Negotiating as an individual in a market made up by large blocks makes you very easy to ignore. If everyone moved off employer insurance and into the market then, assuming we didn't have massive market corruption (which I think is a pretty big assumption), we'd all be on an even playing field. Asking individuals to do this independently is just a recipe for them to fail.

I think auto insurance is a good indicator of how it would play out if you made everyone do individual insurance. Insurance would still likely need to be legally mandated, like auto insurance, so that the insurance market would be solvent.

From there, insurance would likely break down into high cost / high coverage, mid cost / mid coverage, low cost / legally mandated minimum coverage.

The poor would end up with the low cost / minimum coverage plans as cost would likely end up being the main motivating factor. Given that 6-in-10 Americans can not afford an unexpected $500 bill (https://www.cbs19news.com/story/34248451/6-in-10-americans-d...), this would likely be the coverage level chosen by about half of Americans. These policies would be affordable, but I expect the deductibles and co-pays would be high enough to make it prohibitively expensive for policy holders to actually get much utility from them.

The other half would end up with the better plans, unless they were more comfortable with risk and elected for the cheaper plans. Their lot is probably pretty similar to today.

That article says that 60% of Americans don't have $500 in a savings account, not that they don't have $500. Savings accounts are an anachronism, it is like saying Americans don't have phones if they don't have a landline. By that standard, I'm flat broke.

Americans can afford a $500 expense just fine. The median American household has ~$1000/month left over after all ordinary living expenses, per the US Bureau of Labor and Statistics.

That article isn't the original research, and I don't think the original research specifically asked about "savings accounts".

I think they're drawing on this series of studies: https://www.bankrate.com/banking/savings/survey-how-american...

That infamous bankrate.com "study" is misleading in similar ways; they define terms in a way no reasonable person would to support a desired conclusion. Same for "retirement savings" and a bunch of other financial topics where the terms are misleadingly defined to create a dramatic headline. These are all clickbait articles that have been debunked countless times, and any careful reading of the studies indicates why.

Start from the well-sourced fact that median American households have ~$1000 per month to spend without sacrificing anything, and work from there. This can't be true at the same time all of those breathless headlines about broke Americans is also true. Without fail, if you dig into the details, the headlines are grossly misleading. The percentage of Americans that truly have no capacity to deal with significant unplanned expenses -- per Federal Reserve studies -- is 10-15%. A not inconsiderable number of people but far less than implied by the clickbait.

Average Americans have extraordinary amounts of discretionary income compared to almost anywhere else in the world. Americans both have a low savings rate and they have large amounts of money available to save.

I did this exact thing (bought privately) for awhile because I wanted to decouple my insurance from employment. It's actually very easy.

Most employers don't offer to pay the premium out instead of the coverage, so they usually offer a much better deal than the alternatives.

Like if your contribution to your insurance is a few hundred a paycheck there is a pretty good chance that the employer is paying in quite a bit more than that.

https://www.kff.org/health-costs/report/2021-employer-health...

Most companies (and employees) consider this part of the compensation package.

In most cases there is not an avenue to recover any lost compensation if you opt out of health insurance. If an employer offered a higher base pay for those not on their insurance plan, you probably WOULD see a much higher rate of those securing their own plans in the open market.

Complaining about benefits would be a weird flex though. The alternative of not having employer tied is still available.

A more rational phrasing may be: "I can buy insurance isolated from my employment, but I am priveleged to have the benefit and OPTION of taking advantage of employer benefits."

Maybe. But with employer provided benefits that comes at a cost to the employer. Thats why its a benefit and a part of a compensation package. (IE: you work for us and we pay you x, give you x in retirement and subrogate x on these healthcare initiatives).

If i am freeing the employer of that burden....should that not reflect back on my compensation? Surely you dont mean the employer should then be able to save more and basically lower their compensation for employees and expect the same return?

There are plenty of packages on the open market that are generally better than what an employer offers. But you are essentially making extra sacrifices by opting out with no benefit to you and all the benefit of the company.

It would make more sense for a company to even offer a HSA where they contribute as much as they would to a plan to a savings account and allow the employee to also contribute their share pre-tax. And apply that to plans available on the open market.

Inflexibly benefit offerings are why I generally prefer structuring my employment as 'contractor' / B2B, but I realize many people are unable to structure their employment that way. You're right that it would be advantageous if total compensation were better understood so that employees and employer could negotiate what works for them.

>It would make more sense for a company to even offer a HSA where they contribute as much as they would to a plan to a savings account and allow the employee to also contribute their share pre-tax. And apply that to plans available on the open market.

Agreed

When we were a smaller group, we had to forbid it, because otherwise our group wasn't large enough to qualify for a group plan.

This is very strange, it's not even remotely rare to decline employer coverage - probably half my team either has their spouse on our company coverage, or no company coverage since they are covered by their spouse.

It's not rare. About 1/3 of my team has declined coverage now. But when were six people, and the minimum for BCBS to cover us was six people, we asked everyone to commit to the coverage so we could do it.

In my jurisdiction this practice (forced insurance) would almost certainly be illegal if any unauthorized payroll deduction were included.