Sick of Paying Your Employer to Cover Your Health Insurance?


 Sick of Paying Your Employer to Cover Your Health Insurance?

If you're anything like me, you've been dragged into the world of entrepreneurship by your employer. They'll cover your health insurance and other benefits, but they won't hire you away from them — at least not without a hefty sum of money. With the ridiculously high cost to work for yourself, it's tempting to just leave your job and stick to freelancing. You know what I'm talking about — that sinking feeling in the pit of your stomach after every paycheck as you count down the days until next payday. It's a painful experience, I know.
During the startup phase of my own ventures, I never really felt like I was making enough money to justify quitting my job and going out on my own. That's what makes the recent announcement by New School for Business graduate and entrepreneur Josh Kopelman so ironic: he quit his job at Paypal to start his own company — selling insurance . The good news is that he struck a partnership with a benefits provider that will pay him enough to cover his health insurance premiums. As far as I'm concerned, he should just keep being an entrepreneur. It sure beats swallowing pill after pill for no good reason.
Have you ever noticed that we have these two completely separate systems of healthcare in the U.S.? We have the traditional model where our employer pays a percentage of our health insurance costs, and then we get our deductibles and co-pays. Then we have the new system where we pay an additional amount to our employer, which only partly covers us — except for this little bit on top of that. It's like three separate systems all rolled into one, trying to force us to buy things they want us to buy instead of making consumer choices for ourselves. The benefit plans are so complicated that even people who are getting rich from them can't tell you what it costs or how much is covered without calling an 800 number. By comparison, they're easy to understand. You can look up just about any service offered by an employer on the Internet and know exactly what you will be shelling out for that item.
I can't tell you how many times this happened to me when I was running my own company:
"I'd like to write a check for five hundred dollars a month."
"That should cover your health insurance."
"Oh, I need it to cover my mortgage and auto insurance too." "We don't offer that, sorry." "I have a really good plan with copays and deductibles . It's like ten grand a year. How much does that cost?" "That's way more than you can afford, sir. You'll have to pay for it yourself."
I'd say that was a pretty expensive way to buy health insurance that I didn't want. So I decided that I wanted to do something about this mess. 
Now, before you start thinking that I'm either a socialist or some kind of anarchist because of the above, all I'm advocating is the market solution: let us choose what we want and what we need, and let the price be determined by free enterprise. It should be no surprise that Kopelman's company will be selling plans through the new marketplace being established by the Affordable Care Act (a.k.a., Obamacare). If you don't like it, just don't buy it.
The fact that we've allowed these two systems to exist at all is just another reason why such a large percentage of Americans cannot afford the new plan. They can't have access to the marketplace without getting a subsidy, and they can't get a subsidy without buying insurance that even most employers don't want them to buy. It's little wonder that nearly half of us are having difficulty paying our medical bills and that only 45 million are now covered by employer-based plans.
This is the result of not allowing market forces to determine how much we pay for healthcare. Too many people are making decisions based on what they think they should be paying rather than what they actually would be paying if left up to consumer demand. It's a vicious cycle that we need to get out of if we want real healthcare reform.
What Kopelman is doing is providing consumers with the ability to choose what they want and need, not what they perceive they should be paying. And it's working because he can afford his own health insurance, and he can afford his own mortgage and auto insurance . So why can't you? Right now this marketplace doesn't even exist yet, but when it does I'll be right there buying my own health insurance. I just hope I have the chance before Kopelman sells out for millions of dollars in profits.
The prices in the new marketplace will eventually be much lower, and I say this as someone who has negotiated the insurance rates at my previous company. The young and healthy have a lot better deal than they used to, but it's still a good deal considering that health insurance is about three times more expensive than it was just ten years ago.
The costs of health care are going up faster than anything else in our economy, even faster than housing. According to Joseph Antos, former head of healthcare at the American Enterprise Institute:
In 1970, healthcare costs accounted for 10 percent of GDP. Today they account for 21 percent of GDP — an increase that equals one-third over 40 years. If the costs incurred by the healthcare industry had risen at the same rate as other costs in the economy, they would be only $1 trillion — less than half what we actually pay. Instead, US citizens are stuck with rising insurance premiums, deductibles, and co-pays.
Our country is in a crisis. Even for those of us who have good health insurance, it's still difficult to find a doctor willing to accept our plans. What makes you think that I'd want to pay for a policy from you if you won't take my business anyway?
Let me tell you how a free market works. If you want to do something, you find a way to do it. If there's no demand, then the only option is to do something else. This is the way the free market works.
If we leave this mess to government, they will either make it worse or leave it up to trial and error trial and error until it comes out more expensive than what we can afford anyway. The last time I checked, we have an original concept of individual rights in this country called "freedom." It seems like both of those have disappeared in favor of regulation and bureaucracy run amok.


The most important point to keep in mind is that this new marketplace only exists because of the Affordable Care Act. The only reason Kopelman has insurance, because of his employer's plan, is because the marketplace was allowed to exist and to exist on an experimental basis. The marketplace will evolve and improve as more people get coverage, but the fruits of this experiment will be under heavy scrutiny by Congress and President Trump. If it doesn't work, it doesn't work, but if it does it means less money for bureaucrats and private companies alike. That's a pretty refreshing concept.
A government-run system will always be slower than a free market one because you're not being incentivized to innovate and improve your product or service .

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