Healthcare for Aliens & Startups Demystified (US Edition)

Healthcare in the US is complicated. The start of each annual calendar is that time of the year. When you get a chance to step outside into the mist and change or join a US health insurance plan. Or maybe you won’t.. in fear of the unknown. You heard all the tales of terror. But maybe this time it might be different. You plough through…

Health insurance optionsBack in 2009 we were acquired by a US based company. So off I went to Silicon Valley leaving Australia and it’s public healthcare behind. I still remember being presented with a bunch of paperwork outlining health plan options and I was like.. wtf is HMO? Or PPO or Kaiser? Network? There’s a network? Worse, what do all these pages of tabular data mean and how the **** do I compare it all? I was lost in the vastness of options and meaningless pool of words. Later when I became a cofounder of a health tech startup, as an employer, I needed to setup company healthcare for our company and its employees. Being partially prepared helped but I also experienced the other side of the coin.

Today, I feel like having seen both sides of the fence (employee and employer) I can share my experience and hopefully demystify a tad of the US healthcare for newbies.

Healthcare acronyms – what it all means

  • Network: hospitals are owned by a healthcare provider — e.g. PAMF, ECLG, UCSF (all based in SF/Silicon Valley) all are owned by Sutter Health Network. You can find this info on the Network’s website. This is Sutter: http://www.sutterhealth.org/about/affiliates/hospitals.html — pretty big reach. Another Network you may hear about is called Kaiser.
  • Health Maintenance Organization (HMO): Coverage limited to your selected Network.
  • Preferred Provider Organization (PPO): Like HMP but you have a choice to go outside of your network for an extra fee.
  • Insurer: Provider of healthcare plans for HMO, PPO et al, E.g. Blue Shield of California provides plans for Sutter Health Network. Website: https://www.blueshieldca.com/
  • Group plan: something your employer sets up with a selected Insurer (eg. Blue Shield of California or a Broken) to provide their employees discounted healthcare coverage options. More on that below.
  • Metal Categories: There are 4 categories of health insurance plans (insurance pays/you pay): Bronze (60/40), Silver (70/30), Gold (80/20), and Platinum (90/10).
  • Deductible: How much you pay before before your insurance company pays anything. ie. You must pay all the costs up to the deductible amount before this plan begins to pay for covered services you use.
  • Copayments and coinsurance: Payments you make each time you get a medical service after reaching your deductible.
  • Out-of-pocket maximum: Max out of pocket per year. After you reach it, the insurance company pays 100% for covered services.

The EMPLOYEE Hat

Good health and no plan for kids

If you have good health and no plan for kids all you need to care about is:

  • What network you want to be part of — typically one in your county (close by) eg. Sutter Health
  • How much “Choice” you want eg. HMO in a large network like Sutter is good enough unless your picky about your specialists. But then again your health is good and you have no plans for kids so why bother with PPO.
  • Office visits (copayments) — this is how much you will pay for doctor or specialist visits and
  • Deductible — the left over bit insurance didn’t cover — how much you want to pay for medication — $5-$25 is acceptable

Pending the size of your employer and if your in tech (Silicon Valley), they will have a bunch of Plans to choose from with different (low) monthly out of pocket. Some smaller companies might not be providing so much luxury and you will have to decide whether to pay extra for the next plan up.

My healthcare provider: PAMF - Palo Alto Medical Foundation (Sutter Network)
PAMF – Palo Alto Medical Foundation (Sutter Network)

Planning to have kids or have bad health

If your planning to have kids or have health issues then;

  • Consider PPO. So you have “Choice” of care.
  • A PPO plan has lower out of pocket expenses but costs more.
  • Everything mentioned above as HMO also applies here.

Having kids in Silicon Valley is EXPENSIVE

From midwives to duelers to hospitals to all the OB & genetic screening visits, it’s a lot. You want the freedom of choice without too much sacrifice. Hence the advice to go PPO. Expect your insurance company to pay ~$50K for 1 kid delivered at EL Camino Los Gatos Hospital to Stanford Hospital (Sutter network and popular Silicon Valley hospitals). Out of pocket ~$2K. Once you hit the out of pocket (OOP) maximum the Insurer will cover the rest. We hit it on each birth. After you hit the OOP everything is free.

Medical Bills are RIDICULOUSLY INCONSISTENT

Especially emergency visits. Be prepared. How ridiculous & inconsistent? I have no history of kidney stones but thanks to the popular replacement diet popular in Silicon Valley (no name mentioned) landed me in Emergency. Standard resolution CT scan got billed at emergency at 5am for $7K. Total Emergency bill was pushing $10K for 1hr stay. Google “CT Scan” and you’ll see that standard price is $2K for getting smacked with radiation. That inconsistent! Thanks to my amazing Insurer Blue Shield for covering the out of pocket.

My healthcare costs - note CT Scan price Inconsistency

The EMPLOYER Hat

Tech companies in Silicon Valley compete for talent using many forms of incentives which also includes healthcare benefits. However startups are at a disadvantage because a 2–5 wo/man shop cannot use Gusto, Zenefits et al Insurers, instead they need a broker to get a Group plan for 2+ employees with “decent benefits”. Look, the [faster] you grow your business the faster you can move to a plan that’s reasonably priced. Don’t fart around moving slow.

Comparing health insurance options for your company is a pain in the bum. It takes time. And provide shitty coverage for your future employees and don’t expect quality candidates. Information is freely available and employees do share with each other their benefits.

Next be aware of the Insurers coverage not just in your area but also further state wide to cover employees when they travel and need care outside state.

Group plan and group # is what you get from your broker once they have setup healthcare plans for your employees. Once that’s done, hook it into Gusto to make it easy for your employees to handle their health affairs. PAY ATTENTION! This is important. I’ve seen this before where sloppy setups create confusion and friction in the workforce. Automate your HR. Startups with 5+ employees can by pass the independent broker and use Gusto’s network of healthcare Providers.

Hospital Register - choose your pain

Other tidbits

Avoid Kaiser Network

In my time in Silicon Valley I never came across anyone in the tech community who chose Kaiser when they had other options. I’ve heard stories of being treated like a number. That speaks louder then my advise here.

Catch an Uber, not an Ambulance

Ambulances are expensive. A fully equipped ambulance is called ALS (Advanced Life System) and costs ~$3K or the basic model BLS (Basic Life System) ~1.5K. If you can walk catch an Uber or a police car take you for free to emergency. The ambulance can stitch you up at the point of accident, thank them and Uber in.

Hospitals will always give you care

Even when you don’t have insurance. So don’t believe the horror refusal of care stories online. There’s always a different side to every story. However the hospital may chase you for large bills after. So get your insurance sorted if your new to Silicon Valley / US.
Hope this shed some light and as an employee or startup founder you are hopefully empowered or more educated to make the right decisions around healthcare.

 

Feel free to contact me with further questions or leave your comments below.
~ Ernest

I’m cured, I can breathe again!

Ever since having wisdom teeth extraction in a private hospital in Australia, I have my body has been addicted to Drixine or more specifically its active component called oxymetazoline. But the good news this is history thanks to the American health care. Here’s how to beat this nasty legal drug which is putting many with nasal breathing difficulty through hell. There is hope! read on.

What is Oxymetazoline? – get to know the devil

Oxymetazoline, or Drixine/Afrin as it is known to consumers as a rapid nasal decongestant. The marketing sells it to you as a “rapid 12 hour relief from nasal congestion due to colds, hay fever and flu for the whole family.”. Oxymetazoline is the active ingredient in Drixine/Afrin which does all the damage. It is also present in Vicks Sinex, Afrin (USA), Sudafed etc..

Let’s compare the marketing to reality

Marketing The truth
Starts acting in a few minutes True. It’s frightening at 1st to feel a drug acting so quickly opening up your nasal canal.
Reduces swelling in nasal passages True. By “shrinking” the blood vessels & turbinates in your nose. You actually feel them shrinking and occasional pop and nose bleed.
Controls excessive flow or build up of nasal secretions Nasal secretions are good since they clean out the nose from all the mess you breath in. Now your nasal canal is going to be dry and open to intrusions.
Acts fast for up to 12 hours At first yes this is true but it quickly escalates into max of 2 hours.
Treatment should not exceed 3 days Should say more than 1 day. After the 2nd day you need to use this to breathe normally. This is where 3 days escapes into a weeks, months and then years.

The dangers

Once you have used Oxymetazoline for a few days you cannot stop it without going through pain. Your nose by then has gotten used to being fed this drug and if you stop your nasal passage will expand so much that you wont be able to breathe through your nose or sleep and will feel like your nose has swelled up. Worst is, after weeks of use your nasal passage gets damaged so much that you start loosing your sense of smell. Lack of smell will change your life around especially taste – watch out!

What are your options?

  • Go cold turkey for at least a week of torture not being able to breathe and hope your nasal passage “rebounces back”,
  • Stop using Oxymetazoline in one nasal passage and survive on the other and gradually ween off the 2nd one or (if neither options worked)
  • Radio frequency.

The cure – Radio frequency

The turbinates are shelves on the side of the nose. The main ones are the middle and the inferior. They normally enlarge and shrink. They especially enlarge with a cold or infection because blood is coming to the area to fight infection. They enlarge with allergy, and become pale and swollen.

nasal-interior

What do Turbinates do?

The turbinates serve a major function. They warm inhaled air before it enters the lungs. They are covered by millions of cilia which defend the body against contaigons and irritants in the inhaled air. They provide an environment for the good white blood cells, and a bacteria-fighting enzyme called lysozyme, to gather and fight infection. They act as a baffle to better direct the flow of air.

No matter how much your turbinates seem to cause you trouble, you don’t want to just remove them. If you did, you would have dryness, crusting and sensations of burning pain. Doctors have therefore come up with various ways to reduce the blockage of your nasal passages without removing your turbinates and their cilia.

The procedure – Radio frequency

radio-frequency
The device used to send radio frequency

The physician uses a radio frequency current to coagulate the material under the mucosa. This therapy is precisely directed, and does not damage nearby tissue as do other methods which generate heat. . It seems to be the best approach. It is an office procedure taking around 30 minutes and is somewhat painless.

Where to get this done?

I had my done at the ENT (ear, nose & throat) center in Palo Alto Medical Foundation (PAMF) in Palo Alto, California USA. I never heard of this until my allergy specialist (also at PAMF) advised me of this quick win procedure with the amazing ENT specialist Dr. Arman Abdalkhani.

Back in Australia I traveled from specialist to specialist spending a large amount of money trying to get myself off Drixine. Xrays, meds that made me sick and failed cold turkey attempts yielded no results until I arrived in America. This whole procedure was covered by my private health care.

So, now I can breathe again 24×7. I sleep better, feel better and my sense of smell is coming back… slowly but it’s getting better. The world feels fresh to me to be able to walk past flowers and able to smell them. You really get a sense of appreciation only once you lost something and then gain it back. I’m back baby!

Drixine/Afrin (and their Oxymetazoline variants) should be banned! Full stop.

If you know anyone out there who is going through nasal issues direct them to this blog post and save their life!

mum-radio-frequency
My mum had this procedure done in 2013 too

Ernest

The American private health care system

I love the American Private Health Care. My American friends might think I’m crazy but let me explain and compare Australian vs. American private health care as I see it and having experienced both first hand. I wont go into the detail of these plans because it’s never a clean apples to apples comparison but I will compare the cover based on my usage of the plans in both Australia and USA so you can see where the 2 differentiate on a daily basis.

In Australia my wife and I had private insurance for nearly 10 years. We had MBF Healthsmart for couples. MBF stands for Medical Benefits Fund. This plan is meant to cover most health scenarios a young couple might encounter. It basically allows me to visit any specialist, hospital or medical group to get service.

In USA we are covered by HMO from Blue Shield of California. HMO is a Health Maintenance Organization. It is a medical plan that has a network of selected physicians at a modest co-pay. Thus I had to choose a “Medical Foundation” to be my primary source of care. I chose Palo Alto Medical Foundation (PAMF) because of a good reputation and of having great specialists from a top-tier USA University, Stanford University. PAMF is a massive group of hospitals spanning the Bay Area. I have 3 of them within 15 minutes drive from Mountain View (my hometown).

PAMF - Palo Alto Medical Foundation
PAMF - Palo Alto Medical Foundation

This is the only medical foundation I can visit during the year. That’s the rules of the game with Blue Shield.

Let’s compare the two plans

In Australia (MBF) In USA (HMO Blue Shield)
Dental. I have 2 root canals and in Australia was quoted $1,500 for a crown to protect those teeth. That would end up $3,000 in total and I’d be out-of-pocket by $2,700 after MBF cover. Today, I have 2 crows. Both done in the USA over the last 1.5 years and all it cost me was $300 out-of-pocket.
MBF gave me $300 budget every year on dental. Is that even enough for 1 filling and a clean. HMO gives me $1,500 budget every year on dental. Enough to get a crown, 5 fillings and 2 cleans. Here’s the catch – there is a gap and most dentists will cover this gap hence it costs you nothing out-of-pocket. Find the right dentist!
General practitioner (GP).
Free. Actually covered by the public health system else it would be a $40 out of pocket fee per visit (as of 2009). Private wouldn’t cover it. Co-pay of $10 per visit. Without the private you would end up paying in the hundreds.
Specialist visits. The Australian public health care system (Medicare) helps with covering some specialist visits to around 30-40% of what you paid. But you still have to visit Medicare, fill out a bunch of papers and wait for an hour to get your money back.
MBF covers 20-30% of specialist visits. Supposedly they would cover 100% if you could find one which is part of the MBF network and complies with MBF gap cover – Good luck with that! lol neither of the specialists my local GP suggested over the last 10 years ever were a part of the MBF network of specialists. HMO co-pay is $10 for “any” physician I see within my network. It doesn’t matter if it’s a geneticist, x-ray, ENT, skin or allergy specialist et al that I see the most I will pay for each visit is $10. Even an “in-house” procedure like Nasal Turbinate Surgery is included in the $10.
Medical supplies (medical prescriptions/drugs)
Prescribed by the GP and/or specialist vary in price and only a very very small number are covered by private. I only ever came across 1, and this I had to file & lodge the claim myself. Asthma inhaler costs around $30 (2009). Most will cost me $10 or $25 if it’s a rare med. Asthma inhaler costs me $10.
Other differences
  • Waiting period of up to 3 months before I can start using the benefits – like wtf!
  • My medical supplies are prescribed on a piece of paper and I have to hand it to the pharmacy of my choice and then wait.
  • No waiting period to use the benefits.
  • All my med supplies are electronically sent to the closest pharmacy (nominated by myself) and they call me a machine calls me to inform me the medical supplies are ready to be picked up. Typically within an hour.

So how can this be true Ernest… I hear you asking. It’s true. But only IF you have private health insurance in the USA. Without it you are a sitting duck in the water. Not only do the private health insurance plans vary in benefits, not all are as good as the one I outlined above. I consider myself lucky and am very thankful for the amazing company I work for to be offered this level of cover and security. Most companies in the bay area are known to offer benefits like private insurance (of varying degree) which helps ensure good ongoing health of the their staff. God bless America!

My aim with drawing this comparison was to illustrate that private health is all proportional to wherever you are and whatever situation you are in. Having had an active cover in Australia and one here I am able to draw on these conclusions. I hope this was an eye opener and also a myth buster to some of the false views of the American health system.

Ernest