“Is this Covered By Insurance?”

People ask me the insurance question all the time. We have been conditioned to have practically all our healthcare paid by the insurance industry.

Or by government.

For the record, there are three ways to have someone else pay for my services in assisted living.

1. A long-term care insurance policy that you purchased in your younger days

2. A subsidy from the Veterans Administration called Aid and Attendance

3. Medicaid if you qualify

That’s about it. If you don’t have one of those, you’re paying out of pocket.

What is not so obvious is that you are paying for all your other healthcare. The insurance company is just the middle man. And they are not on your side.

Let’s take your employer-funded health plan. About 178 million Americans pay monthly premiums to their employer and receive health insurance as part of their overall compensation package.

People think it’s great. Their employer or the employer’s insurance provider covers most of their healthcare costs.

Actually you cover all of your healthcare costs. Unless maybe in that rare exception where you have something catastrophic and very expensive happen. And even then your other employees are helping cover it for you.

When your employer hires you, they look at what is the overall cost they will pay to have you as an employee. That covers your:

• Salary

• Employer portion of your taxes (social security and Medicare)

• Healthcare

• Savings account such as a 401k

• Other perks and benefits (cell phone, company care etc)

Whether the employer writes a check for all of this directly to you or to the administrator of each of these doesn’t matter to him or her.

It should matter to you.

Instead of doling the money out to other buckets, they could write you one big check each month and you spend it however you want.

Maybe you might shop around for health insurance with that big check? Or just purchase catastrophic coverage because you’re 23 and bulletproof? And then you can keep the rest of the money.

But no. Not only do you get less in your salary as healthcare costs rise. You are also handcuffed to your employer because you think you have a great deal.

Total healthcare spending in the US has increased from $74.1 Billion in 1970 to $4.9 Trillion in 2023. A 6500% increase.

On the other hand, real wage growth since 1970 has been minimal to non-existent. Yes there has been a lot of offshoring of jobs. However, US workers would be a lot more competitive if the employer didn’t need to spend so much more on healthcare.

That spending comes out of what otherwise the employer could pay you.

Self-employed? Unemployed? Now you’re really screwed.

Have you seen what healthcare policies cost on the open market? Huge premiums and sky-high deductibles. In effect most people on these plans are uninsured and paying for their own healthcare.

What about the government plans? I think you know how that works. Your taxes pay for everything. If you’re extremely poor and don’t really pay taxes, you probably made out alright - especially if you have a lot of health problems.

But then you’re really poor and have a lot of health problems. Not ideal.

To qualify for Medicaid in assisted living, people will ‘spend down’ meaning they will have to spend all their money on care to meet the income limit to qualify for Medicaid. In other words, you are still paying for healthcare.

Are you starting to see why I am so passionate about everyone taking care of their own health and not relying on whether ‘insurance will cover it’?