For every dollar you spend on health care, the actual practitioner gets only a taste. The system of "administration" gets a good chunk just for shuffling paperwork. And if you really get sick, this system of Health "Care" will drop your coverage so fast you won't know what hit you.

Sunday, August 2, 2009

Health Insurance as Investment

If you viewed health insurance through the eyes of a finance professional, what kind of investment would it be?

Felix Salmon, in his blog post Conditional probabilities and evil insurers, sees it as a risky one... you have about a 50% chance of collecting (and a 50% chance of getting nothing) if you get really sick.
"if you’re making a series of small payments now on the grounds that you will be paid a large sum of money if something bad happens, you’re running some large and unhedgeable counterparty risk"
The Taunter article (unconscionable math) which he refers to is a clear analysis of health insurer's rescission methods. ie - real and sad and borderline criminal.

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