How much does free healthcare really cost you to be free

Many people think that healthcare, education, social transfers are free in Slovenia. That's exactly what two visitors from an institute wanted to tell me, and they even said they didn't blame me for having the wrong opinion. Unfortunately, I still have to tell you, nothing is free and in this blog I show you how much does free healthcare and education costs you. 

Imagine Luka. Luka has recently been employed at company ABC d.o.o. He has agreed with the director of the company that he will receive a salary of 2,379.68 euros for his work, which is also the average salary in Slovenia. 

Luka is currently studying, during his studies he met a classmate Filip. One evening, Luka and Filip are sitting in a bar watching TV. Television is showing a short documentary about how Americans are taking out loans for freebie and how they can't afford basic health care services. 

Philip, who is a member of the Left Party, declares; "Look at these poor Americans, they have to pay for their own medical treatment and for school, and everything is free in Slovenia." Luke also finds it unfair that Americans have to pay for medical treatment and education, and he's proud to live in a country where he doesn't have to pay for anything.  

Meanwhile, the month turns and Luke gets his first paycheck. But then something unusual happens, as he receives only 1527.19 euros in his account. Indignant, he calls his friend Filip with the intention of telling him how exploitative the company ABC d.o.o. is, because they did not pay him the agreed salary. However, even before the phone rings to the end, Luka finds out that the payroll is folded, and on the part, which was previously obscured, there are words written that were unknown to him until then, advance payment for income tax, contributions for pension and disability insurance,  health insurance, supplementary health insurance... What the hell is that now? But isn't it all free? 

Then a quiet voice in the background says; "No Luke, nothing is free." Luke, a petrified, unfamiliar voice replies, "Here's the ghost of your financial past, and I want to show you how we got here." 

Ghost and Luka set off to the distant year 1991 on December 23, the day when the Constitution of the Republic of Slovenia was adopted. The ghost points with his finger to Article 2 of the Constitution, which reads: 

"Slovenia is a state governed by the rule of law and a social state." 

Luke looks at him in bewilderment, not understanding what it has to do with the fact that he got a lot less on his bill than he should have. 

Ghost explains: "Luka, this is where it all began, or rather continued, when we wrote or rewrote into our constitution that Slovenia is a welfare state. It is true that this has given us state insurance for health care and state education as we know them today, but at the same time it has plunged Slovenians into an eternal cycle of deterioration of state services and tax increases on an already overburdened population. ” 

Here, the spirit of Luke's financial present takes over, taking him back to the present. He explains why he received 1,527.19 euro in his account and not 2,379.68 euro. 

When Luke got hired, he saw how much his salary before all taxes and duties would be, his gross salary. The first taxes or contributions to be deducted from his salary are contributions to invalidity and pension insurance, health insurance, parental care contributions and unemployment contributions. Together, they lower Luke's salary by 22.10%, and he also pays a lump sum of 35 euros for additional health insurance. In total, EUR 560.90 is deducted for pension and healthcare.  

And that's not all, Luka has studied, uses state roads and other services, which someone has to pay and here he is hit by another tax, income tax. This is 291.59 euros on his salary. In total, Luks salary is lowerd by €852.49 or 35% of his salary is for government services. 

Luke, of course, is a little disappointed that all of this isn't free, but now he claims that it's still worth it in exchange for everything he receives. 

The ghost begins to laughloudly and barely catches his breath, and then continues. 

The state knows this very well, they know that it is as much as you are willing to pay for these services and not a cent more, but since this is not enough anyway, they have put an extra burden on your salary and they hide it from your eyes, under the pretext that the rest of the taxes are paid by the employer. 

Luke became even more puzzled and asked, "What the rest?" 

Ghost explains to him that he pays even more for all these services, because Luka's employer, ABC d.o.o., has to pay another 16.10% on top of Luke's gross salary, which amounts to an additional 383.13 euros on top of his salary. Which raises Luke's real gross salary to 2,762.81 euros. With this salary, Luka pays 1,235.62 euros in contributions or taxes, which represents 44.72% of his salary. 

In this way, it looks as if the employer pays your contributions, but in reality his salary is lower by as much as he should have paid himself. 

Luke gets a little angry, but he still somehow gets over it. 

The spirit does not allow itself to be distracted, and adds; "That's not all, but do you really think that's all the taxes you're going to pay, Luke? The ghost then shows Luke his last receipt from the store.  At the bottom of the invoice it says VAT.  VAT stands for Value Added Tax, you pay this tax every time you buy something and it is 22%, 9.5% or 5% depending on the thing you buy. 

The ghost isn't done yet, and asks Luka, "Do you remember the last time you filled up your car?" Luke replies that of course he remembers it, but he also remembers how his friend Philip explained to him about how oil companies make a lot of money on us little people. The ghost starts laughing again: "That friend of yours is wrong about many things, do you know that you pay another additional tax on gasoline, which is called excise duty, and that all taxes on gasoline together amount to more than 50% of the price of gasoline." 

The ghost tells Luke that there are many other taxes, but that this is enough for the first time so that he doesn't accidentally have a heart attack. 

Luke is angry, but he still insists, saying that at least if he gets sick, he will be entitled to medical care and when he is old, he will receive a pension from the state. 

This is where the ghost of Luke's financial future comes into play, and it takes him into the future. The Spirit shows Luke the man. This man lives in a modest apartment, in which it is very cold, and there is a very modest gentleman in it. He then goes outside, it's cold outside, the gentleman walks around, then gets in line, where he waits for hours. When it is finally his turn to find out when he has surgery on his hip, which he has been waiting for years. When the gentleman returns home, he opens the post office, which contains a receipt of receipt of his pension. When Luke sees the number written on the receipt, he smiles and says, "I couldn't live on that little money." And the ghost answers: "You will have to, this gentleman, it is you in the future, you will work hard all your life, pay all your dues, and in the end you will receive a miserable pension and you will not even get to the operation. How do you like this now?" 

Luke capitulates, surrenders, and becomes melancholic. 

And the ghost strikes him one last blow. "Luke, do you really think that's all, at least read this article on how the state is stealing savings through inflation." Here is a link to an article titled: "How I Found Faith in Bitcoin." 

https://www.oskarvolcansek.com/en/post/how-i-found-my-faith-in-bitcoin

I think I've illustrated well enough by now how much it costs you to be free. Whether you're rich or poor, whether you're an adult or a child, we all pay through some form of tax. The average person pays more than 50% of everything he earns through all taxes. In return, he gets a non-functioning health care system and a miserable pension and a bunch of other bad services. 

When I suggest that the only solution is private insurance, people get scared. 

People do not understand that the state is playing the game of the insurance company in the health and pension system, but it does not know how to play it. 

I do not understand why people trust insurance companies to insure their houses, cars, property, as well as their health, but this is not the case in the case of general health and pension insurance. 

So why doesn't the state take over car and house insurance? 

To sum up, nothing, it's not free, you pay everything, you pay taxes every step of the way, whatever you do, you always pay something when you get a salary, you pay income tax and contributions when you buy food, you pay when you buy fuel, you pay, even when the kid buys ice cream, he pays.. In the end, you get a bad service in return that you would never pay for in the market or you would pay much less for.