Now, $10k is kind of a scary number for something like that, but I felt comfortable with it given that we'd never have to write a $10k check. At the very worst we'd rack up a $10k debt to a hospital or something, which (given the current state of healthcare) we could reasonably expect to pay off over like 15 - 20years. It seemed reasonable to me, for what we needed.

The HSA is helpful because it's effectively another IRA you can use for pretty much any medical expense. So for normal health care, we ended up paying about 40% of the "list" costs for things, and pre-tax.

Doing this requires that you be a little aggressive about getting good deals on care, though. My daughter broke her arm about three months in to this, so we took her to a minor emergency clinic. I told them what was up and they "coded" the visit at a much lower rate than it would have been. The next day, we actually called around to find out what people were going to charge us for a real cast to replace the splint the clinic put on. It worked out to be about $600 total, including the minor emergency clinic visit.

So in summary: get coverage for catastrophic health events with a "cheap" plan, abuse the negotiated rates that plan gets you, get an HSA, and be an intelligent consumer of health care. Oh, and minor emergency clinics are your friend.

$1,500/mo is a typical quote for "normal"-deductable health insurance. If you're a young family, that's not what you want; you want high-deductable health insurance, which has a low monthly payment but effectively means you're paying for all your doctors visits and medications out of pocket.

The real goal of insurance is to keep you from going bankrupt over appendectomies and broken bones. You can afford to pay your pediatrician yourself.

If you have a qualifying high-deductable plan, you can also create an HSA account and fund it to pay for routine health expenses; those costs are then tax-advantaged.

I agree with the other posters that recommend brokers. Especially for a family, you can wind up in a rats nest of preexisting coverage denials if anyone has ever been to the hospital before. I got the sense that insurers simply don't like covering women who might have children. Brokers will not resolve this problem for you, but they'll make most of the paperwork go away.

Couple more thoughts.

First, there may be an engineering union style group you can join to get health insurance from. Jeremy, one of my NYC partners, had a group like this he got coverage through. So look around for things like that.

Second, beware of temporary/month-to-month insurance, which reputable insurers offer very cheaply. It doesn't take a lot of thought to see why this is a bad deal: they're under no obligation to pick you up once the term ends. If you get sick April 29th and your plan runs out April 30th, you're completely fucked.

Matasano got group coverage (through United, and I'm not a fan) a couple years ago. It made hiring much easier; health insurance was often the first question candidates asked, before base comp. Be aware that group coverage isn't a magic bullet either. What it does is make preexisting condition issues go away. But it isn't cheaper than what you can get on your own.

This is probably because of an adverse selection problem: childbirth is usually planned (unlike serious illness). This means families planning to give birth are more likely to purchase insurance.

Is it possible to avoid the adverse selection problem by purchasing health insurance which does not pay for childbirth or childbirth related health problems?

If you KNOW you don't need maternity coverage that saves you a lot of money, but don't have any "accidents" as childbirth will cost you many thousands, up to hundreds of thousands if there are complications.

Personally, I'd prefer an independent broker than someone who worked for a big firm like State Farm or the like.

As an additional note, you don't pay anything extra for using a broker; the carrier pays them additional money directly. All the carriers will have similar override agreements with a broker, so you don't have to worry about the broker being shady. They only get paid for as long as you have the policy, so it is in their interest to match you with a policy that you will actually keep.

If you're concerned about costs, ask about an HSA. Make sure you understand what an HSA actually is before you decide to go with one, though.

[Edit: I forgot to mention that I'm in the the brokerage portion of the health insurance industry; before I worked here though I used a broker and he saved me about 500 bucks a year.]

Take this knowledge with a grain of salt, given the systems, but one way you could control costs is by looking into a Healthcare Spending Account (HSA) - I believe the US equivalent would be a Health Reimbursement Account (HRA).

This allows you to set a max contribution limit, but it automatically caps your claims to the money in the account. If you paired that with high deductible catastrophic insurance, you may come out ahead. Wiki has a good set of info: http://en.wikipedia.org/wiki/Health_Reimbursement_Arrangemen...

Other than that, I think you are SOL in terms of paying the big bucks. Health Coverage is one area where the US is simply lacking in my opinion, compared to the rest of the world.

Good luck to you. You should definitely contact a local broker or two and have them walk you through the different options. There is a lot of stuff out there that is simply too crazy to understand and is best handled by a pro.

They have plans as low as $90/quarter that have a $5k deductible. Not good if you come down with frequent colds, coughs, flu, etc. It is good if you're in a car accident and fracture your leg in 2-3 places. Or slip on ice and hit your head, etc.

ACM: http://www.acm.org/membership/insurance

IEEE: http://www.ieee.org/web/membership/financial-advantage/insur...

He advised us to take our (start up wages) and buy catastrophic disaster insurance. Or relax, because our car insurance also covers medical bills, so if we're in a car accident (most likely scenario) we're covered.

[He then also told us (off the clock, and again this was 2004) that if we voted for John Kerry, the health care reform would put our company out of business. ]

But yes, in the past 5 years they could've gone away.

That's not a dig at you. You might be right that there's economic rationale for you to carry coverage; the risk is remote and the cost is high. That's a problem the system needs to fix.

It's actually pretty simple to get right. Everyone must be in and everyone must pay proportional to their earnings. The key is not to have minimum contributions because that's what kills you while you earn next to nothing.

And wanting to ensure everyone receives the medical care they need regardless of income is a matter of social justice.

But why should we confuse insurance with solidarity? We can use taxes/hand-outs to level people's income somewhat, and leave insurance to the market. Most sectors of insurance seem to work quite fine that way.

I wouldn't be opposed to a parallel system for people who opted out of or augmented the Govt services, that could be assessed like regular insurance, but the important thing is to have the universal basic care.

The point you make is technically true, but seems a bit bizarre.

It's like saying "if we had an financial instrument that paid for people's airline tickets, we wouldn't want to allow people to choose to join or not join - if we did that, we'd just have all the people who like to travel a lot join, and it would cost a lot! So what we really need to do is force EVERYONE to contribute, so that there are a lot of people who get no benefits who can subsidize those people who draw a lot of benefits".

Yes, you're right - unless we do that, people who draw a lot of benefits will have to pay for a lot of benefits.

...but it seems a bit morally autistic to me.

Of course, health is something that people have some amount of control over, but exactly how much is obviously a big open question. Unsurprisingly, people who are on the "winning" side of the lottery (be it health, talent, or success in things like sports and business) tend to under-estimate how much luck has to do with it, over-estimate their own contribution, and thus also over-estimate how much someone else's actions have to do with their "loss" in that lottery.

Injury only or highest-possible deductible health insurance is also a good option if you're generally healthy.

No they don't. Hospitals mark up for people paying cash. This is because they know most of the people paying cash won't pay at all. The markup for people paying cash is about 3 times that what they bill the insurance company.

If you are paying cash they will always lower their bills big time to accomodate you.

This can happen but it's arbitrary. I needed to be hospitalized without insurance and the hospital wouldn't budge on the bill. Likewise I had a roommate who had a $40,000 concussion once and the hospital wouldn't negotiate that bill, either.

This is one of the more startup-friendly features of living in MA as opposed to the Valley.

Obviously personal income tax isn't the only one in town, but it's not significantly worse in MA than elsewhere.

Source: http://www.taxadmin.org/fta/rate/ind_inc.html

I'm only half joking after reading the other comments here. The US. system is seriously broken.

https://www.tonikhealth.com/

It all depends on your health, too. If you have sleep apnea and want to get it treated, that's hundreds of thousands of dollars if you don't have insurance. Probably better to get a full time job for a few years until your apnea is treated. If you have hypothyroidism, you can take remarkably inexpensive prescription drugs and get an annual checkup for cash cheaper than you can get insurance to cover the thing.

My working hypothesis is that high-deductible catastrophic insurance is the best solution for broke, comparatively healthy adults. In this model, you're using health insurance as insurance qua insurance, to make sure you don't go bankrupt if a medical emergency costing more than $10,000 happens to you. (This of course requires you to be able to raise $10,000 if something DOES happen to you.) This does nothing for drugs or routine care, and needless to say there is no dental plan. I pay $40 a month for this. I don't get anything out of my $40 a month, but on the same token, insurance qua insurance is something you pay for but you hope you never have to use. An HSA is not a bad feature if you're going with this model.

Depending upon state law, you can leave out things like maternity coverage, or get further discounts if you're in good health. A good female friend of mine doesn't have maternity coverage but she is very aggressive about birth control and has no qualms about abortion, though, so I would carefully consider whether this also applies to you or your spouse. I would also hasten to add that if there's a possibility of having more children, the expense of health insurance is not your biggest problem here.

In fact, I don't know how well this model works if you have kids. Or how founding a startup works if you have kids, for that matter.

I plan on getting a high-deductible/HSA plan. If the deductible is $X I will put $X into an HSA. Thus any care I might need over the next year will "feel" free. If I'm lucky and my current health trend continues I will not need to take any money out of the HSA. And it will simply be a tax benefit. In future years I'd replenish the HSA up to or over the deductible level of whatever my present plan is.

I would look at the high-deductible/HSA options. Assuming you have the cash around to buy the policy and stock the HSA with cash you'll not have to worry about health bills until next year. Psychologically, this could be comforting. Whether it makes sense probably depends on how much you and your family actually use insurance. And the specific costs of the plans available to you.

After all, yes, health insurance IS expensive, but you can find the cheaper options. But well, the same way you can think about your rent, groceries, etc. You have to have them, and you have to pay for that.

During hiring we mentioned that we would cover up to X amount of personal health insurance. Since our hire had a family though we are now looking at getting a group plan even though the company only has 3 people, the man reason was getting family plans is much harder to get cheap personal plans while the group plans have better benefits for families.

http://www.aarongreenspan.com/essays/index.html?id=11

I used this a few years ago while working for a startup and I got a full plan (comparable to the average full-time job's plan) for half price (at that time, around $250 a month).

Worth a look. They are always expanding and trying to provide more and more benefits for the W2-challenged.

...but that won't cut it if/when I get to the point of needing to hire other people.