Pets can be a serious line-item in your yearly budget. A yearly vet physical can set you back anywhere from $30 to hundreds of dollars, depending upon whether the veterinarian finds anything wrong with your fuzzy, feathered, or scaly companion, to say nothing of the unexpected costs that arise when your pet is ill or suffers an accident.

I first became aware of pet insurance when my kitten, Maxwell, got into a scrap and had to have his face drained (sorry, TMI). I never signed up for it, though. It just sounded like a hassle and I wasn’t convinced the benefits would outweigh my assumptions.

From time to time, we are sent relevant information from other sources hoping to use Wallet Blog as a way of getting important information out there to American consumers.  We were sent this explanation of Medicare benefits by David Colgren, the media relations counsel to CalCPA and thought it might be of interest to our readers. Here is his explanation:

Step 1. Understand how Medicare works.
Medicare is a federal program that provides health insurance to retired individuals, regardless of their medical condition. Here are some basic facts about Medicare that you should know.

Here at Wallet Blog, we get lots of PR pitches. It’s flattering, really. But one company I never expected to hear from, especially in November, is Coppertone. Nevertheless, it’s fun to be surprised (especially as I just winter-proofed my double-paned windows against the encroaching Nor’easters).

Their pitch was helpful and informative, and I live to be helpful and informative, so let’s talk about some little-known ways to maximize your FSA spending.

The latest version of the health care reform bill, sponsored by congressional Democrats, offers a mixture of both productive and counterproductive methods of gaining the necessary revenue to make affordable national health care a possibility. However, by-in-large, the bill ignores the fact that we operate in a free market capitalist society, in which competition exists in order to keep costs down. Instead, the bill proposes a funding solution that will cause a trickle-down effect, with the costs of reform being passed back to the consumer at the end of the day.

The bill does have a few provisions that would encourage competition and thereby drive down costs. For instance, it includes a provision that would allow the government to negotiate prescription drug prices for beneficiaries. However, in large part it targets the medical industry as a funding source for the suggested overhaul, by levying fees and taxes on medical device manufacturers and drug companies, among others.

If you tuned in to “60 Minutes” on October 25th, you saw a segment detailing the extent of fraud committed against Medicare and taxpayers.  If you missed it, here it is:

The latest version of the health care legislation has weakened the requirement that all Americans must have health insurance. Coupled with the inability under the proposed law for health insurance companies to deny coverage to people for poor health, this concession would mean that Americans could purchase insurance at any time and therefore would have little or no motivation to get health insurance while still healthy.

What Washington has failed to account for is that the very idea of insurance is based on the idea of spreading the costs between people who file a claim and those who do not. The cost of premiums is kept down precisely because some people will not die within the span of a term life insurance policy, or will not have a car accident, in the case of an auto insurance policy.

A few weeks ago, in the middle of the evening rush hour and during one of Washington, D.C.’s infamous summer rainstorms, I was side swiped.  The fault was completely on the part of the driver that hit me.  After this lovely woman insisted, while screaming at the top of her lungs, that the accident was my fault, we exchanged the necessary information.  I looked down to the portion of the torn piece of paper where she had written her insurance information, and saw that she had listed a company called MAIF as her automobile insurer.  I thought innocently, “huh, never heard of these guys before.”

When I got home I Googled “MAIF,” and was shocked at what came up.  Turns out MAIF stands for the Maryland Auto Insurance Fund, which was, according to the Web site, “created by the Maryland State Legislature in 1972 for the purpose of providing automobile liability insurance for those residents of the State of Maryland who are unable to obtain it elsewhere in the private insurance market.”  What does this mean?  It means the state of Maryland has a government run and subsidized car insurance program for residents who have been priced out of the commercial auto insurance market.  This usually happens due to drivers being involved in multiple car accidents, which causes insurance premiums to increase until they eventually become unaffordable.  I’m not a resident of Maryland, and I’m a liberal who believes in big government, but I’d be pretty teed off if I knew that even one penny of my tax dollars was going directly or indirectly towards a program that seems to have been designed to help insure reckless drivers.  I’m all for universal coverage when it comes to health insurance, but for car insurance - nope not on my dime. 

I’ve been criticizing the Obama administration’s healthcare plan recently without really offering an alternative solution.  Rather than continuing to point out the faults within the plan currently being offered up, I’d like to lay out my vision of what a comprehensive, national healthcare plan should look like.  This is a plan that I think will work, particularly because it is driven by the fundamentals that shape any successful free market economy.

The healthcare system I am proposing is designed to fix the elements of our current system that don’t work, and leave the elements that do work with relative effectiveness as they are.  One rarely hears complaints about the quality of U.S. healthcare; rather the complaints are centered around coverage and cost.  And so, I feel that if a healthcare system is to work, it should strive to maintain the level of quality we currently enjoy, while at the same time driving down costs and increasing coverage. 

The pending health care plan being debated currently in Congress lacks, according to  the director of the Congressional Budget Office, Douglas Elmendorf “the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount.”

Elmensdorf is not alone.  The previous Secretary of Health and Human Services (Mike Leavitt) and the head of a Medicare advisory commission (Glenn Hackbarth) have both said that the plan does nothing to stop the escalation of health care costs which, once under the jurisdiction of the government, will cause a massive budget deficit which will, eventually, be passed on to the tax payers.

Want to save 40 to 80 percent of the cost of a domestic Total Knee Replacement, heart procedure, plastic surgery, or another, typically high-cost medical procedure?  You might look into medical travel, which can save you up to 80 percent of the typical costs for an equivalent procedure in the United States.

“If the procedure you’re considering costs more than $6,000 in the United States, it might be worthwhile and money-saving for you to evaluate a medical travel option,” said Patrick Marsek, Managing Director of MedRetreat and co-author of “The Complete Idiot’s Guide to Medical Tourism.”

As the nation’s lawmakers make decisions about healthcare reform, we ought to keep in mind the danger of fixing a system without understanding how it  became broken in the first place.  Among nations with comparable average lifespans, Americans pay more for healthcare than does anyone else in the world.   The system is grossly overpriced, because it has structural problems which need to be acknowledged before they can be fixed.  One such problem is the American Rule in lawsuits.

The American Rule  requires that, even if someone wins a lawsuit, they remain responsible for their legal fees.  This means that if someone brings a lawsuit against you, though you may have done nothing wrong, you still have to pay for your defense.  In general, the American Rule encourages a kind of legalized bullying since the system does not provide incentive to avoid starting a lawsuit, and actually encourages frivolous legal action.

There has been a lot of talk about healthcare in the news recently, especially in regards to its reform.  For the most part, these discussions center around coverage: who pays for it, who will get it and what that means for those who do?  What seems to be missing from the discussion is an acknowledgment that a system that doesn’t hold the recipient at least partially responsible for the financial burden of their medical expenses is likely to fail. 

The problem with America’s current system is evident with one look at its global performance.  Though life expectancy is about the same in France, Sweden, the United Kingdom and the United States, the price of healthcare (as a percentage of Gross Domestic Products) varies greatly.   According to the World Health Organization’s 2009 report, the U.S. pays over 15%, whereas France pays 11.2%, Sweden 9.2% and the United Kingdom 8.2%.  We are paying more for what is essentially the same level of healthcare because our system encourages inflated costs.

At a time when everyone is looking for a way to make their money stretch further, one solution to curb rising insurance costs is to regulate insurance at the federal, rather than state, level.  Such regulation would require tax payers to pay for one regulatory body (rather than fifty) and would allow the insurance providers themselves to more easily and more cheaply operate at a national level.  Thus the price of insurance  would go down through increased competition.

To better understand this point, we must first acknowledge that for every business, there is inherently a cost associated with operation—whether it be the cost of raw materials, the rent on a storefront, the salary of employees, etc.  For insurance companies, part of their operation cost is related to staying within compliance of state regulation.  As insurance is regulated at a state level, rather than the federal, the various laws that govern the operations of these companies change depending where you are in the country.  It stands to reason then, that the cost of staying in compliance in Georgia, doubles if the company must also stay in compliance in Montana.  A company that offers insurance policies nation-wide must pay an increased overhead so as to simultaneously stay in compliance for all of its customers in all fifty states.  With only one set of regulations, however, any state insurer could make the transition to a regional or national insurer without having to incur additional costs.  Thus a change in regulation would increase the number of providers in the market and would lower the overhead costs for all the insurance companies.  The combination of a lower cost structure and increased competition, would bring in a better price for consumers.

Janine Sahadi did a great job over at CNNMoney.com describing the current ideas being looked into by lawmakers to help the government pay for health care reform. From her synopsis, it looks as though the government is hoping to tax revenues that have, up until now,  gone untaxed. So far, lawmakers have suggested taxing, among other things, employer contributions to health care, Medicare benefits for state and local government employees, and drinks with high fructose content.

We are fundamentally aligned with the belief that everyone ought to get health care regardless of their condition as we see this as a basic human right.  However, we find it a little disturbing that all of the ideas being bandied about by lawmakers involve either raising existing taxes or creating new taxes. We are willing to do our part, of course, but shouldn’t the government be just as willing?

Obama has four major issues on the agenda for his presidency:  three he wants to deal with and one he inherited.   Those issues are: the current economic recession, education, health care, and energy.  All of these issues are pressing.  Massive government spending needs to happen to keep this recession from spiralling into a full blown depression.  We must maintain high standards in education so as to make sure that the next generation of American worker will be as competitive in the world stage as the previous one.  We must refigure health care for moral reasons as it is unacceptable that one of the richest nations in the world should leave millions of its citizens without health care.  Energy innovation is an issue of  both national security and economic prosperity in that it keeps America’s money at home instead of sending it abroad.

All of these projects will significantly drain the nation’s finances in the short term.  We agree that these plans are necessary but the money to pay for them must come from somewhere.  As we see it, of the four agenda items, the development of a more efficient energy source is the most likely to produce the money needed to fuel the other initiatives.