Healthcare Without an Employer or Medicare
#stayrich #liverichly The good news is that there are practical steps that a rich person can take to avoid the worst parts of the USA's healthcare system, even if it’s just up and leaving the country!
Before we start, let me remind you that I’m not a MD. I’m not a nurse. I’m not a financial planner, an attorney, or a tax professional. I have no professional qualifications whatsoever! I’m a random person on the internet, and while I try to read carefully and cite my sources, this blog always has to be the beginning of your research, not the end. I try to tell people when they should include professionals in their lives, but this entire thing is best effort. You’re way too smart to think that this post should be taken as gospel, right? That goes for everything I write. Now that we’ve got that out of the way, on with the blog post, OK?
On a forum I’m on, a person recently wrote in to ask about how to deal with the problem of healthcare for a person who is choosing to step away from employer coverage prior to 65. Fortunately, there's good news here! Prior to medicare, the vast majority of people who take care of themselves don't need much medical coverage, because 1% of the healthcare/public health $s provides about 99% of the benefit.1 For the vast majority of folks under 65 in good shape, the primary worry is not chronic health conditions, but catastrophic care.
Therefore, first and foremost, once you are no longer eligible for workplace coverage, exercise is your new first job!2 Optimal levels of exercise appear to be in the range of 14-20 hours per week. That said, the improvement from large scale, long term studies for people who exercise that much vs. people who exercise closer to 5-7 hours, while significant, isn’t as large.3 If you are not an exerciser today, start at a couple 25 minute sessions weekly and increase both intensity and duration until you hit your goal. If you are in a position to voluntarily give up medical coverage through work, you have 5 hours a week, and don't accept any excuse your brain comes up with! Included in that time, you should include at least 2 weight lifting sessions as well that hit every major muscle group, although 4 may closer to optimal.4 With weight lifting, don't aim for it to be hard. You should feel like with every set that you could have done another 3-5 reps, and with every session that you could have gone another few 10s of minutes. It shouldn't be easy, but it shouldn’t be difficult either. (For clinical references on this topic, I suggest the Barbell Medicine podcast and website. They do a great job of citing their clinical opinions and staying up on the latest significant research findings.)
Next, sleep: get 6-9 hours per night, and aim to go to bed early enough such that you don't need an alarm to wake up. Dark, cold, and quiet sleep areas are your watchwords here, as well as avoiding any psychoactive substances (caffeine, alcohol, etc.) late enough in the day to be still active in your system when you sleep. Alcohol will knock you out, but any good smartwatch will tell you that you get crappy sleep if you drink within a few hours of bedtime. (I know. Sometimes ignorance is bliss! I basically don’t drink at night any more!)
Next, diet: avoid sugar and booze, limit saturated fat, and aim to eat from the outside of the grocery store. If you avoid sources of concentrated sugar (including fruit juice, fruit concentrate, etc.), eat lean protein sources, and exercise like above, you will probably be doing about the best you can regarding diet. Yes, you may get a small boost to heart health by avoiding red meat vs. white meat5, but who cares? We're aiming for big optimizations here. Also avoid exposure to smoke, chemicals, etc. You don't have to go crazy here, but you will need to ensure they aren't a regular part of your life, and for the addictive versions of these, that probably means zero indulgence for most people.
Last, loneliness: humans are tribal monkeys. Find your tribe of people you can relax and trust and let your guard down around. Relax and let your guard down a few times a week! If you have toxic people in your life, life's too short. Cut them out! Move if you have to.
Now, how to fund the remaining healthcare needs prior to 65? Options are:
Obamacare: get HSA coverage and MAX OUT that HSA every year. Invest the HSA in low cost stock market index funds, and build up a nice nest egg against catastrophic care (car/hiking/bike accident, etc.). This HSA can also pay for your end of life care if you get dementia at a normal age. Our HSA is up to six figures by following this approach. We plan to have enough to fund round the clock care for five years for both me and Mrs. Solving Wealth by RNs, plus daily MD visits. I figure that will run a few million $s, but thanks to the miracle of compound growth over many many decades, I should be fine when I need it, and I can always supplement from my general portfolio. I save my receipts such that if my HSA gets too big, I can start reimbursing myself for long ago expenses. Get a plan that minimizes maximum expenses, although beware, because the out of pocket max is not the out of pocket max (significant edge cases apply) because everything about healthcare in the USA is terrible except the outcomes. Plan to pay out of pocket for everything except covered catastrophic care, and never reimburse yourself from your HSA, until it's grown to that millions of $s stage.
Health Sharing ministries: These still have lifetime maxes and also require you to swear "lifestyle" statements, which if later proven false can be used to deny coverage. But they are way cheaper than Obamacare, because they are generally way worse in terms of coverage. Still, they can be better than nothing. I don't like them because I'm building a healthcare plan that minimizes my chance of getting chronic diseases before medicare coverage starts, which means my main worry is a multi-million dollar accident involving months in an ICU, and that lifetime maximum is a killer here. Literally!
Medical tourism. Costa Rica is close, cheap, and GREAT care is available, reportedly. Mexico is close, cheap, and GREAT care is available, reportedly. I’ve heard that in India, a person can wander down to the local chemist (that’s what they call pharmacist) and get the same medication that you get here for 85% off the sticker price, or even larger discounts, with no prescription, and can come from the same factory that Walgreens gets it from! Reportedly. A little bird told me this. I have no idea if this is legal in the general case, or legal for you. You should consult a lawyer. However, if a lawyer were to advise you on a strategy that you could pursue, then the cost of a ticket and five star lodging in India is cheaper than the out of pocket cost for many medicines! I also have a former colleague who suggested that a luxury trip to South Korea could get you a 5-star executive annual checkup with full blood work, MRIs, etc. for a couple thousand $s.6
Pay out of pocket. They are rare, but my primary care physician doesn't take insurance, and takes cash or check. He charges by the hour, and passes on costs for vaccinations, blood tests, EKGs, etc. I spend a few hundred $s per person per year with him. Hospitals will often pre-negotiate rates at their “concierge desk” or through their normal billing department for prepaying certain surgeries and procedures, and these rates are sometimes lower than insurance copays!
OK, now what about the most common things in the remaining long tail?
For birth/maternal care, check out birth tourism, or just pre-negotiate with the "concierge desk" at your local hospital. If your local hospital doesn't have a concierge desk, find one that does!
Hysterectomies are super common, and about 600K are performed every year in the USA alone! Again, check out medical tourism, or work with the concierge desk.
For diabetes care, revisit the above about exercise and diet, and find a doctor who can work with you on this topic, which can help lower insulin expenses, etc. You may find that regular trips to somewhere cheap to purchase expendables and flying them back in a cooler is cheaper than buying locally, although reportedly Walmart has some exclusive deals on certain kinds of injections for certain subsets of diabetes cases that are super cheap.
For trauma, cross your fingers, hope to God, and hire a medical advocate and an attorney ASAP. If you are well enough to travel, consider medical tourism. Be prepared to play hardball with asset protection strategies, and treat the collection offices at your medical providers like the scum they are, somewhere below used car sales-droids and payday lenders in terms of ethics. Lawyer up HARD.
(Remember, your doctors and nurses are just as frustrated by that side of the business as you are, so don't take it out on them. They are as helpless as you are.)
In the USA, we are used to fixed prices. Medical bills after a procedure here are always, always, always a suggestion and an opening negotiation, and can often be settled for 10-20 cents on the dollar. In extreme cases, people have been able to settle for under 3%, or get out of paying entirely legally! (This can have an impact on your credit score, but I’m down for a bad score for 7 years in exchange for a couple hundred $K!) And given the terrible tactics, lies, and greed that runs through our medical system, you should feel rightous about fighting every medical bill from a large faceless provider tooth and nail.
Of course, your small practice down the street is entirely another story. When you hit the call center when you try to call about your bill and you get that slimy feeling from the person on the other side of the phone, you’ll know which kind of provider you are dealing with.
Every country is deeply broken and totally insane several unique ways. The inhabitants look at you funny when you ask them about it, because they can’t conceive of life any other way!7 Folks from the USA know our healthcare system is broken, but if any specific changes are suggested, it’s likely to ignite a full on tribal war of red vs. blue. So I’m not going to suggest any changes here.
The good news is that there are simple practical steps that a rich or upper middle class person can take to avoid the worst parts of the USA’s healthcare system, even if it’s just up and leaving the country occasionally!
No, this is not the actual ratio, probably. The actual ratio is hard to quantify and wildly controversial, but put it this way. 15 years ago, per capita spending for Costa Rica on their entire economy was lower than USA per capita spending on healthcare, and the Ticos lived longer and healthier lives, on average! (People from Costa Rica are called Ticos.) Something is deeply wrong with the health systems in the USA, but this isn’t a political blog. Let’s just say that most of the money and effort is wasted and leave it at that.
If you’ve got a startup or are self employed, guess what? You’ll do better at that if you are in great shape! https://www.health.harvard.edu/mind-and-mood/exercise-can-boost-your-memory-and-thinking-skills The biggest benefit of working for yourself is that you don’t have to conform to some workplace’s idiot ideas about how you will best perform!
https://www.hsph.harvard.edu/news/hsph-in-the-news/exercising-more-than-recommended-could-lengthen-life-study-suggests/ You appear to get most of the benefit from the first hour-ish a day of exercise, and doubling or quadrupling it increases healthspan and lifespan but not as much. It’s diminishing returns, although I’d argue it’s worth it to find the 2 hours a day.
You are overwhelmingly likely to be stronger and look sexier if you hit all the muscle groups four times per week, but the evidence for living longer is weaker vs two times a week. Yes, this applies to both men and women. And absent high levels of androgen hormones, no, female bodies won’t get big bulging muscles from lifting weights. They will get lean and strong. https://www.livestrong.com/article/438477-how-often-should-i-lift-weights-per-week/
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5474906/
There's little evidence that these checkups are all that useful prior to 65 for most people, or even post 65 in many cases, although you can talk to your doctor to see whether that wild generalization applies to you. Another way of putting it is to ask the question, "How many people like you would have to get this checkup to save a life, or cure a disease?" followed by "Of those, how many will have a health scare due to a test that got it wrong?" Aside from some basic screenings that you can get basically anywhere, it seems like the tests aren't precise and accurate enough to provide good, reliable numbers on most things, and the scans will find all sorts of problems that will never develop into something you'd ever notice. Those basic screenings are really important though!
That's not to say there's not a place for this kind of intensive workup. But if you are thinking that a single blood test will tell a random person on the street whether they they have a hormone or vitamin that is “in the optimal range,” the answer is probably not. You may need many tests samples from many different fluids and tissues over an extended period of time to say definitive things, even then we don't always get it right, and the biopsies can cause their own problems! There's mostly not a secret executive checkup that works, at least not until you reach the level of wealth/power to where you have a personal physician who's seeing you every day or every week, and that's such a tiny marginal improvement for a young healthy person that why waste your time?
In Moscow, they are capable of running a public sewage system and tap water system perfectly well, but can’t prevent money in private bank accounts from disappearing, while in Mexico, at a similar level of GDP/capita, the tap water is mostly unsafe to drink. Not only does Argentina have high inflation, but they have multiple, wildly different, official government exchange rates between their currency and the rest of the world’s money! In order to figure out how your own country is insane, you will need to travel widely and spend time with locals who can force you to take an unbiased look at your own culture in the mirror.