PHILADELPHIA REFLECTIONS
The musings of a Philadelphia Physician who has served the community for six decades

273 Topics

New Revenue Sources for Health Savings (and Retirement) Accounts
New topic 2016-06-23 22:23:35 description

Introduction: Surviving Health Costs to Retire: Health (and Retirement) Savings Accounts
New topic 2016-03-08 22:42:53 description

Start Younger, Save Longer, and Do It Yourself: Health Savings (and Retirement) Accounts
New topic 2016-06-22 19:26:36 description

(2) Obamacare: Spare Parts for a Book
New topic 2015-07-22 16:02:02 description

Terse Verse: Thomas C. Howes (10)
Poetry is a form of literature that uses imaginative and creative words in a compressed form to express idea.

Click for more Topics

Philadelphia Reflections is a history of the area around Philadelphia, PA ... William Penn's Quaker Colonies
plus medicine, economics and politics ... 2627 articles in all

  • Try the search box to the left if you don't see what you're looking for.

Prologue for New Revenue Sources

In earlier volumes, it has been proposed to make healthcare more affordable by re-arranging the pieces of it, eventually gathering investment income from the float. That's entirely passive investing, utilizing total market index funds as income generators. In this volume, we invite the reader to consider what might result if the income stream were increased by active investment in health-related companies. Obviously, increased income could eventually lead to a totally not-for-profit health system, rather than a confederation of consumers and producers. Under one system, the consumers pay the producers. Under its alternative, the two are in balance, resulting in a confederation which wipes out consumer costs by transferring producer profits into a common bank account. Carried too far, of course, it creates an incentive for people to get sick; but that would be too long a leap from facing unsupportable health costs, to interfere with a little consideration of it. That's what this is: a bemused reflection on what it might be like.

We have already calculated passive investment returning about 7.5% might do the job, for a lifetime individual health cost averaging $300,000 in year 2000 dollars. Experience is showing there are good years and bad years, but it seems pretty tough to average more than 5%, net. So if we could find 2.5% extra, a cost-free health system would be in sight. Successful corporations can probably expect to make 10% profits for their stockholders, so the addition of $150,000 worth of stock producing a 10% return, might result in a total portfolio yielding 7.5%. It wouldn't be an easy task to get there, but it might be done.

In order to avoid turning this idea into either a boondoggle for hedge funds or a gigantic tax dodge, it would probably be wise to limit the portfolio to health-related corporations. Over the past century, we have seen Medical Societies own malpractice insurance companies, medical journals, post-graduate educational tape recordings, health insurance companies, and probably a few hospitals. Even more enticing would be drug companies and medical device makers. In all of these areas, the danger of conflict of interest would arise, but somehow it has always been managed. In fact, medical ownership or control of ancillary services has probably declined, although it is likely the medical owners have usually been happy to be rid of the distraction. Medical malpractice insurance is probably an example of medical owners filling an unfilled need. When competition returned to the field, the owners have generally preferred being rid of the unpleasantness, rather than enjoying distasteful profits.

If, to all these associated for-profit corporations, is added the educational loan system for healthcare providers, plus the myriad institutions to house the patients, it starts to become clear the danger of monopoly control is a small one. While there is no doubt local monopolies would arise, and some instances would occur of provider control of them, the industries now making up 18% of gross national product would greatly dwarf the number of providers. Physicians were paid 20% of the healthcare dollar in 1980, but only 8% today, as an example of how greatly the field has become dominated by non-professionals. The scientific field has become so huge and so attractive in itself, that comparatively few professional of eminence are interested in business careers. It is true professionals lacking eminence are more attracted to such activities, but the resulting peer pressures strongly favor the few eminent professionals who allow themselves to be involved.


Front Stuff: Surviving Health Costs to Retire: Health (and Retirement) Savings Accounts

...Also by the same author:

The Hospital That Ate Chicago, Saunders Press, 1980

Health Savings Accounts: Planning for Prosperity, Ross & Perry, Inc. 2015

---------------------------------

Ross & Perry Book Publishers

3 South Haddon Avenue

Haddonfield, New Jersey 08033

856-427-6135

----------------------------------

Surmounting Health Costs to Retire: Health Savings (and Retirement) Accounts Copyright: 1-2540412791

ISBN #: 978-1-931839-44-0

-----------------------------------

Acknowledgements

For advice and support about the thrust of this much revised book, I owe new debts to the many people who read the first version and commented. The first book was written as ideas developed in my mind, and rather in a hurry. The present revision was written so later thoughts could be introduced earlier in the argument. It also gave me a chance to distinguish between, what is immediately practical, and grander ideas at the mercy of intervening events. I briefly considered omitting the long-term viewpoint, but include it to suggest alternatives which may or may not be achievable immediately, but would seem like blunders if passed over when there was room for them. Voters want representatives (and authors) who are clear what they hope to achieve, even if events bring them short of it.

----------------------------------------------------------------------

Foldback, Front Cover

This book outlines the hidden advantages of Health Savings Accounts, which the author had a hand in creating in 1981, along with John McClaughry of Vermont when John was Senior Policy Advisor in the Reagan White House. HSAs have achieved 30% savings among early subscribers. The most popular advantage appeared later: to convert the left-over tax-exempt savings to an IRA, at the time of beginning Medicare Coverage. Because of the popularity of this retirement savings feature, this book suggests renaming them to Health and Retirement Savings Accounts, to emphasize the dual possibilities.

In a later section, the book looks ahead to still other features which take advantage of compound interest income during an era of lengthening longevity. Substantial savings appear to become possible from reversing the system, from paying interest, into one of receiving and compounding it. Individual private accounts rather than group insurance contain a number of other hidden advantages, as do high deductibles but absent co-pays. The public currently embraces Medicare, but needs to foresee the advantages of gradually shifting its funding whenever research reduces Medicare costs in the future. The mathematics appear to be sound, but resistance might appear, from the political and social disruptions entailed.

--------------------------------------------------------

Foldback, Back Cover

{Privateers}
George Ross Fisher III M.D.

George Ross Fisher, MD, the author of this book, graduated from the Lawrenceville School in 1942, from Yale University in 1945, and from Columbia University, College of Physicians and Surgeons in 1948. After postgraduate training at Pennsylvania Hospital, Thomas Jefferson University, and the National Institutes of Health, he spent 60 years practicing medicine in Philadelphia. During that time, he spent 25 years as a delegate to the American Medical Association, and as a trustee of a number of medical organizations.

Following retirement, he formed a publishing company, Ross and Perry, Inc, which has published several hundred books, mostly reprints. He is personally the author of eleven books about Philadelphia history, from William Penn to Grace Kelly. He is the author of the following three books about medical economics:

The Hospital That Ate Chicago; Health Savings Accounts: Planning for Prosperity; Surmounting Health Costs to Retire: Health (and Retirement) Savings Accounts,(the current volume.)

------------------------------------------------------------------------

Dedication Page

To Robert Morris of Philadelphia, who taught Alexander Hamilton about credit, but personally learned it had its limits.

-------------------------------------------------------------------------


To Sum Up: Health and Retirement Savings Accounts: Immediately, and A Peek at Future Advances

As an earlier section outlined, Health Savings Accounts were developed by John McClaughry and me in 1981, as a bare-bones health insurance scheme for financially struggling people. The package consisted of the cheapest insurance we could imagine (a high-deductible Catastrophic indemnity plan with no co-pay features), attached to what others have aptly described as a tax-sheltered Christmas Savings Fund. What was this duet supposed to accomplish? The Account part was originally intended for folks who must accept a high deductible to lower the cost of health insurance, but then struggle to assemble the deductible. A combined package thus became the cheapest healthcare coverage we knew how to devise -- the higher the deductible, the lower the premium. As deposits built up in the account, the remaining deductible fell toward zero, but the premium of the insurance did not rise. At that point, you could describe it as "first-dollar coverage for a rock-bottom premium." Stepping through the process should demonstrate to anyone, how expensive it had been to include the deductible costs within the insurance . It certainly compares well with so-called "Cadillac" plans, where the underlying motivation was to include as many benefits as possible, money no object, with someone else paying for it and writing off its cost against high corporate tax rates. If the government elected to subsidize our plan to provide it even more cheaply to poorer people, subsidies could easily be included for seriously poor people, just as the Affordable Care Act does. HSA is itself absolutely the cheapest, but neither it nor the Affordable Care Act is free, so additional features like charity must be supported by additional revenue from somewhere. Cheaper is simpler, simple is easy to understand.

{FYOF3}
FYOF3
{LYOLG2}
LYOLG2

First-dollar coverage by any mechanism generates the danger of spending health money unwisely. That undesirable feature was neutralized by letting subscribers keep what is left over at age 65, thereby generating retirement income. Retirement income is generally in short supply, and there may exist a future danger well-meaning attempts to supply generous retirements would destroy this incentive to be frugal. But right now it isn't a worry.

Other Incentives. One thing we didn't immediately verbalize was, making it a bargain entices people to save, even when they are sort of inclined to consume. We didn't think to include regular paycheck withdrawals, but that's another common savings incentive with proven effectiveness. Having loose cash does seem to create a vague itch to spend. But the HSA specifies an invitation to save for health care, using any surplus for retirement, a much more tangible appeal. With that addition, it becomes a more attractive program, while possibly appealing to a larger segment of the population without reducing its appeal to the original ones. Our reaction was that everyone was complaining about high health costs, so the more people HRSA appealed to, the better.

The real game-changer was this: When a subscriber later acquires Medicare coverage, anything left in the fund is automatically turned into a tax-exempt retirement fund, an IRA. As enrollments in HSAs began to boom, it was realized this provision creates an unmatchable retirement fund if someone puts extra money into the account. I wish I knew whose idea that was. So you might as well say the basic package has three parts: a high-deductible health insurance, a spill-over retirement fund, and a Christmas savings fund to multiply savings with compound interest. It is a savings vehicle for two sequential stages of life, with the tax advantages of the first stage getting it on its feet. The separation of the account from its re-insurance, also separated the incentive to save from the desire to share the risk. Adding compound interest adds particular attractiveness for the later stage of life, because compounding takes a long time before it means much. It connects two benefits end-to-end, lengthening the time for compound interest to become meaningful for the second one, as it would not if it waited for retirement to begin. We eventually realized the deductible-funding and retirement-funding Christmas savings account package was the most attractive investment vehicle most ordinary folks could find; beating it as a retirement fund was therefore nearly impossible.

Hence the overall strong incentive to save, sadly missing from every other form of health insurance. We strongly suggest adding this feature to Medicare, which badly needs some such incentive, although retirement would be in parallel, not sequential. Experience shows this unique set of incentives to buy HSA were effective, so a 30% reduction in premiums for total health insurance began to be demonstrated among pioneer clients, not merely claimed in theory. The recognition of all these advantages led millions of frugal people to sign up without an expensive marketing effort. Everything seemed to fall in place, making us quite satisfied with the result. Even though mandated extension might have speeded up acceptance, slower adoption avoided the early catastrophes of taking on more than could be handled.

So that's where HSA stands today -- the best little health insurance idea available anywhere, unless someone monkeys with it. Even the remote possibility of getting very sick, very often, was covered by adding the feature of a top-limit to out-of-pocket costs, paid for by dipping into a small portion of savings generated by other features. Anyone who thinks of a better health insurance plan than this one, is welcome to offer it. Let's whisper a reminder: the policy is owned by the individual rather than his employer, so it doesn't suddenly stop when you change employers. To a different audience we could whisper, it could bring another feature closer to an end, the business of paying for Medicare with debts which have to be borrowed from foreigners. The Account gathers interest, instead of costing interest charges. The best part is: it induces the subscriber to hold back from using the account, saving it for more distant requirements, which otherwise come without warning. Paying for your old age is wonderful, but starting to save while young is vital, and more likely to work. Most plans now maintain an upper limit to the subscriber's out-of-pocket costs, protecting against a second illness with its second deductible. When we say, "That's all there is to it," we really mean that's all the advantages which have so far emerged. It's ready to be renamed HRSA, the Health (and Retirement) Savings Account.

Technical Amendments, Needed at Present.

Now, let's pick the nits, noticing how hard it gets to improve on it. If Congress could pass a few amendments, the following flaws could be more or less immediately repaired:

1. Full Tax-Deductibility. Attractive as it is, HSA still isn't as fully tax-deductible as the health insurance many employed people are given at work. The savings and retirement portions are indeed tax-sheltered, but unlike some of its competitors, the high-deductible health insurance itself stands outside the funds (as what insurance experts might call re-insurance) and isn't covered. Employers get around this difficulty for their employees by buying the insurance themselves and "giving" it to the employees. Without monkeying around with this rather dubious maneuver, we propose the premiums for the Catastrophic health portion of the HRSA might instantly become tax-exempt if the Savings Account paid the premium. That would appear cheaper to the Treasury, than proposing to make the whole package deductible. Because the other parts are already tax-exempted.

To permit something like that would require a one-line amendment to the HSA enabling act, but would restore fairness to the system, and bring out how much cheaper the Health Savings Account really is. Making it cheaper means more people could afford to buy it, thus relieving the Treasury of the need to include those people under the Affordable Care Act. That compensates for some of the loss of revenue to the IRS of making the Catastrophic Health Insurance tax-exempt. Regardless of how the CBO scores this complexity, it should be remembered that poverty is not a lifelong condition for most poor people; after a temporary period of poverty, many if not most of them rise toward becoming full tax-payers. Equal treatment under the law is itself worth something; it could alternatively be provided by lowering the corporate income tax. But that's not self-evident, and politically hard to explain. If the Congressional Budget Office would extend its dynamic scoring to include retirement taxation on the HSA's eventual compound interest (instead of limiting its horizon to ten years), it would prove to be better to chose the alternative of letting the Accounts buy the re-insurance.

2. A better Cost of Living Adjustment for HSA deposit limits. There is presently an annual limit of $3350 for deposits in Health Savings Accounts, whose limits have seldom been raised. This new COLA should be formalized into a continuing cost-of-living adjustment which is somehow related to the current rate of inflation in the economy, and perhaps takes account of the transition to HRSA by people over age 60. These late arrivals simply cannot catch up within the present deposit limits, even if they possess the savings to do so.

3. Age Limits for HSAs It is a quirk of compound interest (originally noticed by Aristotle) that interest rates increase with the duration of investment. Consequently, much or most of the revenue appears after forty years, and consequently the HSA gets progressively more valuable with advancing age. To put it another way, young people contribute more time for interest to grow, old people must contribute more money. At present, the HSA age limits are set to match employment, but the HSA will inevitably focus increasingly on funding retirement. Removing all age limits might go a little too far, but would substantially increase the amount of investment income generated, at almost no extra cost to the government. It might also supplement the platform for funding childhood health costs, a problem age group which stubbornly resists improvement. It might greatly enhance revenue for older subscribers as well, the surplus from which could be used at their death for grandchildren.

{Privateers}

Extending the age limits would potentially also serve as a platform for re-adjusting dangerous imbalances in the healthcare financing system. We are fast approaching a demography of thirty years of childhood and education, followed by thirty years of working life, followed by thirty years of retirement. But substantially all of the revenue comes from the middle third, while the remaining two thirds of the population contain most of the health costs. To some extent, this is unavoidable, but the whole health financing system becomes a dangerously unbalanced transfer system for well people to subsidize sick ones. It is possible to foresee the beginnings of class warfare, based on age alone. Consequently, society would be well served to create the more stable system of subsidy between yourself as the donor and yourself as the beneficiary. The alternative is to continue the process of having one demographic group collectively subsidize two other groups of strangers who generate most of the cost. Eventually this might lead to the well people dumping the burdensome sick people. I hope I am unduly concerned, but to extend the age limits for individual self-financing seems a very cheap way to begin stepping out of that particular mud puddle.

Finally, there is the conflict with inheritance laws. By extending the age limits for the funds to the legal boundary of perpetuity (one lifetime, plus 21 years), the ability to transfer funds between generations is enhanced without the perplexities of inheritance. It would be particularly useful to permit the fund to remain active until a grandfather's death, or even extend to the birth of his designated grandchild's 25th birthday. Like a trust fund, it would gather interest after the death of the owner, and leave his selection of heir to the last possible moment, if he chooses.

To return to the subject narrowly at hand, it is easy to see that so many small projects are made possible, you end up with an aggregate of goodies which eventually sink the lifeboat. Something must be chosen, something must be dropped, and the choice should be delayed as long as possible, left to individual choice as much as possible. It can be commented in advance that retirement costs potentially dwarf other costs, and small single payments held at interest for long stretches have the greatest efficiency. There seems little choice but to constrain retirements to what the individual can manage independently, rather than permit retirements to absorb all the benefit of a new windfall. The theme is, and should be, one step at a time.

As an aside, it's true the subscriber to a Health Savings Account is not fully covered in his first few years, until the account builds up to the deductible. At first, that was a concern, but it has proved largely unnecessary to provide for it among young healthy subscribers. Apparently, by the age hospital-level illness becomes common, ability to meet the deductible has mostly been achieved. Nor has it proved necessary to resort to sliding-scale deductibles hidden in the slogan, "the higher the deductible, the lower the premium" -- probably because conversely, lower premiums lead to more money for saving. These features might be reviewed when self-selected frugal applicants taper off, since HSA enrollment has favored younger enrollees, so far. For the moment, sales incentives seem adequate; everything else may be indirectly changed by HSAs, but very little is directly changed.

Future Expansions.

How far these three short amendments would extend retirement solvency, is hard to predict into the future, but it would be considerable. Aside from any improvement never seeming like enough, it is almost impossible to guess the future timing of health costs, even if you can see them coming. But while the amendments might assure a comfortable future for Health and Retirement Savings Accounts, they do seem unlikely to address the full costs of retirement, which are usually undefined and often overly ambitious. So the problem for many, many afternoons' deliberation, would be to expand the potential of HSAs until they become objectionable for competing concerns. For that, I have four additional proposals which might work, but inevitably collide with professions who would be quick to suggest narrower limits. Let's describe them, while waiting to assess objections from those they would discomfit:

1. A re-insurance scheme (insurance company to insurance company), called First and Last Year-of-Life Re-Insurance.In the far distant future, health insurance will surely concentrate into the these two years, so we get our directions approximately right if we start there. It's superimposed on but untangles many cross-subsidies, and extends the duration of compounding within the present system. A ninety-year transition period for lifetime HSAs is too long and must be shortened somehow before whole-life can be feasible. In retrospect, it is difficult to understand how the insurance industry managed to establish whole-life insurance; certainly, it could not have been based on actual experience. The present proposal is a reinsurance system, invisibly supplementing present procedure-based payment systems but extending their duration of compound interest for a full lifetime-- we suppose, but cannot prove except by waiting..

In summary, a small escrowed sum at birth--possibly three hundred dollars-- grows undisturbed to astonishing size in eighty to a hundred years. At death, the fund would easily reimburse Medicare for its demonstrated expenses during the terminal year of life, essentially providing a quarter of Medicare expense at a total cost of three hundred dollars. A somewhat larger deposit, perhaps another hundred dollars, might also produce enough surplus after reimbursing Medicare, to take care of the first year of life of one grandchild or equivalent, although there appears to be so much surplus from last-year, that the two approaches could proceed from both ends at the same time, to shorten the transition. Available figures for obstetrical costs are not available, but the approach might be improved by considering obstetrics as a cost to the baby. The main problem with this transition issue is not its cost, but its extended duration. Finally, it is possible to be casual about some of these projections, when a contingency fund of about $100,000 can be provided by an initial investment of $300, providing it follows the same compounding path as the investment itself.

By placing these funds in escrowed individual Health Accounts, the suspicion is addressed that the money might be spent on battleships or otherwise diverted during its long period out of sight. About a quarter of health costs would be replaced, and essentially removed; although the accordion principle might adjust it larger or smaller. Birth and death years are the two most expensive in human life. Almost no one pays his own costs for them. And they affect 100% of the population. The Health Insurance Industry, now precariously balanced on questionable cost-shifting between demographic groups of strangers, would never be the same. Particularly since private industry would expect to finance the reinsurance out of reduced write-offs from corporate taxation.

2. Medicare should be modularized but without other basic change, so recipients can buy pieces they do not need, using the invested proceeds for retirement. Sometime during the next fifty years it can be predicted at least one of the five most expensive diseases (Alzheimers, diabetes, cancer, psychosis, and Parkinsons) will be inexpensively cured, once the initial cost increase is absorbed. We need a way to fine-tune the transfer of such medical savings into retirement income, understanding many competitors will hope to divert the windfall. Redirecting the Medicare withholding tax makes an excellent way to channel the funding, as would reductions of Medicare premiums. Scientifically, Medicare is eventually destined to shrink as we find cures, but funding the resulting longevity must be given first call on the savings.

{Privateers}

3, The investment component of Health Savings Accounts should be dis-intermediated.The stock market has produced--for a century--10%-11% long-term returns on large-cap stocks, 3% inflation, and less steadily 4-5% on bonds. The volatility is much less than most people imagine, and there is every reason to suppose Index funds of these entities should perform better with less volatility at far less cost, perhaps 0.1-0.3%. The days fast fade, when the public will continue to surrender the present level of stockmarket transfer costs and fees, which now sometimes erode investor return to as low as 1%. The fast-growing and simpler system is "passive" investing with index funds, and its goal should be an average return to the retail customer of at least 6.5% after inflation and costs. The struggle will be a fierce one, but the retail finance industry must re-examine who is at risk, and who is rewarded for taking that risk.

4. The center of medical care should migrate from medical centers to shopping centers attached to retirement villages. Architects report it will always be cheaper to build horizontally than vertically. Since we seem destined to spend thirty years in retirement, and the principal occupation of retired people is taking care of their own medical needs -- the wrong people are doing the medical commuting. Teaching hospitals were located close to the poor, in order to use them for teaching material. But now "meds and eds" are fast becoming the principal occupations of high-rise cities. If there is ever a good time to place medical care closer to the patients, this is it.

And if ever there is a way to put the doctor back in charge of medical care, decentralization is the way to do it smoothly. We will always need tertiary care, but we don't need indirect overhead, skyscraper construction, or multiple layers of overcompensated administration. Even continuing education is becoming a revenue center. No one can claim the present centralization made things cheaper, and the disadvantages of medical silos certainly call the quality issue into question. The Supreme Court failed us in the Maricopa Decision; so let's see what Congress can do with reconciling the Sherman Act with the Hippocratic Oath.


Cover

{Privateers}

Younger is Longer, and Longer is Bigger

A central feature of compound interest is the quirk that the longer you invest, the higher the interest rate becomes. That's not going to change, no matter who votes against it. What did change, after thousands of years of staying the same, was longevity. The Biblical guess for potential longevity was three score and ten, but most people died in their twenties and thirties, far from the theoretical longevity of the human condition. By the year 1900, actual longevity was 47 years, and three-score and ten still seemed about right. But today longevity at birth is thought to be around 82, and what with heart transplants and all, it may level off at 90 in a few decades. The Sunday supplements are already speculating the average person may someday reach the age of 110, or more.

It's probable that civilization developed a number of conventions to adjust to shorter longevity, based on the notion that if things don't change for a century, we can make do with short-term expedients for national currencies, life insurance, mortgages and similar long-term arrangements. Stories are told of Bismarck, or was it Franklin Roosevelt, who based retirement schemes on the assumption most people would be dead at the age of 65 or 67, so there would be plenty of money to pay their pensions. But insurance companies gradually learned how to get rich on premiums based on old assumptions, but pay-outs based on a longer reality. Other long-term financiers played the same game, and governments switched from a gold standard to inflation-targeting. A fixed amount of gold drives prices steadily downward in an expanding economy; a floating currency gradually floats prices upward, but creates innumerable adjustment headaches. With periodic crashes, we manage. The present book proposes we use the quirk of rising interest rates in compound interest as a way to cope with unstable currencies, but it's only an expedient, and it may not last forever.

At the moment, it looks as though longevity will level off at around age 90, but that projects a progressively longer retirement vacation to pay for. For the time being, we appear to be leveling off at equal thirds, childhood and education until 30, earning from 30 to 60, and retiring from 60 to 90. That's pushing things a bit; no one can be sure a third of the population can, or will, support the other two thirds. It's particularly dubious when you consider about 30 million people in America will always have some degree of dependence. That's roughly seven million incarcerated in jail, eight million handicapped, and 11 million illegal immigrants. Going to work at age 25 and retiring at age 75 would provide much safer numbers, particularly if 5% of the population is normally between jobs in a mobile society, and we propose to spend 18% of national income (GDP) on healthcare for the rest. Americans like to grumble a lot, but compare how much better off we are, than the other four fifths of the world, living on something approaching a dollar a day. We like to think it is possible to get rich without making anyone else poor, but the rest of the world has been taught to make money by taking it from someone else.

So, without further illustration, Americans should adjust themselves to a century of working longer and harder, perhaps age 25 to 75, recognizing the rest of the world will out-vote us if they can, and trusting in our own resources whenever there is a choice. That's the reality underlying a preference for individual savings accounts, it really isn't safe to trust the currency forever because even our leadership occasionally disappoints us for whatever motive. And it's the reality of extending the working years, even if income falls, because the longer you are self-supporting, the shorter the time you must depend on others. And there's one other simple peasant teaching: start saving as young as you can, on the day of your birth if your family is organized that way. It was pretty useless when people lived to be 40, because compound interest scarcely had time to begin work. But the rule of thumb is that money at 7% interest doubles in ten years. If you live to be 90, that could be nine doublings (2,4,8,16,32,64,128,256,and 512) or five hundred dollars per dollar. Since you only need a trustworthy custodian to do it, it is probably the basic unit of currency, slowly changing over time. But you don't need to take it so literally, understanding the principle is more important.

The rule for health insurance (which is what we are mainly describing)is to organize the insurance to begin saving as young as possible, and to spend the money as late as possible. Health insurance is one big transfer mechanism. You earn money from 30 to 60 and you spend it from 0 to 90, but you spend the greatest amount in the first year of life and the last four years of life. Therefore, it is poor design to assign the cost of childbirth to age 30, it's mostly borrowed money, and it's spent the day you were born. You could argue before a judge the cost is partly the mother's cost, partly the father's, partly the infant's; the judge will probably assign the cost to the person with the deepest pocket. In this particular case, the deepest pocket is probably the grandparent, having six or seven doublings intervene. In fact, in a situation torn with divorce and dissension, the grandparent may be the person -- not only most able, but -- most willing to pay the bill. Skipping the process of inheritance, the donation of the money by grandparent to the baby's individual account eliminates cost and controversy, and potentially reduces the cost by 32 to 64-fold.

A most interesting website, thank you. I really hope to visit Philadelphia one day, and I shall definitely consult your website. I came across this website after doing a search on Johannes Kelp / Kelpius. I had just listened to a song written about him called, 'Sighisoara' at ukuleleroadtrips.com. Sighisoara is the place J Kelpius left for Philadelphia with 40 followers. Best Regards
Posted by: Pamela   |   Aug 20, 2015 11:04 AM
I'm overwhelmed. I'm thinking of a one-line poem by William Blake: "Enough or too much" " stragglers who live from 85 to 91." Sorry to be a burden, but soon to be 91 I can still go a couple of rounds without huffing and puffing. You remind me of Dr. Melvin Konner.... professor.... anthropologist..... physician.
Posted by: Martin   |   Sep 27, 2014 5:16 AM
I want to thank you for this wonderful resource. I find it fascinating. May I offer one correction? In the section "Rittenhouse Square Area" there is reference to the Van Rensselaer home at 18th and Walnut Streets and its having a brief fling as a club. I believe in 1942 to about 1974/5 the Penn Athletic Club was located in the mansion. The Penn AC was a good club, a good neighbor and a very good steward of the building - especially the interior. It's my understanding that very unfortunately later occupants gutted much of the very well-preserved original, or close to original, interiors. I suppose by today's standards the Van Rensselaer-Penn Athletic Club relationship could be described as a fairly long marriage. The City of Philadelphia played a large role in my life and that of my family, and your splendid website brings back many happy memories. For me and many others, however, there is also deep sadness concerning the decline of so much of the once great city and the loss of most of its once innumerable commercial institutions. Please keep-up your fine work. Your's is a first-class work.
Posted by: John D. Mealmaker   |   Aug 14, 2014 2:24 AM
Dr. Fisher, The name Philadelphia University was adopted in 1999, as you write, but the institution dates to 1884 and has been on School House Lane since the 1940s. It acquired the former properties of the Lankenau School and Ravenhill Academy, but it did not "merge" with either of them. I hope this helps when you update your site.
Posted by: David Breiner   |   Jun 11, 2014 10:05 PM
Hello Dr. Fisher, I was looking for an e-mail address and this is what I could find. I must tell you my Mother who you treated for years passed away last May. She was so ill with so many problems. I am sure you remember Peggy Marchesani. We often spoke of you and how much we missed you as our Dr. You also treated my daughter Michele who will be 40. I am living in the Doylestown area and have been seeing the Dr's there.. I just had my thyroid removed do to cancer. I have my fingers crossed they get the medicine right. I am not happy with my Endochronologist she refuses to give me Amour. I spoke with my Family Dr who said he will take care of it. I also discovered I have Hemachromatosisand two genetic components. I have a good Hematologist who is monitoring me closely. I must say you would find all of this challenging. Take care and I just wanted to convey this to you . You were way ahead of your time. Thank you, Joyce Gross
Posted by: Joyce Gross   |   Apr 4, 2014 2:06 AM
I come upon these articles from time to time and I always love them. Is the author still alive and available to talk with high school students? Larry Lawrence F. Filippone History Dept. The Lawrenceville School
Posted by: Lawrence Filippone   |   Mar 18, 2014 6:33 PM
Thank you for your articles, with a utilitarian interest, honestly, in your writing on the Wagner Free Institute of Science [partly at "...blog/1588.htm" - with being happy to post that url but the software here not allowing for the full address:)!] I am researching the Institute, partly for an upcoming (and non-paid) presentation and wanted to ask if I might use your article's reproduction for the Thomas Sully portrait of William Wagner, with full credit. Thanks very much for any assistance you can offer here. Josh Silver Philadelphia
Posted by: Josh Silver   |   Jun 2, 2013 1:39 PM
Thank you for your articles, with a utilitarian interest, honestly, in your writing on the Wagner Free Institute of Science [partly at "...blog/1588.htm" - with being happy to post that url but the software here not allowing for the full address:)!] I am researching the Institute, partly for an upcoming (and non-paid) presentation and wanted to ask if I might use your article's reproduction for the Thomas Sully portrait of William Wagner, with full credit. Thanks very much for any assistance you can offer here. Josh Silver Philadelphia
Posted by: Josh Silver   |   Jun 2, 2013 1:39 PM
George, Mary Laney passed away last November. I was one of her pall bearers. She had a bad last year. However, I am glad that you remembered her and her great work. I will post your report at St Christopher's and pass this along to her husband Earl. Best wishes Peter Hunt
Posted by: Peter Hunt   |   Mar 28, 2013 7:12 PM
Hello, my name is Martin. I came across [http://www.philadelphia-reflections.com/blog/1705.htm] and noticed a ton of great resources. I recently had the honor of becoming a part of a new non promotional project on AlcoholicCirrhosis.com. We decided to put together a brief guide about cirrhosis, and the dangers of drinking. We have received a lot of positive feedback and I wanted to suggest that we get listed on the above mentioned page under The National Institutes of Health. Let me know what you think and if you have any further requirements or suggestions.
Posted by: Martin   |   Jan 1, 2013 8:51 AM
I FIND THIS VERY INTERESTING, INDEED. I AM HOWEVER, SEARCHING FOR THE ANCESTOR WE HAVE BEEN TOLD WAS JOSEPH M. WILSON OF JORDAN TOWNSHIP IN WHITESIDE CO. IL USA. MY HUSBAND WAS ORPHANED AND WITH LITTLE CONTACT WITH HIS FATHERS SIDE OF THE FAMILY THE 9TH OF 10 SURVIVING CHILDREN SINCE ALL ARE DECEASED BUT, ONE). I HAVE HOPED TO FIND HIS CONNECTION AS TO THE STORIES RELATED BY SEVERAL OF HIS DECEASED RELATIVES THAT WE ARE CONNECTED TO THE WILSON MILL FAMILY HISTORY. OF JOSEPH AND FRANCES. MY HUSBAND WAS ALSO, FAMILY TO: GRANDFATHER RANSOM (ISABELLA)WILSON & HIS BROTHER WILLIAM; OF ELKHORN GROVE CARROLL CO. IL USA AND HIS SON JOSEPH WILSON(NANCY). I?WE( MY SONS AND NEPHEWS NEICES AND GRANDDAUGHTERS IN COLLEGE... WERE HOPING THAT NOW THAT I AM ON THE COMPUTER AND WITH YOUR HELP THRU THE GENELOGICAL SOCIETY TO YOUR ADDRESS WE MAY FIND THE FAMILY WE SEEK. MY LATE HUSBAND AND I DROVE PAST THE SITE OF THE FIELD WHERE JOSEPH AND FAANCES ARE BURIED , THE CEDARS ARE GONE AND IT IS NOW FIELD. I HAVE BEEN HOPING TO FIND THE LINK FOR OVER 30 FAMILY TO PAY TRIBUTE TO THOSE WHO HAVE GONE BEFORE AND PERSEVERED TO BRING US THE LIFE WHICH WE ENJOY AND SERVE, TODAY. I RECEIVED ONLY THIS WEEK BY A FLUKE AN EMAIL WITH PHOTOS FROM A 3RD COUSIN THAT FOUND MY EMAIL ON A COUSINS EMAIL ADDRESS AFTER INQUIRING AND INTRODUCING HIMSLEF: AND HE TOOK THE TIME TO SEND MANY PHOTOS AND HISTORY OF GRANDPARENTS AND FAMILY AS WE HAVE HAD NONE. WE STILL DON'T HAVE A PHOTO OF HIS MOTHER AND FATHER. WHAT I HAVE OF THE TREE, I AM ANXIOUS TO SHARE WITH FAMILY THAT IS SEEKING HISTORY, AS I STILL AM HOPEFUL TO FIND IT IN TIME FOR THE DEADLINE AUG. 30 TYPED AND DELIVERED TO MY MARTIN HOUSE MUSEUM WHERE I AM A MEMBER. MY HUSBAND WAS A MASTER MASON WHILE IN LODGE WITH THE COUPLE THAT DONATED THE HOUSE TO BE A MUSEUM. THANK YOU FOR YOUR TIME AND THE GRAT WORK YOU HAVE ALL DONE ON THIS HISTORY. WE WERE LIFE MEMBERS OF THE LUTHERAN CHURCH BUT , THERE IS NOT ONE IN OUR TOWN, SO I FOUND THE REFORMED CHURCH,OF WHICH, I AM VERY HAPPY TO BE A PART. THANK YOU .
Posted by: SUSAN WILSON   |   Aug 12, 2012 12:49 AM

Please Let Us Know What You Think


(HTML tags provide better formatting)

Because of robot spam we ask you to confirm your comment: we will send you an email containing a link to click. We apologize for this inconvenience but this ensures the quality of the comments. (Your email will not be displayed.)
Thank you.