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If the cost of health insurance is the deciding factor in your decision to start a new company, you're better off not starting--you're seriously undercapitalize

If the cost of health insurance is the deciding factor in your decision to start a new company, you're better off not starting--you're seriously undercapitalized.

logicalmind 17y ago
Isn't this a contradiction to being "ramen profitable"? If you're only ramen profitable, how can you afford health insurance for yourself and employees?
- michael_dorfman 17y ago
  Do you think "ramen profitable" means "able to afford only ramen, and not somewhere indoors to sleep"? In my world, "ramen profitable" means covering basic expenses, of which (modest) health insurance is most certainly one. Put another way: health insurance is not a luxury item.
  - logicalmind 17y ago
    Health insurance is a cost that comes out of your profit. If you are ramen profitable after the costs of health insurance are removed you'd be even more profitable if the cost of health insurance was not there. If you're ramen profitable without the cost of health insurance, then by definition, you can't afford to pay for health insurance.
tptacek 17y ago
Repeating a point I made elsewhere, and sorry, but: The problem isn't just that health care is expensive. The problem is that it isn't available to many otherwise viable founders. You can be turned down with shocking ease by private insurers; no exceptions, no recourse except a multi-month appeals process that is no more likely to get you covered. The financial drag isn't the issue for us; the uncertainty is.
- michael_dorfman 17y ago
  Really? Which state are you in? I used to work for a private health insurer (in the US) and our "group" coverage was offered to businesses of 2 people (i.e., a founder and one employee). At that time, at least, sole proprietors were in the "individual" coverage category, but there was talk about changing that.
  - tptacek 17y ago
    Personally, Michigan and Illinois (at the time). Companywide, add New York. We tried to get insurance ourselves, and then worked with a family friend broker, and failed both times. We could get coverage for three of us (although my daughter would have exceptions in the contract), but not for my wife. I was 28 at the time.
    - midnightmonster 17y ago
      Florida. No problem to get coverage for me; we can get coverage for the boys but with riders on my youngest sons; we can't get coverage for my wife at all. We're 27 and 29. We're "lucky" in that we had COBRA coverage from a Maryland job before we moved here. Now that COBRA is expired, our MD insurer is required by MD law to offer us a group policy. It's decent coverage, but at almost $1000/month it only covers my wife and the kids. It would be another ~$600/month to add me.

If the cost of health insurance is the deciding factor in your decision to start a new company, you're better off not starting--you're seriously undercapitalized.

logicalmind 17y ago

Isn't this a contradiction to being "ramen profitable"? If you're only ramen profitable, how can you afford health insurance for yourself and employees?

michael_dorfman 17y ago
Do you think "ramen profitable" means "able to afford only ramen, and not somewhere indoors to sleep"? In my world, "ramen profitable" means covering basic expenses, of which (modest) health insurance is most certainly one. Put another way: health insurance is not a luxury item.
- logicalmind 17y ago
  Health insurance is a cost that comes out of your profit. If you are ramen profitable after the costs of health insurance are removed you'd be even more profitable if the cost of health insurance was not there. If you're ramen profitable without the cost of health insurance, then by definition, you can't afford to pay for health insurance.

tptacek 17y ago

Repeating a point I made elsewhere, and sorry, but: The problem isn't just that health care is expensive. The problem is that it isn't available to many otherwise viable founders. You can be turned down with shocking ease by private insurers; no exceptions, no recourse except a multi-month appeals process that is no more likely to get you covered. The financial drag isn't the issue for us; the uncertainty is.

michael_dorfman 17y ago
Really? Which state are you in? I used to work for a private health insurer (in the US) and our "group" coverage was offered to businesses of 2 people (i.e., a founder and one employee). At that time, at least, sole proprietors were in the "individual" coverage category, but there was talk about changing that.
- tptacek 17y ago
  Personally, Michigan and Illinois (at the time). Companywide, add New York. We tried to get insurance ourselves, and then worked with a family friend broker, and failed both times. We could get coverage for three of us (although my daughter would have exceptions in the contract), but not for my wife. I was 28 at the time.
  - midnightmonster 17y ago
    Florida. No problem to get coverage for me; we can get coverage for the boys but with riders on my youngest sons; we can't get coverage for my wife at all. We're 27 and 29. We're "lucky" in that we had COBRA coverage from a Maryland job before we moved here. Now that COBRA is expired, our MD insurer is required by MD law to offer us a group policy. It's decent coverage, but at almost $1000/month it only covers my wife and the kids. It would be another ~$600/month to add me.