I'm always amazed how blatantly clear it is that having health insurance tied to employment specifically discourages this kind of entrepreneurship, and the ability to "strike out on your own".
Literally handcuffs keeping people at their jobs.
One other observation: During the pandemic my spouse left her job to work with me full time. We had COBRA (health insurance based on her previous plan per federal law) for 18 months, which was great. Then we had to go to the open health marketplace. What a freaking disaster that was.
If you make any sort of middle class income, which we did through my business, you don't qualify for any breaks in our state's marketplace (Massachusetts Health Connector). The broker database they had for small businesses insurance was a joke - no one ever returns your call; it seems they are looking for midsized businesses where their commission will be larger.
I spent many hours comparing family plans on the Massachusetts Health Connector and eventually decided to bypass the marketplace and purchase insurance directly from the insurance company because it was a little less expensive and had a slightly lower deductible (but was still sky-high compared to COBRA/her previous employer's plan). We got reamed on the monthly insurance cost as well as the crazy-high deductible. She eventually went back to her old employer, and one of the primary reasons was getting access to affordable health insurance without crushing OOP costs.
1. Anyone who pays cash for a procedure should pay a price that is no more than the lowest price that any insurance company has negotiated for the same service.
2. Anyone who buys a health care plan from the marketplace should get a price that is no more than 10% higher than the cheapest negotiated price any company pays for the same plan.
3. Anyone should be able to deduct the cost of health care for income tax purposes, not just companies that buy health insurance for their employees.
Entrepreneurs see business potential on this arbitrage opportunities.
1. The healthcare and health insurance marketplace is riddled with regulation. There is no such thing as offering a health insurance plan or a healthcare service in the United States absent any regulation. Every existing service is, more or less, imposed via regulation.
2. The current health insurance system dates, in its current form, either to shortly after WWII or to the adoption of the ACA, depending on your perspective. That’s somewhere between 14 and 75 years. Where are the plans you speak of from these entrepreneurs? What are they waiting for, letting all of this sweet, sweet, arbitrage pass them by? Biding their time? Toward what end?
We need to fix the price gouging in the medical system by incentivizing competition. With the way things are currently set up in the US, the hospitals are essentially written a blank check any time a patient steps foot on their premises. If we bring competition between the hospitals with price transparency, the prices will fall dramatically.
How do you envision this working for say emergency care, where as a patient you may not be in a state to make an informed decision about which hospital to visit?
The current scheme only benefits rich people whose ability to pay outrageous insurance rates is easy and less than taxes. Poor people get substandard care, middle class workers get boned. I spend more on healthcare than taxes, and half my taxes are paying for stupid healthcare, either directly or through proxy.
So more significantly:
* bring back association health plans across state lines and industries, so small businesses can band together for group rates. https://news.bloomberglaw.com/daily-labor-report/biden-admin...
* Expand Direct Primary Care. https://www.dpcare.org/
* Allow primary care physicians, dentists, etc. to offer services without a state board providing "certification of need". This seems to just be gate-keeping / moat-building.
I'm not saying either or all of these are a perfect solution (nor do I think we need to find that solution immediately). As a small business owner, they'd make the health insurance handcuff problem easier to navigate by driving costs down.
I will say this - flying solo without health insurance does make you a FAR better consumer of healthcare services. You will comparison shop (made easier by price transparency rules). You will critically consider the necessity of gratuitous tests / procedures. You will learn that doctors are running profit-minded businesses like everyone else.
It also makes you reconsider some life choices (re: physically risky behavior).
I think the biggest fear I faced was the lack of catastrophic coverage (cancer, etc.). When we didn't have insurance (both small business owners) my wife and I probably consumed less than $1000 of direct services combined, per year. That part (direct pay for services used) was fine. Walking the tightrope without a safety net for expensive medical developments was our biggest risk. With kids it's even less of an option to operate that way. I've known many that have returned to corporate jobs for this reason alone.
1) Services are often unique per patient. Even for patients with the same ICD-10 codes, the quality of service will vary. Hospitals cost different amounts to run. If you always peg the price to the lowest, it will be a race to the bottom for quality of service.
2) Patients are unique, with different health profiles, with different preferences for paying. Markets are different. Some markets only have one insurance payer.
3) Healthcare is already tax deductible
Additional out of pocket healthcare expenditure is only deductible if you itemize your deductions and you're only allowed to deduct medical expenditures in excess of 7.5% of your income (AGI to be technical).
We should unlock all barriers to entry that we possibly can
Life is much more difficult in most places in the world than it is in the US. We have had more success with entrepreneurship because of a culmination of specific things, not a generalized "difficulty of life", which empirically does not exist.
It's also more common for successful entrepreneurs to have grown up without financial distress.
Sorry to shatter your dreams, but your theory is very silly.
I think it's okay to talk honestly about that. There's a LOT of waste and purely indulgent service in the current system. And as a person striking out on a business venture, I don't need concierge health services. I need a health safety net.
I think it hurts the conversation about UHC when that's waved away - telling people that they'll be bringing the best of low deductible in-network, gratuitously provided services to everyone.
UHC isn't about bringing great service to everyone, it's about bringing a higher level of minimal coverage to everyone.
I think both things are true, that we're getting a bunch of things right toward a successful entrepreneurial culture, but are also getting this one thing massively wrong and leaving a huge amount of further potential on the table!
Taiwan boasted more than 1.59 million small and medium enterprises (SMEs), according to the White Paper on Small and Medium Enterprises in Taiwan, 2022. This accounts for more than 98 percent of all enterprises, an all-time high. Further, SMEs employed 9.2 million people, representing more than 80 percent of the total workforce.
https://www.moea.gov.tw/MNS/english/news/News.aspx?kind=6&me...
I think the official number undercounts the many micro-businesses that exist around the food industry, markets, and services.
It should still cost you less to hire yourself than it'd cost a company to hire someone to compete with you, even before considering things like pass-through taxation and agency problems.