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Iowa insurance market collapse could ground young entrepreneurs' dreams

desmoinesregister.com

48 pointsitamarst97 comments

Obamacare, the proposed trump care, its all a failure.

Get rid of the employer sponsored plans, that makes no sense at all and makes me hesitant to lose my job because my health relies on it? That is simply absurd. Get rid of this. I'm so frustrated with the healthcare here and I don't understand how Washington can't come up with any real solutions

Single payer has been proposed many times and works well in the rest of the first world.

Edit: Don't forget to vote every November.

It works so well in Australia that entire elections are basically predicated on who will protect it the best.

Single payer works well in the US. Despite claims and the continuously driven narrative of government inefficiency and waste, Medicare and Medicaid are easily the most efficient and effective health care options in America.

It would take a one line act of congress...removing the income cap...to make America a defacto single payer state. The only problem is that it would disrupt a huge capitalist market, and our society has judged the protecting markets is more important than protecting people.

Medicaid and Medicare are heavily subsidized in practice by private insurance covered patients.

Hospitals that have too high of a proportion of Medicare patients get a bonus subsidy from the government to cover up the fact that the coverage alone can't financially sustain the provider.

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Paymen...

If we implemented single-payer in the form of Medicare as it is now, the healthcare industry would quickly collapse.

> Medicaid and Medicare are heavily subsidized in practice by private insurance covered patients. If we implemented single-payer in the form of Medicare as it is now, the healthcare industry would quickly collapse.

In addition to everything you said (which is true), Medicare's apparent success is also boosted by the portion of Medicare patients who receive their non-pharmaceutical Medicare benefits through a private insurer.

Original Medicare (which is the part of Medicare that is purely government-run[0]) has dramatically lower ratings for both medical outcomes and patient satisfaction scores[1] than Medicare Advantage, which is privately run. Medicare Advantage also consistently outperforms Original Medicare on cost as well.

Unfortunately, when statistics are cited for Medicare as a whole by laypeople and in mass-media, Original Medicare and Medicare Advantage are lumped together, giving the impression that Original Medicare is much more effective and well-liked than it actually is.

The same applies to Medicaid, but because that's state-run, the exact details vary from state-to-state. Overall, though, nearly ever state has some form of private management for Medicaid plans, and those consistently outperform the state-run counterparts, for reasons which are immediately clear to anybody who's experienced both firsthand.

[0] except for drug benefits under Part D

[1] In 2015, Original Medicare's patient satisfaction scores were lower than the very worst Medicare Advantage provider - they were literally the bottom of the rung.

I agree my comment was an oversimplification but I think it is fairer to say that "the health care industry as we know it would change"

I think you are unlikely to see immedaite adoption but over time you would have many other/new/different problems to address just as we have many problems now. It is worth mentioning that it would like cause significant employment reductions in the non-governmental insurance providers which are not without an impact.

But for starters, both medicare and medicaid are effectively a concentration of very high risk/high cost customer pools (the elderly and the low income). Opening it up would likely positively impact that cost calculation as well

But this is because Medicare reimbursement rates are set by a panel of specialists (I believe there is one internal medicine doc and then every specialty is represented, so getting a stent sure does get reimbursed well while counseling a diabetic about keeping that A1c down or working on the toe of a homeless guy get reimbursed approximately not at all) who don't necessarily care if Medicare is that fair.

Tangentially, note Medicare spends about 3% on overhead, compared to private industry's previous 30%. (There are now caps on overhead expenditures -- trying to keep it to 20% or less.)

> But this is because Medicare reimbursement rates are set by a panel of specialists... who don't necessarily care if Medicare is that fair.

The problem is that Medicare has no incentive to ensure that their rates are sustainable (without the indirect subsidies that come from private insurers).

Medicare can balance their budget either by increasing their revenue (ie, asking Congress for more money) or by lowering their costs (ie, cutting reimbursements). They have no mandate to ensure that their reimbursements cover the marginal costs of care (and as a result, they don't). On top of that, private insurers are guaranteed by law to pay more than Medicare does, so they can set their reimbursement rates as low as they want.

This is also why the best providers almost never accept Medicare - or, if they do, they do it through a separate practice from their main one. Accepting Medicare means that you're likely going to run a loss on those patients (unless you're operating out of a CAH). So, the best doctors either segregate their Medicare patients into a separate practice (which allows them to manage their losses by capping the number of Medicare patients they see, but also dramatically reduces doctor availability from the patients' perspective), or they just drop Medicare altogether.

The US government spends more on health care than some other G7 nations, not including private insurance.

http://visual.ons.gov.uk/how-does-uk-healthcare-spending-com...

If you include both government spending and private insurance the US leads the G7 in spending on healthcare (but doesn't seem to get results that match the massive spending); if you only include government spending the US pays more than Canada, the UK, Italy, and the OECD average. It pays about the same as (a bit less than) France.

> If we implemented single-payer in the form of Medicare as it is now, the healthcare industry would quickly collapse.

This is because of the pisspoor state of US healthcare that insists on huge amounts of over testing, over diagnosis, and over treatment - causing excess harm at every step.

To amplify your last statement, I recently had a kid. It was a low-risk pregnancy and in the end a fast and boring birth -- could have had the kid in a clean barn with some qualified attendants, in the end. But to get this boring, normalish (breech) birth I had to spend some hours researching providers and my insurance options to work with someone who practices low-intervention, evidence-based medicine -- and I had to drive to another state to work with this guy. Everyone within 40 miles wanted to throw a lot of resources and a C-section at me -- for no mortality or morbidity benefit that persists after about 10 minutes. (Breech babies born the old-fashioned way generally have low 1-minute Apgar scores.) I saved my insurance company a ton of money, I have to say.

The whole experience of pregnancy was an experience of reading the medical literature and then trying to evade the "care" of obstetricians in the standard US care model. I'm glad we have the facilities to deal with all the complications that arise, but we don't have to use them just because they're there when they're not appropriate care.

What about drug R&D in those countries?

For all the issues of the US healthcare system, one thing it has going for it is most of the new developments in medicine comes from the US.

Great for pharma stockholders, terrible for American citizens.

Let's stop subsidizing drug R&D for the world on the backs of US citizens who are being squeezed to death by Washington and a for profit healthcare system.

That's a fair argument but I'm more interested in how much R&D happens under single payer systems.

Does the NIH and NSF not provide a pipeline for drug research in the US?

Did you know the CEO of Mylan, the company that makes epipens made $98 million last year? Is that reasonable?

http://money.cnn.com/2017/05/31/investing/epipen-mylan-chair...

Reminds me of a good SSC post.

> The problem with the pharmaceutical industry isn’t that they’re unregulated just like chairs and mugs. The problem with the pharmaceutical industry is that they’re part of a highly-regulated cronyist system that works completely differently from chairs and mugs.

http://slatestarcodex.com/2016/08/29/reverse-voxsplaining-dr...

Well the board felt it was reasonable, and I'd expect the board of a publicly traded company to know more about its finances than me.

The question was about how much R&D happens in single-payer counties, not how much one particular CEO made. I am a proponent of single-payer health care in the US but responding to unrelated, valid questions with, "yeah, but this one person made a lot of money and that makes me mad!" is ridiculous.

That CEO only made that amount because of FDA regulations related to the manufacture of generics, as well as her family connections.

http://amp.timeinc.net/time/money/4502891/epipen-pricing-sca...

My point is that the entire for profit healthcare system in the US is broken, and it's time to burn it to the ground.

> responding to unrelated, valid questions with, "yeah, but this one person made a lot of money and that makes me mad!" is ridiculous.

Waste is waste, and must be eliminated from the system with extreme prejudice.

Excessive profits are waste.

> That's a fair argument but I'm more interested in how much R&D happens under single payer systems.

Half of all medical and pharmaceutical research in the world is directly funded by the US. That number doesn't include indirect funding which takes place as well - for example, pharmaceutical companies that are based in Europe (such as Astra Zeneca) often receive the funding for their research from the US, and use additional indirect funding methods to essentially subsidize their research that takes place outside the research with the money they make in the US.

The US's market share of medical research has dropped a bit in recent years, but not because countries with single-payer systems are picking up the pace - it's because the research industries in China and India have grown incredibly fast in the last five years.

GSK is British. Novartis is Swiss. Roche is Swiss. Bayer is German. In short: plenty.

Hell, how much of the money is spent on marketing, not actual R&D? It seems like there is a lot of Hollywood accounting in pharma.

Only $5 billion a year.

https://www.statnews.com/2016/03/09/drug-industry-advertisin...

> Ad spending soared more than 60 percent in the last four years, hitting $5.2 billion last year.

> And there’s no sign it’s slowing. On the contrary: Nine prescription drugs are on pace to break $100 million worth of TV ad time this year.

Sure but why do i as a American consumer subsidize drug invention for England or India?

If the goverment wants to pay for R and D awesome. Dont put it on my bill to see the doctor.

> Sure but why do i as a American consumer subsidize drug invention for England or India?

You don't. You subsidize the massive advertising budgets of the companies in the US.

Drug advertising -> Drug Sales -> Drug Profits -> Profit for Drug Company -> More R&D For Next Drug

If all drug advertising went to 0, it would not significantly impact drug prices in the US. It might in fact increase prices as there would be less users per drug. (Which of course may be a better result for society, but I digress)

What about it? What R&D has been done, for example, in the past few decades for routine doctor exams and to combat obesity?

Outside of niche drugs for rare diseases, what has R&D done to reduce costs?

It's a valid solution that will never happen. Why?

https://www.google.com/finance?q=NYSE%3AUNH&fstype=ii&ei=QD1... $184B in revenue and 230k jobs gets eliminated

https://www.google.com/finance?q=NYSE%3AAET&fstype=ii&ei=Zj1... $63B in revenue and 49.5k jobs get eliminated

https://www.google.com/finance?q=NYSE%3AANTM&fstype=ii&ei=yj... $84B in revenue and 53k jobs get eliminated

https://www.google.com/finance?q=NYSE%3AHUM&fstype=ii&ei=7j1... $54B in revenue and 51k jobs get eliminated

That's just 4 companies that total $385B and 383,500 jobs. More broadly, healthcare spending is about 20% of the US's GDP.

The issue is that the left wants single payer and the right wants tax cuts. Then there is the insurance lobby.

Premiums increases can be mitigated by reinsurance. The ultimate payer of that should be the Feds (as it is with almost all catastrophic cases e.g floods/earthquakes/landslides).

The reasons Washington can't come up with real solutions are simple: ideology and money.

A big chunk of Washington firmly believes that socialized medicine is evil, and they will fight it. It doesn't matter what the facts are, it's part of their identity at this point.

For the rest, the desires of insurance companies and similar get in the way. For example, the main, perhaps only reason the ACA didn't include a public option is because Joe Lieberman, Senator from a state where the health insurance industry is huge, refused to vote for a bill that included it and his vote was required for passage.

If lawmakers wanted to fix things, it would be easy: study the systems of other first-world countries and incorporate the things that work best into ours. But "something that works well" is way down on the list of priorities.

> For example, the main, perhaps only reason the ACA didn't include a public option is because Joe Lieberman, Senator from a state where the health insurance industry is huge, refused to vote for a bill that included it and his vote was required for passage.

...there were 40 other senators who were not voting for the ACA. The bill didn't, and still doesn't, have enough popular support. You can't blame one play on a lost game and you can't blame one voter for a lost ballot.

Doubling down on employer provided healthcare with additional mandates didn't help their case.

> you can't blame one voter for a lost ballot

You can't do this in popular elections but you can absolutely do it in the legislature where everyone has a different constituency, policy portfolio, campaign contribution history, etc. Lieberman wouldn't vote for a bill with a public option, full stop. The math worked out such that Lieberman was necessary. Ergo, Lieberman killed the public option if there was no other Senator for whom the existence of a public option would have changed their Nay to a Yea. There was not, so you can absolutely lay the lack of a present day public option for health care in the US at his feet.

I think you're letting Congress as a whole off to easy by scapegoating one senator. A more bipartisan bill that included a few Republicans could have been passed instead.

> A more bipartisan bill that included a few Republicans could have been passed instead.

Assumes facts not in evidence, notably that there is any bill oriented to the policy objectives the ACA sought to acheive that Republican Senators would have supported at that time, and (for relevance regarding the responsibility for the absence of a public option in the ACA) that such a bill would include a public option of the type Lieberman opposed.

No such bill existed. You might as well say that things would have been different if there were leprechaun senators.

I can and will blame one voter for a lost ballot. Republicans controlled 40 seats. Democrats controlled 58 and had two independents who mostly leaned their way. They needed all 60 of those votes to pass something. Lieberman was one of those independents, and he explicitly threatened to filibuster any bill that included a public option, while the other 59 accepted it.

Republicans were going to vote against the ACA no matter what it contained. That means they had no power over the content of what got passed. Lieberman had huge power over the content.

No faction should force through a marginally popular, sweeping change by the skin of it's teeth.

This is one of the reasons why the Constitution and amendment process exist. The Supreme Court ruled that the passage of the ACA was technically OK (I disagree, but that's moot I guess) but they didn't rule whether it was wise.

I'm saying given the political and practical mess on this issue, it was unwise. I think partisan finger pointing is likewise a bad idea.

60% shouldn't be considered "skin of its teeth" and historically wasn't. It only is now because the Senate has become fairly dysfunctional.

I don't see how it's "partisan finger pointing" to explain why the lack of a public option is the responsibility of a single independent senator. It vaguely fits for stating that the 40 Republicans were never going to vote for any form of the ACA, but that's really just a statement of fact.

> study the systems of other first-world countries and incorporate the things that work best into ours

The problem with this line of thought is that the US is orders of magnitude larger, more diverse, and more complex than most European nations. For any single European nation I'd wager at least two of those are the case.

But we have a way to do this already without massive Federal overhauls - allow individual states to do what they want. This means the decisions are made closer to the people, so California can do what California wants while Mississippi can do what Mississippi wants. It also has the side benefit of California not paying for services in Mississippi.

Personally if one of the US states offered non-employer-based, single-payer healthcare I would move there in a heartbeat. If it's as successful as proposed, it would not take very long to most states to offer something similar. At that point, depending on individual implementations, it would be much easier to extend it to the Federal level.

If it's as successful as proposed, it would not take very long to most states to offer something similar.

IMO this isn't clearly true. Lots of states (especially those that currently have the worst health care outcomes) seem far more driven by the ideology that has caused their problems than by this kind of pragmatism. Example 1: the ACA's Medicare expansion.

Hell, it might even work the opposite way: proof that something worked in California could end up as an argument against it. "Candidate x wants to implement the same sort of government health care system that's taken over California. This November, send him a message that we don't do things that way here."

That sounds like democracy working. Democracy means as many people as possible get the government they want. This get progressively easier as the government gets more local. Overall people are much happier with local, then state government than the federal government.[0] If the people Mississippi don't want single-payer health care, and the people in California do, I'm in favor of a system that gives both of them what they want.

[0] http://www.people-press.org/2012/04/26/growing-gap-in-favora...

Well, that's some type of democracy having some effect, yeah. But I was taking issue with the specific idea you put forward that good healthcare ideas would likely spread (in today's political environment) through the "laboratories of democracy" that are the states. It sounds good in theory; it's not so good if it doesn't happen in practice and you're poor and sick in Mississippi. You and I can move (and likely would have health care regardless). They mostly can't.

EDIT: also, I think this framing can badly mislead us: "If the people Mississippi don't want single-payer health care, and the people in California do, …". We get a picture in our head of Mississippi residents monolithically not wanting it while Californians monolithically do. In actuality it may be that 49% of Mississippi residents want it and 51% of Californians do. This is of course a broader topic (the benefits and failings of democracy and of various electoral systems) but I do think it's worth being aware when certain ways of phrasing might distort.

EDIT2: I don't at all mean to imply that your framing was intended to mislead; I don't think that at all.

Why do size and diversity matter? Size is solved by just doing more of the same. If Germany, say, needs X doctors and Y administrators, then the US needs approximately 4X doctors and 4Y administrators. There are problems which get dramatically more difficult with scale, but I see no reason to think that this is one of them, let alone that a factor of 4 is enough to take it from tractable to intractable.

I can't even figure out how diversity would factor into it. Medical treatment depends very little on people's race or culture. I don't get it at all.

Diversity definitely makes implementing generous social programs more difficult politically. The average working-class voter in any country will be much more supportive of eg. universal healthcare if he feels like the benefits are going to people with backgrounds similar to his own, just perhaps a bit worse off, as opposed to (implied-minority) "welfare queens" living off the fat of the land. The larger and more diverse a population, the less said everyman will feel like his taxes are actually serving people he knows and trusts.

That said, I do think we're moving in an encouraging direction. The percentage of the developed world that's willing to recognize others from different cultures and backgrounds as part of their own society seems to be growing, ever so slowly and fitfully. There will be years and perhaps even decades feel like regressions, but on average it feels like things are getting better.

I can see how that might make it more politically difficult to pass something, but it wouldn't make it harder to come up with a plan that works. A plan that works and can pass is a harder, but unfortunately I was already in the realm of fantasy the moment I started talking about looking at foreign countries to see what worked for them.

Individual states would need need to pool together to make single payer work (except for maybe California). As Congress regulates interstate commerce already you may as well go single payer.

But this is likely what will happen and we will get there eventually. If you are poor in a lower income red state you will be screwed for 20 years unless you move.

> socialized medicine

When you put this word here, they succeeded. Socilized has a special meaning here, and it's installed through near 5 decades of propaganda (number could be wrong, you get the idea).

WHY pooling the society's resource for health care is "socialized"?!

WHY WHY WHY WHY...

When anyone examine this idea, everything falls apart. WHY? I don't know, and I will surprised anyone knows.

> WHY pooling the society's resource for health care is "socialized"?!

Because it is pooling some of societies wealth into the government to distribute as a good.

The only difference between this and full socialism is that this does not extend to the entire economy.

Also, keep in mind that a self proclaimed socialist is currently the most popular politician in the US.

> WHY pooling the society's resource for health care is "socialized"?!

Because that's what the word means.

It's easy to understand - the rich continue to get richer because that's how politicians stay in power. As a father of a chronically-ill 5 year old I can't tell you how frustrating it is. Should I change jobs? Depends on the healthcare plans they offer. What do I do if I lose my job? COBRA adds insult to injury.

How will he take care of himself when he gets out of college (assuming he goes of course)? Will it consume half of his paycheck?

Through me, my son will have citizenship in France...maybe it's time to teach him French and consider steering him to moving to France when he's done with school.

We need to shift the conversation away from single-payer, insurance, etc and focus on either: universal healthcare or strict price controls. Until these options are shoved down the throats of our politicians, they're going to keep distracting us with b.s. 'solutions' like the ACA, its "replacement", etc.

The part in all of this that has bothered me more than anything is that it's a diversion to mask the real problem: healthcare service and products are unsustainably expensive.

Casinos use chips and vouchers to distract gamblers from actually grasping just how much money they're playing with. Health insurance sure feels like the same thing, but it's even worse in that when you're in need, you're not always in a state of mind to make rational choices nor are those choices even adequately defined prior to receiving a bill. Why is this acceptable? Since when are contracts entered into under duress admissible? I suspect it's probably a massive success on the part of lobbyists.

I don't know the solution, but I can confidently say it's probably not reached by tackling the insurance side of healthcare. Maybe the current system needs to collapse under its own weight before a new approach even stands a chance? Unfortunately, it's probably more likely it'd just receive a government bailout at taxpayers' expense so it could continue the status quo.

Just to meta-riff on this a little bit... The issue here is that the mechanisms we have for price signaling are too crude to easily account for the things you're alluding too (i.e. an unconscious patient needing urgent medical treatment can't really negotiate; fluffy concepts like quality of life or the lifetime cost to manage an illness are hard to quantify monetarily, etc.) Yet in the U.S. we still try to use market forces jury-rigged with Medicaid, Medicare, Private Insurance, public hospitals, the Veterans Administration, etc., as a means to allocate health resources.

Note that I'm not saying that we can't eventually devise a market-like system for allocating medical resources. I do wonder if we have the technology today for building such a system though. After all, we'd ideally have very good information very quickly so that we can make decisions about where to spend. I'm just not sure we have anything close to such a thing yet, and perhaps we should stop pretending that we've got one.

Healthcare services and products are unsustainably expensive in the US. This is not quite true in the rest of the world. Part of this is economic and structural, and part of it is American psychological and societal problems with letting people die when they are going to die (end-of-life care is hugely expensive and we even love treatments that do not necessarily lead to increased lifespan, because we'd rather feel like we're doing something medically than actually take evidence-based steps that might include doing nothing). Part of it is that "healthcare service" in the US includes the amazing overhead charged by private insurance.

Certainly before Obamacare, private insurance companies spent about 30% on overhead (enrolling & dropping people, advertising, dealing with referrals, arguing with hospitals and doctors, auditing people, hiring lawyers to get someone else's insurance to pay for treatment). That's a lot of money and it figures into "healthcare costs" in the US.

We spend so much more than any other country on healthcare, so much more.

You are absolutely right that "the current system needs to collapse under its own weight before a new approach even stands a chance". I believe it will take people dying publicly to make the US consider a change. First we will be bamboozled by the "freedom" and "choice" we'll get with the new plan, foremost the choice not to have coverage or care at all :)

I always wonder why, in all the coverage about health care and insurance groups "pulling out" of the marketplace, no one seems to want to state the obvious:

* Insurers are not pulling out of the insurance market.

* Insurers are pulling out of selling to individuals.

* This is happening because selling to large groups (like entire companies) is easier/more profitable.

* It is easier to sell to larger groups because you have greater numbers across which to amortize risk.

* The largest group of Americans one could envision selling insurance to is...ALL Americans.

So, by pulling out of the unprofitable individual marketplace in order to focus on selling to larger groups, these insurance companies are practically shouting at us what anyone with half a head already knows: single payer is the only practical, efficient, and cost effective solution for universal coverage.

It's a big leap to say 400 million pools of one is inefficient therefore the best option is one pool of 400 million.

I know what you are getting at here but almost any individual market at the state level is going to be bigger than almost any entire company from a risk pool amortization perspective.

Given that, your fourth bullet point would point in the direction of insurance companies preferring the state pools to selling to companies one at a time.

The problem with the state pools is not (for the most part) one of size, but of adverse selection.

I'd actually be interested to see the numbers. Obviously, as you say, it's not just size but also the risk profile of the group...but add to that the fact that this pool is being split between as many companies as are selling on the marketplace, I wouldn't be surprised if size is part of it.

Regardless, if universal health coverage is a goal, the only way to truly amortize risk is to have everyone in one pool. Anything less pits some very perverse incentives against an inherently inefficient market. It's no wonder no one wants to participate!

Even small states like Iowa (total population ~3 million) are going to have 10s of thousands of people on the individual exchanges. That's bigger than all but very large corporations (who tend to self insure anyways).

I hear you about universal health coverage. I've come around to the idea that we should have it at the national level above some sort of cap. I think free markets can still work when it comes to your annual checkup or small expenses like a broken arm or a monthly prescription for non esoteric drugs.

It's worth noting that Iowa is in particular trouble because of a single patient that costs ~1M a month[1]. In a relatively small market you end up with an unstable situation when there are more than 1 insurers because none of them know if they will have to take on this very expensive patient in any given year.

1. https://www.balloon-juice.com/2017/04/21/catching-the-fallin...

How exactly do you run a $1 million/month health bill? In EU that would mean one open heart surgery/heart/lung transplant done by world class specialists flown from all over the place every single month.

This sounds like a scam.

Apparently the patient is a teenage boy with hemophilia. I'm fairly confident that it isn't a scam.

https://www.usatoday.com/story/news/nation-now/2017/06/01/io...

Hemophilia Federation of America: "A million dollars per month is something we've never heard of," sure makes it sound like a scam, maybe by hospital?

Given that the insurance companies know exactly who the patient is, exactly what treatments he is receiving, and exactly when and where they are happening it seems like it would be pretty easy to uncover a scam if there was one. And they have a lot of incentive to do so!

Would you consider $1 mil/month a good incentive to scam?

Well, that's coming from the insurer, so I'm sure they're not exaggerating (/s)...

> Iowa’s largest health insurer, Wellmark Blue Cross & Blue Shield, has cited the case as an extreme example of exploding health care costs.

Iowa has only one ACA insurer left and they are raising their rates 43.5%.

Basically providing Obamacare was hemorrhaging so much money that Wellmark and BCBS left, leaving a single payer, that ACA users are forced to use.

http://www.thegazette.com/subject/news/health/medica-to-stay...

Same thing happened in Phoenix last year. Our whole county was left with 1 ACA plan who raised rates too. Everyone is bailing.

http://www.azcentral.com/story/money/business/health/2016/09...

I heard this morning that in Iowa 94 out 99 counties will have no offering in the insurance exchange. We need single payer.

Source: President of the AMA, 4:50 seconds in http://www.npr.org/2017/06/23/534056758/the-amas-take-on-gop...

Did people actually think ACA was sustainable or anything but a payout to insurance companies as it was passed?

Knowing that insurance companies can willingly just abandon the market makes the ACA even more of a joke than one would have originally thought.

And no, before anyone tries to suggest it, temporarily insuring a few million poor people and people in poor health (at the cost of fucking over young and healthy people) is not a success.

> Did people actually think ACA was sustainable or anything but a payout to insurance companies as it was passed?

Well, they thought it was the former (in part because of the ways in which it was the latter; a sustainable public service not provided directly by government typically involves payment from the government to the service providers.)

Much of the collapse and withdrawal is due to payments they were mandated under the ACA not being funded by Congress (resulting in a giant stack of lawsuits and at least one $200 million+ judgement against the government in favor of an unpaid insurer), with the deliberate intent of causing a collapse of just the kind that is occurring. (And the recent acceleration is that exacerbated by additional uncertainty deliberately injected by the Trump Administration with the intent of producing exactly that result.)

That's probably the main factor preventing me from quitting and working for myself. Crazy high medical insurance for a family of 4. That and educational savings for kids.

"Free" medical and college would cause a hell of a disruption that corporations would not like.

They would have to adapt. This would create a good evolutionary pressure, and as a result, bad policies wouldn't survive. Not a bad thing overall.

Do employers really negotiate that much lower health insurance rates compared to what a self-employed can get?

1) yes 2) you are assuming that it was even possible to buy health insurance as a single person prior to the ACA. I actually tried and found it incredibly difficult.

So what realistic options did self-employed have before the ACA: either pay for an expensive insurance or be uninsured? What did most typically choose?

(Obivously the IAMAE note applies here)I choose uninsured because I was young...and dumb. There were some options out there, especially for add on things like dental and vision. Insurance was available, but it was hard to find as an individual and very expensive in my experience. COBRA was an option but was still tied to a previous job and had limits.

As an entrepreneurship scholar, I see health insurance as one really strong limiter of entrepreneurial activity in the US. The lack of single payer significantly privileges those with the means, the young, and those without children to conduct entrepreneurial activity.

Yes, at least the tech employers that most of us are likely to work for. And, with the repeal of the ACA imminent, this seems relevant: employer plans usually didn't discriminate on pre existing conditions. Individual plans did.

Would you be able to quantify the difference somehow? Individual plans where more expensive by a factor of two, or more?

When I read the article, I wonder how viable the business really is. The business started in 2015 and he's still below the poverty line: "He needs the subsidy, because he’s taking only about $17,000 in salary per year from the fledgling engineering company."

I attempted to run a company prior to ACA. Because I had a pre-existing condition, I had to buy COBRA. This forced me to get something running within 18 months. I also paid much more than "$100 per month" for my insurance.

18 months went by and I was nowhere. With the ACA, I might have lasted a few more months; but I'll never know if I would have gotten anywhere. Either way, after 18 months I did not have anything close to a viable business.

I think it's important that people are able to start businesses, and health insurance should not be an obstacle to that. There's a fine line, though, between fair access and an outright subsidy of a fledgling business. It's hard to see where that line is when reading this article.

I have an employer sponsored plan through the small business (25 employees) that I work for. The rates the company pays has gone up around 10% a year since I started working here. Two years ago, rates were going to go up 35% but the company found another insurance provider and (after polling employees) went with a higher deductible plan to keep the increas just under 20%.

This does not seem sustainable.

This isn't just an Iowa issue. When I talk to early stage entrepreneurs looking to raise seed capital healthcare is almost always one of their biggest concerns - both for their own families as well as the impact it will have on recruiting the necessary talent.

PEOs help early stage companies to a certain extent, but for a pre-revenue company the cost of healthcare is almost always going to be a significant burden that funnels valuable cash away from the product and shortens the runway. But without a decent benefits package, start-ups have almost no hope of attracting key talent especially if those prospective employees have kids, so they (and their investors) are forced to just suck it up.

Healthcare in the US is a ticking time bomb with the potential to significantly impact our long term growth (if it isn't already). Unfortunately we're in a situation where for-profit insurance companies, for-profit health networks, and for-profit pharma companies are all fighting for their share of the pie while pushing increasing costs onto the average consumer. I wish I knew what the fix was - other than an unattainable single-payer system - but we need to find something and find it fast.

This is all such bullshit. Single payer has problems, but it works well and is a whole lot cheaper in terms of % of GDP as implemented in places like Italy. Also in Italy you have a decent, parallel private system where you can simply call up and ask how much basic stuff is. I once got some chest X-rays and a consultation with an ear-nose-throat doctor for 150 Euros out of pocket (oh, and I got to do both the day after I called). They apologized because it was so expensive. I barely kept a straight face.

The people who claim to be protecting your freedom are shifting the economy into the worlds largest extortion play.

Its maybe the penultimate stage of a truly free market.

I got a letter from my insurance provider saying they're pulling out of the local market in 2018. I pay full price directly, no subsidy, not through any exchange, it's very expensive and I've poured tens of thousands into premiums over the years.

I can't help but relate the entire industry to a ponzi scheme.

>I can't help but relate the entire industry to a ponzi scheme.

In what way is the insurance industry a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities?

Seriously, I feel that phrase to be misused so often it has lost all of its original meaning. /rant

Basically, do we want to send the signal that entrepreneurship is for everyone, or just the rich and healthy?

Entrepreneurship is not for everyone. It is for people who take risks. And yes it takes being healthy, because it is a stress which even most absolutely healthy and young people can't endure. And preferably rich because it sucks being left at the mercy of investors.

You're implying that the risk a young, healthy person takes is entirely within their control, but even a healthy person can get hit by a car or get injured in some way unrelated to their "fitness" level.

The reason we need to fix health care is simple: if you are dying or seriously injured, and you don't have health insurance, you are going to the ER regardless and someone, somewhere will end up paying for it. Let's all be adults about the situation and just implement something that works.

What about people with a chronic but completely controllable condition?

Dismissing anyone with an illness from entrepreneurship because you think they can't handle the stress is ridiculous.

This is not a full picture of entrepreneurship or small business ownership. Entrepreneurship, especially in "middle America", also encompasses starting your own hair salon chain with an innovative approach to curly hair, or trying to get your dog-washing device manufactured and into stores, or selling Ukrainian sausages and imported chocolates. Sure, on HN it's all about healthy and young people at the mercy of investors, but out in the world it's imperfectly healthy sometimes-old people who use savings and family and friends to get things going. Especially if we're talking about health insurance in Iowa.

Risk tolerance is neither a useful proxy/predictor for entrepreneurial activity or entrepreneurial success [0,1]. Instead, it is more appropriate to say that entrepreneurs have a higher tolerance for ambiguity [2]. The most current/best research on entrepreneurial ways of thinking suggests that successful entrepreneurs tend to look for systematic exploits that exist within current market conceptions by assessing the ambiguity in markets and products [3]. Within a pure conception of risk, risk is not the right term but rather uncertainty/ambiguity. However, it is very easy for that uncertainty to look very risky when existing models of risk are employed. That is how the competitive advantage is created...finding a new business model/prouct to address market uncertainty that is low risk by relying on a different conceptualization of the underlying risk model and its assumptions. This is why entrepreneurship so often results in creative destruction of existing solutions and markets...because the new risk model is more efficient and/or lower risk and it had yet to be pursued because existing models (for whatever reason...e.g., technological progress) made the new model look extremely risky.

[0] http://journals.sagepub.com/doi/abs/10.1177/1476127004047617 [1] https://www.inc.com/kimberly-weisul/weve-got-the-relationshi... [2] https://www.forbes.com/sites/acton/2012/05/17/the-one-key-tr... (or you could just cite Schumpeter/Knight...this is just more readable) [3] Sarasvathy, Saras D. Effectuation: Elements of entrepreneurial expertise. Edward Elgar Publishing, 2009.

When I quit my job to run a company, I was very healthy. I just couldn't buy health insurance on the open market because I had a pre-existing condition.

This was prior to ACA, so I ended up paying through the nose for COBRA.

Pre-existing conditions aren't always debilitating. They can be things that, when treated appropriately, don't impact your ability to start a company at all: diabetes, amputation, cosmetic issues like severe hair loss, sleep apnea, amputation, ect, ect.

That's a terrible way to look at things. There are many people, myself included, who developed a pre existing conditions while a teenager. I require health insurance. So now, you're telling me I shouldn't be able to be an entrepreneur because of that?

While your point is well made...it assumes that the objective function in these decisions is entrepreneurship. It isn't, in fact it is almost the opposite. Because of the way our elections work the objective function is entirely focused on increased/optimizing ROI for existing businesses that contribute to campaigns.

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