The Continued Failure of the USA Health Care System and Our Politicians

Providing a health care is extremely costly everywhere. Rich countries nearly universally provide a health care system that allows all citizens to get needed health care. Nowhere is it perfect and nowhere is it cheap. And nowhere is it more of a mess than in the USA.

Sadly those we elect in the USA have continued for the last few decades to keep the USA healthcare system the mess we have now. The Affordable Care Act took a relatively small step in addressing several of the most flawed aspects of the USA system. It left unaddressed many of the major flaws. Instead of taking where we are now and making improvements to address the problems left from decades of Democrat and Republican created and maintained USA health care policy all we have had it demands to “repeal Obamacare.”

This is exactly the type on avoiding improvements to maintain the existing (for the last few decades) broken healthcare system those in the USA must live with. Cutting hundreds of billions from the budget to provide health care to the elderly is not improving the health care system.

Making next to no attempts to actually improve healthcare outcomes in the USA shows how flawed the current process is. It continues the behavior of the Republicans and Democrats for the last few decades. It is sad we continue to elect people behaving so contrary to the interests of the country.

The exceedingly costly health care system in the USA is in need of a great deal of work to improve the government policy that results in the mess we have now. Some of the huge issues we face.

photo of the Capital building in Washington DC

photo of the Capital in Washington DC by John Hunter.

  • Pre-existing conditions – this has long been a huge problem with the USA healthcare system and one of 2 major things ACA dealt with well. ACA greatly improved the USA healthcare system in this area, something that Democrats and Republicans had failed to do for decades. Current attempts by the Republicans are to gut these improvements. This is a completely unacceptable area for all but the most extreme people to even be looking at. That the Republican house members approved this radical removal of health insurance coverage from tens of millions of people and the vast majority of Republican senators has not expressed outrage and such attempts to punish those who have been sick in the past is pitiful. The USA even with the ACA does a much worse job on this measure than any other rich country in the world.
  • Medical bankruptcy – due to the decades of poor leadership by the Republicans and Democrats the USA is the only rich country with this as a macro-economic factor. The ACA made small moves to improve this but much more is needed. Instead of improving the USA healthcare system to deal with this long term problem the current Republican efforts will great increase the number of medical bankruptcies in the USA if they succeed in their efforts.
  • Massive cost-tax on all economic activity due to the costs of the USA healthcare system. The USA healthcare system costs twice as much per person as other rich countries (there are few countries with costs that have costs which the USA “only” 50% or 75%… but overall it is twice as costly) with no better outcomes than other rich countries. ACA did nothing to improve this (certain aspects of the ACA did but other aspects balanced those out), the new plans are not going to do anything to improve this (in a minor way it is possible reducing medical care for the elderly could reduce costs by having people die much sooner but given the mess of the USA healthcare system for many reasons the huge reductions in Medicare and Medicaid are unlikely to actually result in cost savings that are material).
  • Tying health care to the employer – The USA is one of the few rich countries to do this. Combined with refusing or providing only inadequate coverage for those with pre-existing conditions this is a great barrier to small businesses and entrepreneurship. ACA didn’t address this directly by eliminating the pre-existing condition failure it did greatly reduce the harm this causes the USA economy and individuals in the USA. The current proposals don’t address the problem and exacerbate the issue by returning the huge problems the USA system has in dealing with pre-existing conditions (it would be slightly better than before the ACA but much worse than what we currently have with the ACA).
  • A huge burden on individuals of dealing with insurance company paperwork, fighting with the medical system and insurance companies… Neither ACA nor the current plans made any improvements in this area.
  • The USA pays much more for drugs than any other country. This is directly the result of decades of failure by Democrats and Republicans to create sensible healthcare system policies for the USA. Neither ACA or the current plans made any significant improvements in this area.
  • Of interest to the readers of this blog the current USA healthcare system doesn’t deal at all well with the reality that tens of millions of USA citizens travel and live overseas. This is a complicated issue but it has been unaddressed for decades. It is pitiful that ACA didn’t address it and the current plans don’t address it. Even things that would be able to save tens billions of dollars by allowing healthcare to be preformed overseas (at much lower costs) for say Medicare are not addressed. There are complexities in how to craft policy to save tens and hundreds of billions of dollars this way. So it isn’t something you can expect to be addressed in a year or two. But they have had well over a decade since the obvious huge savings potential has been apparent and nothing. When you are going to cut health care benefits of the elderly to save money and don’t bother using wise policy to save money without reducing the care people receive you are failing as policy makers. And we are failing by continuing to elect these people that decade after decade fail to make wise policy decisions and instead force us to suffer with a poor healthcare system.
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Tiny Homes – A Great Alternative

Homes don’t have to be huge as they are now. The ever expanding USA single family home: average square footage of single-family homes in the USA: 1950 – 983; 1970 – 1,500; 1990 – 2,080; 2004 – 2,349.

Tiny houses are looking at going back even earlier than 1950, and that is a good idea. I would also like to see experiments with small houses along the lines of 1950s (or even a bit smaller). By reducing the high cost of housing we can drastically change personal finances for the non-rich in the USA (and elsewhere).

The innovative thinking by Cass Community Social Services discussed in the video in is the type of thinking we need to see more of. The Detroit non-profit is building tiny houses and making them available for rent to low income residents. The effort includes monthly personal finance and home care classes to make those tenants ready to transition to home owners (which they can do, buying the houses they start out renting).

The plan is to use the rent-to-own model. Rent is capped at 1/3 of income (and should be something around $250/month I think). The houses cost about $40,000 build and funding from the Ford Foundation has jump started this effort. The initial effort plans to build 25 tiny houses.

I think housing innovation is one of the areas with great potential to make people’s lives better by reducing the burden on people’s finances. Tiny houses are one method. Multi-generational housing communities is another. Dorm-like housing is another (I would have found this appealing after college). These apartment buildings seek to increase the social space in the building and encourage social interaction and also often have smaller units (bringing down the cost while providing benefits people desire – social options).

Related: Making the Most of 450 Square FeetAmazingly Flexible 344 Square Foot Room Can Transform Into 24 Different Rooms

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USA Expat Tax Advice and Services

Taxes for USA expats can be complex. The USA is one of less than a handful of countries that tax citizens on worldwide earnings no matter where they live.

If you are employed by a foreign company and stationed overseas for the full year (in qualifying countries) you will pay tax on your earnings where they are earned and have the first $100,800 (in 2015) of earnings excluded from USA income tax. However earning above that level will be taxed where you earn them and by the USA. Learn about the Foreign Earned Income Exclusion on the IRS web site.

The IWantOut and USExpatTaxes SubReddit are forums to search for more information and learn from others. Taxes for Expats is one service many USA expats use and have been happy with.

image of the front of the current USA dollar

Like banking, taxes (at for USA citizens) are one of the more difficult issues of an overseas (including nomadic) lifestyle.

Related: Health Insurance Considerations for Digital NomadsFinding an International Business Bank as a Digital NomadTransfer Money Between Currencies Using New Providers Not Banks And Save

USA Proposes Rule to Welcome International Entrepreneurs

The U.S. Citizenship and Immigration Services (USCIS) is proposing a new rule, which would allow certain international entrepreneurs to be considered for parole (temporary permission to be in the United States) so that they may start or scale their businesses in the United States.

Read the advance version of the notice of proposed rulemaking: International Entrepreneur Rule. To submit comments, follow the instructions in the notice.

“America’s economy has long benefitted from the contributions of immigrant entrepreneurs, from Main Street to Silicon Valley,” said Director León Rodríguez. “This proposed rule, when finalized, will help our economy grow by expanding immigration options for foreign entrepreneurs who meet certain criteria for creating jobs, attracting investment and generating revenue in the U.S.”

The proposed rule would allow the Department of Homeland Security (DHS) to use its existing discretionary statutory parole authority for entrepreneurs of startup entities whose stay in the United States would provide a significant public benefit through the substantial and demonstrated potential for rapid business growth and job creation. Under this proposed rule, DHS may parole, on a case-by-case basis, eligible entrepreneurs of startup enterprises:

  • Who have a significant ownership interest in the startup (at least 15 percent) and have an active and central role to its operations;
  • Whose startup was formed in the United States within the past three years; and
  • Whose startup has substantial and demonstrated potential for rapid business growth and job creation, as evidenced by:
    • Receiving significant investment of capital (at least $345,000) from certain qualified U.S. investors with established records of successful investments;
    • Receiving significant awards or grants (at least $100,000) from certain federal, state or local government entities; or
    • Partially satisfying one or both of the above criteria in addition to other reliable and compelling evidence of the startup entity’s substantial potential for rapid growth and job creation.

Under the proposed rule, entrepreneurs may be granted an initial stay of up to two years to oversee and grow their startup entity in the United States. A subsequent request for re-parole (for up to three additional years) would be considered only if the entrepreneur and the startup entity continue to provide a significant public benefit as evidenced by substantial increases in capital investment, revenue or job creation.

As is always the case when rich countries seek to attract entrepreneurs they are seeking those that are already fairly well off and successful. And despite the difficult hurdles for entrepreneurs and business people to get working visas to the USA there are still many seeking to do so. This would be a good step, even if it leaves many people without an opportunity.

Related: The Future is Engineering (2006)Statistics on EntrepreneurshipEconomic Strength Through Technology LeadershipStart-Up Chile – An Innovative Program for Global EntrepreneursScience and Engineering in Global EconomicsFunding Entrepreneurs in Nicaragua, Ghana, Viet Nam, Togo and TanzaniaIskandar, Malaysia: Present and Future

Vanlife in the USA

I have been reading about the possibilities of living in a van (customized to be a small RV) for several months. I am getting more interested in this idea. The cost of living in the USA is so high, especially if you want to travel – which I do.

The combination of where I want to travel (National Parks, National Forest and nature largely) and the cost effectiveness for van living works out very well. You can often park for free in US National Forest and BLM land. Also the cost of campgrounds is much less than any form of lodges, motels or hotels; so even in the instances you pay for lodging the costs are greatly reduced.

Another option for free parking are many Wal-Marts across the country actually don’t mind RVs and vans parking overnight. Many other businesses are hostile to just using their parking lot overnight when it isn’t being used. I must say this is something that greatly increases my opinion of Wal-Mart. I am not a huge fan in general but this is a very real positive action they are taking. It definitely encourages me to shop there.

Stealth parking on city streets or parking lots is another option with van living. Often cities seek to stop such living which is why the stealth part is important. Some cities and residents are more apposed to the practice than others. Obviously if there are negative externalities from you parking your van for a long time that will encourage people to seek to stop that. But if you don’t make anyone’s life worse there is much less likely to be an issue.

Even if you don’t it can make residents, police or security guards nervous (which I understand is possible in some instances) and that is something that again makes it more likely you will be bothered and maybe not allowed to park. I am still in the early phase of learning about all this but it does seem a tactic of driving to a sleeping spot at night and leaving early in the morning is a good idea. And moving around so you don’t park in the same spot (that people will notice anyway) for long periods of time.

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One of the words I learned recently is boondocking, which is free camping and at least when I have read about it means also off the grid (no electrical connections, water…) for your RV (or a van that is able to plug in to services). I knew that this was somewhat available on USA Federal Government lands (BLM and forests) but I think it is much more available than I thought (I am still learning so…).

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Peer to Peer Car Rental

Turo provides peer to peer car rental in the USA. I have rented cars through them before and have found it useful. A big part of the reason I do so is I find the big rental companies pricing so opaque. And if you want something like an SUV the pricing is often very high through car rental companies.

And it isn’t just the pricing that is opaque through the big rental companies, even the rules are crazy. Some seem to block you from renting if you are local (for example, if you didn’t fly into the city) or if you don’t have car insurance (which I don’t because I don’t own a car). It is all just a lousy customer experience to deal with them.

Toyota Rav 4, Skyline Drive, Virginia

My Toyota Rav 4 on a visit to Shenandoah National Park in Virginia.

You can also chose to rent out your car through Turo. It isn’t really ideal for doing while you travel overseas, as someone needs to deal with the car (get people the keys, check it out, clean it up…). But if you had a friend that wanted to pick up some spending money maybe you could leave it with them while you travel.

When I went on my oversea travel adventure I sold my car before I left. And actually I still would as I planned to be gone for years. But, if you were doing something like going to South East Asia for 6 months, you could possible have your car earning money while you were gone.

Eventually there might even be model where you can leave your car with a location that deals with arranging pickups etc.. I think that would be a nice addition to this business. I think it is also a pretty good business for Turo also. One big advantage is they can sell insurance at a huge markup (so make lots of money) and they also get a portion of the rental payment (I think 20% of it).

Related: Should I Sell or Keep My House When I Become a Nomad?Transfer Money Between Currencies Using New Providers Not Banks And SaveTaxis in Johor BahruMy Early Experience as a Digital Nomad: Part 2