Urgh … our health insurance bill is goingup again!
For what we pay every year we could
add another room onto our house. Sheesh,
It seems like we’re paying more and more
for a service we barely use.
I do yoga.
And eat all my veggies.
We hardly everget sick.
Now that we’re no longer required to purchase health insurance,
it kind of makes me wonder…
should we be paying for it at all?
We could pocket the premiums ourselves.
And if we get sick or hurt down the line,
we can just use that money to pay the bills.
But what if we have a serious injury?
Like your turkey fryer incident last Thanksgiving.
No sweat. We can just crowd-source money forthe bills.
I see people on Facebook fundraising
for medical costs all the time! Great!
Although I do think you should quityour extreme parkour.
Only if you give up knife-juggling.
Have you ever found yourself wondering
if you should just skip out on the whole health
insurance thing? If you don’t have coverage offered
through your job, it’s a pretty
heft monthly expense.
In 2018 the averageprivate insurance plan cost $440/mo for an
individual and $1,168 for family coverage!
For that kind of dough, I could afford that
trip to Japan or buy a miniature pig!
With the recent repeal of the individual mandate within the Affordable Care Act,
some younger, healthier people might be left wondering,
“ Should I pay thousands of dollars each
year for a service I’ll probably never use?”
Take Maria here.
She just graduated
with a Master’s degree and works for a tech startup
that doesn’t offer health insurance or retirementoptions.
She’s making too much to qualify
for subsidized healthcare,
so she has to pay $ 375 a month for her individual health insurance policy.
But she’s an avid runner,
eats mostly organic, and hasn
’ t been sick in 5 years.
That money that could be going to her retirement,
or savings to buy a house!
What might happen to Maria
if she decides to cancel her policy in order to fast-track
other financial priorities?
I think it’s time to… RUN THE NUMBERS!
If Maria decides to cancel her health insurance policy,
she can expect to save around $ 4,500
a year. But she’ll still prepare
for the occasional minor injury or illness, by setting
aside $1,000/yr for doctor visits or occasionalurgent care.
If she stashes what’s left
[$3,500/yr] in a CD earning 2.5% interest,in just 5 years she’ll have $18,857! Maria
just has to stay relatively healthy for the next five years,
and she’s gamed the system.
Things are going fine for a while.
And then in her third year
of the plan, Maria is in
a serious car accident.
Auto insurance wouldonly pay a fraction of her medical costs.
支付了所有的医院 手术 和救护车的费用
After all the hospital, surgery and ambulance bills,
Maria is left with $ 58,000 in medical
debt and an additional $ 8,000
on credit cards she used to pay her bills while recovering
($66,000 in debt) Desperate, Maria launchesa GoFundMe campaign, joining the 250,000 other
people who use the platform every year to try and help pay medical bills.
And she ends up raising
the average amount: only $3,000.
Facing $63,000 in debt, her parents decideto help.
They take out a line of credit on
their home, using the money to pay
off Maria’s debts in full.
Two years later, when Maria’s
dad is forced to retire because of his own health problems,
they fall behind on their
mortgage payments and lose the house. Granted,
the chances of a sudden,
costly medical problem hitting someone
young and healthy like Maria are slim…
but not insignificant.
A 2011 survey found that people between the
ages of 25-34 had a 1 in 10 chance of getting hit
with a medical bill of $ 13,000 or more,
and a 1 in 20 chance of at least a $ 27,000 bill.
Considering the lifetime of financial damage that that kind
of price tag can do to you
or your family, those odds are not to be takenlightly. Besides,
the whole point of insurance
is to protect you from really bad things that probably won’t happen.
No one buys insurance
hoping they’ll get to use it.
Is there a middle path
that Maria could have taken that would have allowed her to save something,
but also protected against a catastrophe? Well,
she could have enrolled in a High Deductible
Health Plan [$220/month]. These have lowerpremiums and will help you if something really
bad happens, but don’t typically cover routinemedical costs.
Most insurance providers offer
such options, and they can be a good fit
for young, healthy people.
But Maria would still be on the hook
for everyday doctor’s visits and medications, so she
could still set aside $ 1000 a year for that purpose,
but put it into a Health Savings Account,
which allows her to deduct that moneyfrom her taxes.
And anything that’s not
used for medical expenses becomes part ofher retirement savings.
Health Savings Accounts
are available only to people with High Deductible Health Plans,
and can be started at your insurance
provider’s recommended bank, or one of yourown choosing.
想象一下 如果玛丽亚出了车祸 但有这个保险
Imagine if Maria got into that car accidentwith this scenario.
The most she’d have
to pay out of pocket is $4,000.
And if she stays safe and healthy,
healthy she’ll be stashing money away into her HSA
that could later be used for retirement
and even have a little left over to start saving for a home.
Most importantly, she know
she’s not putting her financial future or that of her loved ones
And that’s our Two Cents!
Do you know other creative solutions to the high costs of health insurance?
Let us know about them in the comments.