Wednesday, April 25, 2012

What To Do With All That Money?

The idea behind the Medical Savings and Loan is that people should be directly responsible for the first portion of their health care of their family.

The first step is to figure out what is reasonable and what is not reasonable. What the program does is look at people current experience. If we look at current experience, we might find that 75% of of the people spend 15% or less of their life time income on health care, and that 90% of the people spend under 20% of their income on health care.

The Medical Savings and Loan would boldly declare that people are directly responsible for their care up to the first 20% of their income.
NOTE: By income, I mean your salary plus current health insurance. Lets say your salary was $40,000 and you current isurance was $10,000. Then your income is $50,000. A person with a $50,000 job would make $2,000,000 in a forty year career. 15% of that is $300,000. 20% of $2M is $400,000. This is a lot of money!

This person is paying $400,000 in insurance already. Essentially, they get to keep their insurance money.

Anyway, the Medical Savings and Loan might look at a person's income and boldly declare that this person is responsible for up to $300,000 in life time care, and put the person in a structured savings program to save for this care.

As you can see, members in the Medical Savings and Loan will end up with hundreds of thousands of dollars in savings for retirement and health care.

What are they to do with all of this money?

Well. This is the fun part!

People will have a great deal of control over this money.

The deal is that the funds must be put in things that hold value and can be converted to cash in times of need.

People would be encouraged to diversify; so the money is likely to go into a variety of investments.

The first part of the money would be in a savings account. Once you have a few thousand dollars in savings, you will want to diversify. So. some of the money would go into stocks and businesses. Some of the money might go into physical goods that hold value.

My grandparents had a set of furniture that they bought from a local doctor. The furniture was given to the doctor for services by a local furniture maker. So, there is absolutely nothing wrong with having health savings in the form of physical goods such as antiques, art or other goods that can be converted to cash.

Likewise a good portion of one's health savings would go into real estate.

The economic collapse of 2008 revealed that a large percent of the American people had little equity built up in their homes. A home is the natural vehicle for long term health savings. The economic crash would not have been as severe if people owned a greater portion of their homes.

Part of your health savings might go to paying down the mortgage. Better yet, your health savings account might buy a lien against your house.

So, lets say someone had $100,000 in health savings. You might have a quarter of the money in a savings account. A quarter in stocks or bonds, a quarter in physical goods that hold value such as antiques and a quarter of it put against the mortgage.

The system is taking the money that currently disappears into the hole of insurance and using it to turn regular people into owners.
With insurance, you take all of your health care money and put it in a pool which is controlled by the insurance company that owns the pool.

With the Medical Savings and Loan, you keep their health savings and are directly engaged in figuring out how to preserve or increase the value of the savings.

Essentially, converting from insurance to the Medical Savings and Loan would help restore the concept of ownership.

To repeat: the Medical Savings and Loan would tell people that they are responsible for the first 15% to 20% of their health care. They would be expected to put this money in things that hold or increase in value.

The insurance paradigm tells people that they are nothing but workers who toil away at a job and consume.

The Medical Savings and Loan tells people that they are owners and directly engages people in the game of figuring out how to preserve and create wealth.

Insurance is a relatively new invention. It really didn't take hold until the 1960s and 70s.

I contend that the concentration of wealth that we currently see is a direct result of the insurance paradigm.

The secret to making the Medical Savings and Loan work is a new position called the Health Care Advocate.  The first job of this advocate is to educate people about expected health expenses. The advocate will have a computer program that shows people will have large health expenses when they age.

The advocate will tell clients that they are expected to pay for their care up to 15% to 20% of their income, and would develop a savings plan to help save this money.

Yes, the first part of the money will into a savings account. As a person builds savings, the money will then be diversified with some money going into ownership of business, the home or into tangible goods like antiques.

With insurance, we are currently taking the same amount of money from people. It disappears into the coffers of the insurance company. The history of insurance is that workers diminish while the small group of insiders who control the pool become filthy rich.

The Medical Savings and Loan returns us to a more organic ownership paradigm in which the people as a whole thrive.
PLEASE CONTACT ME: The Medical Savings and Loan will replace insurance with personal savings. This program creates a new position called the Health Care Advocate. Each person in the plan will have a few hundred thousand dollars in savings to invest. If a group of people switched from insruance to direct savings, the group would have hundreds of millions of dolars to invest.

If a group of business people wanted to take a chance at exploring this concept, it is highly likely that first people who work on defining this program will end up making a great deal of money.

If a patriot who wanted to save America from socialized medicine hosted a conference on the Medical Savings and Loan, that person is likely to become a millionaire.

All that is needed is a group of patriots who want to restore the concept of ownership. If a group of people who wanted to stop socialized medicine contacted me, the people would have a fun presentation and just might be in a position to start a business that made them wealthy. I am in Utah and am willing to travel, but only if someone gives me a compelling reason to borrow money to pay for the trip.

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