For most of us working as engineers or other technical jobs in the United States, it is a given that we receive paid-for medical insurance. It is difficult for companies to find technical workers, therefore they usually offer health insurance in some form or another as an incentive.
This site gives a breakdown of how much insurance costs state by state: http://www.ahipresearch.org/statedata.html
So if you work somewhere that asks you to pay say, 50% of your health insurance, you might be paying $2,500 per year for a single person. That is on par with paying to go out to eat lunch every day (and even then, on the cheap).
If you’re a family, things get much more expensive; the costs get closer to $6,500 on average. If you have a single-earner family, it’s unlikely you’re eating lunch out every day. If you are self-insured in NY state (where I’m from), it is about $5,700 for single person insurance and roughly $12,000 for a family plan. That would be a lot of expensive lunches!
Many of my project friends and talented online acquaintances talk about leaving their jobs to pursue inventing, projects or starting companies; that is, if it were not for the high cost of health insurance (again, in the United States). It is sad to see so many talented engineers so stuck because of the psychological pull of this major expense. While there are changes in the works currently (set to kick in by 2014), there are a lot of catches regarding pre-existing conditions and getting an insurance company to accept you. I feel it is very backwards thinking of the US government to effectively clamp down on creative entrepreneurs by linking health care to being an employee.
Health Care is not an easy thing to price out. Many of the insurance companies suggest a fax machine to transfer info back and forth, or requests for information are ignored entirely. The insurance documentation takes a bit of getting used to and even longer to understand. Most engineers utilize Human Resource professional or Benefits Administrator for a reason, right?
I get health insurance through my local Chamber of Commerce, so they take care of administration and acceptance. As far as I know, they accept everybody into the insurance plan. I do this to maintain my “life-hacked” engineering and sales job.
Once this expense is thought of in actual money terms, it is easy to determine whether or not the money for this cost can be earned by doing side work. One small engineering design project, for example, can pay a single person’s health insurance for an entire year. Additionally, this can be written off as a business expense, so the money that is earned towards the insurance will not be taxed.
Does $6k stand between you and doing what you love?
Editor’s note: Health insurance is a hot-button topic in the US. Regardless of your political views, we felt it was useful to consider to the implications of (US) health insurance on engineering. All opinions are welcome, as long as they are civil discourse.
Thanks to arimoore for the lovely drawing!
When I decided it was time to leave my old job, I found myself in the exact same situation. I ended up slogging through it until I had a new job lined up and felt like I could safely jump ship.
Finding a new job took a while though, and a major factor in considering a more entrepreneurial career was what the cost of health insurance would be.
This article definitely resonates with me.
Having been part of a socialized death-panel health care system all of my entire adult life, tying job selection to health care was a rather unfamiliar concept until I started to negotiate my move to China. The original offer was that I would get what local Chinese employees get in terms of health coverage (which sucked), but I manage to convince the powers that be to give me an upgraded package. It wouldn’t have been a deal breaker, but it was a concern that I hitherto never had to think about.
When talking with HR in China, she initially expressed surprise after our initial conversation that out of all of my questions to her, I barely touched upon the subject of health care. She said that when talking with Americans moving to China, health care was almost always the number one issue to come up. Different life experience, different concerns.
I’m sure your main concerns as a Canadian were the weekly distributed rations of Maple Syrup and Poutine, correct?
Sorry Flux, just the jealousy talking there 😉
Mmmm…poutine… And of course, where can I get a satellite feed to watch hockey.
It is counter-intuitively freeing to pay for it yourself. No jealousy here at all.
And…what is poutine?
Of course, I do pay for it. It’s just under a different guise — taxes.
As for poutine, it’s a Canadian staple. http://en.wikipedia.org/wiki/Poutine
Not for me.
I have to say the price quoted is high ($2500 for 6 months) with private insurance in Ireland and the Netherlands (mandatory there) at €1500 for a very good policy including dental for the same period and lower for the UK. Thus it does not hold one back as the cvosts are usually expected.
The US is no longer favorable towards startups—largely because of this huge health insurance barrier to leaving corporate employment.
More at http://gasstationwithoutpumps.wordpress.com/2011/11/21/usa-not-the-home-of-startups/
I could go on a long rant, but I won’t. I do think it’s insane that other countries seem to handle this problem, but we are still fighting about it here.
Bingo. Have often thought that a single-payer system, far from being a drag on the free market, would unleash a wave of entrepreneurship in every other industry sector.