Why is health care insurance so expensive?

Well, for people in GROUP plans, everyone’s premium is the same, and determined by averaging the risk for the group. That works out great for the sickest guy in the group, as he’s paying less than he would if buying insurance based on his personal health, but it’s not so hot for the young, healthy person who ends up paying more. That’s why I’m looking at INDIVIDUAL health care plans, where the rate is based on MY health and age. In fact, I saw something online that is pretty cool, and I’m surprised no one thought of it sooner. There’s a company called Precedent offering low cost individual health plans in Texas for young, reasonably healthy people. You buy into a plan at a super low cost with fixed benefits that will cover the typical activities and preventative care of a healthy person. Then, if something catastrophic happens, you have the option to get additional levels of coverage, even AFTER the event. You’d have to check it out for more details, but there appear to be options for people like me who can’t afford outrageous premiums, http://www.precedent.com/ Even if you’re not in Texas, my understanding is that they’ll be offering plans in additional states soon. Hope this helps!

From what a relative who is in family practice tells me malpractice insurance and administrative costs are the two main causes.

Although he's never been sued he still must pay almost $100K in malpractice insurance annually. And to stay covered AFTER he retires he will have to pay about $80K for five years. That is a healthy nut to have to crack every year.

There is actually more money spent by medical practices handling paperwork at all levels than is actually spent on diagnostics and treatment. That is why two Tylenol given to you by a nurse in a hospital costs more than two bottles of Tylenol bought in a drug store.

There are other factors that increase cost but those are the two worst. And here's another thing to consider. Insurance companies are designed to NEVER lose money. Insurance companies bet something isn't going to happen. When you buy insurnace you are betting something will. Either way YOU are going to pay for it.

because health care itself is so expensive. And there are many reasons for that:

Charity or deadbeat cases that don't pay (I'm not saying those are the same)

Frivolous Lawsuits driving up malpractice insurance and scaring doctors into ordering tons of unnecessary tests just so they can defend themselves IF.

Pharmaceutical companies have about 5 years to recoup the literally BILLIONS of dollars it costs to take a drug to market, before other companies can make generic versions and undercut them .

Those are just a few factors going into a very complicated issue.

Health provider and administrator's ego. Everyone thinks they should get more than the other resulting in spiraling salaries.

ooooh i know this one!!!

because they don't reimburse providers enough, so providers have to raise their overall prices, so insurance companies raise their rates with the reasoning that providers prices are too high, when they don't pay providers any more $$

its all a big scam