Outrageous by Eric Novack


First and foremost—congratulations to Matthew and Amanda on their
wedding!!! Now to the outrage!!!

In Friday’s Boston Globe , health reporter Alice Dembner reports the plight of a 60 year old woman who has to pay twice the amount for health insurance as a 27 year old. “That’s discrimination!!” she says in the article.

Yet MSNBC reports that, “ a typical couple retiring in 2020 will have paid about $100,000 in lifetime Medicare taxes. ‘For that price, this couple is scheduled to receive about $500,000 in lifetime Medicare benefits over and above the premiums it additionally pays in retirement.’

Also, has anyone checked out how much more it costs to get auto insurance
for a 20 year old versus a 60 year old?


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4 replies »

  1. Eric, I view auto insurance and claims more as an achievable behavior modification than healthcare. Young people take more risks and older people aren’t as attentive with slower reflexes. But age discrimination in insurance should be carrot and stick. A young person should be assumed to be safe until they have a claim, then sock-it-to-them so to speak to awaken their reality, even suspend their license. Should those over 18 pay higher premiums because they are of legal drinking age and therefore will be more likely to drink and drive? In a private health insurance system not all self driven healthful life styles guard against disease so who are you going to fairly penalize or reward? Don’t forget insurance premiums and risk calculations are about profits – not about health, healthcare or access. If the young and healthy were charged more to premium level the field I doubt the insurance industry would attract many young, healthy and profitable premium payers. Better to get them in when they will not be a risk then price them out of the market as they get older, then dump them onto Medicare when they really start costing you money. Cars don’t cost $100,000++ dollars to repair and insurance companies are adept at value depreciation.

  2. apparently my point was not clear— if it is discrimination to make a sixty year old pay more than a 25 year old because the 60 year old is more likely to utilize health care services, is it not the same discrimination that the reverse is true when we talk about auto insurance? And why do we not read about this on the front pages of major newspapers?
    No editorial comment– just wondering…
    Peter- hope that helps… and some insurance plans are beginning to make adjustments for behaviors– the employer based market and other regulations make it very hard to do.

  3. “The state-subsidized plans charge the same premiums for all age groups.”
    Could this be because the subsidized plans are based on income. Same income levels = same affordability no matter your age.
    “State officials acknowledge that insurance is unaffordable for some, but have made no special accommodations for older people.”
    Why is this statement inconsistant with the first? And how are co-pays and deductibles worked into the calculation for affordability? I bet they’re not.
    And if we’re paying for REAL risk then my healthy lifestyle should receive a huge discount. Why doesn’t it?
    So Eric, if as you say people have only paid $100k for $500k in benefits – what premium should they be paying? Should your FICA deduction be 5 times more than it is now?

  4. Hmmm, about that $100,000. Has it been adjusted for the fact that it is paid out over several decades? The early money especially needs to be inflation adjusted as well as adjusted for the accumulated interest it would have acquired as an investment.
    If that hasn’t been done, the real ratio of payment to payout is not 1:5, but probably something more like 1:2 or less.
    And anyway, the solution is not to make the Medicare recipient pay more so much as to make that same person pay more when they are younger, between 30 and 60. Whether we have a private or a public system, this is what has to happen eventually.

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