Healthcare -- Who pays for what?

Obamacare, Medicare, Medicaid, Private Insurance.  Who pays for what?

The answer, unless you have absolutely zero assets, is you.

First, if you are employed and your employer offers health insurance as a benefit, you pay premiums to an insurance company so that you will have health coverage.  These premiums are usually deducted from each paycheck.  (Your employer typically also pays a portion of your premium, but we'll get to that later.)

But you're not finished paying yet.  Your policy, in order that you can "share" the cost of healthcare with your insurance company, requires that you pay a deductible.  For hospital related charges, that means you must pay everything up to a certain level.  That's what the deductible is.  If I have a $1,000 deductible, I must pay hospital (and lab, x-ray, CT, MRI) charges up to $1,000 before the insurance company starts to pay.

Wait, there's more.  If you go to a doctor, there is  something called a "copay".  If I have a $30 copay, that means I pay $30 every time I go to the doctor, and the insurance company pays the rest of the charge.

Finished?  No.  Now we have to talk about co-insurance.  The easiest way to understand this is to consider an example.  Let's suppose you have an appendectomy.  Further, let's suppose your doctor charges $1,000 for the procedure.  Your insurance company has decided that they will only "allow" $800 for the procedure.  So your doctor has a fee schedule, but the one that counts is your insurance company's.  Your doctor, by agreeing to be part of the insurance company's "network", also agrees to the discounted rate on the company's fee schedule.  Now, your policy usually has language like "the company will pay the doctor 80% of the allowed amount".  That means the company will pay $640 for the appendectomy and you foot the bill for the remaining $160, the co-insurance.  If you have a second insurance policy (e.g., both you and your spouse are covered through work), then the secondary coverage steps in to pay the "co-insurance".

Let's summarize so far.  You pay insurance premiums, deductibles, copay, and coinsurance.  Got it so far?

That's all, right?  No, next you pay for health coverage for when your retire.  That's called Medicare.  Every time you are paid, 1.45% of your pay is deducted from your check and sent to the Federal Government for deposit into something called the Medicare Trust Fund.  Your employer contributes an equal amount to the Trust Fund.  So, in a way, you are paying premiums for your healthcare now and for when you retire.

Whew, thank God that's over, right?  Not by a long shot.

Let's talk about Medicaid, government provided health insurance for the poor.  It is a collaborative program provided by both the Federal and state governments.  Taxes fund Medicaid.  Who pays taxes?  You do.

Now, to the uninsured.  People lack insurance for one of two reasons:  they can't afford it or they refuse to have it, preferring, they think, to pay for all their healthcare out of their own pocket.

The problem with the latter approach is the cost of healthcare.  If you don't have insurance, then you don't get to take advantage of the discounted rates that come into play when you do have insurance.  So that appendectomy?  You pay $1,000 unless you personally negotiate with the doctor for the discount.  If you have appendicitis, you are not in a good bargaining position.  You are in just as poor a position with regard to the hospital bill that is sure to come and is likely to be even higher.

In the United States, the average costs of a day in the hospital are $1,878 (for state/local government hospitals), $2,289 (non profit hospitals), and $1,791 (for profit hospitals).Average Cost of Inpatient Care  That's just paying for the privilege of being in a hospital bed and receiving nursing care.  That doesn't include charges for operating room services, emergency services, and forget about intensive care services.

It's easy to see how a 10 day stay in the hospital can reach five figures.

Getting back to those uninsured people.  The ones who couldn't afford to pay insurance premiums sure can't afford to pay for this kind of care.  The ones who think they will pay for their care out of pocket are headed for bankruptcy.

This is the situation that the Affordable Care Act (Obamacare) attempted to address, to have more people covered either by commercial insurance or by expanding Medicaid to cover more poor people.  For people who can't afford their entire premium, subsidies were offered.  Where do the subsidies and the additional expenses related to the Medicaid expansion come from?  Two guesses.

Believe it or not, there is one more leg to this stool.  Remember how, if you are employed and covered by insurance, your employer usually pays a portion of your premium.  Also, your employer pays half of your Medicare premium.  Your employer pays taxes.  Where does your employer get that money?  From you or people like you who buy their goods or services.

That should close the loop.   Thanks for staying with it.  It's actually more complicated than I've outlined hear.  More about healthcare in days to come.

I'd love to hear feedback from readers.

The Loyal Opposition

A term has come to mind that I haven't heard in a while and it seems to apply to our current political climate:  loyal opposition.

As I understand it, the notion comes from parliamentary forms of government, such as in England.  Simply put, it describes the collection of people and parties not in power.   For a more complete definition see Loyal opposition.  

I wonder why we can't use the term and, to a certain extent, the concept to describe those of us, both post- and pre-Donald Trump, who remain loyal to our country, but who disagree with the party in power.  The term seems to carry more respect than we use now to vilify whoever opposes us.

And that's my point, to return to a civil discourse.  So, yes, I'm loyal, but I am definitely the opposition.

Why did it happen?

Yes, I'm disappointed with the results of the election.

I have my own thoughts as to why things turned out the way they did.

One of the main reasons, I believe, has to do with the economy.  Pundits say that Donald Trump tapped into the deep seated conviction, primarily of white blue collar workers, that they have been treated unfairly.  Their jobs went overseas.  They were not able to obtain jobs that allowed them to keep their middle class lifestyle.  Someone must be to blame:  immigrants, documented, undocumented, and CITIZENS, make easy targets.

I agree with them.  Someone is to blame.

There are the politicians who lacked the vision to support educational efforts that would enable those who have lost their jobs to compete in a new economy.  There are the politicians who lacked the vision to see the opportunity in an economy no longer based on fossil fuels but on renewable resources.  There are the politicians who hold to the old economy because they are afraid to tell the truth to their constituents.  There are the politicians who, simply put, are afraid to lead.

There are the education systems that devolved into teaching for the test and not for competence. There are education systems that forgot how to instill values without resorting to one brand of religion or another.

There are the major corporations, lacking any sense of civic responsibility to their employees and the communities left reeling in the aftermath.

There is a culture that no longer valued education the way it did in the post World War II years that sent millions of veterans to school and created a generation of businessmen, lawyers, doctors, and other professionals, that values the superstar basketball player over the high school physics teacher, that does not insist that an educated electorate is to be prized.

Finally, there are the citizens themselves.  Those who refused to admit that they no longer had the skills to make it in a new economy and refused to take responsibility improving their lot by means of education.

What's the big deal about education?  A well rounded education, easily obtained or not, gives the individual the tools, not only to earn a decent living, but also to learn to think critically, to have a sense of curiosity about the world, to learn to discern truth.

So we ended up with two candidates, but with flaws.  We decided with our emotions on which was the more flawed.

One had a career in public service.  She had made some mistakes, was not the most likable or approachable, but was clearly competent to take on the job.  You don't have to like your President.  But that doesn't mean you can't go the extra mile and decide for yourself whether her flaws were so significant and verifiable that she didn't deserve the office.  There's that critical thinking thing again.

The other had no background in public service.  By one measure, he lied once every three minutes he was on the campaign trail.  He kept the fact checkers busier than they've ever been.  He scapegoated immigrants, insulted women, threatened to put his opponent in jail.

Over fifty newspapers endorsed one of the candidates.  Only two endorsed the other.  But newspapers are languishing.  Readership is down.

One candidate had her party solidly behind her.  The other found his party seeking to distance themselves from him.

So I'm disappointed.  I'm disappointed that it was even close, so close that the electoral college is being challenged.  How was it close?  Did we think change was so important that we were willing to allow a campaign that resembled a demolition derby more than civil discourse?  Were we more willing to accept the easy lies rather than the difficult truths?

I've done my best to keep an open mind.  It's been easy for me.  Either way, I don't really have a dog in the hunt.  I'm white, male, and sixty-seven years old with retirement savings for which I am more grateful than I can express.

I also know that we live in a world that disputes facts, truth.  I remind people that you can have your opinion, but you can't have your own facts.  But that's what happened.  People chose their own "facts".  They listened to the big lie.  They went for the outsider in the White House, but re-elected the same Congress.

I've tried to speak truth here.  I hope I've given you something to think about.

Until next time.