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>I guess my point is we all pay in, and we all ultimately take out of the system. And my point is that young people disproportionately pay in a larger value an

• zaroth 11y ago
  I should have been more precise. You pay based on your own expected lifetime cost, over your expected lifetime. For example, something like $300,000 / 80 years or $3,750 per year. The entire model is predicated on not paying in each year exactly how much you take out in benefits. That would completely defeat the purpose. So, of course young people pay more than they take out, while they are young. Almost all of those young people will also eventually get sick, hopefully old, and need health care for many years in excess of the amount they are paying in that year. Are younger people actually subsidizing older people over the long-run, in other words, are younger people today on a track to pay in more than their expected lifetime cost? I doubt it, I think that would only happen if a future event dramatically cut the cost of care, you could end up having over-paid if care became abundant and cheap. Another way to think about health insurance premiums is, you are born, you start $300,000 in debt. That's about the amount of healthcare you're going to consume, and you have your lifetime to pay it off. But that "debt" is also growing at ~5% based on increasing cost and complexity of available therapy, and average number of therapies someone can survive. The average 25 year old should have paid for about 30% but may have only actually spent 10% of their healthcare budget so far, but you can rest assured the balance will eventually be spent. Doesn't mean they are being ripped off by the old people!
  • diskcat 11y ago
    >The entire model is predicated on not paying in each year exactly how much you take out in benefits. That would completely defeat the purpose. So, of course young people pay more than they take out, while they are young and here's the gist of the scam. It's a pyramid scheme where the new entrants i.e. the young people pay for the old people's costs. The young people would be far better off investing the money they are paying for old people's healthcare and then using that money for themselves when they are old. And how much have the old people paid into ACA? They couldn't have possibly paid any because the ACA didnt exist when they were working. So where does the money to pay for their healthcare come from if not from the young people. So yes they are being ripped off. Young people are having their hard earned money taken to keep old people on life support so they live longer to take more money from young people.
    • zaroth 11y ago
      Far better off investing the money? No, because sometimes young people do get sick and need insurance, so you can't just invest your early payments, keep the returns for yourself, and skip the insurance, because then you're bankrupt if you lose the "lottery" and get sick at a young age. Most young people will eventually become old people. It's by definition not a "pyramid scheme" if average total lifetime benefits are designed to equal average total lifetime cost. It seems like you are upset that an insurance policy is acting like an insurance policy should by spreading cost over time and averaging costs across members of the pool? That medical costs have positive feedback (better more expensive therapies allow patients to go on to have more, better, more expensive therapies) is definitely a huge fiscal challenge. But it's also why young people are more likely to be underpaying now for future benefits they will receive, not overpaying.
    • AnimalMuppet 11y ago
      > and here's the gist of the scam. It's a pyramid scheme where the new entrants i.e. the young people pay for the old people's costs. No, it's a scheme where the least expensive people pay for the most expensive people's costs. Insurance is like that.