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Comment by whatever1 | Hacker News Reader

So you have to pay like $30k out of pocket in a year before the insurance chips in a single dollar? And if you ever ask for a dollar, I can also reject your coverage.

How can I start an insurance company?

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You don't pay the deductible for many typical services if you're in-network. We have a mid-tier United Healthcare plan, and we only ever pay a $25 copay per doctor visit.

United Healthcare's net profit margin is about half that of Chipotle in a good year: https://www.macrotrends.net/stocks/charts/UNH/unitedhealth-g...; https://www.macrotrends.net/stocks/charts/CMG/chipotle-mexic...

I pay around $1100 a month for me and my two children through my employer. Yes; I have a $25 copay for many services, but most are simply not covered under that $25 copay. They refused an age-appropriate colonoscopy last year. It's basically fucking useless and expensive.

So; is it worth it anymore? No. Is it necessary? Yes; unfortunately.

I just took a look at our annual medical contributions and employer's part.

We pay just over 10k for health insurance through our (different) companies. Our different employers cover almost 28k. So around 38k for insurance. This doesn't even include dental or vision which is separate.

It just seems so crazy how much we pay and still have deductibles. I understand we have small copays and get items covered like age-related screenings but this just feels excessive.

Just talk to people in the healthcare industry about what kind of patients they have. We cover a tremendous amount of treatments in the U.S., at an arguably unsustainable level of service.

My aunt had a kidney infection in Canada and my cousin had to pull teeth to get her scheduled for an MRI. My five year old got a black eye from running into a table and they scheduled him for an X-ray and CAT scan (“just in case “) later that same morning. Had the results by lunch. My dad had a non-emergency scan scheduled the next day, and an outpatient procedure for a kidney stent (to treat high blood pressure) within two weeks. Once the surgeon was in there he realized my dad didn’t need a stent after all.

Here in the US, I see wait times for medical care comparable from what I hear from my Canadian friends. I don't think we our system can really tout that as an advantage over theirs.

Where are you located? E.g. the average wait times for CT scans and MRIs in Canada is weeks: https://canjhealthtechnol.ca/index.php/cjht/article/download.... UK NHS is 6-18 weeks. Here in suburban Maryland I’ve never had to wait more than a day or two for anything.

I live in the urban west. Most of the people I know have to wait weeks for pretty much anything.

When I had a serious accident involving multiple broken bones and the need for orthopedic surgery, I had to wait two weeks to get an MRI, although I did get a basic X-ray in the emergency room. Then another month (while being unable to move much, let alone work, and being in a great deal of pain) to get the surgery. That was me getting expedited scheduling. It also cost me a fortune out of pocket.

I’ve never had anything that available (outside of urgent care which imo is not very good). None of this had an immediate need.

MRI a few years ago had a month and a half wait (not urgent but recommended).

Pediatrician? At least 3 months and thats IF they take new patients.

Allergist, 6 month waiting list.

My last PCP I had to book out 2 months in advance (the practice I wanted to go to was booked 6 months out).

We are also suburbs of a big city.

It's not about wait times, it's about excessive scanning and endless, marginal-benefit end of life care

The people who opposed socialized medicine by fear-mongering about “death panels” can’t now complain that their preferred system provides limitless, marginal benefit end of life care. That’s the trade off THEY argued for and said THEIR system could do.

What about the people living in the same country who didn't oppose socialized medicine or fear monger about death panels? Can they complain that their non-preferred system sucks every bit as much as they always knew it would, and advocate for improving it, or are they forever bound to suffer karmic justice for what other people did over a decade ago?

I pay 8% from my salary for mandatory government health "insurance" which is basically a tax as there are enormous waiting queues for something serious.

Yeah, I think that's a big part of the overall grievance. If we paid these high premiums and got great care, that'd be one thing. But I've almost never walked away from a sizeable medical expense in my family thinking I wasn't being ripped off somehow.

Profit margins are irrelevant if you inflate your costs to reduce them.

Not really... If you want more $s by inflating costs and keeping the margin constant, then you will need more capital for paying these higher costs. This additional capital will either come from equity or from debt. Currently both equity and debt are expensive....

Profit margin is quite relevant...

The capital comes from raising premiums.

Mine went from $3k/month to $3.6k/month this year.

Bonus points if you can steer the increased costs to providers you own. https://www.statnews.com/2024/11/25/unitedhealth-higher-paym...

What is a typical service that you only pay $25? This year I had two shoulder injuries. I paid for every single thing (doctor visits, X-Ray, MRI, Physical Therapy).

For my family, annual screenings are around a $40 copay (no other bills after). I think I paid that for some age related screenings.

I only go to the doctor for the kids. So checkups, vaccines, ear infections, minor injuries, etc.

No, $13.4K before the insurance company starts chipping in. Also that would be total deductible for the family; there's a lower deductible per individual. (I.e., the deductible might be $2.5K per individual, and $6K for the family.) So if one person needs more medical care, the insurance company kicks in once you've paid $2.5K (or whatever amount) for that person's care.

>How can I start an insurance company?

One requirement is to be willing to earn returns less than SP500.

Look up profit margins and annual returns for UNH, Elevance, CVS, Cigna, Humana, Centene, and Molina.

You have a billion laws to follow, you’re used as a punching bag by politicians and customers, have to get the price of your service approved by a government employee, and for all of that, you earn a 2% to 3% profit margin.

No it will be a zero profit company. All of the revenues will go to my compensation and bonuses.

> for all of that, you earn a 2% to 3% profit margin.

Yeah -- it seems like a paradox that the insurance companies charge so many people so much money, yet struggle to make a profit.

I've heard that they spend a lot of money handling their "internal friction" -- reviewing claims, handling appeals, etc.

Health insurance premium revenue = medical loss ratio + operating costs + profit margin

Medical loss ratio is the money paid to healthcare providers. Operating costs end up being ~10%, across multiple publicly listed companies. This fact, plus 2% to 3% profit margins means any more cost reductions have to come from legislation, reduction in healthcare prices, or advances in automation.

https://www.oliverwyman.com/our-expertise/insights/2023/mar/...

https://www.kff.org/private-insurance/medical-loss-ratio-reb...

Uh huh, and for them to have inserted themselves between me and my doctor, what exactly did they contribute to the transaction and how much should I want to pay for such a privilege since apparently $30k a year isn't enough? A measly 2-3% for adding no value and creating friction, egregious, we must get the profits higher!

First of all, some or much of your premium is a wealth transfer (from young and healthy to old and sick). So consider that portion a tax (it literally is, just not collected by the government directly):

https://news.ycombinator.com/item?id=45800973

https://www.cms.gov/marketplace/private-health-insurance/mar...

https://www.healthcare.gov/how-plans-set-your-premiums/

>what exactly did they contribute to the transaction

Obviously this varies based on personal experience, but the biggest benefit is usually covering the big expenses beyond the out of pocket maximum, such as premature babies, bypass surgeries, cancer treatments, hemophilia treatments, etc stuff that costs hundreds of thousands and millions of dollars.

Second would be negotiated pricing with healthcare providers. If you think you can do a better job negotiating, you are welcome to not pay the health insurance company (better referred to as managed care organizations), and see what kind of deals you can get.

Third would be services as an agent that knows something about healthcare to be able to discern necessary and unnecessary care, since most buyers are unable to discern that information. This is, of course, highly subjective based on personal experience and the lack of government audits here leaves much to be desired.

>how much should I want to pay

When you have 7 publicly listed managed care organizations along with numerous non profits such as the various BCBS and Providence and Kaiser Permanente all selling insurance at roughly the same price, it's sufficient to conclude prices are about as low as they can get in this business environment.

>A measly 2-3% for adding no value and creating friction, egregious, we must get the profits higher!

This sentiment really doesn't make sense, unless the goal is to just be outraged for the sake of being outraged, because it has been clearly shown that there aren't much profits to be had in the first place. It's such a shitty business that one will end up with more money by investing in SP500.

Great. So this system provides guaranteed healthcare at the worst possible point, the emergency room, AND funnels these 'wealth transfer taxes' of yours through for profit corporations? Sounds like a really bad way to be doing this. Crazy also that we have a government insurance/payment program on top of this for old and sick people. So why have a government program and an additional private wealth transfer tax?

I have never met a normie whose insurance covers more than 1 million in yearly benefits. So no, they aren't covering millions of dollar claims.

> I have never met a normie whose insurance covers more than 1 million in yearly benefits. So no, they aren't covering millions of dollar claims.

Legally, an ACA compliant plan has to cover healthcare expenses more than the out of pocket maximum. “Benefit maximums” are not allowed under the ACA.

https://www.healthcare.gov/health-care-law-protections/lifet...

> Lifetime limits

>Insurance companies can’t set a dollar limit on what they spend on essential health benefits for your care during the entire time you’re enrolled in that plan. Yearly limits

>Insurance companies can’t set a yearly dollar limit on what they spend for your coverage.

Here is a famous example of a single healthcare recipient causing an insurer to stop selling insurance in a state:

https://www.desmoinesregister.com/story/news/health/2017/05/...

I think my sentiment is that with single-payer we could go from arguing about how expensive health care is and how much money should middle-men be able to extract from the system, to mostly just arguing about how expensive health care is.

Broadly speaking yes, though to be fair I should note that if your household size is a certain number and your income is a certain number, that can come down. They cap the amount you pay in premiums to a certain percent of your income.

EDIT: https://www.healthreformbeyondthebasics.org/wp-content/uploa...

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