Category Archives: Healthcare

Personal finance: “FIRE” doesn’t really mean “retire early”

True:

In truth, “FIRE” should be “FICC” for “financial independence change careers.”

Source: What I learned about the FIRE movement while making a doc about it

I have followed several “FIRE” blogs from people who save aggressively (generally a good thing) and “retire” at 30 or 40. I admire them for practicing frugality (something we have practiced too). I am now retired, albeit, at the age when many people have retired (old dude, ok?)

I too noticed that most FIRE practitioners did not retire, exactly, but often took advantage of their near financial independence to work independently, on their own schedule – instead of the usual corporate rat race. That’s not  bad thing either – in fact, it sounds like a great opportunity for many!

But there are some hidden “gotcha” expenses that may be lurking for FIRE adherents in the near future …

Continue reading Personal finance: “FIRE” doesn’t really mean “retire early”

Increases in student loan availability lead to increases in tuition and fees

Stated another way, the more money poured in to student loan programs, the higher the tuition charged. Tuition goes up because of student loans rather than the view that student loans go up in response to higher tuition.

Consistent with the model, we find that even when universities price-discriminate, a credit expansion will raise tuition paid byall students and not only by those at the federal loan caps because of pecuniary demand externalities. Such pricing externalities are often conjectured in the context of the effects of expanded subprime borrowing on housing prices leading up to the financial crisis, and our study can be seen as complementary evidence in the student loan market.

From: Lucca, D., Nadauld, T., Shen, K. (2015, 2017). Credit supply and the rise in college tuition: Evidence from the expansion in Federal student aid programs. Staff Report no. 733. Federal Reserve Bank of New York.

As the authors note, this is similar to other areas where a third party supply of money causes prices to rise – such as the effect of cheap mortgages causing home prices to rise.

A similar effect occurs in health care where third party “insurance” benefits are an enabler of higher priced health care services.

Whenever the cost of goods are services are subsidized such that their immediate direct costs are lower than the market clearing price, demand for those goods and services will increase. As demand increases relative to supply, the prices charged increase to a new actual and higher market clearing price.

Student loan programs are a major cause of tuition hikes. Cheap mortgages are a major cause of rising home prices. Health “insurance” is a major cause of higher prices charged in health care.

Health: Insurers pay $15-$85 for “free” flu shots; I paid $19.99 cash at Costco. “Insurance” is an enabler of high costs in health care.

Although many consumers pay nothing out of pocket for flu shots, insurers foot the bill. And those prices vary dramatically.

Source: The Startlingly High Cost Of The ‘Free’ Flu Shot | Kaiser Health News

Insurance has made possible random pricing for what should be fixed price goods and services. Contrary to widespread misunderstanding, insurance does not make health care cheaper, it merely makes someone else pay for it. Kaiser found that 3rd parties pay $15 to $85 for the same flu shot.

I paid $19.99, cash, at Costco, because we no longer have 3rd party paymet for prescriptions or vaccinations. Fred Meyer wanted $60 – it was hard to get a price quote from them as they were flustered when I asked for a cash price, as if they didn’t know what to do. Several minutes later they got back to me with a price.

Since I have skin in the game, I shop around. There is no reason for anyone or any insurer to pay exorbitant (and secret) prices for a fixed service like a flu shot. But they do it anyway.

All proposals for addressing health care issues in the United States are of the form “health care costs too much so let’s find someone else to pay for it“. This strategy will only work as long as you can find someone else to pay for it, and then it collapses.

The reality – as shown by prices paid, time after time – is that 3rd party payers enable high prices and do not control them, as they claim.

Off topic: New brain scan technique finds evidence of brain changes long after concussion/TBI/Brain injuries

Off our usual topics here but … Having experienced six traumatic brain injuries in life, this study is of great interest to me:

The authors point out that there is growing evidence of persistent changes in the brain that last well beyond clinical recovery and clearance to return to play. This study confirmed those findings showing clear brain changes in both structure and function that persisted six-months after injury. They also showed that these persistent brain changes related to concussion history, even in healthy athletes.

We were able to show evidence of prior concussion history through this method,” said Menon who is also a scientist at Robarts Research Institute and the director of the Western Centre for Functional and Metabolic Mapping. “This component correlates directly with the number of previous concussions that an athlete has had. This hasn’t been shown before.”

Source: MRI technique shows unique signatures of concussion in rugby players – Media Relations

Very interesting!

I have had six traumatic brain injuries (TBIs) ranging from about age 5 or 6 up through about age 50. One included a skull fracture (and unconsciousness) and 3 others involved knock out blows. Two did not knock me out but left me disoriented or with other affects such as “slow brain” and (oddly enough) arrhythmia for a couple of weeks.

In the past, these were called “head injuries” not “brain injuries” and were mostly ignored by doctors. Associated broken bones got attention! This is why TBI has been called an “invisible injury”.[1]

Incredibly, I did not know what a “TBI” was until 2018! I had, at various times, and in some cases still, experienced a variety of common TBI symptoms including “word finding” (knew what word I wanted to say but was physically incapable of saying the word), “stabbing” headaches, “throbbing” headaches, tinnitus, visual migraines, “slow brain”, emotional lability (since my third TBI, I found myself breaking into tears at emotional movie scenes or news stories), irritability, anxiety, “negatavistic thinking” including rumination and perseveration, sensitivity to low frequency sounds and noise and very short term memory issues (but not long term). For example, I tend to misplace tools I am working with and then spend 10 minutes looking for them, misplace my reading glasses, leave a stove burner on, etc. I developed coping strategies to avoid this now and it no longer happens as often as it once did!

I had no idea my brain was not behaving as it should. I learned just this year that this was not normal brain functioning and these were common after TBI (and sometimes long term after TBI). Merely learning this has left me with a wonderful feeling – finally – a coherent explanation and treatment options for a few things that linger on from long ago TBIs.

I learned that some people had very mild head injuries – but very debilitating brain injuries. There are some who have severe head injuries – but have made fantastic recoveries. There are also those who have had injuries and have had very difficult recoveries. Personally, I feel incredibly grateful that I came through a staggering six TBIs quite well and without diagnosis or appropriate treatment – not everyone has been so fortunate.

The above study has found a method for doctors to finally see evidence of physical changes, which they were previously unable to see. Lacking physical evidence, many patients with brain issues were ignored. More recently neuropsychologists have been brought in to evaluate cognitive functions and diagnose brain disorders that show no physical evidence.

Help for TBI patients is available.

Notes

[1] When I was 11 1/2 and recovering from a skull fracture, I remember I felt odd being so affected but nothing to show for it. Back in those days, kids with broken arms and legs got sympathy – but most didn’t know I too had a significant bone fracture and brain injury. TBI is mostly invisible. Yet my skull was fractured from my left temple to behind my left ear due to my bicycle striking a small pot hole, turning the front wheel into the curb, and throwing me over the handle bars, landing on the back of my head (per witnesses and evidence – obviously I have no memory of it). This was back in 1971 before bike helmets existed.

ACA, Medicare-for-All, Single Payer, Health Insurance and related topics

Most everything we think we know about the Affordable Care Act is probably wrong, owing to a combination of propaganda and abysmally poor news reporting on the subject. Starting in 2016, I began researching why insurance premiums were climbing so rapidly in the non-subsidized individual market. Our own premiums rose by +167% (about 2.7 times higher) in 4 years, before we had to drop out of the ACA markets. For 2018, insuring ourselves and our youngest daughter, who is in grad school, would have cost almost $24,000/year for a bare bones, basically catastrophic “Silver” insurance plan with high deductibles.

What happened? My paper goes in to all the details but here are some highlights:

  • All of the very high cost, high risk patients were merged into the small individual market risk pools. As of 2017, all of their high costs is shared exclusively with the other members of the small individual market pools – consequently, premiums skyrocketed.
  • Some persons receive subsidies to lower their monthly costs. The subsidy cut off level has no relation to actual insurance prices. The level is set by the regional poverty level whereas insurance rates are determined by pool risk, individual age and geographic location. There is no relationship between the subsidy cut off level and the price of insurance. This leads to bizarre situations where in several cities across the U.S., an age 64 married couple earning $65,000 per year is above the subsidy cut off level, and hence, receives no subsidy assistance – but their cost of a Silver plan is over $50,000 per year (see paper for details).
  • All health care market participants have engaged in acquisitions and mergers to give themselves greater market pricing power. This includes hospitals buying medical clinics, drug companies buying each other, retail pharmacy changes buying other chains and even insurance companies and more. Everyone has increased their pricing power except for individual consumers. The ACA, as implemented, prohibited individuals from forming groups to achieve volume pricing discounts. Literally everyone else merged to strengthen their market positions – except for individuals.
  • A big surprise – most ACA policies checked provide no coverage for hospitalization or surgery while traveling outside one’s narrow network of medical providers, which is typically an area as small as a few counties (see paper for details). Literally, the ACA leaves people without critical insurance protection while traveling in the United States.
  • The ACA actually does have a pre-existing condition exclusion, but in a different form and name. See the paper for a description of the types of pre-existing condition exclusions. The ACA implements a waiting period for certain pre-existing conditions. If you have no insurance in January but are diagnosed with cancer on February 1, you will have to wait 11 months before you can sign up for insurance. See the paper for details. Its a pre-existing condition exclusion in a different form.
  • Medicare-for-All has almost nothing in common with Medicare, other than the name. Similarly, everyone has different ideas as to what single payer means. Consequently, there is no coherent and workable proposal at this time.

Clearly we need to solve these problems. Medicare itself goes bankrupt in 2026 per the 2018 forecasts. My paper contains many pages of proposed solutions, some of which were adopted by my state, Oregon. Various drafts of the paper were read by state legislators, state health agency staff, insurance and health care industry staff.

Unfortunately, I learned most politicians do not want to listen to ideas on solving real problems and prefer to ram their ideologically preferred solution (whether it works or not) on to others. Consequently, at this point, I maintain this paper for my own records.

I have posted this paper here so that it can be indexed by the Internet search engines. Hopefully others will find it of interest.

ACA Individual Market (PDF) – about 50 pages

Keywords: Affordable Care Act, ACA, ObamaCare, Health Insurance, Premiums, Prices, Cost, Medicare, Medicare-for-All, Single payer, insurance risk, risk pools, individual, group

Robotics for rehabilitation medical care

This is total awesomeness! The application of robotics to assist those subject to physical disabilities:

It’s not only engineers who work in robotics

Source: It’s not only engineers who work in robotics | Robohub

My wife recently retired from nursing. She had worked as a Certified Rehabilitation Registered Nurse, working with spinal cord injury patients, and sometimes with traumatic brain injury patients. She tells me that tremendous advances are  being made toward spinal cord regrowth and repair – this is still a ways out but is another exciting development for those with these types of injuries.

How to get out of ObamaCare without paying a penalty

We, like many, have been  hit by extraordinary price hikes under ObamaCare. ObamaCare began in 2014. Since the first year, our premiums have risen 140% culminating in a 56% price hike in 2017. Obviously, ObamaCare’s nongroup market has failed and is collapsing (so say the insurance commissioners in Minnesota, Tennessee, the editors of the Chicago Tribune and others, former proponent Gov. Mark Dayton (D-MN), and former President Bill Clinton.)

There are ways to escape the crushing burden of ObamaCare’s extremely high insurance rates and rates that are increasing on an exponential trend line. Fortunately, there are perhaps 15-20 exemptions written in to the law. This post addresses only a few of those exemptions

The reason ObamaCare’s nongroup market has failed is due to a design and implementation error in the ACA. This is not rocket science.

Continue reading How to get out of ObamaCare without paying a penalty

Cover Oregon software failed due to “ideological blindness” to the organization and management failures

Cover Oregon ran Oregon’s failed online health insurance market; it never enrolled a private individual and is being abandoned in a shift to the Federal HealthCare.gov web service.

The system never worked but insiders refused to believe what they were seeing because a “true believer mentality won out”.

This mind set is common in too many software projects with thoughts like “its just a few problems and will work fine once we get through this”, “we will make up the lost time later”, “the defects are not that serious-they are fixable”, “we can just drop a few features”.

Though the beta site was limited to insurance agents and certified consumer assisters, exchange managers — not unexpectedly — encountered bugs. “On Day 1, agents couldn’t even log in,” Jovick said.

It was the reaction from certain other people in the room that was disturbing.

Troubleshooters for Oracle, the project’s lead vendor, “were flabbergasted” and completely stumped by how the system was malfunctioning, Jovick recalled. Rather than knowing who to call to get problems fixed, Oracle’s reaction was “Huh? How did that happen?'”At that point, no one realized Oregon and Oracle had built “this absolute disaster that just didn’t do anything,” Jovick said.

via Cover Oregon insider Tom Jovick speaks: Health exchange problems stumped Oracle, blindsided staff video | OregonLive.com.

The management team ignored the warnings of many consultants who found “lousy code”, poor testing, lack of test environments, and more.  They were true believers in the ideals of the project and were blinded to what was in front of them.

Oregon ended up enrolling people by hand using paper applications. They lost 20,000 applications and enrolled 4,500 “non documented” immigrants (formerly known as illegal aliens) who did not qualify.

There is a potential that the  Cover Oregon organization be shut down and the staff laid off  (Update: Cover Oregon was shut down after spending about $450 million and never enabling a single consumer to enroll online). From a traditional business perspective, it seems they made need an entirely new organization that is not carrying “emotional baggage”, which is unfortunate for the staff. From a marketing perspective the “Cover Oregon” brand is irreparably damaged and should be replaced.

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