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- Isn't that like a safe job with a 100% chance of low income vs a startup with 10% chance of jackpot? With health insurance, you're assuming bad luck, but with

by ced 19y ago

- Isn't that like a safe job with a 100% chance of low income vs a startup with 10% chance of jackpot? With health insurance, you're assuming bad luck, but with a startup, you're assuming the opposite. - 77$/month is still quite a bit of money. Even if you absolutely want to spend it on safety, it's not clear that insurance is the best way to go. Upgrading those frozen dinners to bio food might be a better bet for long-term health. Or buying a bike helmet, living in an unpolluted area, taking time to exercise daily. - When you're twenty-something, there is a rather low number of incidents which are not a) low-cost enough that you can take care of it and b) curable at all I have health insurance now, but I'm not sure that it's such a wise investment. I find it hard to make an honest assessment of how much it is really worth. Anyone have hard data on this?

kingnothing 19y ago
I had no insurance a couple of years ago and needed a minor outpatient surgery. The surgeon worked with me on the price and charged nothing for the follow up office visits. The cost of the OR comprised about 90% of what I had to pay as the hospital only gave something like a 10% rate reduction. Taking everything in to consideration, it cost me about the same out of pocket for that to have insurance versus not having insurance, including the cost of premiums for a couple of years. Afterwards, I decided I'd be better off with insurance in case something bad happened. I've only known one person who had a huge medical problem without insurance, and, after spending some months filling out forms for the hospital and various programs for uninsured people, he wound up paying only the bills from the doctors. All but one of them offered a decent reduction in their fees, and I think a couple dropped them all together. All said and done, he was relieved of around $250,000 of debt. From my experience, I think it's a good idea to have some type of health insurance just in case you hit a worst case scenario.
Tichy 19y ago
That would depend on the value you put on your health/life. For me P(illness)ValueOfLife exceeds P(startupSuccess)ValueOfStartup
paul 19y ago
It's not at all the same. Do you understand the difference between buying a lottery ticket and playing russian roulette? Your strategy should be to seek upside while limiting downside.
- ced 19y ago
  Well, I've got to admit that I don't see the fundamental difference. One involves death, but death is also quantifiable. "Your strategy should be to seek upside while limiting downside.": But it's all a matter of degree! Taking insurance would be a dumb idea if it costed 5000$/month, wouldn't it? Plus, there is all this business about being risk-averse or not, for which there is no rational answer. People who stick to their safe jobs are risk-averse. It makes absolute sense for them to get insurance, as long as its expectation value is not too negative. People who do startups, however, are less risk-averse. They accept a game in which the EV is higher, but variance is also high. Not taking insurance is a very similar game: higher EV (presumably; it depends on the value and probability of death), higher variance. Loto and russian roulette both have low EV and high variance. They both suck. So would you rather have a 100% chance of an exciting life, or a 99% chance of a slightly more exciting life + 1% chance of a really bad one? I believe there is no single answer to the question, even if you quantify everything. It depends on how risk-averse you are. But maybe I'm just blinded by mathematics. If so, I'd appreciate a correction.
  - paul 19y ago
    Like I said, it's about controlling downside. The downside of losing the lottery is that you lose a dollar. The downside of losing at russian roulette is that you die. It's a mistake to only consider expected value. Risk is something that should be intelligently assessed and balanced, not blindly embraced. It's also a mistake to equate "not winning" at startups to failure. I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.
    - ced 19y ago
      "It's a mistake to only consider expected value." Agreed, to be precise, one has to look at the entire value range, associated probabilities, and their effect on one's personal "happiness function". That's what I was trying to do with my variance "estimates", since most of these things are pretty gaussian anyway. "Risk is something that should be intelligently assessed and balanced, not blindly embraced." Also agreed, and that is precisely what I am trying to do with regards to the real value of health insurance (admittedly without much quantitative data). So far, all I see in this thread is anecdotal evidence of some catastrophic events. "I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.": Me too, but that depends on a whole lot of personal factors, and there is no one right answer for everyone. Likewise for health insurance.

by ced 19y ago

kingnothing 19y ago

I had no insurance a couple of years ago and needed a minor outpatient surgery. The surgeon worked with me on the price and charged nothing for the follow up office visits. The cost of the OR comprised about 90% of what I had to pay as the hospital only gave something like a 10% rate reduction. Taking everything in to consideration, it cost me about the same out of pocket for that to have insurance versus not having insurance, including the cost of premiums for a couple of years. Afterwards, I decided I'd be better off with insurance in case something bad happened. I've only known one person who had a huge medical problem without insurance, and, after spending some months filling out forms for the hospital and various programs for uninsured people, he wound up paying only the bills from the doctors. All but one of them offered a decent reduction in their fees, and I think a couple dropped them all together. All said and done, he was relieved of around $250,000 of debt. From my experience, I think it's a good idea to have some type of health insurance just in case you hit a worst case scenario.

Tichy 19y ago

That would depend on the value you put on your health/life. For me P(illness)ValueOfLife exceeds P(startupSuccess)ValueOfStartup

paul 19y ago

It's not at all the same. Do you understand the difference between buying a lottery ticket and playing russian roulette? Your strategy should be to seek upside while limiting downside.

ced 19y ago
Well, I've got to admit that I don't see the fundamental difference. One involves death, but death is also quantifiable. "Your strategy should be to seek upside while limiting downside.": But it's all a matter of degree! Taking insurance would be a dumb idea if it costed 5000$/month, wouldn't it? Plus, there is all this business about being risk-averse or not, for which there is no rational answer. People who stick to their safe jobs are risk-averse. It makes absolute sense for them to get insurance, as long as its expectation value is not too negative. People who do startups, however, are less risk-averse. They accept a game in which the EV is higher, but variance is also high. Not taking insurance is a very similar game: higher EV (presumably; it depends on the value and probability of death), higher variance. Loto and russian roulette both have low EV and high variance. They both suck. So would you rather have a 100% chance of an exciting life, or a 99% chance of a slightly more exciting life + 1% chance of a really bad one? I believe there is no single answer to the question, even if you quantify everything. It depends on how risk-averse you are. But maybe I'm just blinded by mathematics. If so, I'd appreciate a correction.
- paul 19y ago
  Like I said, it's about controlling downside. The downside of losing the lottery is that you lose a dollar. The downside of losing at russian roulette is that you die. It's a mistake to only consider expected value. Risk is something that should be intelligently assessed and balanced, not blindly embraced. It's also a mistake to equate "not winning" at startups to failure. I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.
  - ced 19y ago
    "It's a mistake to only consider expected value." Agreed, to be precise, one has to look at the entire value range, associated probabilities, and their effect on one's personal "happiness function". That's what I was trying to do with my variance "estimates", since most of these things are pretty gaussian anyway. "Risk is something that should be intelligently assessed and balanced, not blindly embraced." Also agreed, and that is precisely what I am trying to do with regards to the real value of health insurance (admittedly without much quantitative data). So far, all I see in this thread is anecdotal evidence of some catastrophic events. "I'd rather work at a string of unsuccessful but fun startups than some soul-crushing big company.": Me too, but that depends on a whole lot of personal factors, and there is no one right answer for everyone. Likewise for health insurance.