Soaring Healthcare Costs Jeopardize Retirement In America

Yves here. This post highlights an ugly fact: Medicare, while better for most people than crapified employer health plans and quite a few Obamacare policies, is not all that hot by world standards due to the high cost of American healthcare. One big problem is despite the government footing roughly 60% of US healthcare costs between Medicare, Medicaid, the VA and other programs, does perilous little to contains costs, particularly drug costs. The health care industry has long been the biggest lobbying group in Washington and that investment has paid off in spades.

I’m sure readers can pipe up with examples from other countries, but when I was in Sydney, the cost of various medical services was about 1/3 of that of the US, which even allowing for the strength of the dollar then, meant about 1/2 of the US in more typical terms. And the doctors were also less aggressive about intervention, more inclined to monitor a condition and see how it progressed before doing too much.

One difference that is particularly relevant to the elderly is the Therapeutic Goods Administration. The TGA reviews medical research carefully for efficacy and selects certain drugs for various ailments, then bargains hard on price. The TGA regularly avoids minor formulations (like 24 hour versions as opposed to 3 times a day types) that allow the drugmakers to file a “new drug application,” extend the patent life, and jack up the price on the “new improved” version. In the two years I was in Oz, I never heard or read any complaints on how the TGA restricted access to drugs.

Needless to say, older people are typically taking multiple medications, so the US failure to rein in drug prices hits them particularly hard.

One option is to become an expat. But that takes energy and at least some money. And it also means leaving family and friends behind. And on top of that, some destinations aren’t as promising as they seem from afar. One reader pointed out that for Ecuador, which is typically ranked high among destinations for expats, 50% of the Americans who retire there return within five years.

By Fred Dunkley, a tech analyst, writer, and seasoned investor Originally published at SafeHaven

Retirement means something quite different in America today: Increasingly, it is being redefined as “laboring in old age”. In fact, the Baby Boomers that are now reaching retirement age are still playing a key role in the American workforce–but not necessarily by choice.

Seniors are mostly working longer because they need the money. Hikes in Social Security’s retirement age, massive health-care costs, depleting savings and high levels of personal debt have made it harder than it was in the 1960s and 1970s to retire.

According to a new report from money manager United Income, the participation rate in the labor force of retirement-age workers has topped the 20-percent mark for the first time in 57 years.

“As of February, the ranks of people age 65 or older who are working or seeking paid work doubled from a low of 10 percent back in early 1985,” the report found.

What’s worse is this: The upward trend is expected to continue, with the report estimating that 13 million Americans aged 65 or older will be in the labor force by 2024.

While some switch to new jobs within their long-time careers, for others a retirement job means trying something entirely new. According to the data, the most popular jobs of 65+ people including accounting, teacher assistants, retail…

However, not everybody can work longer. As workers with desk jobs can work past retirement age, the ones working hard labor can’t. About 10 percent of those over 50 had to leave their jobs because of health.

And there is no getting around the obvious here: At the core of the problem is the cost of healthcare and prescription drugs–the number one biggest threats to retirement solvency.

A recent study by Gallup entitled “The US Healthcare Cost Crisis” found that seniors last year withdrew an estimated $22 billion from their long-term savings for health-related expenses.

The report also found that some 10 percent of Americans aged 65 and older did not seek needed treatment in the past 12 months because of the cost of care.

And the future seem to be just as grim, if not worse.

A study by the Schwartz Center for Economic Policy Analysis finds that about 40% of middle-class Americans will live close to or in poverty by the time they reach retirement age.

On a rare positive note, older workers are not only growing rapidly in numbers, but are also becoming substantially healthier and no longer feel that the traditional retirement age is an expiration date.

Of Americans aged 65 or older and working or looking for work, 78 percent report being in good health or better, up from 73 percent in 1997 and 69 percent in 1985. And since manufacturing jobs are being overtaken more frequently by desk jobs or jobs that require less physical activity, age isn’t quite the barrier to employment that it used to be.

Economists have also found that retiring at age 66, instead of 62, can raise a retiree’s standard of living by one-third.

Employers aren’t complaining because the elderly workers are better educated and more experienced in many cases than their younger colleagues. The share of all employees aged 65 or older with at least an undergraduate degree is now 53 percent, up from 25 percent in 1985. This pushed up the average real income of retirement-age workers by 63 percent during this time period, from $48,000 to $78,000.

But the heart of the matter is that eternal American bogeyman of healthcare: The system is broken to the point that retirement is increasingly elusive and many are hoping that it will crack soon–and preferably before Baby Boomers end up workers as Walmart greeters just to survive.

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  1. Disturbed Voter

    This happened, because in WW II and since, the government encouraged businesses to offer health insurance (not health care). Supposedly, ACA solves this problem, because you can easily and inexpensively get health insurance (not health care) outside of employer plans. Perhaps single-payer can clean up the ACA mess.

    As far as crony capitalism goes, this is yet another case (employer health insurance plans) of unintended consequences of government intervention, and collusion with oligopoly.

    1. Svante Arrhenius

      It certainly seemed very well considered and intentional to non-union low wage earners (where we were making too much for Medicaid, but unable to buy into group plans?) It felt like Hill-Burton, “free” clinics/ diagnostic screenings were feeding the working poor into some huge, feudal, kind of punitive shake-down scam, Rust Belt university affiliated research hospitals, especially?

    2. rd

      It only seems like the ACA is inexpensive because of the exorbitant insurance pricing otherwise.

      The dirty secret of US healthcare is that the US actually spends more on publicly funded healthcare per capita than all but two other countries (Norway and Netherlands). The employer and individual paid costs are on top of that.

      So everybody bleating about how expensive single payer healthcare would be is missing the “side of the barn” sized picture of our healthcare system.

      The health care sector has every level of US government bought and paid for so that our per capita costs are obscenely greater than anywhere else in the world and we are not even close to universal coverage.

      1. coral

        ACA can be relatively inexpensive for those qualifying for subsidies. If you are above that limit, the premiums plus deductibles are huge. It does address the “preexisting conditions” scam, so it is more affordable. But the narrow networks limit access to doctors and specialists. I am all in for Medicare for All. Many family members would benefit greatly.

      2. d

        The other thing that is missed, is that that the government can’t afford, so how in the world can insurance and individuals do it. Never mind that, Congress doesn’t allow Medicare to negotiate drug prices???????? And while they don’t negotiate with providers, they represent so many that they can just set the price

    3. d

      The reason they did that in WW2 is that wages were going up so much, that it was thought that would tank the economy and doom the war effort

      1. John Zelnicker

        April 25, 2019 at 6:39 pm

        Health insurance was offered to workers during WWII because there were wage and price controls in effect. Wages could not be raised more than a small amount each year. However, health insurance was not included in the price control regime so this was a way for employers to increase the compensation of their workers without violating the wage limits.

  2. Sound of the Suburbs

    Don’t panic.

    Alan Greenspan to the rescue.

    Alan Greenspan tells Paul Ryan the Government can create all the money it wants and there is no need to save for pensions.

    What matters is whether the goods and services are there for them to buy with that money.

    Money comes out of nothing and is just numbers typed in at a keyboard.

    The real wealth in the economy comes from its goods and services.

  3. Winston Smith

    I’ve lived and worked in the US for almost 25yrs and healthcare in retirement is one reason I would seriously consider going back to Canada. Of course the Canadian healthcare system is not the Eldorado that some americans imagine but at least you do not face bankruptcy caused by medical bills.

    1. d

      There is no perfect health system. Its just the US one is much worse, results are lower and we pay than other developed countries

  4. PlutoniumKun

    One option is to become an expat. But that takes energy and at least some money. And it also means leaving family and friends behind. And on top of that, some destinations aren’t as promising as they seem from afar. One reader pointed out that for Ecuador, which is typically ranked high among destinations for expats, 50% of the Americans who retire there return within five years.

    Anecdotally, I think this is very common and not just for Americans or people moving abroad. People often keep it quiet as they don’t like admitting a mistake, but I’ve heard many stories of people either moving to sunnier climes, or just a nice rural house on retirement, but then a few years later quietly moving back to their city or suburban homes when they found the lifestyle away from old friends and work contacts simply too boring. People often really underestimate the value of just having familiar faces around. I’ve also heard retirees complain that other retirees, including old friends, can become unbearable when they’ve too much time on their hands, they’d rather be around a more regular mix of people.

    1. Peter

      Moving back happens, especially when you have not much to do in the country of choice but to sit on your behind and enjoy the sun, and do not make any effort to learn the naive language.
      We moved from Canada with a good health care system but with winters up to six months long and down to -35C to one with an average winter temp between 16 -18C, and ratjher high housing prices in the typical southern retirement areas like Vancouver Island.

      We have a large garden to take care of, and intentionally choose a country where we have to learn a new language (although it being a rather international sailing hub one can get around in english quite well), take care of some chicken and ducks for our own meat and egg supply and build up a new small network of fiends and aquaintences of both natives and expats from other EU countries, Canada and the USA.

      For pensioners the participation in the healthcare system is free, only a charge is levied for hospital visits at 5€ and 1€ at the central government health clinic and prescription drugs for members are subsidized heavily.

      We have been living here for 4 years now and despite advise from a relative also temporarily living here did not come for a trial run but packed up and moved regret free.

        1. Peter

          Portugal, Azores….

          BTW – Houses are still quite affordable in the Azores and mainland Portugal. It is a beautiful country, still a lot of open spaces, the coast not obstructed by Hotels – there are building restrictions in place – and freely accessible…have a look for yourself.

          The Islands are a completely different story, wildlife in the ocean, some but limited tourism, very quiet to live here – except maybe for Sao Miguel. But there are 8 others islands in our archipelago..

          Doesn’t cost much to fly to the continent, and car rental off season is cheap and the off season is still quite warm from october onward

  5. PlutoniumKun

    Another issue with US healthcare is not just medicine – the whole system seems very expensive. An ex of mine, an Irish American from NJ who worked for a US bank in Ireland, brought her ailing father to Ireland for a specialist home for Alzheimer’s patients. She did careful cost comparisons and she said that even the best private facility in Ireland was at least 40% cheaper per annum than anything remotely equivalent in the NJ/NY area (he did not quality for Irish government subvention so she was paying full market price).

    As Ireland is by no means a cheap country for either labour or property, and is proportionately more expensive than most European countries for medical care, I’ve no idea how there can be such a price differentiation, except by way of gouging of one form or another (and price gouging in residential care is by no means unknown in Ireland).

    1. Carl

      You’re correct about the exorbitant costs of the US healthcare system. The story I use to astound people from other countries is when my mom had two ER visits in one day for her IBS. Routine visits, ran a few tests, gave her medication and released. The total from the hospital: $17,000.00 US, of which Medicare paid $1000.00 and the hospital ate the rest. If Mom was uninsured, the entire amount would be due; if I, with my crap policy was the patient, my insurance would have negotiated an approximate 50% discount and I’d be responsible for the rest (or at leat $6500, my deductible). Either way, the costs will eat you alive.
      And I am moving to another country for this reason…

      1. hoonose

        Exorbitant billing is not exorbitant costs. Hospitals typically receive $20-30% of their billings. Still too much?

        Medicare works!

        1. cnchal

          > Still too much?

          Hmmm. In Carl’s mother’s case 20 to 30% is in the $4000+ range, so yes, still ridiculously expensive.

          Seems to be a crazy game. Walk into a hospital and the expected bill is exorbitant, but hey, if I’m a great negotiator I can get it cut to just ridiculous.

  6. dearieme

    No doubt the US needs healthcare reform: it’s no coincidence that I’ve never heard anyone from the developed world say “we must copy the American system”. I offer only one bit of firm advice: don’t copy the NHS.

    1. Martin

      Until only about five years ago, the NHS was providing wonderful care to all who needed it. My own parents never worried for a single second about healthcare; doctors actually made house calls to treat them, and hospitalization was never a concern. The bad reports about the NHS now reflect in their entirety the effects not only of cuts in funding, but also the introduction of market relations within hospitals that have pushed up the inefficiency to the max. — initiated by New Labour, I might add. So a great institution is being systematically sabotaged. That is the aspect of the NHS not to copy; a state-funded universal system is perfectly fine.

      1. dearieme

        Until only about five years ago, the NHS was providing wonderful care to all who needed it.

        No, not consistently. Sometimes. They did manage to kill my father-in-law.

        a state-funded universal system is perfectly fine: if you get the structure right it might well be. Alas, the NHS isn’t a state-funded system, it’s a state-provided system. I repeat, oh Yanks – you’d be mad to copy it. Nobody else has, and for good reason.

        1. Martin

          I’m sorry for your loss. But I don’t see the difference between state-funded and state-provided: it’s a system funded out of taxation that does not require people to pay at the point of service. Certainly the current structure is inadequate, but the principle is right.

        2. paul

          If you can find a system that hasn’t killed anyone inadvertently, please let us know.
          While I’ve hardly used it, I know a lot of people who have, a few of who have had their lives saved by it and just about all are appreciative.

        3. d

          And don’t think that only happens in government provided care. It happens in private care too. My dad was almost done I because the surgeon noticed his blood pressure was low prescribed a med to address that,only it seems another had prescribed med to lower it. That didn’t work well, and he had to take a helicopter to the hospital because he was so far from the hospital. Good thing he had a policy to cover of the side affects of being away from the city, there may not be any hospitals in 30 miles

    2. rd

      The UK total (private + public) healthcare spending is about 1/3 of the US while Canada is about half.

      Many of the complaints about other systems are because they are simply not putting enough money in, public or private. My guess is that the sweet spot is probably in the 50% – 70% of total US cost range where an efficient system can provide excellent care while spending about 3%-4% of per capita GDP less than the US. BTW – that savings in health care would completely fund the US military – that is how much money Americans are wasting on health care.

    3. Procopius

      I think the NHS before New Labour (i.e. Tony Blair) was pretty good, but I admit I’m basing that on a couple of conversations with British persons I’ve met here in Thailand. Of course there’s no doubt that Tory austerity has harmed it greatly.

  7. Anon

    Yves, after you posted about your move and the fact that your mother was getting older, I wanted to share some of my experiences with the US healthcare system and its treatment of the elderly. My parents have/had both Medicare and gap coverage, so cost of treatment has not been a big issue. The problem with the US healthcare system as we experienced it was that it is generally understaffed and unable to care for the basic needs of patients who are hospitalized or in rehabilitation. The only facility in which there was appropriate staffing to support patient recovery was inpatient rehab — and even that was low for the needs of an octogenarian recovering from, in our case, a stroke.

    So, my advice to anyone dealing with the US medical system — but especially anyone with an elderly relative in the system — is to have someone with them for most of the daytime hours. To help make sure they are able to get to the bathroom when they need to and basically that their needs are being met. Attentiveness (with at the same time respect for overworked hospital staff) during the day will most likely mean that staff will be more attentive at night, because they know someone’s paying attention. If your relative is likely to try to get up when they’re not supposed to (i.e. nobody has come to help them yet) and is at risk of falling when doing so, you may need someone at the facility 24 hours a day to keep the facility from deciding that the only way to deal with the patient is to sedate them. If you have the money, home health care providers are used to sending staff to stay with patients at both hospitals and other care facilities precisely to deal with these issues.

    Standard rehab facilities — that are typically also nursing homes for patients who can’t go home — are equally understaffed. Even the best of them is not equipped to provide recovery for the elderly. The quality of the patient’s recovery will depend on whether or not family can muster the resources to spend time at the facility making sure the patient’s needs are being met. The most important thing here is toileting. Somebody in recovery will work with the aide to get there when they need to go and that helps their physical recovery. Somebody who has had to wait an hour or more for help will be angry, uncomfortable, and may not even be able to go any more. By simply not meeting their needs most facilities in the US “train” their patients to go in their beds and be changed — which is a psychologically devastating form of dehumanization.

    Giving medications that cause constipation and then not doing a good job of managing whether or not BMs are taking place in appropriate quantities is another issue. Unfortunately relatives who are caught up in the US medical system will almost certainly need your help.

    I just wanted to share my experiences with you, since eventually most of us end up dealing with the medical system — and learn about how it works too late to do anything.

    NB: My father is currently in rehab for a stroke. My mother passed away two years ago. She came out of her rehab experience completely traumatized. And out of sheer force of will retrained herself not to be incontinent.

    1. Disturbed Voter

      In the US recently, 5 times per week day time coverage of an elder assistant was $400 per week. In home full time nursing care was $12,000 per month, and in facility nursing care was $6,000 per month. Unless you are well off, it is best to not grow old. In olden times, you might have a spinster daughter to cover her parents, but now that would be unwise, since the care giver becomes very vulnerable to legal complications.

      1. neo-realist

        Or the daughter is living out of state, and may not be on the best of terms with the aged parent.

        I believe that euthanasia will be a massively growing industry in the next 10 – 15 years with the massive costs of senior care and the lack of availability of family members to either care for and or afford the care of an elderly parent.

        1. pretzelattack

          yeah, almost all my immediate family is dead, and I don’t want to be some husk in a nursing home, abused and neglected by aides and the occasional nurse. how do you add the trademark thingy, i thought of a name–happy trails inc. i’m visualizing a chain of euthanasia for profit centers , easy in and even easier out, guaranteed painless or your money back.

    2. Spring Texasn

      You constantly hear that advice about having someone with someone in a health care institution all the time, but although yes it would be great I think you either have to have a LARGE family (with enough people who don’t have to make it to a job) or a LOT of money to do that. Sure it would be great but isn’t really possible. Just makes people feel guilty. But I do agree in principle – hospitals often don’t even check that elderly patients actually ate or drank something and they can get dehydrated and weak if they don’t. Nonetheless, normal people with normal constraints CANNOT be there all the time.

      Minimum staffing laws, of course, are fought tooth and nail by corporations, and so far successfully. :-(

      1. jrs

        Doesn’t it sometimes seem like we are bombarded with advice that can only apply to the top 10% of the income earners if that. No, I don’t even think the top 20% can afford to quit their jobs, be full time caregiver, and btw never get similar or maybe any jobs back because the job market is not forgiving of taking time off for other things in life.

    3. dearieme

      So, my advice to … anyone with an elderly relative in the system — is to have someone with them for most of the daytime hours.

      That would also be wise advice for the UK system. Not least to make sure that the poor old thing gets food and water.

  8. Chris Cosmos

    I hope everyone understands who knows how the HC system works in the USA, like the military industry, is systemically corrupt–which means the whole system needs radical reform at all levels from insurance to the practice of medicine. The insurance system is the kind of nail in the coffin of all this either insurance needs to be banned or it needs to be a public utility as in most of Europe. There’s an interesting article in the American Conservative that ought to be read by all who are interested in the subject. As usual, that publication far outstrips any “liberal” publication in clear and creative thinking.

    The ugliness and corruption displayed by the medical system might have had a better result if Obamacare had not come across to force citizens to buy garbage insurance products. Alternative health-care would have increased its market share–so I still hope Republicans can repeal it. Most alternative-care depends on the ability of clients (not patients) to heal themselves. It may well be that the placebo effect could expand dramatically because I think, ultimately, we can heal ourselves–but that takes enormous confidence. I was just talking yesterday to a friend about this who healed herself from cervical cancer decades ago by doing what she enjoyed and laughing a lot.

    1. jrs

      people are no longer required to buy ACA plans (well a few states might require it, but that’s rare, I think it may only be CA proposing such). The mandate is already repealed. We will see it in costs, of course those with employer coverage won’t notice I guess.

      I’m not sure what else people want repealed, the ban on discriminating based on preexisting conditions? I mean the ACA sucks, but things are not getting better under Republican rule. And at a certain point in time it’s actually not fair to blame Obama for a Republican butchered ACA, because it’s no longer the law Obama pushed (I’m not saying it didn’t suck then, just things getting worse and worse with the ACA, we don’t have an alternative now, and it is due in part to Republican meddling).

      1. Chris Cosmos

        Obama always wanted a insurance centric system he had many clear paths to getting a sensible system had he presented the facts to the Ameican people like OECD statistics, scientific studies, and publicized the variety of ways other societies have solved the problem. Instead he offered no dissent from the prevailing media Narrative still in play that universal HC is too expensive. I had forgotten that the forced buy in was repealed and was only thinking about the legislation that passed.

    2. Harrold

      I was just talking yesterday to a friend about this who healed herself from cervical cancer decades ago by doing what she enjoyed and laughing a lot

      So she prayed the cancer away?

    3. Shonde

      Excellent American Conservative link. I was surprised it did not mention that private equity is buying up large medical practices in addition to home care companies, hospice and dialysis centers.
      And for all the animal lovers who frequent NC, be careful since private equity is also buying up vet practices and putting vets on commission. I personally ran across the commissioned vets while I lived in California. Suddenly my otherwise excellent conservative vet clinic had lots of new vets when all my old favorites left rather than work on commission.

    4. kareninca

      “I was just talking yesterday to a friend about this who healed herself from cervical cancer decades ago by doing what she enjoyed and laughing a lot.”

      I have a friend who just got a bad pap smear result. I certainly hope that she does not try to enjoy and laugh her cancerous cells away.

    5. d

      Well if you can convince an insurance company that alternatives treatments work, they might pay for them, but then i recall that a lot of these treatments from China,and some of what was shipped had products adulterated by antifreeze

  9. Josh B Gelb

    Your exhorbitant cost is somebody else’s S class. You think doctors should drive Subarus? Seriously our system is broken, but fixing it means taking money out of millions of people’s pockets and I don’t see them willingly allowing that to happen.

    1. Inode_buddha

      It isnt the doctors that are getting the money either. My cochlear implant surgeon told me he only gets 2500 per for the op. The majority of 50 grand goes to the hospital. The local hospital execs are driving Maseratis.

        1. Inode_buddha

          Dunno, but that seems awfully low for the kind of credentials required to drill holes in peoples skull and manipulate things in there.

    2. Shonde

      “You think doctors should drive Subarus?”
      That is going to happen anyhow. Do you really think the large for profit hospital chains or private equity groups will continue offering “S class” salaries for doctors once the only available jobs for doctors are in one of their mega units?

      1. Svante Arrhenius

        Apparently, any number of Yves’ commentariate need to start blogs; while continuing to post gems (and URLs), here? A visit to my home town, involved hanging with several folks working their ass off in futile attempt to maintain their employer’s ACA conforming plan. The former US Steel, then Rockwell International Building (Pixboig’s Barad-dûr) now sports UPMC’s Yooj logotype, towering 841′ above all my surviving opioid abusing deplorable friends. Is it Columbian owned, now? Peh!
        Used to joke about Iranian & Ashkenazi immigrants, paying for our unemployment & food stamps, doing multi-organ transplants during Reagan’s Miracle. But, now a whole new generation of brilliant kids pouring-in, as locals’ exposure to air, water & psychic toxins mount.

      2. WheresOurTeddy

        first they came for the factory workers, and i did not stand up, because i was not a factory worker…
        when they came for the white collar types used to healthy 6 figures, there was no one left to stand up for me…

    3. rd

      Most other countries heavily subsidize medical education so that the doctors don’t come out with high loans that act as pretext for high incomes long after their loans are paid off. As a result, they can be well-paid professionals, but are unlikely to be in the top 1%.

  10. Watt4Bob

    Meanwhile, the other day, lying scumbag, cheerleader for everything neo-liberal, Larry Kudlow, told the National Press Club that he wasn,t sure what the ‘correct’ portion of our economy should be spent on health care, but we have the best HC system in the world, and it’s better that people have ‘choices’ as to what quality of HC they spend their hard earned money on.

    This was in answer to a question about why the USA spends almost twice as much on HC as the rest of developed nations.

    The only choice most of us have to avoid bankruptcy, and the loss of our homes, is by a combination of expensive, but useless insurance, and not getting sick.

    (My ‘health plan‘ actually has nothing to do with providing health care, and is actually there to prevent losing our home in the event of illness. A $5000.00 deductible means doctor visits are not part of the budget)

    The rest of his talk/lie-fest was equally disgusting.

    The moderator mentioned at the beginning of the Q&A that the small but intense applause for his attack on socialism was owed to his having brought a gaggle of fellow cheerleaders with him.

    That small nod to honesty doesn’t absolve the NPC from hosting that POS.

    1. rd

      As far as I can tell, the best “cost-to-complaint” ratios seem to be in the 10% – 13% of GDP range. That provides for very good universal health care if run efficiently. The US is around 17%-18% and does not provide universal coverage. We would likely be 20% if we offered universal healthcare without systemic change.

    2. DHG

      Isn’t Satans system grand… My mother passed last year in a nursing home. I have no intention of ever going to one and keep a pistol to use when the time comes. I even have orders if anyone finds me collapsed they are to do nothing for 30 minutes to ensure I am gone.

    3. mistah charley, ph.d.

      Some insurance plans are actually useful. My wife has a good BC/BS plan as part of her benefits in a professional position – last year she had a breast cancer diagnosis and a mastectomy – and yet our own out of pocket expenses did not reach the itemized deduction threshold for income tax. I was a little surprised, actually. Although she could retire early now clearly it is not in our financial interest that she do so.

    4. Tom Bradford

      I recently had a TURP down here in New Zealand. Had I waited a couple of weeks I could have had it done for free under the public system but (having the cash) I chose to go private within three days. A 105 minute procedure with two days recovery in a private hospital cost me less (in $NZ converted) than your $5,000 deductible.

  11. mbc 92028

    Crapification indeed.
    Despite what you here about full employment(last few years) and a nursing shortage(since about ’90).
    My wifes a nurse with 27 years experience. She has a AA and went through a rigorous nursing program to become a LPN. She has for the last 17-22 years worked at jobs previously only done by a RN, but for $10 less an hour then they pay a RN to do the exact same job. Often managing RN nurses that were making $10 an hr more then her, because the rules requires a certain % of nurses be RN on a shift.. She has been underpaid by $10 an hr for the job she does for 15-20 years because she lacks a piece of paper. She has made the same amount for almost 12 years now, no raises. While her med insurance has tripled and the 401K match has gone down to 2 measly %.The last 2 years she has been taking classes to get her RN to fix some of this. But now the medical group she works for was bought out by a a large nation wide group. And they are looking to replace the LPN position(the nurse you see before u see the Dr)with EMT’s. Because they are $5/hr less the a LPN nurse is. Which I can imagine they will start phasing out for robots or self serve DR offices in about 5 more years.

  12. Jeremy Grimm

    There is another aspect of our economic and the health care systems I didn’t see mentioned yet. Who cares for young adults, or grandchildren now that even a moderate Social Security check amounts to more than the income many young adults can earn — and all they can afford is no or limited medical insurance? I am retired and have two young adult children who must continue to look to me for support from time-to-time — times such as when they have medical expenses or dental care expenses. I went to a lot of trouble to bring my children into this world and to raise them. I remember what it was like when I was a young adult and times are very different now and grow ever worse. I can’t imagine looking to my children for help when I’m too old to care for myself.

  13. Yves Smith Post author

    Making stuff up is against our written site policies. The percentage of people working past normal retirement age, as a percentage of the population, is higher than it has been since these statistics were kept, including people who are in their 70s. And the plural of anecdote is not data. Most people are working longer because they have to, not because they want to. The press likes to exhort older people working because they like to so you don’t have to feel guilty having an old person as your, say, checkout clerk (as in working a taxing job for not much pay).

    Similarly, you assume people start collecting SSA at 62 because they chose to retire, as opposed to they lost their job earlier and have been scraping by.

    And the average age isn’t 62. 62 is the earliest age. It is the most popular age but even then less than 50% start collecting then.

    You are already in moderation. You can’t afford to collect more troll points.

  14. cripes

    -Jeremy Grimm
    And this is yet another way crony capitalism destroys the bonds of community, family and generations, depriving them of the support and interdependence of kin or pitting the each generation against the next. Family values, my ass.

    Harry Chapin knew a long time ago

  15. Pat

    Add another anecdotal incident to the we must have single payer no carve outs list, a friend is spending a great deal of their time trying to sort out a billing problem with Medicare. Yes, Medicare. Apparently there is mistaken listing for a private insurance company policy that does not exist. So claims are being denied. Their parent is still receiving treatment, but they know this has to be cleared up or that may not continue. There are other problems with the process of figuring this out as in it is too easy to say that isn’t this department, but most of the problem would disappear if there were no private insurers to supposedly be the primary insurance carrier.

    1. cripes



      Spent 6 months after a fender-bender trying to “prove” to ER billing department that GEICO was not my “primary” health insurer. Idiots.

      GEICO does not do stand-alone health insurance policies and can’t be anybody’s “primary.”

      1. hoonose

        Could be related to any medical payout from your or the other vehicle’s insurance. The powers that be make sure that money goes directly towards paying the medical bills.

  16. cripes

    I should have added, that we are so focused on getting a modicum of health CARE security, that we haven’t begun to address the appalling lack of family leave policy-vacation, holiday, sick care, child and elderly care that places us not #37 in the world statistics, but dead last, as virtually the only nation on the planet, not just the “advanced” countries, in having no national policy, minimum benefits or any protections whatsoever.

    Mighty Estonia is first, with the equivalent of 85 WEEKS OF FULLTIME PAY. Many countries not far behind. The US is LAST. AGAIN.


    A handful of major cities have made tepid steps in this direction.
    Millions of workers have no paid leave of any kind.

    Deplorable, indeed.

    1. jrs

      They are related, hard to even see a doctor even for a less than serious issue with no time off (much less for surgery etc.).

      So if a magic wand was waved and we all had FREE healthcare tomorrow, there would still be people putting off medical care they NEED, because they are too busy hustling to survive day to day, with no paid time off to attend to medical conditions.

      India also has a ton of paid family leave. Yes yes poor India, and YES Modi’s India Granted they have exceptions so some people probably do fall though the cracks of the policy, but they have a very generous policy of paid family leave, the U.S. has none.

  17. Wukchumni

    Somebody shared a recent ambulance bill with me, and a 40 mile jaunt was $3300, and the way it broke down was insurance paid 95% of the base rate of $1900, and 35% of the mileage rate of $1400, so the unlucky co-payer had to shell out nearly a thousand dollars, aside from what their insurance paid.

    Highway robbery, that.

  18. Glen

    I ended up getting a $5000 bill because both my spouse and I were working and HAD health insurance. If only one of us was working, it would have all been covered. And it was for rabies shots, $22k per person!

    US health insurance is insane. Obviously, it’s all in a death spiral. ACA was just a way to prop it up with tax dollars.

  19. lordkoos

    What surprised me the most when I became eligible for Medicare a couple of years ago was that they take Medicare money out of your social security check. Two programs supposedly to help seniors and the elderly, and they take from one to give to the other? I think that started in the Reagan years?

    1. Jeremy Grimm

      I really like having to buy supplemental insurance with the Social Security money remaining after Medicare takes its cut because Medicare leaves a few gaping holes in its coverages.

  20. Craig Dempsey

    Medicare Part B has premiums. They can be deducted from Social Security, Railroad Benefits, or OPM pensions. Otherwise, premiums are billed to the beneficiary. One option for direct pay is to have the premium deducted directly from a checking account. If you do not pay for Part B, it will be terminated, just like most other insurance policies. Whether there should be a premium charged is an interesting question, but since there is one, Part B must be paid for (unless it is covered by an outside premium payer such as a state welfare system).

    You can read more here: Medicare Premiums

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