Here in the US I pay $700 a month for health insurance for my family, with my employer contributing another $1,200. I have a $3,000 deductible, so the first $3,000 of expenses every year are not covered. Above that I pay 20% of costs.

I also pay 1.45% of all income for Medicare, which I will not be eligible for until I'm 65, a few decades away. My employer pays an additional 1.45% on my behalf and I pay an additional 0.9% surcharge on all household income over $250k.

I'd love to start my own company but health insurance costs are a big impediment. I have young kids, I can't leave my family underinsured. We're healthy now thankfully, but what if one of us gets cancer or is in a car accident and we're hit with $500k+ bills (or worse - if we can't get the right treatment)? I don't know how other people do it.

In other words: The direct cost of the insulin for the average German is not $55, but $0 - since it is covered by the mandatory health insurance.

That said, don't worry that you do not get enough back from your health insurance. This will come soon enough when you get older ;-)

Are people not understanding how drug prices work?

Intellectual property law is a way for government to grant exclusivity to one firm. This whole "you can get it for x in Canada and y in Germany" is a silly conversation. It's not like it costs 1000x to manufacturer the drug here vs there. The R&D and marketing costs are amortized over the period of exclusivity. Saying "you can just go to Canada to get it" just means "im going to circumvent intellectual property law." It's kind of like, but not quite, piracy. You're choosing where and when which laws apply to you. It also kicks the can down to the rest of the people buying the drug, because we know the pharma actuaries arent going to price their drug at a loss. And then on top of that, like you say, these prices people pay AFTER insurance arent what the cost of the drug is to the population, its an already subsidized price.

Germans and Canadians are getting the drug cheaper not only because they have different laws, but because the R&D recovery isnt evenly split between country, they take their money where they can get it.

Insulin SHOULD be generic by now (the patent on long-acting synthetic insulin expired in 2014), but the companies continually improve it and always sell the latest variant. And of course Doctors are going to prescribe what works best.

Unfortunately, numbers don’t back Big Pharma’s talking points.

1. A lot of drug patents are bought by hedge funds that just raise prices to reap profits and never invest in R&D

https://www.nytimes.com/2015/09/21/business/a-huge-overnight...

2. Drug companies spend more on marketing than R&D:

https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...

3. Because of lobbyist, Medicare can’t negotiate drug prices - unlike the VA in the US and every other country.

https://www.forbes.com/sites/johnwasik/2018/08/10/why-medica...

> but because the R&D recovery isnt evenly split between country,

This point, which always comes up in these threads, has already been debunked both in those other threads, but it was even debunked here before you made this comment.

You're saying drug companies make an equal amount of extra money, after manufacturing costs, in every country?

You do not have co-pay in Germany? Here in France we have to pay 1€ per doctor visit and 0.50€ per drug (up to 20€ per year IIRC). I find this outrageous /s

500 Euro per month? What is the name of your insurance provider?

I have never heard of such outrageously priced healthcare plans (private providers excluded, of course).

In Germany, and this might apply to other states of the EU too, you'll pay a fixed percentage of your loan for healthcare services. For Germany it's around 14-15% of your monthly income before taxes. So, if you earn well, you'll also have to pay a bigger sum for healthcare services.

Health insurance is capped in Germany. We have the very German word "Beitragsbemessungsgrenze" for that.

Basically, the insurance cost is a percentage of income (14.6%) up to 4,537.50 €/month (gross income). If you earn more, your absolute health insurance costs will stay the same at 662.48€.

Keep in mind that in Germany, half of your health insurance is covered by your employer (by law).

Edit: The above is for the "public" insurance system, as noted in the comments. If you are above the Beitragsbemessungsgrenze, you can opt for private insurance which will very likely be significantly cheaper while you are young. But it carries the risk of steep price hikes which you might not be able to handle later in life (think retirement). And the path back into the public system is not straight forward and might include having to file for personal bankruptcy or similar drastic measures.

If one was naïve enough to choose private insurance (because they earned more than the threshold where it's possible to insure yourself at a private provider), it can get up to 1000€/mo pretty quick. Not in your twenties but beware the forties.

When less than 45 years old and married with a spouse covered by public insurance, it may be worth taking a year off work (e.g. a sabbatical; must earn less than EUR435/month) to undo that damage.

(Details:

You can go back once you're covered by public insurance for 12 months, no matter through which status, so family insurance helps get these months. For family insurance your income needs to be below EU435/month + some exceptions.

The outcome changes a bit when you're older than 45 because you need ~20 years (in raw terms: more than 90% of the second half of your working life) in total in the public insurance scheme to be able to apply for the "public health insurance for pensioners" system when you retire. That complicates matters.

Even more details for people not used to the German health insurance system:

By default people are in the public health insurance system. Exceptions are self-employed folks, public officials and people with income beyond the cap mentioned upthread: they can choose whether to use the public system or some private health insurance.

The reason why you can't just move from private insurance to public insurance is that otherwise the private insurers would try to get ahold of all the healthy youngsters and their (usually significant) money while offloading them to the public system as soon as they start to cost more than they bring. That would break the economics of the public insurance system.)

Thanks, wasn't sure about that anymore. Only see how much is left from my Brutto and always cry a little bit... ;-)

> For Germany it's around 14-15%

Are you sure you don't mean total social security (of which health care is a subset) with that number.

Because that's how it is here in Austria. The deduction for social security is significant, but health care is only a small fraction of it.

Edit: I checked and I stand corrected, thanks to the replies clearing this up.

No, the 15% is just Krankenversicherung (health insurance). There's also Pflegeversicherung (nursing care insurance), Arbeitslosenversicherung (unemployment insurance) and Rentenversicherung (national pension fund).

When I take an average salary (3000 euro monthly gross salary) and put it into a tax calculator, the net salary comes back as about 1950 euro, so the different between gross and net salaries is about 35% in that tax bracket.

It's 14-15%, but half of that is covered by the employer (outside your gross pay).

So if you earn EUR 1000 (just to have a nice round number), it's EUR 150 for health insurance, of which EUR 75 come from your gross pay, and another EUR 75 are itemized as coming from the employer.

That makes the 14-15% look scarier than they are (for the employee).

If you earn more than 50k Euro per year you can opt in for private health insurance instead. This greatly reduces the cost of insurance if you have big income. You can get good private insurance for 250-400Euro/month depending on your age.

... which will balloon to 600, 800 Euro/month, as you get older. And if don't maintain the same level of income as you retire, you might have another thing coming - the public insurance will not welcome you back.

And once you get older, your private insurance premiums rise, which you may not be able to afford. Public insurers won't let you back in.

> Public insurers won't let you back in.

I find this perfectly valid and think we should get rid of private health insurance at all. It's undermining our system, pretty much like pension for state workers and alike. We really need to unify this system, imho.

I'd say your grasp of how taxes work is not great if you think you paid 500EUR for your use of healthcare that month.

The parent comment said:

> I paid 500€ per month for healthcare

You misquoted that as:

> 500EUR for your use of healthcare that month

(Emphasis mine.) Their original statement was correct (assuming that is what they paid!) and didn't sound like a complaint to me, just a factual correction.

Technically correct, the best kind of correct :-)

It’s not tax, we pay to a “Krankenkasse” (roughly a not-for-Profit health insurer), so we see exactly what it costs.

The premium is based on your monthly salary.

So, you pay for others when you are young and healthy and reap the benefits when you are plder and more prone to illnesses.

Yes. That's the "social" in "social market economy".

By the same logic the zakat in Saudi Arabia is not a tax because it theoretically goes to a non-state entity.

If you’re not free not to pay it it’s a tax. It may be a well designed, special purpose tax that stops people doing stupid things but it’s still a tax.

There is an important legal distinction between tax and insurance (in Germany).

If you pay taxes, the state may do whatever it suits with the money. If they decide once day to no longer maintain the public infrastructure using your taxes but instead increase politicians salaries they are free to do this.

If you pay an insurance, on the other hand, you have a legally enforceable right to receive the insurance benefits if you meet the pre-defined criteria for an insurance case.

That one payment is legally a tax and another is not has no bearing on whether it is economically a tax, any more than the culinary distinction between fruits and vegetables bears on the botanical one. Botanically a tomatoe is a fruit. In the kitchen it’s a vegetable.

Not sure I can follow you here. What’s your definition of a tax?

I would define it as an involuntary payment, mandated by government.

In German law the insurance contribution may not be a tax because payment of it entitles you to certain services. That doesn’t stop it being an involuntary payment, mandated by the government, a tax by common definition.

That doesn’t make the legal definition wrong, but it isn’t really relevant outside a legal context just as a chef won't argue with a botanist that actually a tomatoe or a pumpkin is a vegetable not a fruit. Botanically they’re right but who cares?

https://en.wikipedia.org/wiki/Tax

A tax (from the Latin taxo) is a mandatory financial charge or some other type of levy imposed upon a taxpayer (an individual or other legal entity) by a governmental organization in order to fund various public expenditures.[1] A failure to pay, along with evasion of or resistance to taxation, is punishable by law. Taxes consist of direct or indirect taxes and may be paid in money or as its labour equivalent.