Should each generation save for their own retirement health care needs?

Yes

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by Paul Kemp

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If each generation, even each individual, isn't responsible for their own retirement health care needs, then they have no incentive to take care of their health, nor do they have a reason to save for the care they will need.

The problem of high health care costs is a simple one of supply and demand. There is a lot of demand for health care services because people live unhealthy lives, for the most part. That drives up the price. What makes the situation worse is that nearly everyone thinks someone else is paying for their health care.

Those who have no insurance tend to go to the emergency room to see a doctor. This is the most expensive way to receive attention, but the cost is passed along to everyone else in the form of higher prices. So, even though it's an inconvenience, the poor who don't pay have no strong incentive to avoid situations that lead to sickness or injury.

At the other end of the spectrum is the Medicare patient. They, too, have little incentive to save or do without expensive treatments because they pay only a small portion of the cost. So they want to get everything they're entitled to, with little concern that it is driving up the cost of service for everyone else.

The same situation holds true for those who buy insurance or have employee benefits. "Get it while you can!" seems to be their motto. Although many problems can be avoided by simply losing some weight, it's easier to have knee replacement or bariatric surgery or whatever the doctor offers to remedy the symptoms, for example.

Finally, there is the doctor, with more paperwork to do to comply with third party payers and HMOs. All this paper shuffling has to be done by employees and it adds to the doctor's cost of providing service to patients. It may also take time away from the doctor's treatment of patients.

A simple answer to cutting the rising cost of health care is for each individual to take responsibility for doing everything they can to stay fit and healthy. I realize this goes against every social cue we receive from government and the people who surround most of us, but I also know from experience that it works. The key to cut the cost of health care is to reduce the demand for it.

It seems only natural that people should prefer to be healthy instead of sick or injured. Somehow, over the decades that Medicare or employer-provided health plans have intruded into the doctor/patient relationship, we have been tricked into thinking that we must have some type of health insurance, rather than focusing on making sure we stay as healthy and safe as possible through our own efforts.

I have found that, with some daily attention to healthy exercise and nutrition, I am better off saving cash for my rare health care needs, rather than paying month after month for services I may not ever need. To this end, a Medical Savings Account, is the ideal tax-free solution to the need for the average person's health care needs.

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