late 2010) has increased as well. That would put said value at around $972 trillion (give or take a trillion $ either way); $37 trillion is a bit over 3.78% of that. Not exactly insurmountable.
User avatar
technovelist
Executive Member
Executive Member
Posts: 5584
Joined: Wed Sep 15, 2010 11:20 pm

Re: Health insurance

Post by technovelist » Sun Feb 16, 2020 5:23 pm

Lol!
Don
Senior Member
Senior Member
Posts: 112
Joined: Fri Apr 21, 2017 6:21 pm

Re: Health insurance

Post by Don » Sun Feb 16, 2020 5:40 pm

I know an illegal immigrant who suffered a massive heart attack in NYC. He was revived and spent 2 weeks in a fine hospital. After about a month he went back in for another week for a heart valve repair.

His bill is probably close to a million dollars but it's not costing him a cent.

How can this country not go bankrupt absorbing these huge health bills from illegals?
Post Reply