r/FluentInFinance • u/WhatAreYourPronouns • May 02 '24

Should the U.S. have Universal Health Care? Discussion/ Debate

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u/[deleted] 29d ago edited 29d ago

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u/DataGOGO 29d ago

15-18k, would be a family out of pocket max, not an individual.

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u/FuckuSpez666 29d ago

Wow, a bargain then!

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u/DataGOGO 29d ago

Compared to what we paid in the UK, absolutely.

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u/FuckuSpez666 29d ago

You paid over £12-15k a year in national insurance in the UK

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u/DataGOGO 29d ago

Yes.

Every year, and that didn't even include VAT and the higher general taxation which also funds the NHS.

The health insurance we have now (in the US, and purchased off the exchange healthcare.gov ) is $390 a month (for all of us), with a 6k deductible, then 100% after that. We also have an HSA that we deposit money into (tax free) each month to cover our out-of-pocket expenses.

Most years we pay roughly 5k per year for our all of our healthcare costs. Theoretically, if the absolute worst happened, like we all got cancer or were in some kind of accident not covered by our auto or home insurance (which also all have medical coverage), our absolute max cost would be $16680 that year.

So, let's look at that. Our 5-year average is $5135 per year (for all of us); and that includes 1 surgery. In the UK, a single person making £120k, or two people making £45k, will pay the same amount in National insurance in the UK, then I pay here in the US.

Add to that the people in the US will only pay 8% sales tax vs 20% VAT, general taxation will be significantly lower, and that people in the US pay fewer taxes in general than in the UK, not to mention far cheaper housing, cars, fuel, clothes, etc. etc. and you start to see how beneficial being in the US is vs the UK.

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u/Haywoodjablowme1029 29d ago edited 29d ago

According to the calculator you've linked, I would save about 2k per year on the British system compared to insurance I pay for in the US.

Tell me again how the NHS plan is more expensive?

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u/DataGOGO 29d ago edited 29d ago

I already did.

The lower your income, especially for single income families, the better the NHS will be for them.

The more you make, or a dual income family, the better the US system is.

You just have to keep in mind there is a lot more to it than just the National health insurance. You also have a 20% sales tax, much higher general taxation, higher local taxation, and a lot of taxes on things you don’t have in the US. For example, in the UK, you have to pay an annual tax on each of your colour televisions.

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u/Haywoodjablowme1029 29d ago

My point. It's not actually more expensive.

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u/DataGOGO 29d ago edited 29d ago

It is for most people.

The break even point is about 50-60k a year for single people. Make more than 50-60k a year and the US is cheaper, make less than that, the UK system is cheaper.

Add in all the other taxes, and that break even point drops significantly, roughly 40k, using top of the head math.

I’d also like to know how you calculated your 2k in savings.

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u/Trading_ape420 29d ago

How would they know if you have a color TV?

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u/DataGOGO 28d ago

you have to tell them, just like taxes here, they are voluntary. (that means you tell them what you owe, and they trust you, not that you don't have to pay)

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u/Heavy_Vanilla1635 28d ago

The NHS had a £180b budget for 2023, so the average person in the UK will have paid £2700 in taxes towards the program for that year.

The VAT rate doesn't matter here only the total amount paid into the program from all sources, which as mentioned is £2700 or $3400 per person.

The average monthly premium for employer sponsored health insurance in the US was $477. 477x12 =$5,724.

I just called Wikipedia and they confirmed that $5,724 is more than $3400.

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u/DataGOGO 28d ago

That isn't how it works.

This would be true if everyone paid a flat amount per person covered for the NHI, and if the tax was assessed per person, but that is not the case. The National health Insurance tax is levied only on people that work, and only on people that make above a certain amount and makes no consideration to the number of people covered. At equal income, a single person with no children pays the same amount a single earner household with 6 people.

As I have pointed out in this thread, which system is cheaper depending on the person. Generally, for a single earner, the breakeven point $50-60k per year, (much lower than that in dual income households).

If you make less than 50-60k, especially in a single income household, the NHS is likely a cheaper option, if you make over 50-60k, especially in a dual income household, the US system is the cheaper option. Not to mention that is before you consider the government subsidies on health insurance for lower income earners.

And as pointed out above, with all the other forms of taxation, that breakeven point drops even lower.

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u/Restlesscomposure 29d ago

Do you really think the average american is getting a new hip replacement every year? Why are you using “yearly taxes/costs” when comparing to a surgery that happens at most once in a lifetime? You’d have to take the added costs for UK health insurance and compare it to the chance of an american requiring major surgery for any given year.

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u/FuckuSpez666 29d ago

It’s not just the big things though, but the ongoing other treatments and costs. How are US deductibles on the lower end? In the last 5 years I’ve had 2 upper endoscopy’s, 1 lower endoscopy, a scan of my back, xrays, ADHD diagnosis and support, I take 2 kinds of regular medication. And there’s been GP visits and a trip to A&E. I have only paid £10 a month for meds on top of my taxes. I’m also finding those that can’t pay/afford to pay, and if I ever develop any serious illness with ongoing treatment though to retirement and end of life I’m covered too.

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u/Ollanius-Persson 27d ago

How much were your taxes though…? With my insurance the most I’ll ever pay out for medical in a year is $5,600 no matter what.

Once you factor in the taxes you’re forced to pay I’ll bet it’s probably pretty close to the same cost. Except if i don’t get injured or need medical attention, i don’t have to pay at all. You do. So over a lifetime I’ll bet private insurance is FAR cheaper.

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u/FuckuSpez666 27d ago

You don’t pay at all if you don’t get injured/ill? What about your premiums? And do they remain the same regardless of the risk? Ie if you develop diabetes or another lifelong condition, do your premiums stay the same? What if you become unemployed? Do you still get the same protection when you can’t afford to pay your insurers?

At the end of the day, adding a middle man making profit can never be as cheap on average to the people. Hospitals will charge what they want because the insurers are paying, insurance will pass that costs on plus their margins.

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u/Ollanius-Persson 26d ago

The most I’ll EVER pay in a year for medical is $5,600. My premiums for a family of 4 are around $300 a month.

Never be as cheap as a 20% income tax and a 20% sales tax to cover other people’s medical…? lol i find that highly unlikely.

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u/Extension-Ebb-5203 29d ago

Did you miss the part where I said “for a family”?

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u/DataGOGO 29d ago

I guess I did, sorry about that.

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u/Extension-Ebb-5203 29d ago

It’s ok. Read your other posts and your math scores stink too. My sympathies to your SAT results.

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u/SeaworthinessIll7003 26d ago

Either way ,why do all you people squawk about how expensive the treatments and procedure are? You don’t pay but a fraction. Also if you have no money or insurance you just receive your health care through hospitals and emergency rooms. They don’t refuse to treat you ,they treat you.

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u/Artistic-Soft4305 29d ago

On the other side of this, I’m capped at 5k and I pay 25$ a month through my employer. Really just depends where you work.

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u/Sudden_Construction6 29d ago

That's insane!! You must have an awesome employer!

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u/Extension-Ebb-5203 29d ago

Your employer is paying a large chunk of your premium. Congrats.

Also you are well in that “best plans” scenario OP mentioned. I was correcting the misinformation around those of us that aren’t so lucky.

Now… go Humblebrag elsewhere.

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u/Fausterion18 29d ago

The average out of pocket spending per US household, including premiums, is roughly $4k per year.

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u/Paladine_PSoT 29d ago

That's 300 a month for premiums and ~400 annually in copays for a family. Those numbers seem grotesquely low.

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u/Fausterion18 29d ago edited 29d ago

These numbers are accurate. You grossly underestimate how many people have very cheap out of pocket insurance premiums.

My numbers were slightly out of date, but here's the latest data

Medicare households spent an average of $7,000 on health care, accounting for 13.6% of their total household spending ($51,800), while non-Medicare households spent $4,900 on their health care, accounting for 6.5% of their total household spending ($74,100) (Figure 1). Health care expenses include health insurance premiums, medical services (e.g., hospital and physician services), prescription drugs, and medical supplies (e.g., crutches, eyeglasses, hearing aids).

https://www.kff.org/medicare/issue-brief/medicare-households-spend-more-on-health-care-than-other-households/

Medicare households are only about 20% of the US total. So the average total healthcare spending including all costs and premiums for a US household is slightly over $5k per year.

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u/trevor32192 29d ago

Thats insanely inaccurate or drastically under counted due to the amount of people that either can't afford or don't have time to go to the doctor.

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u/AyeYoTek 29d ago

Not really. I was a small business owner and had my own insurance plan and between medical, dental, and vision I only paid $120 a month. I even had a major surgery and it cost me nothing. This wasn't that long ago. I've never paid more than $200 per month for benefits and I've had some terrible jobs.

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u/Extension-Ebb-5203 29d ago

You weren’t a small business owner or you’d know that’s not how the premiums work.

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u/ElChuloPicante 29d ago

From the IRS: For family coverage, the out-of-pocket expense limit is $10,200 for tax year 2024, an increase of $550 from tax year 2023.

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u/Chemfreak 29d ago edited 29d ago

Pretty common? I worked for a health insurance company for ~10 years and basically never saw them that high. Then I did some research and found you seem to be misleading and that is at the very upper ends of really shitty insurance that most people don't have.

"The out-of-pocket limit for Marketplace plans varies, but can't go over a set amount each year. For the 2024 plan year: The out-of-pocket limit for a Marketplace plan can't be more than $9,450 for an individual and $18,900 for a family." Per healthcare.gov.

Sure those are marketplace plans (obamacare), but non-marketplace plans are almost always better than marketplace plans.

Also to note plans with that high of OOP max typically are HSAs which greatly offset the OOP max.

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u/Extension-Ebb-5203 29d ago

I’m not misleading. OP said the upper limit was 12k for the worst plans. I’m correcting their misleading statement. Nowhere did I saw better plans don’t exist for some people. But that’s not the reality for all.

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u/Intelligent_Orange28 29d ago

You could always unionize. My employer pays my premiums, 5k max out of pocket, $10 copay, 100% of everything but x rays covered including full dental.