There is a continual suggestion that CI's prices be increased because of the inevitability of inflation and because of the inexpensiveness of insurance policies. I have been opposing this because almost all of our patients pay in cash and are scraping to raise the funds. By raising prices above current levels we would rob people of access to cryonics and reduce our cash flow. Of our last 10 patients, no more than one or two of them paid with insurance – the rest were cash.

$15,000 is enough to cover our marginal patient costs including liquid nitrogen in perpetuity. Anything over $15,000 helps covers our fixed costs. Our fixed costs are the same whether we get one patient per year or ten patients per year. Our fixed costs are about ten times what our marginal patient costs are.

People who are funding through insurance are not likely to become patients for at least ten or twenty years, when we may be suffering from the effects of inflation. On the other hand, economies of scale could make things cheaper per patient in twenty years (as has happened with us and liquid nitrogen). But to be conservative we can offer "cash discount" prices which are much lower than our insurance prices -- thus allowing us to raise our prices for those who pay by insurance. That would also give us a free hand to raise cash prices for those who do not pre-pay insofar as we would have no commitments with last-minute or post-mortem clients. People who pre-pay in cash would be "grandfathered-in" at their pre-payment amount.

The downside of this is that people may try to leave insurance proceeds to their relatives -- trusting them to pay in cash. Or use this as an excuse to delay making arrangements until the last minute. I am not sure how much to be concerned about this. There are already people who think that they can save on Membership fees by joining at the last minute and think this is a good idea. In practice, this plan nearly always results in disaster -- burial or cremation. But it may be excessively paternalistic to try to prevent this, when there are obvious advantages to separating cash pricing from insurance pricing.

A more worrisome downside is that this will increase incentives to fund with trusts, PODs, etc. I think such funding should be priced the same as insurance policies because they are so risky and so messy. I am very fuzzy on this subject and am hoping that discussion will bring me more clarity. Trusts are a legal nightmare to interpret and to ensure funding for -- and they are rarely guaranteed to pay promptly in a cryonics case. On the other hand, if we are hard-nosed and say that a person will simply wait in ice until CI has cash in hand, that might create incentives for better alternatives.

The CI Directors are having a Conference Call Meeting next week and I am proposing the following:

(i) Grandfather-in all current members at current prices.

(ii) Retain current prices for those who pay in cash.

(iii) Charge $38,000 for Option One Members and $48,000 for Option Two Members who fund with insurance or other non-cash alternatives. (For those living in the United States, the extra $2,000 can be spent on their local help rider.)

(iv) Effective date for the price change should be July 1, 2007

I would like to hear from CI Members what they think of this plan, which could help the Directors in making a decision.

Ben Best

Marta Sandberg replied: With due respect Robert. Two hundred dollars a year is a lot if you are on a fixed income of $177:- per week (that is the pension rate in Australia translated into US dollars). It is also bad business sense as CI would come to rely on a continuous stream of new members to pay the running costs for those that are already frozen. Sooner or later that will break.

I have a high regard for your stewardship of CI, but sometimes I disagree with you.

Marta
*****

You may be right, Marta, about dues--even grandfathered--being a bad idea,
if added to Option One. I don't have any strong feelings about it.

Bob

I've been a fully funded member of CI for 7 years, as an Option One member. I think that CI should not at this time raise their prices or start annual dues. If in the future, the economy and inflation get worse, than CI can increase their prices and begin annual dues.

Paul Battista

Why do we have to raise dues at all at this point????? Because everyone else is raising prices ie. inflation??? This is always a common argument to raise prices for anything even if prices don't need to be raised. As such the inflation argument becomes self fulfilling. The real question is has the cost of liquid nitrogen gone up specifically...has the cost of the facility gone up??? What specifically is causing a need for or a perceived need for costs to be raised...I think this is a fair question. Arguing if people should be grandfathered in or not assumes that a price increase is needed in the first place....I am not convinced that one is needed and I am not sure that the gains in funds would outway the losses in potential new members.
The scales of economy some times dictate that getting 10 customers to pay $1 at a 50% profit margin is better then 2 customers paying $2 at a 100% profit margin. I still think more customers
is the answer to greater security and funds not dues increases....in fact the lower prices is why many choose CI over Alcor....I might even suggest lowering dues as an answer to a greater pool of funds....How about a sale on memberships or funding to attract people on the fence...This is how most successful business models work. Not until your company is a house hold name should you think about raising prices. We could kill off enthusiasm from the masses before cryonics even gets a chance to take a really strong foothold. If I am wrong about CI's financial security then please let me know what specifically is causing prices to go up...and don't say inflation because inflation doesn't always dictate a raise in prices....Further more I doubt there would be any serious discussion of lowering prices in a deflationary cycle?????

Dennis Kowalski

I liked Kevin's approach below about CI getting more new members by keeping our basic paid up price at $28K. However, I also like Ben's approach as far as the insurance type contracts being made at a higher prepay amount since it involves little difference in the premiums paid as for say a $50K insurance policy as a 28 K policy simply does not exist. So, I propose that we keep the cash prepay 28K policy with CI, but go with a higher future insurance contract as Ben has proposed which I would vote for. However I would not require the new CI policy to make CI be the exclusive beneficiary of such insurance policies.

Jack Nixon
Jack is a CI Director

Since the present facility was started, I would imagine that the costs of operations ( ie salaries and liquid nitrogen and equipment updates) has had a certain level of inflation, maybe even deflation. The cost of protection, (ie insurance, national and local taxes, legal fees) has most likely risen beyond average inflation. The difference between that and income from memberships, investments plus overpayments and gifts provides a "disposable income" that can be spent on public education and research.

If the cost of protection goes on rising beyond general inflation, and there is no deflation in costs of operations, or increase in nett receipts from investments, it will start eating into the "disposable income" until nothing is left. Then price rises will be forced.

The same sort of problems exist with family budgets in the UK where the cost of local taxation rises more than general inflation. It lead to the "poll tax" riots towards the end of Margaret Thatcher's period of office. A similar level of unrest is approaching with the current "council tax". (The main difficulty is that both these local taxes are capital based not income based.)

The idea of trying to educate insurance funded members as to inflation is a very good one. However when the figures go in, a young person finds he has to insure for dizzyingly large amounts. Allowing for 5% inflation from age 20 to age 120 (not unrealistic for someone 20 today) multiplies the insured amount by 1.05 to the power of 100, which is just over 232 times. Thus $28k becomes about six and a half million dollars. A 20 year old insuring for even one million dollars is likely to raise a few eyebrows.

I know inflation is less at present, but there are periods of very high inflation for a while, so 5% overall seems a reasonable guess as any other.

Perhaps the best answer may be to insure for as much as one can afford the premiums.

John de Rivaz:

John is a CI Director

Customers vs consumers vs members vs owners, tax exempt!

Wow! Thanks to everyone who's responded on the customer issue. For anyone who misunderstood, I like being a member better than a consumer, and customer better than consumer too. Plus, you can obviously be ALL THREE---and you are. The one thing you CAN'T be is a shareholder, or an owner, right? Or is this my misunderstanding?

I do understand that being non-profit, and not to have recognition of tax exempt status from the IRS is a very bad thing, as potential donors can't deduct their donations at tax time. Also, can you get grants without tax exempt status? I hope CI wins that appeal, and soon. That might make the whole rate increase issue moot, eh?

To respond to Ben's call for our opinions on the rate increase, I would like to appeal to the directors who are here to vote "No", at least unless some reason other than it might be a good idea is found. I can only generalize from my own experience. I think keeping costs as low as possible is a good thing, and since CI could also prosper from getting new members, why not try that first? The low cost, imho, is a big selling point. Next: some ideas on getting more members...
Cheers,

At the Cryonics Institute Directors' meeting held on Tuesday, Nov 28, 2006 the question of whether to have different prices for people who pay in cash and people who pay with insurance was considered.

Our attorney David Ettinger advised us that it would be in violation of Michigan Cemetery law to give cash discounts. Thus we could only describe the proposal as a price increase for people who pay through insurance. And the main justification we could give for this differential increase is ability to pay ("soak the rich"), because insurance is cheap and it is difficult to get an insurance policy for less than $50,000.

It was acknowledged that only one of our last ten patients used insurance, the rest paid in cash. Those who pay in cash are very price sensitive and raising cash prices would likely reduce revenue. Raising prices for people who wish to pay with insurance would make little difference to our bottom line insofar as most of our patients are being funded with cash. The rationale that our costs will be higher in the future is based on the assumption that we will not experience economies of scale and on the assumption that we would not raise prices at the time required because of a moral commitment to grandfathering. We are not committed to grandfathering prices and CI Members should be warned of this fact. We will deal with inflation problems as they arise, not by anticipation.

The proposed price increase for Members funding with insurance was defeated by a vote of the Directors.

Ben Best

No, I don't say prices have to increase eventually. I say prices have to increase now (as in: yesterday), a conclusion reached eventually. CI Directors can decide not to increase prices. Eventually this will come back to haunt the membership, as all of a sudden in 2010 or 2020 a new CI directorship will decide prices will go up. And by then they will skyrocket in one jump from $28,000 to $70,000 or so, and a chance exists current members at that time cannot be grandfathered-in. This hurts the total package more than a gradual increase of fees, be it just inflation-correction.

Jappie Hoekstra wrote:

"$15,000 is enough to cover our marginal patient costs including liquid nitrogen in perpetuity. Anything over $15,000 helps covers our fixed costs. Our fixed costs are the same whether we get one patient per year or ten patients per year. Our fixed costs are about ten times what our marginal patient costs are."

http://tech.groups.yahoo.com/group/Cryonics_Institute/message/2176 Implicit in the above criticisms is the assumption that higher price => higher income

As has been stated repeatedly, the fact that 90% of our last ten patients paid in cash, and most did so by scraping for the

funds -- and the fact that others were not able to raise the funds -- indicates that the above assumption is false. And, of course, we must remember our goal of making cryonics accessible, if possible.

Not only is it bad business judgment to simply assume that demand is inelastic, it is wrong to ignore the effects of economies of scale on covering fixed costs. MacDonald's does not pay for its buildings and equipment by charging their first clients hundreds of thousands of dollars per hamburger. It is not a simple task to estimate volume of sales, but the effect of volume on covering fixed costs is crucial. I certainly do not argue against the proposition that the more money we have the better off we are. Despite Alcor's higher prices they rely greatly on donations, which cover about four-fifths of their costs (including a large staff). At CI we have much lower costs to cover -- fewer staff, fewer projects, much less equipment, smaller facility and no independent standby/transport program (relying on Suspended Animation, Inc.). Imaginary calculations can be made for both CI and Alcor concerning what costs could be cut if there were no more donations, no new Members or Patients and all costs had to be paid only through revenue from investments (with assumptions about returns from investments during times when equity prices are dropping).

Re: Prices and Methods of Funding Suspension I still think unfunded cases could be handled by (what's the polite term here?) neuro straight freeze. I think future technology will be able to repair over 95% of that damage, failing only where severe pulverization has taken place. This could be offered only as a contingency rather than as a standard service. I know nobody will take this suggestion seriously, but I still thought it needed to be voiced.

Jordan is a CI Director

Graham Hipkiss wrote:

I've always been against reanimation funds for the reasons already well stated, i.e. the main goal is to survive and the best way to do that is to give as much as possible to CI/Alcor to spend on research/promotions/infrastructure etc.

As cryonics organizations acquire more Members they can become increasingly impersonal and the Members feel a reduced sense of personal involvement, despite our efforts to prevent this. Fewer CI Members seem inclined to leave money to the organization. On the contrary, many of our Members make every effort to ensure that CI does not get paid one penny more than is absolutely required to obtain service. Are we to oppose this sentiment by protesting their "selfishness"?

When people pay the minimum amount to CI and strive to get all of the rest of their assets into a reanimation fund they believe that they are maximizing their self-interest. In their own eyes, giving money to CI accrues a negligible benefit to them personally. It is the "public goods problem". People who believe that a reanimation fund is the best use of their money are engaging in wishful thinking. They imagine that having a contract to be cryopreserved guarantees future survival and reanimation.

But a cryonics organization is not a supernatural being that can transport you in time and space whenever and wherever you die. Money would be better spent on increasing chances of full survival of all of your mental faculties than on a reanimation fund.

I believe that making arrangements for Standby and Transport with Suspended Animation is a better use of money than a reanimation fund. Money can be well-spent on personal cryonics rescue equipment, like the EZ shampoo bath, which can be used for cooling the head in ice water:
http://www.wisdomking.com/product15223.html

A well-equipped local cryonics support group could be greatly benefited by capital investment. You cannot buy enthusiasm for cryonics, but you can advertise and promote cryonics locally to find like-minded people who would assist.

Money could be spent on medical surrogates if family members are not sympathetic to cryonics. Money can be spent on arranging to move close to the Cryonics Institute and/or invested in cryonics-friendly hospice care for when you are terminally ill. Money can be spent on improved alarm systems that monitor vital signs -- and on people to respond if necessary.

In sum, I believe that any money spent on reanimation funding would be better spent on improving the likelihood that reanimation will occur. This is not only enlightened self-interest, it is of benefit to other cryonicists because what we learn can be shared with others, and the more people who use cryonics services the more economies of scale become possible. Donating money to the Cryonics Institute does help strengthen the organization. It may be of greater personal benefit than a reanimation fund, by increasing the probability of reanimation. I am greatly over-funded with life insurance to protect myself against price increases and to allowfor additional cryonics services which may become available at additional cost, such as intermediate temperature storage. I have chosen to leave any over-funding I have to the Cryonics Institute.
Ben Best

Jeff Fortin wrote:

Ben, I thought this was interesting. Check out this link, I am going to be putting all of my vital information about SA and CI on this medic tag. http://www.usbmedic.com/index.html
This may be something we can offer in lieu of the bracelet or necklace?

Marta Sandberg wrote: It seems a good idea, but for it too work it has to be generally recognizable and emergency workers must have access to a computer to plug it into. Do you know the answer to those queries?

Marta

Dennis Kowalski replied:

I think its a good idea perhaps as a supplement to a standard emergency bracelet or necklace. But as a practical point from an emergency paramedics point of view...I can tell you at the present time there is going to be no one available to take the time to stop and read a flash drive....everyone will be working to keep you alive immediately (a quick bracelet check will be done but that is all we are trained to do and we do not have portable laptops...we do however have squad mounted laptops that do not allow access to flash drives nor are we allowed to put anything on them if we could.

If you are declared dead in the field...we do nothing else to your body it is to be left alone until the police and or medical examiner arrives...If the police only arrive then they probably won't touch the body or look at a med alert bracelet much less a flash drive chip...The medical examiner may look at the bracelet to reaffirm suspected death due to prior existing medical condition but they may not be in a hurry to do so because this may all be completed at time of autopsy if one is desired. I would hope that sometime before autopsy. that some one from the ME's office would read it and follow up at the office...a curious examiner or tech should run the flash drive to check your Prior medical history more thoroughly...once they get clearance to upload on a city computer...which is generally frowned upon by anyone other then authorized computer techs or maybe a doctor...that’s if you die at home or out in the street as we say.

When trying to revive a cardiac arrest patient (all dead people are in cardiac arrest) we rely mainly on family and friends, med bracelets, or obvious signs and symptoms prior to deanimation for Past Medical History...we simply do not have time and resources to upload flash drives and as soon as you are declared dead in the field...we get back in service to help someone else as do the police and then the on scene ME. It is up to family to follow up on Cryonic requests with or with out limited assistance from ME or Funeral Home at that point
Now if you deanimate in a hospital the situation is similar with a twist....Pretty much the same procedures in a Emergency Department would be followed until after they give up or pro

nounce you. Would anyone even have time to consider running a flash drive? I suspect that a busy hospital as most are would move on to other patients and not even bother. Unless you are dieing real slow which gives much more time for family and friends to bring hard copy documents and to advocate themselves. But if you had already died, a curious doctor who wasn't busy might run it.

The body would sit in the room until family was called in to identify or make their peace....or until police arrive in (suspicious cases)....police aren't normally called to hospitals.. after anywhere from 10 minutes to 3 hours the body would be taken via a tech to the hospital morgue. After the family has been notified, the body could be then picked up by a certified funeral director and the same situation would apply as in a field death.

So In all cases it pays to die around family or friends who support cryonics and it pays to talk to a funeral director in advance. It pays not to die of suspicious causes and to die slow enough to have some input into your preservation. I would not at all rely on a flash drive but it is yet one more level of protection or at least a source of additional information that could help out...If family was present but did not have the religious objection to autopsy on hand they could snatch the flash drive and run off a copy to hand to the ME....but again you would need access to a computer and printer. so you might as well just have a preprinted copy.

The flash Drive is just another tool in the tool box..not the big answer to all our problems....The best we can do is have human intervention...an advocate right there willing to fulfill our wishes or fight for them. Having a close friend or family who understands and has the right paperwork and who is willing to come to the hospital ASAP to help out would begreat.perhaps more then one so you have multiple coverage.

I always thought there should be a volunteer network of cryonics members so that local areas would be served by cryonics advocates assisting families. Perhaps a person would dedicate himself to a 50 or 100 mile radius as willing to come to a area at any hour...including leaving work etc. Have that persons cell number put on tags also so they could zoom over and see that things go smoothly or have them act as a liaison between CI and the ME or Family. Its just a thought...it would have to be entirely voluntary and wouldn't come into play very often as there aren't many people dieing who are signed up for cryonics but I know I would volunteer.

What I have outlined is my experience with dead or dieing people and I have never seen any patients with med-alert flash drives...but I will be taking the time to talk with a few doctors and medical examiners to see how they would react...maybe they would react differently then I have outlined...but either way I will get back to you with this info....It may take a while but I will find out.
Dennis K

Jeff Fortin wrote:

Marta, To answer the question of being recognized, it is a standard USB thumb drive that will most likely contain the information on Word docs, which is recognizable by any computer running windows, the information could also be viewed by word pad as well which even older running computers have installed.

Eron Hennessey wrote:
To be on the safe side (and who wouldn't in this situation?!) I'd personally only store such information in plain ASCII text – guaranteed to be readable on any system, with any word processing software, text editor, notepad, or what have you since the dawn of USB storage, and most likely far, far into the future.

It's important to note that if you include a Microsoft Word document saved with the most recent version of Microsoft Word, older versions of Word won't be able to read it without installing special updates for compatibility with the new format. Some older versions of Word (anything DOS-based, for instance) would not even be able to read many of the Word documents that exist today. To further complicate things: beginning with Microsoft Vista -- WordPad will no longer be able to read the new XML-based Word format.
I certainly wouldn't want to take the double risks that (1) the "emergency" computer has Microsoft Word installed and, additionally, that (2) It's the latest version, and/or has the updates necessary to read whatever Word format the docs were stored in. There's no guarantee, either, that older Word formats will be readable on present or future computer systems. ASCII text is the most universal, past- and future-proof option, followed
closely by HTML. The .rtf format that can be stored by Word and WordPad is also widely supported, since it is also a text-based format.

So, were I to have something along the lines of a USB "tag", it would be bright red, emblazoned with the ancient caduceus symbol, and be labeled "EMERGENCY INFORMATION!" on it. Within, it would simply have a text file(s) in the root directory (no sub-folders!) titled with eye-catching and unmistakable names, such as:

IN CASE OF MEDICAL EMERGENCY

IN CASE OF DEATH

The first file would contain information on allergies or other conditions that would affect emergency medical treatment. The second would duplicate the information found on the CI medallion/bracelet, followed by more complete procedures or information regarding cryonic preservation. Any computer modern enough to have USB ports on it will be able to read these files -- *no matter* what OS or software is installed on it.

This might be something good to have *in addition* to the normal CI tags .I'd never replace my metal CI tag with such a thing. As I mentioned, I'd rather be on the safe side. Especially where my life is concerned.