Family Healthcare: USA and Canada

Healthcare cost is one of the major expenses of middle class North America. In the USA this expense is covered by employer provided plan(s) and private household plan(s), or Medicaid if you qualify. In Canada this expense is covered by employer provided plans(s) and the government; few Canadians pay for a private household plan.

It is natural that healthcare expenses will go up as you age and when you have kids. As the gig economy grows and more people are self employed, the portion covered under employer provided plan(s) shrinks. Self employed people and gig workers will have to pay double for the same coverage to families growing up in the previous manufacturing economy.

In Canada there is a universal healthcare plan for everyone, rich to poor, young to old, everyone pays the same amount in taxes towards paying for it. The differentiating factor is private employment, in which a good stable job also provides the best healthcare plan to employees. But that differentiating factor is eroding among middle class kids growing up in a gig economy. Perhaps that is why the news is reporting that the majority of second mortgages, loans using the equity in your house as collateral, is being used by aging baby boomers during their retirement. And it will explain why Canadian household monthly expenses (bills for debt) are close to 200% of monthly income.

Human Resource professionals are shedding light on a unique phenomenon for companies. There are now 5 generations of workers in their work place. And that is a complicated scenerio for managers because it puts people against company bottom line. The situation gets more complicated with diversity and the unexpected stories of individuals that the cost model is not as simple as older workers are less healthy. In Canada, lyme disease is on the rise as is the opioid crisis which began with an approved pain-killer. These unforseen factors are creating a complex health coverage cost model for big employers and practically an impossible one for smaller employers to have to deal with.

Exacerbating the situation by limiting the free flow of capital are speculative activities and decisions that are causing inequal distribution of wealth in the economy. The sentiment might be that if you build it they have no other place to go; except it didn’t take into account people’s sense of self worth regarding their own perceptions to their family’s future well being, their experience and investment in all things related to skills training. That if you make them an offer they can’t refuse they will, because it is meant to make a few rich and get a few others off the hook for wasting money.