Ask HN: If you didn't have to worry about healthcare, would you start a company?
If health insurance for yourself and your employees was not a consideration (taken care of without cost) and wouldn't change, would you start a new company in the next year?
108 comments
I don't have to worry about healthcare (living in a country with a pretty good socialised system) and I'm still too much of a chicken to go fulltime.
Since I live in Massachusetts, that's almost exactly what happened! (It wasn't/isn't free, but it was no more expensive than when I worked for BigCo).
I imagine most people on these forums are interested in starting a company regardless of healthcare issues. Personally, as I'm a little older and have a family to consider it's a little more of an issue but even then I feel like I can work around it and that it's not one of the major risks I consider with starting a business.
So, that being said, I guess my answer to your question is "yes" although I would probably be doing it regardless of your proposed situation.
I guess what you really may want to know is how many people would start a business that otherwise wouldn't, or how many people consider this a barrier to entry.
So, that being said, I guess my answer to your question is "yes" although I would probably be doing it regardless of your proposed situation.
I guess what you really may want to know is how many people would start a business that otherwise wouldn't, or how many people consider this a barrier to entry.
I just might have started one in the last year. I was between jobs over the Spring/Summer and developing pitches and prototypes.
Without going into details, health insurance is a big issue for my family. I looked at my options (I'm in the US) and there really aren't any unless my employer has insurance. I have no idea how insurance companies and employers ended up married like that, but if one wants to get/change insurance, the only option is to change employers. And it seems fewer employers offer it every year.
Then I landed a gig with a very nice place that has great benefits, including epic insurance. So, for this year, I'm here in a job that's about as far one can get from a startup without being a government gig and surprisingly happy about it. That's a big 180 from where I was 6 months ago. :-)
Without going into details, health insurance is a big issue for my family. I looked at my options (I'm in the US) and there really aren't any unless my employer has insurance. I have no idea how insurance companies and employers ended up married like that, but if one wants to get/change insurance, the only option is to change employers. And it seems fewer employers offer it every year.
Then I landed a gig with a very nice place that has great benefits, including epic insurance. So, for this year, I'm here in a job that's about as far one can get from a startup without being a government gig and surprisingly happy about it. That's a big 180 from where I was 6 months ago. :-)
" I have no idea how insurance companies and employers ended up married like that"
I believe the short answer is WWII. Price controls meant employers needed to find a way other than higher wages to attract workers.
I believe the short answer is WWII. Price controls meant employers needed to find a way other than higher wages to attract workers.
They are married through price controls and tax deductions. If the choice was 10000$ additional pay or 10000$ annual insurance premium. From a payroll and tax view that insurance premium is much cheaper.
Not to mention in many states, once you reach a certain number of employees you are required to offer a HMO.
Not to mention in many states, once you reach a certain number of employees you are required to offer a HMO.
The reason it is cheaper through your employer than individually is simple (or complex) math. Increasing the risk pool allows for premiums to be reduced. I am not sure that employers and insurance companies are married; you can (for a price and acceptable risk) get insurance without an employer.
Yes. That said, I plan on doing so anyway...but that would certainly make it even easier and that much more attractive of an option.
If you didn't have to worry about buying food, would you start a company?
If you didn't have to worry about paying the rent/mortgage would you start a company?
If you didn't have to worry about .....
If you didn't have to worry about paying the rent/mortgage would you start a company?
If you didn't have to worry about .....
Your argument is that health care is the same as food/accomodation, and therefore should be treated the same way. It definitely isn't. Food and rent are a fixed cost that are identical each week. By being frugal and possibly living at home or relying on a spouse, one can keep it at a very low rate, for example $100 a week. The cost of health care can quickly reach several hundred thousand dollars in a matter of days.
It's a little different from that, as there are active proposals in the U.S. to not have people worry about healthcare, and in many other countries you already don't. There are relatively few countries where you don't worry about buying food or paying the rent, by contrast.
It's also different because healthcare isn't a necessity. Many people can go for years with no health issues, but everyone needs to eat on a regular basis.
This idea (not you, mind you; just your retarded idea) is retarded. Healthcare isn't a necessity until it is.
As a 22 year old, you are unlikely to suffer congestive heart failure. But you also clearly have no idea what it costs to get hit by a car, to have a sudden unexplained seizure, or a burst appendix.
The problem with health care isn't that perscriptions cost to much or that it costs too much to see a doctor. Any of us can pay for a doctor's visit. The problem is that a 4-night stay at hospital will bankrupt you.
As a 22 year old, you are unlikely to suffer congestive heart failure. But you also clearly have no idea what it costs to get hit by a car, to have a sudden unexplained seizure, or a burst appendix.
The problem with health care isn't that perscriptions cost to much or that it costs too much to see a doctor. Any of us can pay for a doctor's visit. The problem is that a 4-night stay at hospital will bankrupt you.
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This is why I'm saying that healthcare isn't a necessity. I might not need any medical care for years, but if I needed to spend 4 nights in a hospital it would bankrupt me. This makes not having health insurance risky, but starting a company has its risks. I would say that most of them are probably not as serious as this, but it's still just a risk.
Starting a company is as much about managing risks as embracing them. You want to take risks with little downside and enormous upside. Not having health insurance is a risk with enormous downside and little upside.
This is probably the only way you'd risk bankruptcy starting a company. There are lots of risks that you'll drain your bank account, but when it looks like you're going to lose your lease, you go get a job.
"...healthcare isn't a necessity. Many people can go for years with no health issues..."
If you mean that most young people in the developed world (who've been delivered by trained midwives, checked over by a doctor at birth, had all their vaccinations, regular eye tests and dental checkups, and managed not to break a bone during childhood or adolescence) generally haven't needed to see a doctor or go to hospital for urgent medical attention, then you've got a point.
Of course, as they get older, they'll almost certainly need some sort of medical treatment.
If you mean that most young people in the developed world (who've been delivered by trained midwives, checked over by a doctor at birth, had all their vaccinations, regular eye tests and dental checkups, and managed not to break a bone during childhood or adolescence) generally haven't needed to see a doctor or go to hospital for urgent medical attention, then you've got a point.
Of course, as they get older, they'll almost certainly need some sort of medical treatment.
It depends on your age. When you're in your 20's and single and your employees are also, healthcare isn't usually a huge issue. But when you work for startup(s) during your 20's your body will take a toll from all of the hours of hard work, lack of sleep and bad diet. When that, and the likelihood of having a family, catches up to you, you will find healthcare a necessity.
You may have to pay for recurring prescriptions. The birth of a child, and many other things that will surely become necessities.
You may have to pay for recurring prescriptions. The birth of a child, and many other things that will surely become necessities.
I've had car insurance for many, many years. In the past 10 years, despite paying many thousands and thousands of dollars for it, I've never "needed" it, even though I drive every day.
Many EU countries have welfare so generous that one need not worry about buying food, paying rent or paying for healthcare.
Why not look to those countries and see if they have more startups?
Why not look to those countries and see if they have more startups?
Those countries also have regulatory climates that are hostile to businesses. It is harder to incorporate, more onerous to have employees, much harder to fire, and businesses are taxed more aggressively.
I doubt health care is the reason it's harder to start up in France.
I doubt health care is the reason it's harder to start up in France.
I think the reasons are cultural rather than regulatory or fiscal.
I do cook at home a lot, saving about $500 a month over what I once paid. When I revert to having money again I can just switch back.
I share an apartment, saving about $2,000 a month over what I was paying before. When I have money again I can just switch back.
I can't really downgrade health care in the same way, as when I have money again they won't be able to pull my amputated leg out of the freezer and give me the hypothetical costly surgery that might have saved it.
I share an apartment, saving about $2,000 a month over what I was paying before. When I have money again I can just switch back.
I can't really downgrade health care in the same way, as when I have money again they won't be able to pull my amputated leg out of the freezer and give me the hypothetical costly surgery that might have saved it.
Please don't confuse healthcare with insurance.
I went for over a decade without insurance yet I was never without healthcare. That used to be quite common, especially among folks in their 20s. Is that unthinkable for the current generation? Why?
Plus, if you're talking about the US, free basic healthcare is almost universally available. It isn't pretty or convenient, but US govt services rarely are.
I went for over a decade without insurance yet I was never without healthcare. That used to be quite common, especially among folks in their 20s. Is that unthinkable for the current generation? Why?
Plus, if you're talking about the US, free basic healthcare is almost universally available. It isn't pretty or convenient, but US govt services rarely are.
If you're uninsured you get price gouged. A simple trip to the doctor with some basic tests can be a months rent. I have catastrophic health insurance; $5k deductible 20% copay to $50k. It won't pay for anything, but it will give me insurance group rates. Where is this magical free basic healthcare? Does not exist. Medicaid is only free if you've already become bankrupt.
You only get price gouged if you don't negotiate or shop around.
My mom is uninsured. She negotiates everything and often pays less than I do (I once compared her bill to mine). If you pay cash up front, the doctor's office will be very nice to you. Additionally, they give you stuff for free that an insurance company might pay for. An actual exchange:
Mom: "$300 for a splint? No thanks, I'll just have my son tape my finger to a piece of wood."
Doctor's office lady: "Oops, my mistake, I thought you had insurance. We only charge people for stuff like that when they have insurance."
My mom is uninsured. She negotiates everything and often pays less than I do (I once compared her bill to mine). If you pay cash up front, the doctor's office will be very nice to you. Additionally, they give you stuff for free that an insurance company might pay for. An actual exchange:
Mom: "$300 for a splint? No thanks, I'll just have my son tape my finger to a piece of wood."
Doctor's office lady: "Oops, my mistake, I thought you had insurance. We only charge people for stuff like that when they have insurance."
I've been doing this for years.
Need medicine for high cholesterol? Doc prescribes $100-a-month latest whiz-bang pill. Say to doc, "Dude, can't you do better than that?"
Get a $10-a-month pill from Wal-Mart that works just as well.
It's a real eye-opener. Businesses will charge anything as long as the customer doesn't actually have to write a check for it.
EDIT: Since many of you haven't experienced this, I'll share another story.
I tell the doc I have sleep apnea and would like to try a CPAP machine. He says first I need sleep study, which is around $2K. Why? Well because the new insurance guidelines say you should have one. So we talk a bit, and it becomes clear that it's not needed. Cross out $2K.
So he writes a prescription and sends me to a place in town that sells the machines. Cost? $1600. Price for same machine on the net? $350.00
I call the doc back and he faxes the prescription to the internet vendor and Bob's your uncle.
This is about $3500.00 that 99% of everybody else would have had their insurance pay that wasn't strictly necessary.
Negotiating your own healthcare prices is a terrific eye-opener.
Need medicine for high cholesterol? Doc prescribes $100-a-month latest whiz-bang pill. Say to doc, "Dude, can't you do better than that?"
Get a $10-a-month pill from Wal-Mart that works just as well.
It's a real eye-opener. Businesses will charge anything as long as the customer doesn't actually have to write a check for it.
EDIT: Since many of you haven't experienced this, I'll share another story.
I tell the doc I have sleep apnea and would like to try a CPAP machine. He says first I need sleep study, which is around $2K. Why? Well because the new insurance guidelines say you should have one. So we talk a bit, and it becomes clear that it's not needed. Cross out $2K.
So he writes a prescription and sends me to a place in town that sells the machines. Cost? $1600. Price for same machine on the net? $350.00
I call the doc back and he faxes the prescription to the internet vendor and Bob's your uncle.
This is about $3500.00 that 99% of everybody else would have had their insurance pay that wasn't strictly necessary.
Negotiating your own healthcare prices is a terrific eye-opener.
I would like to have a proactive patient such as your self. As a student, I am always put off when a physician prescribes an on-patent medication when there is an equivalent that is off-patent (assuming that the research supporting both is equivalent).
Hope I didn't give the wrong impression -- my doc rocks. He's just a busy guy, and the drug companies are making pitches all day long about how the new and patent-protected stuff is so much better than the other stuff. He's just playing it safe. He's always open to a conversation, however, and most times once we talk we arrive at a better place than the one he first recommends.
And I'm not being a "proactive patient" out of any kind of charity on my part. My money rides on all of this stuff, and every little bit is very important. I'm just trying to make very certain that each little thing we do is priced at exactly the least amount is has to be.
[There might be a lesson here, but I refuse to spell it out.]
And I'm not being a "proactive patient" out of any kind of charity on my part. My money rides on all of this stuff, and every little bit is very important. I'm just trying to make very certain that each little thing we do is priced at exactly the least amount is has to be.
[There might be a lesson here, but I refuse to spell it out.]
$300 for a splint is one thing. Try negotiating an MRI when you've just been in a car accident.
Its a real problem. Insurance companies have a ton of weight by virtue of representing many patients, which they effectively leverage for lower prices. Those paying out of pocket have no such leverage, and pay much more.
Its a real problem. Insurance companies have a ton of weight by virtue of representing many patients, which they effectively leverage for lower prices. Those paying out of pocket have no such leverage, and pay much more.
She has negotiated for post-hoc price reductions on emergency care.
Hospitals have leeway in what they charge. If you make it clear that you will be a pain in the ass unless they give you a good deal, they will do so. This is where you drop words like bankruptcy, $25/month for 30 years payment plans, and threaten to contest every single item (out of 47) on the bill. They will take all sorts of nickel&dime charges off your bill, lower prices here and there, etc, giving you a reasonable deal.
Hospitals have leeway in what they charge. If you make it clear that you will be a pain in the ass unless they give you a good deal, they will do so. This is where you drop words like bankruptcy, $25/month for 30 years payment plans, and threaten to contest every single item (out of 47) on the bill. They will take all sorts of nickel&dime charges off your bill, lower prices here and there, etc, giving you a reasonable deal.
All this aggressive price negotiation is fine if that is your choice. But keep in mind your company will have to employ other people and if the company does not provide health insurance you will be expecting your employees to also perform these same kinds of price negotiations for their medical services.
Much like vaccination, this only works because many other people are covered by insurance. What the hospital doesn't charge you (and thousands of other people without insurance), they make up for by raising rates across the board. Just because you negotiated the rate downward doesn't mean the procedure's cost went down for the hospital.
I negotiated a $40k hospital bill down to approximately $15k.
That was still a lot more money than I had at the time. If I wasn't lucky with good credit, I would still be in debt.
That was still a lot more money than I had at the time. If I wasn't lucky with good credit, I would still be in debt.
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Tell me the story about how she negotiated minor surgery that one time. "$20,000 for a C-section? No thanks, I'll just have my son sterilize the dremel and the staple gun." That story is awesome.
When my wife was pregnant, and on health insurance that didn't cover pregnancy she told her doctor she didn't have insurance. End result flat fee, under 2K to have the baby and about double if a C section was necessary.
I can only tell you what the average of the two C sections we were billed for cost. Uninsured cost of a C section without a prolonged stay in the hospital appears to be under $10k, anecdotally from G searches on "uninsured C sectio cost". Our son stayed in the NICU ($$$$$$$) for a week; your wife can also wind up in the hospital for an extra day or two.
Yeah I am glad we dodged that bullet. The insurance was odd they wouldn't cover the pregnancy but they would cover the kid after birth so any NICU costs would have been covered.
This isn't odd; it's standard. Covering normal pregnancy and birth is a pricey add-on if it's available at all, but by law the new child must be covered.
Except under very strict circumstances, not charging everyone (including insurance companies) exactly the same amount for everything according to a practice fee schedule is illegal under the US healthcare system. Just because the insurance company doesn't actually pay the full amount (contract law gets mixed in here), it doesn't mean that a self pay patient gets to have free services. One reason medical costs are so high is because doctors are generally paid the lesser of the service charge amount on their fee schedule or the insurance company contractually allowed amount. Simple game theory dictates their prices be as high as possible.
Self pay patients can be charged less if a standard sliding fee schedule is created by the practice. This is to make sure that discounts are applied uniformly across all self pay patients against some criteria (e.g. 10% discount for families at 400% of the federal poverty level). I'm sure there are other ways too, but they must be applied consistently.
Self pay patients can be charged less if a standard sliding fee schedule is created by the practice. This is to make sure that discounts are applied uniformly across all self pay patients against some criteria (e.g. 10% discount for families at 400% of the federal poverty level). I'm sure there are other ways too, but they must be applied consistently.
In the highly unlikely event the doctor's office is prosecuted for failing to charge her for a splint, I'm sure they could plausibly call it a billing error. Note that they didn't charge her less for the splint (which only cost them a few dollars), they simply took it off the bill.
I'd love to see the DA actually try to prosecute the doctor for this. It would make a great reelection platform: "I prosecuted doctors for failing to charge uninsured patients $300 for a $6 splint."
I'd love to see the DA actually try to prosecute the doctor for this. It would make a great reelection platform: "I prosecuted doctors for failing to charge uninsured patients $300 for a $6 splint."
> You only get price gouged if you don't negotiate or shop around.
Nonsense. Health care isn't something you price-compare on Amazon and Best Buy before making a purchase. It's something you need right now when an unexpected medical emergency happens. That's why an insurance market exists in the first place.
Nonsense. Health care isn't something you price-compare on Amazon and Best Buy before making a purchase. It's something you need right now when an unexpected medical emergency happens. That's why an insurance market exists in the first place.
A quick google search suggests that emergency care makes up less than 3% of medical spending in the US. So negotiation and price comparison is possible for about 97% of medical spending.
http://www3.acep.org/patients.aspx?id=25902
http://www3.acep.org/patients.aspx?id=25902
You're excluding the cost of inpatient care, which is not the same as Daniel Markham's anti-apnea sleep mask.
His story works because he's framing it as getting a broken finger set or getting meds for an ear infection, and ignoring the fact that what we need insured is prolonged illness and hospitalization. What his mom really is is "very lucky"; also, not afraid to throw "bankruptcy" onto the negotiating table.
But catastrophic insurance will cover prolonged illness and hospitalization, and quite cheaply if you're able to shoulder $5-15,000 of the risk yourself. We're talking about how to get around the price-gouging that accompanies everyday lab work and routine care.
The problem isn't cost. Of course you only want to get catastrophic coverage. But you're as likely to be declined for high-deductable coverage as for low-deductable coverage; at least, we were.
Yes, being declined is the problem. I suspect it's more or less of a problem depending on what state you're in, though.
Your Mom obviously gave birth to you. Out of curiosity, how did she pay for it? Did she negotiate the price?
That might work for small things, but wait until you get really hurt or sick.
Eg, the HIV positive friend? His meds w/o insurance are $1700/month. The price with insurance is $60. The manufacturer doesn't negotiate on price.
Eg, the HIV positive friend? His meds w/o insurance are $1700/month. The price with insurance is $60. The manufacturer doesn't negotiate on price.
> Where is this magical free basic healthcare? Does not exist.
It's called the county hospital plus medicaid.
> Medicaid is only free if you've already become bankrupt.
Medicaid is extremely cheap to free if you don't have an income, which is the premise of the question.
It's called the county hospital plus medicaid.
> Medicaid is only free if you've already become bankrupt.
Medicaid is extremely cheap to free if you don't have an income, which is the premise of the question.
I agree with this point, except even basic health care (in the US) is expensive especially for someone on a ramen diet.
If you plan correctly financially this doesn't have to be a problem.
edit: My biggest issue would be hiring my first full time employee.
If you plan correctly financially this doesn't have to be a problem.
edit: My biggest issue would be hiring my first full time employee.
The big trick about uninsured healthcare in the US now is that you will pay 2-3 times market rate for everything. My local hospitals wins with a 9 times multiplier on some emergency care.
Could someone elaborate on the issue? How much of a problem is it?
I find that it is highly dependent on your target employees. For example, if you are a recent college grad and intend to employ recent college grads, you can probably get by without health insurance. However, if you are older and/or have a family and intend to employ people who also are older and/or have a family those people will expect at least partially subsidized health insurance from the company.
And the costs of health insurance are relative to the size of the group you insure. The larger company you work for, the less expensive and more comprehensive the health insurance is likely to be. For small companies with few employees you will pay a lot for health insurance.
And the costs of health insurance are relative to the size of the group you insure. The larger company you work for, the less expensive and more comprehensive the health insurance is likely to be. For small companies with few employees you will pay a lot for health insurance.
until one of your recent college grads gets knocked up or gets his girlfriend knocked up.
It's a big problem. Private health insurance is expensive, and a costly medical snafu can bankrupt you if you're uninsured. Health insurance costs significantly increase your Cost of Living(/barriers to entry, so to speak).
If the cost of health insurance is the deciding factor in your decision to start a new company, you're better off not starting--you're seriously undercapitalized.
Repeating a point I made elsewhere, and sorry, but:
The problem isn't just that health care is expensive. The problem is that it isn't available to many otherwise viable founders. You can be turned down with shocking ease by private insurers; no exceptions, no recourse except a multi-month appeals process that is no more likely to get you covered.
The financial drag isn't the issue for us; the uncertainty is.
The problem isn't just that health care is expensive. The problem is that it isn't available to many otherwise viable founders. You can be turned down with shocking ease by private insurers; no exceptions, no recourse except a multi-month appeals process that is no more likely to get you covered.
The financial drag isn't the issue for us; the uncertainty is.
Really? Which state are you in?
I used to work for a private health insurer (in the US) and our "group" coverage was offered to businesses of 2 people (i.e., a founder and one employee). At that time, at least, sole proprietors were in the "individual" coverage category, but there was talk about changing that.
I used to work for a private health insurer (in the US) and our "group" coverage was offered to businesses of 2 people (i.e., a founder and one employee). At that time, at least, sole proprietors were in the "individual" coverage category, but there was talk about changing that.
Personally, Michigan and Illinois (at the time). Companywide, add New York.
We tried to get insurance ourselves, and then worked with a family friend broker, and failed both times. We could get coverage for three of us (although my daughter would have exceptions in the contract), but not for my wife. I was 28 at the time.
We tried to get insurance ourselves, and then worked with a family friend broker, and failed both times. We could get coverage for three of us (although my daughter would have exceptions in the contract), but not for my wife. I was 28 at the time.
Florida. No problem to get coverage for me; we can get coverage for the boys but with riders on my youngest sons; we can't get coverage for my wife at all. We're 27 and 29.
We're "lucky" in that we had COBRA coverage from a Maryland job before we moved here. Now that COBRA is expired, our MD insurer is required by MD law to offer us a group policy. It's decent coverage, but at almost $1000/month it only covers my wife and the kids. It would be another ~$600/month to add me.
We're "lucky" in that we had COBRA coverage from a Maryland job before we moved here. Now that COBRA is expired, our MD insurer is required by MD law to offer us a group policy. It's decent coverage, but at almost $1000/month it only covers my wife and the kids. It would be another ~$600/month to add me.
Isn't this a contradiction to being "ramen profitable"? If you're only ramen profitable, how can you afford health insurance for yourself and employees?
Do you think "ramen profitable" means "able to afford only ramen, and not somewhere indoors to sleep"?
In my world, "ramen profitable" means covering basic expenses, of which (modest) health insurance is most certainly one.
Put another way: health insurance is not a luxury item.
In my world, "ramen profitable" means covering basic expenses, of which (modest) health insurance is most certainly one.
Put another way: health insurance is not a luxury item.
Health insurance is a cost that comes out of your profit. If you are ramen profitable after the costs of health insurance are removed you'd be even more profitable if the cost of health insurance was not there.
If you're ramen profitable without the cost of health insurance, then by definition, you can't afford to pay for health insurance.
If you're ramen profitable without the cost of health insurance, then by definition, you can't afford to pay for health insurance.
Fortunately, Canada has a sane policy on public health care and this isn't nearly the issue it is in the US.
It'd be nice if they included dental and eye care as well; those are basically the same deal.
Prescriptions too, please. I pay an extra $40 or so a month for blue cross extended health.
Yes.
Maybe the question is: if you didn't have to worry about healthcare would you leave your current job for something else.
In my career, I had lots of very sharp colleagues that had no choice but to stay at their "ok" jobs because someone on the family has more than average health needs.
I have a friend who is self-employed as a web designer. He pays $269 a month for Health Insurance. That's lower than his car payment, house payment, monthly food bill, etc... In fact, by his own admission it's only $100 more than he spends at Starbucks every month.
Health Insurance is a political issue that pertains to the poor who can't afford many of the things people on this board take for granted (like morning coffee). Anyone who has the means to quit their job and start a company also should have the means to pay for Health Insurance
Also, if this was a huge issue for startups than wouldn't it stand to reason that Canada, the UK, France and others would have thriving Startup industries? Ones that far out pace the U.S.?
Health Insurance is a political issue that pertains to the poor who can't afford many of the things people on this board take for granted (like morning coffee). Anyone who has the means to quit their job and start a company also should have the means to pay for Health Insurance
Also, if this was a huge issue for startups than wouldn't it stand to reason that Canada, the UK, France and others would have thriving Startup industries? Ones that far out pace the U.S.?
No, you're incorrect. Your friend was able to get $269/month health care because he is young and male. But in the US, health insurance isn't guaranteed issue. If you are not young, if you are female, or if you have ever been hospitalized before, it is very possible that you are locked in to employer-provided group coverage.
It happened to us and it happened to other people I know.
It happened to us and it happened to other people I know.
If I understand you correctly, a more interesting question would be "What are the reasons you are not jumping into a startup right now?"
I'd love to see a ranked set of answers to that, organized along a timeline. Since there is so much politics infused in this, however, I imagine healthcare/health insurance is going to rank a lot higher now than say five years ago.
As a historical note, every startup that I've ever know that started humbly had no health insurance (although the founders had plenty of healthcare). So it can't be a determining factor in success, although it may be a determining factor in attempts.
On the attempt side, most startups fail, so anything you'd invest in them -- money, health insurance, food, lodging, etc -- is odds-on an overall loss. This is why raising startup capital can be difficult. If I had to pick a freebie to get from anybody, it would easily be lodging. You can do a lot with four walls and good internet connectivity. Much more than having some sort of insurance.
In my opinion, of course.
I'd love to see a ranked set of answers to that, organized along a timeline. Since there is so much politics infused in this, however, I imagine healthcare/health insurance is going to rank a lot higher now than say five years ago.
As a historical note, every startup that I've ever know that started humbly had no health insurance (although the founders had plenty of healthcare). So it can't be a determining factor in success, although it may be a determining factor in attempts.
On the attempt side, most startups fail, so anything you'd invest in them -- money, health insurance, food, lodging, etc -- is odds-on an overall loss. This is why raising startup capital can be difficult. If I had to pick a freebie to get from anybody, it would easily be lodging. You can do a lot with four walls and good internet connectivity. Much more than having some sort of insurance.
In my opinion, of course.
Has YCombinator or some other sort of startup incubator considered offering health plans for startups? We're a pretty uniform population, low risk, and probably a bit smarter about lifestyle choices. I could imagine a package deal (office space, funding, health insurance) DONE.
Actually, that would make a good choice for a start up, no? The population is generally low risk for costly procedures and mostly need basic, no-frills care and if their business succeeds, they could be converted to a more corporate friendly policy. To be honest, I'm not sure why this hasn't been done yet.
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Health insurance is state by state--I can't keep my WA health insurance plan if I move to CA, for instance. Since YC already says "settle in Silicon Valley", I'm sure it would actually be easier for them to buy a deal from a CA health insurance company, though the legal wrangling would undoubtedly be epic.
pg has remarked multiple times about why he doesn't provide office space, though. Not sure if the same rationale applies to health insurance.
pg has remarked multiple times about why he doesn't provide office space, though. Not sure if the same rationale applies to health insurance.
Before we had health insurance, we lost candidates over this issue. I don't have to speculate about it. The current US health care system retards startups.
I would contend that the root cause is that we expect our employers to provide our health insurance. We don't (usually) expect them to provide our housing, food, car, or other necessities of life.
I'm not an accountant, but I understand that there are tax advantages for corporations to provide insurance (instead of just giving me cash, so I can choose my own insurance).
The market is much more efficient (e.g., I can more easily and directly signal what is important to me) if the consumer of a good is also the purchaser.
I'm not an accountant, but I understand that there are tax advantages for corporations to provide insurance (instead of just giving me cash, so I can choose my own insurance).
The market is much more efficient (e.g., I can more easily and directly signal what is important to me) if the consumer of a good is also the purchaser.
I wish it were true that there were a free market that employees can participate in.
I run a small company. If I were to take the monthly premium I pay for my employees and instead give it to them as cash, they could not get health care or insurance anywhere near as good.
I run a small company. If I were to take the monthly premium I pay for my employees and instead give it to them as cash, they could not get health care or insurance anywhere near as good.
The root cause is that only your employer can afford to buy you coverage and also has less risk of getting dropped if they provide coverage for enough people. As an individual, the coverage costs more and your chances of getting dropped is over 50% if you do need care exceeding your premium.
The reason the market is so unfriendly to individual purchasers (high cost, possibility of getting dropped, etc) is that the entire industry is built around and optimized for selling to large corporations.
Do you have a source for the 50% number?
Here's a few articles pointing to the number. I assume that an individual buyer faces a higher rate of recission than those in a large group.
http://tauntermedia.com/2009/07/28/unconscionable-math/
http://www.walletpop.com/blog/2009/09/02/think-youve-got-hea...
http://wintershaven.net/2009/08/04/recission/
http://www.nasdaq.com/aspx/company-news-story.aspx?storyid=2...
http://tauntermedia.com/2009/07/28/unconscionable-math/
http://www.walletpop.com/blog/2009/09/02/think-youve-got-hea...
http://wintershaven.net/2009/08/04/recission/
http://www.nasdaq.com/aspx/company-news-story.aspx?storyid=2...
And I would contend (because I'm right) that you have no idea what you're talking about.
The single most important feature of group health coverage, even more than the lower costs, is the fact that they generally don't (and in many places can't) require health exams beforehand. This is obviously crucial for people with health problems. For example, if you are a survivor of many types of cancer, private health insurance is unavailable at any price.
Perhaps you should take 2 minutes to educate yourself instead of spewing market efficiency nonsense.
The single most important feature of group health coverage, even more than the lower costs, is the fact that they generally don't (and in many places can't) require health exams beforehand. This is obviously crucial for people with health problems. For example, if you are a survivor of many types of cancer, private health insurance is unavailable at any price.
Perhaps you should take 2 minutes to educate yourself instead of spewing market efficiency nonsense.
My startup loses candidates because I can't afford to pay them. I don't have to speculate about it. The current US wage system retards startups.
That's interesting. Mine doesn't. We can afford to pay the candidates we want to hire. We could not simply snap our fingers and solve candidate insurance problems; it took about half a year. What's your startup again?
You also misread my comment. Losing candidates sucked but did not particularly slow us down. I didn't argue that health care retarded Matasano; I do a good enough job of that on my own. I'm arguing that if health insurance ruled out people even when we offered a good wage, it must be doubly hard for people who want to start from zero.
[oh, hey, ps for readers: we're hiring: http://news.ycombinator.com/item?id=953114 --- of course we have health insurance]
You also misread my comment. Losing candidates sucked but did not particularly slow us down. I didn't argue that health care retarded Matasano; I do a good enough job of that on my own. I'm arguing that if health insurance ruled out people even when we offered a good wage, it must be doubly hard for people who want to start from zero.
[oh, hey, ps for readers: we're hiring: http://news.ycombinator.com/item?id=953114 --- of course we have health insurance]
My only point is that your comment can be made about ANY expense. Yes, the US wage system, health care system, office space system, minimum business tax system, credit card processing system, etc, all retard startups.
Most of these have economies of scale, so they will hit startups harder than big business. I don't see any particular reason to focus on health care rather than wages, office space or accounting services.
Most of these have economies of scale, so they will hit startups harder than big business. I don't see any particular reason to focus on health care rather than wages, office space or accounting services.
They're different because there isn't a huge amount of uncertainty in office space, taxes, credit card processing, or even wages if you don't leave your day job until you have cash flows. There is nothing but uncertainty with health insurance.
But what's your point? Yes, Chris, it would definitely accelerate startups if the government gave everyone a $50,000 refundable tax credit for starting a tech company. Also free offices would be great. The question posed was, "would you be more likely to start if". If better wages: yes. If health care: yes. If free office space: yes. If no transaction fees: yes.
Why are you singling out one of the riskiest problems with starting up and implying that it's dumb to address it?
But what's your point? Yes, Chris, it would definitely accelerate startups if the government gave everyone a $50,000 refundable tax credit for starting a tech company. Also free offices would be great. The question posed was, "would you be more likely to start if". If better wages: yes. If health care: yes. If free office space: yes. If no transaction fees: yes.
Why are you singling out one of the riskiest problems with starting up and implying that it's dumb to address it?
Funny: "Matasano" in Chile is a slang term for doctors, and not a particularly nice one.
It translates to something like "Healthy-person killer".
It translates to something like "Healthy-person killer".
Yup. We found that out a month after we picked the name, when we hired a friend from Argentina. We liked the name even more afterward. It suits our particular corner of the industry.
I would adjust the question. Free healthcare can't exist. It costs something, either through taxes or your premium for insurance.
A more appropriate question would be: "If health insurance were more affordable and you were not in danger of being dropped from coverage as a small company or individual, would you start a new company?"
A more appropriate question would be: "If health insurance were more affordable and you were not in danger of being dropped from coverage as a small company or individual, would you start a new company?"
What you say is absolutely correct. But the real point of what would be considered public health insurance is that the risks are spread over a much larger group than simply a base of employees. The pricing mechanism is based on the risk of the people in the group. If the group is defined as the employees of the company, then that number is going to depend on the risk factors of the entire group.
If the group is the entire population of a country then you are going to pay a rate that is based on the risks of a very large population. If the people are on average healthy you will pay less. If the people on average are unhealthy you will pay more.
If the group is the entire population of a country then you are going to pay a rate that is based on the risks of a very large population. If the people are on average healthy you will pay less. If the people on average are unhealthy you will pay more.
I am assuming that any company or individual covered is covered as a group of everyone the insurer covers. I see no reason for one gov entity to cover everyone. 50 to 100 non-profit co-ops would do the job: enough in each group and enough choice to ensure competition.
By far the best thing about moving to Massachusetts for oneforty was the fact that I knew I could get reasonably priced health insurance that wasn't subject to recission through the Massachusetts exchange. (Of course oneforty isn't buying people's health insurance. We're barely seed funded.)
Boston/Cambridge is no Valley, but it's certainly good enough. If health insurance is the one gating factor (and geography isn't), move here.
Boston/Cambridge is no Valley, but it's certainly good enough. If health insurance is the one gating factor (and geography isn't), move here.
I purchased a $130 a month high deductible ($3500) health insurance plan before quitting my job. I am healthy and under 20, however. I do know people who are healthy but have been denied (not offered insurance at a higher rate-- flat out denied) because of past procedures.
I've often felt that if you would remove health insurance from the employer-employee equation completely it'd be a financial boon for business. How many more employees could be hired, how much more could be put into product development, etc., etc., if one of the largest (and always growing) company expenses was not health insurance for employees.
(I'd also like to see health insurance be at a national level instead of being regulated state-by-state, but that's another topic.)
(I'd also like to see health insurance be at a national level instead of being regulated state-by-state, but that's another topic.)
I feel the same way, but I also know it's an institution unto itself. Think about it. Employer provided healthcare has been around since WW2. And you would have to convince the big dogs MS, IBM, KBR, GM,etc. to dismantle a system that they helped create.
Even if the legislation did exist to dismantle the system it would still continue through sheer bulk. ie Microsoft will always be able to negotiate a better price for MS employees due to the fact that they have thousands of employees.
Even if the legislation did exist to dismantle the system it would still continue through sheer bulk. ie Microsoft will always be able to negotiate a better price for MS employees due to the fact that they have thousands of employees.
Yes I would.
eh, I use CORBA; meaning every 3 years or so I have to go get a w2 job for a while. pain in the ass, but not insurmountable.
You're thinking like an employee, not an entrepreneur.
Employees stay at jobs they hate for 30 years because of their "benefits" (what a silly name for cheaper insurance) and the "hope" that they will get some retirement money.
Entrepreneurs start companies because they know that if they do it right, and make a lot of money, these things will come as part of their ongoing successes.
Employees stay at jobs they hate for 30 years because of their "benefits" (what a silly name for cheaper insurance) and the "hope" that they will get some retirement money.
Entrepreneurs start companies because they know that if they do it right, and make a lot of money, these things will come as part of their ongoing successes.
This begs the question - what does the average YC startup do for healthcare? Do the co-founders find insurance on their own? Can a startup do 'employer-provided' insurance? What sort of work does it entail?
I see some comments from tptacker regarding this but would love to hear from the wider YC community
I see some comments from tptacker regarding this but would love to hear from the wider YC community
In my experience most startups live and die based on CORBA timelines. Once you leave a job with health insurance you can pay both the employee and employer portions of the bill and continue your coverage for up to 18 months. This is probably a different story for startups that are mostly composed of post-grads without employer coverage to continue...
Someone please give some leads for those who are unfamiliar with US health insurance system. I've been wanting to know how health insurance works for quite some time, but putting it off.
I bailed on a company with a great product idea because of health insurance.
Basically, I have a congenital defect in my eyes that will lead, with about 20% probability, to very expensive health bills. This (http://en.wikipedia.org/wiki/Pigment_dispersion_syndrome ) if anybody cares. Therefore, I simply can't live without constant health insurance coverage on the off chance I require pretty expensive treatment -- drugs, then surgery if the drugs don't work.
Basically, I have a congenital defect in my eyes that will lead, with about 20% probability, to very expensive health bills. This (http://en.wikipedia.org/wiki/Pigment_dispersion_syndrome ) if anybody cares. Therefore, I simply can't live without constant health insurance coverage on the off chance I require pretty expensive treatment -- drugs, then surgery if the drugs don't work.
No, I'm young and healthy, and don't care about health care. I wouldn't go to the hospital anyway.
Mainly, what's keeping me from doing it is that I'm doomed to obscurity and people tend to dislike me when they either see me, hear me talk, or read what I write.
If anyone has experience overcoming those problems, I'd love to hear it. But "health care" is right around "what color is the sky?" on the list of things I worry about.
Mainly, what's keeping me from doing it is that I'm doomed to obscurity and people tend to dislike me when they either see me, hear me talk, or read what I write.
If anyone has experience overcoming those problems, I'd love to hear it. But "health care" is right around "what color is the sky?" on the list of things I worry about.