A Follow Up

I was responding on Facebook to Facebook comments to my last post, but it is not easy to type there. It is much easier for me to create a post in my word processing program already set to post directly to my blog, which then posts to Facebook. I am a social networking fiend.

Besides, this software has a better spell check and thesaurus.

Adding to my health care debate were Sister; employed, insured, but in a financial quagmire from co-pays and insurance deductibles after surgery, and Cousin; employed (in the health care field), insured, willing to barter for services. They provided the ammo to the gist of my argument.

In an unsubtle segue I heard today that the FDIC is running out of money. In case you do not know, the “I” in FDIC stands for “Insurance”. Because so many banks are failing, the FDIC is losing money on two fronts; outgoing claims and incoming premiums – with 100 banks failing this year alone, those 100 banks’ depositor funds have to be covered and those same 100 banks are no longer paying insurance premiums.

Because the “F” in FDIC stands for “Federal” (although I can think of other things), this news is not the disaster it could be. The FDIC is backed by the full faith of the US Government, with which they have a 500 billion dollar line of credit. But, in an attempt not to use that line of credit, the FDIC is raising the surviving banks’ premiums. They actually would like banks to pay for 3 full years of premiums upfront, but that’s another story.

This exact scenario is what I feel is going to happen to the health insurance industry. Minus the 500 billion dollar credit line, of course. As more people lose their jobs and insurance, as more companies pull back on health insurance benefits, leaving people un or under insured, insurance companies are going to have to charge the existing American clients more for premiums if they want to stay in business. Already, insurance clients pay for those that are un- or under-insured. After all, these companies are not in the business of insurance to help people, but to make money.

If insurance rates continue to rise (or, if coverage is reduced or both), more people will drop their insurance. This could circle back to higher rates (or less coverage) for an ever-decreasing group of policyholders.

I do not think that it is a “right” for every American to have health insurance simply because they are American. What I do believe is that a nation as advanced and as wealthy as ours should provide basic coverage to all its citizens simply because it is the right thing to do.

Even if it means paying for people who abuse the system and their bodies.

Even if it means paying for people with bad genetics.

Even if it means paying for people who will never use it.

Otherwise, we might as well be a 3rd World country. You know, those countries where diseases spread unchecked, where children starve, where death and poverty are commonplace.

I would be glad to contribute to health care costs, just as I contribute to K-12 education, just as I contribute to the protection of my home, life and country. I have no children, yet I pay taxes pay so others’ children can be educated. My house has never caught on fire, nor has a crime been committed in it, nor has a rogue militant force ever invaded it, yet I pay for all these services.

If I were back working in Corporate America, under a Universal Health Care system, they could either save the money they’d be paying for my insurance, or give me a raise to cover my increased taxes. Either way, they would be more profitable and therefore more competitive. Plus, I would not be forced to stay in a dead end, lousy, or miserable job just because of the health care benefits.

Personally, I’m all for Universal Health Care, Medicare for All, Government Sponsored, Socialist/Communist/Fascist medicine, or whatever you want to call it. I would like to be able to use health care services (or not) and not worry about the cost, just as I can use the police service (or not) without a worry as to cost. I would like to see EVERYONE be able to use health care services.

Well, except for members of Congress.

Reform

(verb) to change and improve something by correcting faults, removing inconsistencies and abuses, and imposing modern methods or values

Okay, I’m completely over the Health Care Debate. The information is so convoluted that it is impossible to understand the pros and cons.

How do I see it?

As two separate issues. One is Health Insurance, the other is Health Care. Health Insurance is defined as protection against loss due to ill health for which a premium is paid. Health Care is defined as the preservation of mental and physical health by preventing or treating illness through services offered by the health profession

It’s not Health Care that’s run amok. Any one, at any time, can seek medical attention for whatever ails them. There are plenty of doctors, hospitals and emergency rooms. The difficulties enter with the paying for the services, and the secondary costs that accrue during any possible rehabilitation.

In a utopian world, a person who sustains an injury would be rushed to the hospital for treatment, cared for during months of rehabilitation, while their household and other living expenses are paid for, until such a time they can resume with their responsibilities. Here in Mikutopia no doctors make mistakes, no one takes advantage of the system and everyone recovers to live happily ever after.

And here is where utopia comes to a screeching halt.

Mr. Jekyll decides to go to med school with the altruistic desire to learn as much about medicine as humanly possible to help those that need it most. After incurring a bazillion dollar debt, Mr. is now Dr. and is ready to hang out his shingle. One day, Dr. J heals a patient who is less than pleased with the results. Dr. J, cleared of any wrongdoing watches helplessly as his mal-practice premiums go up anyhow. Needing not only to pay off student loans but also to meet an unrealistic overhead, he has no choice but to raise his rates.

Insure-Is-Us Inc opens its doors. Its corporate mission is to provide protection against loss due to ill health for anyone that can pay for it. Strong bottom line, strong business. Weak bottom line, no business. Survival of the fittest. If they pay out more benefits than premiums collected, well then, so long, farewell, auf weidersehen, good night. While the public corporate mission remains unchanged, the private statement changes to protect that bottom line at all costs! Preexisting conditions, experimental treatment, out of network, unnecessary treatment, paperwork snafu – whatever it takes!

Johnny McD decides at the tender age of five that fruits and veggies suck. So does exercise. Pop tarts, ice cream and brownies RULE! Xbox, Playstation and Gameboy are COOL! Obesity is the rage. Type II diabetes is king! High score on the high blood pressure cuff! Johnny becomes John, and suffers gallbladder issues, joint issues, breathing issues, cholesterol issues. Now he needs a quick fix. Pills and surgery are the answer! Wahoo for health insurance!

My opinion? Leave it alone. It seems to be in such a state of disrepair that it shouldn’t be long before the whole thing collapses all together.

Nerves of Steel

From July 31, 2008 to October 31, 2008, my portfolio dropped 30% when the economy suffered the double whammy of soaring gas prices and the bank/mortgage meltdown.

I listened for months to doom and gloom forecasts, experts saying 20 plus years for a recovery, no hope scenarios. How the credit crisis was going to bring down other industries. How it was going to snowball into all industries and companies worldwide. So, I did what any sane investor does in a down market; I bought more shares. After all, “buy low, sell high” was created in just this kind of downturn. I watched as my new purchases plummeted along with the rest of my shares, now down 36% at year’s end. But I had faith. I also had three things going for me. One, nothing was actually lost until I sold the shares, two, I was young and could ride it out, and three, I didn’t own any shares in the banking, investment or car industries.

President Obama was inaugurated. Stimulus packages were enacted like sandbags along the flood channels. Banks, investment firms, car companies were thrown life jackets. And still I sank. By the end of February, I was down 40%. With nerves of steel and a blind eye, I ignored my portfolio. I figured it had nowhere to go but up. I didn’t need the money, and I was 20+ years away from any kind of retirement thoughts. “Let it Ride!” I declared.

I took a peek the end of June and saw that my portfolio was back in the positive. Not by much, I add, but still. .09% was better than -24.2%. By July 31, 2009, I was firmly planted in Investors Heaven, showing 12.9% ROI. Little by little, each stock was climbing out of the red and into the black. By August 28, 2009 my ROI was higher than it had been before the year before.

Invest in good companies, invest for the long term, and HANG ON! It’s gonna be a bumpy ride!

Stocks2008