Ten years ago, I sat next to a Republican Congressman from my district at an NBA game.
Healthcare coverage was on my mind at the time, since I had just become an independent contractor – one facing the prospect of buying health insurance outside of a company-sponsored plan. Prices ranged anywhere from $800 to $1,200 per month.
“Your efforts need to be focused on health insurance, since it’s the one variable expense most of us can’t control,” I told the Congressman. “The premium’s going to surpass my mortgage payment, and you know it’s only going to escalate if things don’t change.”
My words fell on deaf ears, however. That’s when I realized that politicians – both Democrats and Republicans – had no real answers to the crisis confronting the country…
Sadly, not much has changed.
In fact, as the debate over healthcare’s future reaches a boiling point, consumers are more nervous than ever.
By virtue of that, my inbox is full of letters asking for my take on the issue. Especially some of the best ways to cope with the coming changes.
Today, I’d like to address those concerns.
While you might hate what you’re about to read, there are ways to make the healthcare debacle more manageable – even profitable – when the shift occurs.
Nothing Can Stop Prices From Climbing
Healthcare costs have catapulted from $30 billion in the 1960s to over $2.5 trillion today, or more than 17% of GDP. Data suggests that they will jump to 20% by 2020.
Worse yet, since 2001, healthcare costs have increased by more than 100%, while wages have increased about 34%.
Last year alone, healthcare costs rose by 9%.
(It sounds like a Stephen King horror, right?)
If you’re a businessperson, it’s likely scaring the hell out of you.
If you’re a soon-to-be retiree, healthcare costs are making you choose between a great retirement and a mediocre one.
For those of you who are presently under a company insurance plan, well… your costs are going higher.
Perhaps the worst news, though, is this…
Neither party is working on a way to reduce costs. (The government can’t control healthcare costs anyway.)
When you widen the lens, the problem is merely a supply and demand issue – one where the demand side of the equation falls squarely on us.
Blame Consumers for the Uptick
It might be a generalization, but it’s no secret that Americans lead lifestyles that result in the need for more care.
Other consumers simply demand unnecessary tests and procedures that add to the final bill dramatically. And doctors – who fear malpractice charges if they don’t provide a battery of tests – are willing to oblige at every turn.
Essentially, as long as Americans look at healthcare as an entitlement – seeking treatments to repair damage as opposed to focusing on preventative care – costs will continue to rise.
That’s why the government is looking at how to shift more of the burden to individuals. The change will force Americans to either alter their lifestyles for the better, or foot the bill for receiving more care.
Here’s what we can expect once this healthcare shift takes shape…
- More insurance companies and employers will require health plan members to undergo tests to prove they’re leading healthy lifestyles. Those who are will pay less for premiums. Those who aren’t will pay more.
- Expect more emphasis to be placed on catastrophic care coverage. That is, lower monthly premiums with higher deductibles, ranging from $5,000 to $10,000 per year. This should encourage individuals to lead healthier lifestyles to cut monthly premiums in half.
- Those relying on government-funded care, like Medicare, will have to pass a means test. If they earn more than a certain amount of money, they’ll pay more out of pocket regardless of how much they already paid into the system or what they were promised.
- More individuals and companies will go overseas to outsource healthcare. Today, many companies that self-insure are sending employees to places like India or Thailand – where major procedures are a fraction of the cost. (Even after accounting for convalescent care and travel expenses.)
Bottom line: Regardless of the plan that’s implemented, healthcare costs are going to increase. All but the wealthiest individuals will feel the impact.
Rest assured, however, our team is constantly scoping out ways to lessen the blow. More specifically, we’re hunting down investment opportunities that are almost certain to generate profits as the situation plays out.
For instance, I’m currently tracking one company that’s benefiting from both Obamacare and the demographic changes in America. It’s set to double in price over the next two years.
I’m also zeroing in on an insurer that’s poised to cash in no matter what political party is in power.
These opportunities – plus all the others we dig up at Wall Street Daily – should easily cover any costs associated with new legislation.
So stay tuned!
Ahead of the tape,