Why Is Health Insurance so Complicated?

Why Is Health Insurance so Complicated?


Americans carry many different forms of insurance. There’s car insurance, home insurance, life
insurance, even pet insurance . . . Most of these insurance policies work well and are
fairly priced. But there is one glaring exception: health
insurance. Only health insurance becomes more complicated
and more expensive at the same time. So, the obvious question is: why? To answer this question, we have to start
at the beginning. What is insurance? It’s pretty straight-forward: You pay a
monthly fee which provides financial protection against unforeseen, sometimes catastrophic,
events. People buy homeowners insurance, for example,
to protect themselves from the financial loss incurred in the event of a fire, a flood or
theft. Because millions of people are paying into
the insurance pool, the pool has enough money to cover the unlucky person whose house does
burn down. And since insurance is meant to share risk,
it only stands to reason that higher-risk individuals have to pay more to be insured. Someone who has had two accidents is going
to pay more for car insurance than someone who has never had an accident. Why? Because their track record indicates they
are more likely to have another accident. But while insurance provides a bulwark against
unforeseen loss, it does not protect against routine expenses. Car insurance protects you in the event that
you wind up in a car wreck or your vehicle is stolen, but it doesn’t cover routine
maintenance like oil changes, replacing brake pads or tire erosion. Why? Because everyone needs routine oil changes,
new brake pads, and new tires. So, there is no risk to protect against. Health insurance in America works very differently. Many of us have health insurance plans that
aren’t insurance at all. They’re really pre-paid health care plans. They cover routine check-ups, less serious
illnesses, and recurring expenses like prescription medications in addition to protecting you
from a health disaster. All of this has made healthcare much more
expensive and complex than any other form of insurance. That is true whether you get your insurance
through your employer, through the government, or if you pay for your own plan. The Affordable Care Act, known as Obamacare,
was passed on the promise that it would fix these issues and bring down healthcare costs. But it has actually made the problem much
worse. First, it limited the variety of health insurance
plans private companies could offer. It did this by mandating that every plan had
to cover the same set of ten health benefits, including preventive care, maternity care,
mental health care, and contraception. Second, Obamacare prevented insurers from
charging premiums based on the risk they were assuming. A person with a much higher risk of getting
sick couldn’t be charged more than a person with a much lower chance. These two aspects of Obamacare – requiring
all policies to have certain coverages and not allowing insurance companies to charge
more for riskier clients – caused the price of insurance to rise dramatically. In Arizona, for example, the price more than
doubled between 2016 and 2017 alone. So, how do we undo this mess? By making health insurance more like, well,
insurance. First, stop making people buy plans that include
things they won’t use and don’t want. Second, allow health insurers to offer more
options at different prices. Do these two things and you’d make health
insurance a lot more affordable for a lot more people. And what about people with pre-existing conditions
for whom every insurance plan is just too expensive? We do what any compassionate society does:
we make sure they get the medical care they need. But we don’t need to upset the whole concept
of insurance and make healthcare more expensive for everyone else to do it. Most Americans want to do the responsible
thing and insure themselves against catastrophic health care emergencies. But with health insurance costs rising every
year, being responsible is becoming more difficult. I’m Lanhee Chen, research fellow at the
Hoover Institution, for Prager University.

100 Comments on "Why Is Health Insurance so Complicated?"


  1. you really can't compare risks in healthcare to risks in car insurance, car insurance risk is by behavior health can be by behavior but most often is not.
    preventative care and checkups save on healthcare costs so forcing that into every insurance plan is positive overal.
    obamacare did lower insurance costs and increased the number of insured people, the individual mandate forced healthy people to get insurance so individuals had to pay less.

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  2. Routine checkups, illness, medication, and health disaster? These are all things that should be covered. I’m a conservative but I’m not for getting rid of this law

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  3. I have worked in health insurance and can tell you everything you need to know.

    There is health and there is insurance.

    Health is health and insurance is not Health.

    Both are expensive and complicated

    If the government does the financing of health. ALL THE MONEY GOES TO HEALTH

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  4. How about stop spending the 700 billion dollars the us is spending on the military budget and instead use it for the health care budget?

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  5. That smart asian guy in perfect health likes to keep it good as he watches his fellow american fatties living by fat jokes. Just die early with a slow death, it's America, it's what you do to live. The meaning of life is forever answered. Don't make it slower, you do the fries, you so-die by it. Seems insurance to me!

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  6. Health insurance is so complicated because it is a scam, like all other scams. Make it easier to understand and the price will fall. It is scam involving healthcare providers and insurance companies working together, it is a gift that keeps on giving, and if something goes wrong, hell the doctor was only "practicing". Unlike other forms of insurance, there's no such thing as a settlement, and the scam of bilking policyholders by extending the amount of followup and testing that only ends when the patient dies

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  7. while this video did make things more clear, you didn't actually give a solution. The solution is to stop calling what we have insurance, and embrace the term "health care". We can purchase health care plans that provide the benefits and overages we need. and for those with pre-existing conditions, they can apply to a health care plan that has a reduced cost and provides the services they need.

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  8. When i look at South Africa's medical aid, we have a list of 45 PMB's (prescribed minimum benefits. A list of 45 chronic illnesses which every medical aid plan HAS to cover for. With the exception of a standard hospital plan. Which just covers your stay in hospital and whatever procedures they do in an emergency). Most health insurance companies here have about 5 plan options. Some even more. Others allow you to customize what you want cover for.

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  9. Insurance is a scam, none of them work well, they all tell you that you will be covered, but they have pages and pages of things they don't cover, I wish I had a company that by law everyone had to use and I could write my own rules, it's total crap

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  10. This video is pernicious, health is a right, not a business, if there is a thing that europeans are shocked about is that in the US public healthcare doesn't exist and the lives of the people become a product that has to obey the rules of the free market, and this is fault of the right and its liberist obsession. Healthcare doesn't even cost half here of what ot costs in the US, and yes, I AM taking into account the taxes we pay for it.

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  11. Dont support Dennis Prager. He is a jerk. He believes his idealology is to be practiced by free-thinkers. Divides our country. Always talks about THE LEFT. FU!

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  12. 2:48 – But that's only bad news for health insurerers who don't want to do accident forgiveness.

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  13. Is he serious? Insurance companies will do and say anything to try to get out of paying. Some things they refuse to cover under your policy because they deemed the disaster an ‘act of God’. How ridiculous is that? Insurance companies are just greedy, period. Not to mention the executives pay themselves a salary of a few million. Then, they also get bonuses on top of that. And you KNOW they all have the best health care around. What makes you think that they give a crap about the average American?

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  14. Sorry PragerU, I believe that you left out the factor of drug companies charging extremely high prices, and fixing prices through stock market gains. You also left out the golden rule, All Insurance companies are in it to gain money, not loose money. Nice try Asian guy.

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  15. Don't you conflict yourself when you say that we "make sure they get the healthcare they need" right after you say that we should let companies charge more based on the amount of care expected? How to you make sure the get the care without forcing the insurance companies to keep their prices low and not let them deny people with pre-existing conditions? Genuinely asking by the way, not trying to argue.

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  16. I agree, although we cannot expect people to be able to pay health insurance, even if a big variety of insurance plants and associated prices already exists. Life is simply too unpredictable, and so to better oneself, one first needs to have their basic insurances ASSURED in order to get the financial capacity to sustain a good coverage by their subsequent health insurance plan.

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  17. "Don't make people pay for insurance they don't want" = Women have to pay more for insurance than men. I'm not arguing, I'm just pointing this out.

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  18. Wow… So PragerU wants to charge more to the elders of our country for their service in the workforce and military? How about we just make it Universal Healthcare? That makes it easier for everyone to access!

    We definitely don't need other insurance like auto/home, especially when we're talking about people's lives.

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  19. These videos are great. I'm 14 and dumb, so when I hear Ben Shapiro use his large vocabulary, I get confused. With these videos, and can learn so much and become less dumb with each video. Now, anytime I hear my fellow 8th graders say Bernie Sanders is great for no frickin' reason, I can stand up to them.

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  20. This is a political ad. Visit my page and I'll educate you on how your plans work. I actually do this as my job not a political organization

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  21. Auto insurance industry is a fraud…. no fault of mine….. private health insurance is geared towards huge profits – in canada these profits dont exist therefore costs are more managable…. get it?

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  22. @ 3:43…."We make sure they get the medical care they need." Someone explain exactly HOW. I never hear anyone explain that one on the right side.

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  23. The reason it's different is people WILL get sick. I may go my whole life and never have a car accident.

    The premise on this suggests disabled high risk people should be denied care due to low income.

    That's the most unchristian thing I've seen. How can the owners of this channel have the haul to proclaim they're actually a Christian?! This sure isn't what Jesus taught.

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  24. I work in the insurance industry and this guy is spot on. We don't call it a house or a car. We call it a risk. In health insurance you are the risk. Believe me, you don't want to be the risk. It's a great concept for mitigating property damage. But it's a disgusting idea that your health is looked at the same way that we look at your property.

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  25. I agree with almost all you've said. But I'm a Type I diabetic that is in better health than 99% of people my age and I have struggled getting insurance. I do Crossfit, have never smoked, don't drink, and have perfect health otherwise. But unless forced, insurance companies wouldn't touch me with a 10 foot pole. And my prescriptions (without good insurance) would break me.

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  26. I got one thing that really makes me paranoid with my company. I picked up health insurance and dental 2 months ago and my company sold out to another. Do my payments on my health insurance continue over onto the new company or did I lose that three months worth of payments. Question is do I got to start over. I know everybody's getting reviews but no raises because of the new company transfer. Even if you signed a contract when you are hired on.

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  27. Why would he just casually gloss over pre-existing conditions when that is the most essential question? What do we do for those with pre-existing conditions?

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  28. build more clinics, don't make healthcare insurance mandatory, open your healthcare clinic services across state lines. This will create competition, offer the best quality of service and bring all costs down all because of one thing, because businesses depend on their customers.

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  29. Unforuntatly the proposed alternative is oversimplified, treating healthcare like car insurance won't work either.

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  30. I don't believe the government should control the market, but dear God, do they need to fix healthcare prices

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  31. the less government is involved the better…i work in public housing at a state level and you would not believe the waste and nonsense that goes on..can only imagine federal..

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  32. Insurance, whether it be healthcare, life or automobile is only supposed to be for catastrophic losses, the things which cannot be predicted. Healthcare should not cover preventative care because it’s your job to take care of you. It’s your job to keep yourself healthy. You know you should see a doctor once a year at least. If insurance didn’t cover preventative care, those checkups, then doctors wouldn’t charge so much for them because they couldn’t charge so much for them. Because they know the average citizen cannot afford it. But they can ask as much as they want from insurance companies. And it’s wrong to make everyone pay for the same things. Why should a single man with no prospects pay for contraception or maternity care?

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  33. Some of my coworkers got rid of they're medical insurance through our employer and instead the close to $400 a month they were charged goes to savings in case of emergencies premiums are high and many times our insurance doesn't cover specific things when we visit the doctor I mean in all seriousness its not like everyday life is like that movie final destination where freak accidents happen consistently I think its only good if you have a family member with a serious illness or a terminal illness at the end of the day medical costs are through the roof in this country,

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  34. Thank god someone gets it. How could any rational person think that by Obamacare requiring insurance companies to cover MORE benefits that it would make insurance cost less?? And the preexisting conditions? Many, many, many people have those, but the ones who are not insurable are a tiny, tiny percent. It's pure baloney to scrap the whole system because of that.

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  35. Health care in America is a multi-faceted problem, and it seems like every organization only addresses a single side of the issue.

    Health insurance should be a la carte, and purchasable across state lines. I should be able to go to a health insurance company's website and pick the things I want to cover, and what I'm willing to pay out of pocket.

    We should teach our children the importance of multiple types of savings. Not just "saving for that car I want" but "investing in my retirement with an IRA or 401k," and "opening an HSA to cover unexpected health care costs."

    We should encourage the construction and staffing of more hospitals and clinics across the country. More hospitals, more medical schools, more nurse certification programs. ACA increased the demand for care without increasing the supply, and that was part of the increased cost.

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  36. What I like about conservative PSAs is that they always provide potential solutions. Liberals PSAs just tell us all the reasons life sucks, why it’ll only get worse, and there’s nothing you can do. Unlike those videos Prager U gives me hope.

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  37. About 62% of all US bankruptcies were related to medical expenses in 2007, and 78% of these bankruptcies were filed by people who already had medical insurance. Lets say you get a cheaper plan to save money but then have a condition not covered in your cheaper plan. Now what? That is one huge difference when comparing to the other insurances. Medicine is far more complex then making a home insurance claim.
    Source: David U. Himmelstein, MD, Deborah Thorne, PhD, Elizabeth Warren, JD, and Steffie Woolhandler, MD, MPH, "Medical Bankruptcy in the United States, 2007: Results of a National Study," American Journal of Medicine, Aug. 2009

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  38. 9/15/18……Healthcare/health insurance is complicated & expensive b/c the GOVT gets involved & SCREWS IT UP!
    ENOUGH SAID!

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  39. What is the plan to ensure the people with pre-existing conditions receive adequate care? The democrats implemented the republican plan invented by the heritage foundation more or less.

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  40. I love this channel, and I agree with him, but at 3:34 he kind of just glossed over the topic of preexisting conditions lol.

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  41. What this video fails to mention is the fact that insurers can't compete across state lines which creates mini-monopolies in their geographical jurisdictions. Further driving up costs.

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  42. that's the issue with the private that everyone is trying fix on all sides, pre-existing conditions. That is the root of the entire argument, and i wish you would of ellaborated on that.

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  43. What is Health Insurance

    Generally in the United States a for profit Business which profits off the suffering and unforseen events in order to extort them into giving the Company movie (because if they don't you will fit the entirely overpriced Medical bill yourself).

    A Person who had a much higher risk of getting sick could not be charged more then someone who does not

    You are also forgetting this same aspect plays into the discrimination of People with preexisting conditions which was common before Obamacare (i am for Universal Healthcare not Obamacare).

    Stop making People buy plans they don't use or don't want

    Universal Healthcare would be covered by the taxes so this would not be a concern in that same degree (but then you would whine your taxes are going to someone else's Healthcare as well).

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  44. The United States is a complicated nation. Certain rights are preserved for the union. The rest are delegated to the states that make up that union.

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  45. Less paperwork, less price gouging and more humanity. EVERYONE SHOULD PAY THE SAME PRICE PER PROCEDURE/PRODUCT/SERVICE. Health insurance could be balanced with a transparently monetized pricing system. If any doctors feel they can charge more for better service, make a specific line item and point it out so ALL PEOPLE can see they are making savvy life choices! The prices are stupidly high across the board due to ruling class corporate crime syndicates who paid generations of puppets and created a bureaucracy of statist traitors. Rockefellers set up this dubious health and drug system here in America.

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  46. Has anybody been to Sweden, Norway, Denmark or Finland? Here we have Free health care, and we get this by paying tax. The first big difference from the U.S is that ALL swedish, norwegian, finish and danish citizens are included in the health care system. It does´t matter how much tax you pay. The other big difference is that the health system is non-profitable. All money goes to doctors, hospitals and so on. The system is not perfect due to "governmental slacking" and some times big money goes to waist by bad management. But….I can say that the vast majority of people who live here would´t trade the free health care (and free school, university, kindergarten and so on..) for "free chooice" by paying everything by themselfe in return for a little lower taxes. To pay quite a lot in tax (we are not communists i promise) to get all these benefits is a far better system then leave everybody to their own devices. Not caring for the weakest in the society will cost so much more in he end when the gap between rich and poor gets to bigger and bigger. Make America grate again by doing the right thing for everybody, not only the wealthy.

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  47. Garbage video dude my health insurance went up every year like crazy long before Obama care came to market thanks to Obama care my cost have come down idiot

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  48. Wasn’t the question “why is it so complicated” not “why is it so expensive?” It’s complicated because there are companies that refer to their service as “third party administrators” and “benefit managers” who have no business being in business and get paid to provide no service whatsoever that inflate costs. I’m willing to pay more if it means more people get the care they need, but this video is misleading by putting the blame entirely on the ACA. It’s the industry’s managerial structures that’s to blame (in my opinion).

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  49. You should make a video that explains how Americans got duped into tying their health insurance into their jobs.

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  50. Hello Mister Lanhee Chen,

    I agree with most of your aspects but I have to say that prevention is not a useless benefits of health insurance. This can save a lot of money than doing any prevention. I also think that the price of health care is the problem. I think the problem is the price that hospitals and doctors charge. If medical treatment would be cheaper, medical care would be less expensive. Today health insurance is a business. Some companies forgot that health insurance was initially made to support people that cant pay medical bills. Another thing i want to say is that you didn't give give a clear answer to people with pre-existing conditions. I hope that the goverment of the U.S will find a better solution soon.
    Greetings from Germany. 🙌🤨🇩🇪🇺🇲

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  51. The affordable Care act made the healthcare system pretty similar to Singapore's healthcare system (you know, the best healthcare system in the world,) in structure. Just nationalize the system and let insurers work anywhere in the whole country and remove PBMs, and the system will be much better.

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  52. US Healthcare is in a way idiotic. Good Healthcare for all should be high on the list of the government's top priority for the list. Therefore a government collected but not government run levy to fund essential healthcare services like all that goes into running ambulances and hospitals. Doctors, Nurses, and Ambulance staff should be paid a living wage. Also the US needs to strip away bureaucracy from saving people's lives and do all they can to stop it seeping back in.

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  53. Just a question here. Why is healthcare a "for profit" industry? Don't get me wrong I am not against capitalism, as long as it is reasonable. But what I see is large investment firms buying up hospitals, and creating a conglomerate simply to increase profit for their investors. And remember, there is a difference between healthcare and health insurance. Before the ACA, people with no insurance could go to a emergency room and get health care. True, the taxpayer ended up paying for it. But under the ACA, people who couldn't afford the insurance premium were given vouchers to pay. The taxpayer supplied the vouchers. The ACA simply provided a way for the taxpayer money to go to the insurance companies.

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  54. Perhaps you should address why insurance is needed in the first place. How did medical care go to such high cost? Why can't hew-mons pay for whatever they need out of pocket?
    The free market would've kept prices low and insurance but government created the "need" fot insurance in the first place.

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  55. Health insurance, when Obamacare was supposed to only make insurance companies provide coverage for pre-existing conditions turned into this kind of situation and Trump has not been successful at repealing this mess and replacing it with simpler health insurance policy something that is simple such as health insurance companies cover for pre-existing conditions and can operate around state borders. Everything else is unnecessary. It gets to the point where none of those secretaries who work there know the prices, it is all hidden in that secret spreadsheet.

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  56. If you force someone to buy a product, but don't force the product to work, you'll end up with an expensive product with little benefit, every time.

    I have a product called "wishing you happy day." Now imagine you're forced to pay for it.

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  57. I'm not american, but I find this idea to be bad. Having this mandatory taxes is just makes you poor.

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  58. Lanhee Chen, you did not answer the issue or pre-existing conditions and not all pre-existing conditions are preventable. If someone has Crohn’s disease that is probably a genetic disorder and not preventable. If the patient requires the use of a biologic such as Remicade he needs insurance to cover the expensive medication. The price of Remicade is fixed by the pharmaceutical company and there is no competitive pricing among providers. If his medical insurance denies him coverage for having a pre-existing condition then he faces bankruptcy for the high cost of Remicade and without treatment he will die a slow painful death or perhaps will lose most of his bowels to surgery which will also bankrupt him. Lanhee Chen, medical insurance coverage is not like other insurance coverage. If a Crohn’s patient cannot get his medication from competitive pricing he has no choice but to face bankruptcy and eventual loss of his colon or even slow death. Our current system of for profit insurance companies can only provide for the healthy and not for the chronically ill. Without a publicly funded Medicare type of provider the private for profit insurance companies will not assume the cost. Lanhee Chen your solution does not work for unpreventable pre-existing conditions.

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  59. There should be a subject in school called life skills which teaches about insurances, finances, taxes and life saving skills. For someone coming out of college and bieng bombarded with these "adulting" issues, it's easy to get disoriented. Parents should also contribute.

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  60. Good vid, but you glossed over that part at the very end about "doing the compassionate thing" for people with preexisting conditions without them having health insurance. How exactly? The money has to come from somewhere.

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  61. Prageru is a HUGE threat to establishment media and the left wing. Makes sense why they censor them.

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  62. Has anyone considered the fact that people are paying into pools, sometimes for years, then dropped/cancelled at a moments notice without anything to show for it? Insurance is structured like a gamble when it should be more like an investment over the long term. In the current structure its understandable why younger healthy people choose to forgo coverage. Theres no long term incentive for them.

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  63. My dog has better health insurance than me! I don't even have any right now. Also the ending where he said "being responsibility…"
    Oh sure because we can avoid some drunk hitting us in his car, causing us to spending thousands. Lol it's not that easy

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  64. Notice how he just breezed through the catastrophic care by just saying that if you get into this situation where you will need it that we will just assume the insurance company will cover it. That's fine with me if that's the case but it is not. Notice how he made light of regular expenses or maintenance as if they will always be affordable. notice how they never mentioned that insurance companies still control premium charges. They do not mention that the healthy will just not get insurance if given the choice which is dangerous for all those get insurance as eventually cost will be shifted to them. They also never mention how profit making can really conflict with making people healthier. C'mon this is another right wing propaganda.

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  65. 3:43 you cant just breeze over that like you did. I mean, thats kindof a big deal.
    Im with you on the rest though.

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  66. Is there any books about health insurance?
    A book that the orator of this video would approve of, something that is a bit more detailed?

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