Ok to go without health insurance?

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Topic Author
DiehardDoc
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Re: Ok to go without health insurance?

Post by DiehardDoc » Tue Oct 22, 2019 12:43 pm

cmublitz wrote:
Tue Oct 22, 2019 11:45 am
I think I get it. Between whatever medical situations you can handle between you, your spouse, and colleagues (via professional courtesy?) that probably covers a ton of cases. You could also handle cases of long term issues or anything that can wait a couple days to 1 week because of your business application out of cycle + no exclusions for pre-existing conditions.

However, how would you handle an actual immediate emergency like a car accident? I assume you could theoretically rack up $100Ks+ of medical bills before your newly applied insurance kicks in. I doubt any newly acquired insurance would retroactively cover you during the days you are applying for coverage. Is the plan to effectively self-insure that risk?
Auto/ Umbrella should cover some of the costs?

Topic Author
DiehardDoc
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Re: Ok to go without health insurance?

Post by DiehardDoc » Tue Oct 22, 2019 12:46 pm

furnace wrote:
Tue Oct 22, 2019 12:43 pm
DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Back ground:
Physician couple, self employed, family of 4, 2 adults( 46, 43) 2 kids ( 9,15), S corp.
This year health insurance premium increase is almost 15%.
Will cost ~16K with family deductible of 12 K to stay in PPO network.
[cut]
Is it too risky to go bare?
One is never too rich to save money. Look into short term policies; they are made for people who are healthy like your family. One company in this space is Health Insurance Innovation (https://www.hiiq.com/).
Thank you. Will look into it.

SQRT
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Re: Ok to go without health insurance?

Post by SQRT » Tue Oct 22, 2019 12:47 pm

gr7070 wrote:
Tue Oct 22, 2019 11:24 am
I don't quite understand the outrage. Surely, many folks understand the concept of self-insuring. We do it all the time for things we can afford - like cell phones, and everything else we reject the extended warranty.

Large corporations self insure, for health and others, all the time, as well.

Do not most health insurance policies have a maximum lifetime payout? So aren't we all self-insuring for any amount over, say, the $1M max limit?

So I don't understand why everyone is aghast at the question. Seems a very reasonable question to me.

While a reasonably inquiry, I doubt I'd be inclined to do so myself. Not for four people, not with that "low" a net worth. You cannot afford to pay for a couple million dollars in care costs and come out the other end not feeling the financial effects. Especially if you spend a little bit like your income might allow.

I'll second the above question about the investing part. Simply because if invested if want it in an appropriate investment, one that's diversified.
Agree with this. At some level of wealth, probably more than the OP, health insurance is optional. Really need to assess the worst case scenario and if that doesn’t result in a catastrophe, self insurance is an option.

Clarice
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Re: Ok to go without health insurance?

Post by Clarice » Tue Oct 22, 2019 12:50 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Back ground:

Physician couple, self employed, family of 4, 2 adults( 46, 43) 2 kids ( 9,15), S corp.

This year health insurance premium increase is almost 15%.

Will cost ~16K with family deductible of 12 K to stay in PPO network.

Cheapest Option ~ 13K with family deductible of 13.5K for restricted in state network without access to most major teaching hospitals.

Advantages : wellness visit per calender year covered for each family member, hsa eligible, hsa and health insurance paid through S corp as fringe benefit.

Disadvantages: Other than wellness visit, each year 13k-16k goes to insurance company. Can't contribute ~$6900 to HSA account.

So far balance in HSA is ~ 100K.

Now that penalty for not carrying health insurance is gone , thinking of investing premiums in a separate fund marked health care and invest in Vanguard health care fund.

So far, family fairly healthy and use healthcare services sparingly.

Have total assets in mid 7 figure range in case something unexpected in terms of health care happens.

Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation.

Is it too risky to go bare?

Thanks in advance for your advice.
I’m considering skipping the cost as well. I’m 27. Healthy aside from weekend beers. No kids.

But then again - If I don’t have health insurance then I can’t contribute to HSA! Whack. Premium saved might not outweigh tax advantages.

rkhusky
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Re: Ok to go without health insurance?

Post by rkhusky » Tue Oct 22, 2019 12:56 pm

willthrill81 wrote:
Tue Oct 22, 2019 12:41 pm
rkhusky wrote:
Tue Oct 22, 2019 12:40 pm
Get catastrophic coverage and self-insure for the ordinary stuff.
I thought that the ACA gutted 'catastrophic' plans.
I thought they were making a comeback with more recent changes in the ACA.

123
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Re: Ok to go without health insurance?

Post by 123 » Tue Oct 22, 2019 12:57 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
...Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation...
If there is an auto accident (typical situation) and you and spouse are in comas and kids are in ICU who in your corporation will do the shopping for insurance (and has the authority to do so) and the enrolling?

"We need to buy some health insurance, the who family(company) is in the hospital (ICU) right now, what do you have?" Good luck with that.
The closest helping hand is at the end of your own arm.

cmublitz
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Re: Ok to go without health insurance?

Post by cmublitz » Tue Oct 22, 2019 1:34 pm

DiehardDoc wrote:
Tue Oct 22, 2019 12:43 pm
Auto/ Umbrella should cover some of the costs?
Maybe your coverage is vastly different from mine, but my Umbrella only covers liability of damage I caused to others, not the medical bills of the occupants of my own vehicle i.e. myself. I haven't looked recently, but I think my car insurance Vehicle Occupant Medical Coverage was something like $4-5K, which would help with deductibles, but not actual significant medical care.

KyleAAA
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Re: Ok to go without health insurance?

Post by KyleAAA » Tue Oct 22, 2019 1:36 pm

This seems incredibly short sighted. A string of bad luck could completely wipe out your net worth. Not likely, but stranger things have happened. The insurance costs you cite seem like very, very cheap insurance.

Certainly, at some point self insurance becomes reasonable. Mid 7 figures is nowhere near that point.
Last edited by KyleAAA on Tue Oct 22, 2019 2:03 pm, edited 2 times in total.

LawEgr1
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Re: Ok to go without health insurance?

Post by LawEgr1 » Tue Oct 22, 2019 1:42 pm

EDIT:

I added too much info for my tastes. Long story short I had a medical issue that cropped up unexpectedly, and prior to that I was extremely fit and healthy.

I'm in my thirties. Never thought something could happen like that, and poo-poo'd all the people that said 'things happen'. Fortunately, insurance was there for me, otherwise I'd be out of pocket over $75,000.

Then again, I don't have as much $ as you do, but then again, maybe something worse happens? You just never know.


And therefore, Insure.
Last edited by LawEgr1 on Tue Oct 22, 2019 2:10 pm, edited 2 times in total.

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willthrill81
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Re: Ok to go without health insurance?

Post by willthrill81 » Tue Oct 22, 2019 1:44 pm

rkhusky wrote:
Tue Oct 22, 2019 12:56 pm
willthrill81 wrote:
Tue Oct 22, 2019 12:41 pm
rkhusky wrote:
Tue Oct 22, 2019 12:40 pm
Get catastrophic coverage and self-insure for the ordinary stuff.
I thought that the ACA gutted 'catastrophic' plans.
I thought they were making a comeback with more recent changes in the ACA.
Not to my knowledge.
Do I qualify for catastrophic insurance?
You must either be under 30, or qualify for a hardship exemption. Usually, an exemption means that you can’t afford health care insurance because you’ve recently been homeless, declared bankruptcy, or meet other qualifying criteria.
https://www.cigna.com/individuals-famil ... -insurance
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

TropikThunder
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Re: Ok to go without health insurance?

Post by TropikThunder » Tue Oct 22, 2019 2:03 pm

Here’s a nice catch-22:

- Only people with mid to high seven figure net worths can afford to self-insure.

- People with mid to high seven figure net worths have the most to lose if they self-insure.

Same logic we see here from people thinking it’s a good idea to drop homeowners coverage once their mortgage is paid off. I’ll drop coverage and save almost $1,000!! Wait, my house burns down and the cost to rebuild is $300,000 out of pocket? Plus the cost of housing replacement while we rebuild? Plus the cost of all our stuff that we lost? No problem!

EddyB
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Re: Ok to go without health insurance?

Post by EddyB » Tue Oct 22, 2019 2:16 pm

LawEgr1 wrote:
Tue Oct 22, 2019 1:42 pm
EDIT:

I added too much info for my tastes. Long story short I had a medical issue that cropped up unexpectedly, and prior to that I was extremely fit and healthy.

I'm in my thirties. Never thought something could happen like that, and poo-poo'd all the people that said 'things happen'. Fortunately, insurance was there for me, otherwise I'd be out of pocket over $75,000.

Then again, I don't have as much $ as you do, but then again, maybe something worse happens? You just never know.


And therefore, Insure.
If I avoided my premiums for even a few years and then had an OOP bill of $75,000, I’d be ahead. If I could get catastrophic coverage, I would.

furikake
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Re: Ok to go without health insurance?

Post by furikake » Tue Oct 22, 2019 2:22 pm

I wouldn't consider self-insure unless I had at least $100mil. Mid 7-figure is not enough to self-insure. I know of a guy who had $10mil and thought he was rich and dropped his insurance. His wife got cancer, he spent all his life savings on his wife's medical bills. She died. He had nothing left at the end. Very sad.

I'm about the same age as you, if it makes you feel better, 15 years ago, our family health insurance was about $250/month. It's going up to $18k this coming January. I have an S corp also, and we have insurance through my business. I would not go without health insurance even when I know I could start a new group plan anytime during the year without having to worry about pre-existing conditions.

Big Worm
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Re: Ok to go without health insurance?

Post by Big Worm » Tue Oct 22, 2019 2:29 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Back ground:

Physician couple, self employed, family of 4, 2 adults( 46, 43) 2 kids ( 9,15), S corp.

This year health insurance premium increase is almost 15%.

Will cost ~16K with family deductible of 12 K to stay in PPO network.

Cheapest Option ~ 13K with family deductible of 13.5K for restricted in state network without access to most major teaching hospitals.

Advantages : wellness visit per calender year covered for each family member, hsa eligible, hsa and health insurance paid through S corp as fringe benefit.

Disadvantages: Other than wellness visit, each year 13k-16k goes to insurance company. Can't contribute ~$6900 to HSA account.

So far balance in HSA is ~ 100K.

Now that penalty for not carrying health insurance is gone , thinking of investing premiums in a separate fund marked health care and invest in Vanguard health care fund.

So far, family fairly healthy and use healthcare services sparingly.

Have total assets in mid 7 figure range in case something unexpected in terms of health care happens.

Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation.

Is it too risky to go bare?

Thanks in advance for your advice.
not sure if srs :confused

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VictoriaF
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Re: Ok to go without health insurance?

Post by VictoriaF » Tue Oct 22, 2019 2:32 pm

Any advice based on anecdotes is irrelevant. Some people go without insurance and end up saving money. Other people have unexpected hardships resulting in catastrophic financial losses. These stories invoke the availability heuristic and irrational decisions.

Instead of anecdotes, look at the statistics and consider your risks. With medical expenses, relevant statistics are not averages but the highest band, e.g., what the top 1%-5% of medical expenses are like, the difference between prices negotiated by insurance companies and your potential cash expenses, and how long expenses may last. For example, a cancer may involve not only aggressive treatment of the initial disease but also serious side effects of treatments.

Victoria
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Lee_WSP
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Re: Ok to go without health insurance?

Post by Lee_WSP » Tue Oct 22, 2019 2:59 pm

simplesimon wrote:
Tue Oct 22, 2019 11:01 am
denovo wrote:
Tue Oct 22, 2019 10:59 am
DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am

Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation.

This doesn't seem accurate.
+1. I'd like to know how this would be accomplished.
It's technically true, but it takes a while for the coverage to kick in.

You create a group and get employer sponsored health insurance.

Lee_WSP
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Re: Ok to go without health insurance?

Post by Lee_WSP » Tue Oct 22, 2019 3:02 pm

DiehardDoc wrote:
Tue Oct 22, 2019 12:43 pm
cmublitz wrote:
Tue Oct 22, 2019 11:45 am
I think I get it. Between whatever medical situations you can handle between you, your spouse, and colleagues (via professional courtesy?) that probably covers a ton of cases. You could also handle cases of long term issues or anything that can wait a couple days to 1 week because of your business application out of cycle + no exclusions for pre-existing conditions.

However, how would you handle an actual immediate emergency like a car accident? I assume you could theoretically rack up $100Ks+ of medical bills before your newly applied insurance kicks in. I doubt any newly acquired insurance would retroactively cover you during the days you are applying for coverage. Is the plan to effectively self-insure that risk?
Auto/ Umbrella should cover some of the costs?
Those policies pay for injuries YOU cause. Not injuries you endure. Your family might be covered as passengers though. But they'd be basically suing you for negligence.

You can buy health payments for passengers and yourself for auto, but there are limits. Usually it's only good enough to cover deductibles or a visit to the ER.

randomguy
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Re: Ok to go without health insurance?

Post by randomguy » Tue Oct 22, 2019 3:07 pm

Jack FFR1846 wrote:
Tue Oct 22, 2019 12:12 pm
I don't think you've considered worst case. Say one of you breaks a finger badly. Needs a couple pins. Of course, some time later, back in the OR to remove the pins. Silly broken finger. $75k. I broke my finger and saw the bills. One silly finger.

What if something actually major happens? 6 figures isn't going to take all that long.
75k would be no big deal. 16x5 means that sunless you are doing that every 5 years, you are ahead by self insuring.

The question is how often are you going to get hit by that 300k+ expense that would be a big deal. A lot of the really expensive stuff like cancer isn't a worry since you can afford some time to buy insurance (obviously you would have to double check that). You would need an accident that requires immediate action to screw you. Even then I am not sure how much of the expense is in day 1 versus day 10+ (or however long it takes to get coverage. I would expect that you would need to wait til the start of the month).

No matter what this is going to be one of those things were the reward is somewhat limited (call it 300k or so over 15 years) and the risk is high (i.e. you get hit with a 1 million dollar bill) but with low odds of showing up. It feels like if you have enough money to self insure (i.e. losing say 1-2 million is an acceptable outcome), you don't care about the 16k/year. Seems like a very narrow window (7-15 million?) where taking on the risk is acceptable but where 16k sort of matters.

aristotelian
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Re: Ok to go without health insurance?

Post by aristotelian » Tue Oct 22, 2019 3:10 pm

willthrill81 wrote:
Tue Oct 22, 2019 12:41 pm
rkhusky wrote:
Tue Oct 22, 2019 12:40 pm
Get catastrophic coverage and self-insure for the ordinary stuff.
I thought that the ACA gutted 'catastrophic' plans.
The current administration brought them back, plus it removed the mandate.

NotWhoYouThink
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Re: Ok to go without health insurance?

Post by NotWhoYouThink » Tue Oct 22, 2019 3:23 pm

aristotelian wrote:
Tue Oct 22, 2019 3:10 pm
willthrill81 wrote:
Tue Oct 22, 2019 12:41 pm
rkhusky wrote:
Tue Oct 22, 2019 12:40 pm
Get catastrophic coverage and self-insure for the ordinary stuff.
I thought that the ACA gutted 'catastrophic' plans.
The current administration brought them back, plus it removed the mandate.
Do you have a link for that? I know the mandate has been removed, but have seen nothing about catastrophic plans being legal again for those of us over 30, and it would have been big news because there is a market for it.

Note that proposed changes are not topics allowed on this board, only changes that have been enacted.

Lee_WSP
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Re: Ok to go without health insurance?

Post by Lee_WSP » Tue Oct 22, 2019 3:26 pm

NotWhoYouThink wrote:
Tue Oct 22, 2019 3:23 pm
aristotelian wrote:
Tue Oct 22, 2019 3:10 pm
willthrill81 wrote:
Tue Oct 22, 2019 12:41 pm
rkhusky wrote:
Tue Oct 22, 2019 12:40 pm
Get catastrophic coverage and self-insure for the ordinary stuff.
I thought that the ACA gutted 'catastrophic' plans.
The current administration brought them back, plus it removed the mandate.
Do you have a link for that? I know the mandate has been removed, but have seen nothing about catastrophic plans being legal again for those of us over 30, and it would have been big news because there is a market for it.

Note that proposed changes are not topics allowed on this board, only changes that have been enacted.
They're stripped down plans and they've always actually been around. The previous administration was phasing them out and you could only get them for say 6 months or so, then the new administration allowed them to be basically constantly renewed.

https://www.cnbc.com/2018/10/05/you-can ... d-you.html

aristotelian
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Re: Ok to go without health insurance?

Post by aristotelian » Tue Oct 22, 2019 3:34 pm

NotWhoYouThink wrote:
Tue Oct 22, 2019 3:23 pm
aristotelian wrote:
Tue Oct 22, 2019 3:10 pm

The current administration brought them back, plus it removed the mandate.
Do you have a link for that? I know the mandate has been removed, but have seen nothing about catastrophic plans being legal again for those of us over 30, and it would have been big news because there is a market for it.

Note that proposed changes are not topics allowed on this board, only changes that have been enacted.
https://www.nytimes.com/2018/08/01/us/p ... rance.html

Stormbringer
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Re: Ok to go without health insurance?

Post by Stormbringer » Tue Oct 22, 2019 3:37 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Is it too risky to go bare?
Health insurance does two things for you:
  1. Protects you from a catastrophic expense.
  2. Negotiates pricing.
Even if you have the means to self-insure, the problem is that you may pay through the nose for care.

Anecdotally, a few years back I injured my knee working out. My doctor sent me to physical therapy, which mostly involved spending 30 minutes with a therapist doing some mild strength training and stretching. My insurance company was paying $70 a session. The day of my 6th session, I got a call from the therapist saying that the insurance company cut me off after five sessions and they needed to request more, which would take several days to approve. I asked if I could just pay the $70 for today's session, and was told that without insurance it would cost $320!

I've seen this pattern on every medical and dental bill I've received in recent years. The list price is some astronomical number, and then the negotiated price is considerably less. From what I can tell, those without insurance pay the larger amount.
"Compound interest is the most powerful force in the universe." - Albert Einstein

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goodenyou
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Re: Ok to go without health insurance?

Post by goodenyou » Tue Oct 22, 2019 3:40 pm

My friend (a Urologist) just told me that a local physician in town recently presented to his office with Stage 3 Transitional Cell Carcinoma of the bladder. The doctor had no insurance. Absolutely shocking. Get insurance for you and your kids. It's an anecdote, but I learn from people's mistakes. I have to deal with people everyday without health insurance. It can be devastating.
"Ignorance more frequently begets confidence than does knowledge" | Do you know how to make a rain dance work? Dance until it rains.

Notsobad
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Re: Ok to go without health insurance?

Post by Notsobad » Tue Oct 22, 2019 4:09 pm

Not sure if it was mentioned above, but I’d like to make two points.

There is talk about the protection against blocking people with pre-existing conditions maybe weakened or eliminated .

Also, insurance companies have prenegotiated rates. If you went without insurance you would get charged the full list price which might be several times what private insurance would pay. Then you would have to negotiate down from there.

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Re: Ok to go without health insurance?

Post by KlangFool » Tue Oct 22, 2019 4:11 pm

gr7070 wrote:
Tue Oct 22, 2019 11:44 am


Let's be clear, it is reasonable for a wealthy individual to self-insure, as well. It's simply about the ability to financially handle such events without significant impact. One just needs more wealth than the OP. Especially when insuring four individuals.
gr7070,

Let's assume that is correct. Then, it would reach a point that it is cheaper to buy medical insurance than spending the time and effort to negotiate with the hospital and doctor on the treatment cost for each incident.

At that wealth level, time is more precious than the insurance premium cost.

KlangFool

JackoC
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Re: Ok to go without health insurance?

Post by JackoC » Tue Oct 22, 2019 4:11 pm

gr7070 wrote:
Tue Oct 22, 2019 11:24 am
I don't quite understand the outrage. Surely, many folks understand the concept of self-insuring. We do it all the time for things we can afford - like cell phones, and everything else we reject the extended warranty.

Large corporations self insure, for health and others, all the time, as well.

Do not most health insurance policies have a maximum lifetime payout? So aren't we all self-insuring for any amount over, say, the $1M max limit?

So I don't understand why everyone is aghast at the question. Seems a very reasonable question to me.
You later said the ACA's ban on lifetime payout limits on health insurance wouldn't change your answer. Well OK if your 'answer' is being surprised at the worked up tone of some of the responses. I see your point there to some degree. But as to the substance, my feeling about health insurance (we buy privately on ACA exchange, couple, $13k annual out of pocket limit $18.5k/yr premium, no subsidy) would be significantly different if there was a lifetime payout cap. In an ideal complete market I'd consider buying a policy with a $1mil lifetime OOP limit (limit *my* payout IOW), expecting a much lower premium than I pay now, before I'd consider buying one with a $1mil limit on *their* payout. I'd only buy a policy with lifetime payout cap if it were that or nothing. However as clarified earlier, the ACA doesn't allow lifetime payout caps on 'regular' (not 'temporary') policies and I believe my state didn't allow them pre ACA.

As to Stormbringer's point 2, 'negotiates prices', this a definite benefit of our plan though the OOP limit, highest available, is much too low in terms of the principal of only insuring against losses we can't afford to absorb. In this respect though OP as 'doctor couple' might be in a better position to negotiate as uninsured. When I've had to negotiate uninsured charges I've had problems with a) not knowing what price they are accepting every single day for that same service from covered people, just that it must be a lot lower than the list price and b) whether I'm talking to right person, not somebody who is going to keep saying "we don't give discounts" when they mean "'I'm too junior to be in the loop on discounts my billing supervisor or the MD give every day". A pair of doctors might be in a better position on both those things.

All in all though I'm not that surprised most people find going uninsured is not a good idea for somebody who can easily afford the premiums.

dbr
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Re: Ok to go without health insurance?

Post by dbr » Tue Oct 22, 2019 4:31 pm

The irony is that anyone wealthy enough to self insure health care can so easily afford health insurance that it makes no sense to go without. I think the debate about whether or not one can or should self insure is a side issue.

cherijoh
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Re: Ok to go without health insurance?

Post by cherijoh » Tue Oct 22, 2019 4:48 pm

sleepysurf wrote:
Tue Oct 22, 2019 10:50 am
You're physicians, and seriously considering this? :confused

Certainly you've both seen catastrophic accidents or unanticipated bad diagnoses!
+1

My thoughts exactly!

mountains
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Re: Ok to go without health insurance?

Post by mountains » Tue Oct 22, 2019 4:51 pm

Stormbringer wrote:
Tue Oct 22, 2019 3:37 pm
DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Is it too risky to go bare?
Health insurance does two things for you:
  1. Protects you from a catastrophic expense.
  2. Negotiates pricing.
Even if you have the means to self-insure, the problem is that you may pay through the nose for care.
I think this is really the sticking point! You just won't get the prices you if you self-insure that an insurance carrier gets.

cherijoh
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Re: Ok to go without health insurance?

Post by cherijoh » Tue Oct 22, 2019 4:56 pm

DiehardDoc wrote:
Tue Oct 22, 2019 11:18 am
Only as an individual one has to wait for open enrollment.

If you are a business, business can shop for coverage any time.

Information from insurance company and brokers.

While we ( physicians) have been working harder each year for less money without any increase in our reimbursements, health insurance companies have been raising premiums in double digits every year.

Has helped several patients who are self pay / ins w high deductible navigate complex and often egregious hospital billing practices.

Often it can be advantageous to negotiate on your own rather than through middlemen like your insurance company.
You should understand that you don't always have a warning before a major illness or an accident. If one of you is in a car accident in the hospital with life-threatening injuries do you honestly think the other one is going to start shopping around for health insurance? Why not just play Russian Roulette with a loaded gun?

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fizxman
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Re: Ok to go without health insurance?

Post by fizxman » Tue Oct 22, 2019 5:10 pm

The only way I see this working out is if the majority of the people in the country also did not have insurance. If X% of the population couldn't pay out-of-pocket for a $3k MRI or $75k for a broken finger or $1 million+ for cancer treatment, I'd imagine prices would drop to a level where people could pay. Then you'd be okay to self-insure. Until then, I'd want a net-worth in the mid-eight-figure range to go without health insurance.

delamer
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Re: Ok to go without health insurance?

Post by delamer » Tue Oct 22, 2019 5:24 pm

As a self-employed physician couple, one of you developing a serious illness is not only going to mean large out-of-pocket expenses if you are uninsured, you also are likely to suffer a large drop in your income at the same time you are hit with high medical bills.

A scary combination.

I am not sure why you are so focused on the past and potential future rate of increase in premiums. The decision to purchase coverage should be based on whether it is affordable and necessary today.

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TomatoTomahto
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Re: Ok to go without health insurance?

Post by TomatoTomahto » Tue Oct 22, 2019 5:40 pm

Wealthier than you, older than you, dumber than you, but still wouldn’t consider not having insurance. Penny wise, pound idiotic.
Okay, I get it; I won't be political or controversial. The Earth is flat.

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FrugalInvestor
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Re: Ok to go without health insurance?

Post by FrugalInvestor » Tue Oct 22, 2019 5:51 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
So far, family fairly healthy and use healthcare services sparingly.
That pretty much sums it up as far as I'm concerned. Tell us when that's likely to change and I'll tell you when to buy health insurance. If you can't, then buy it now.

P.S. And it's your FAMILY, not just you.
Last edited by FrugalInvestor on Tue Oct 22, 2019 5:52 pm, edited 1 time in total.
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Re: Ok to go without health insurance?

Post by nisiprius » Tue Oct 22, 2019 5:51 pm

Shallowpockets wrote:
Tue Oct 22, 2019 12:11 pm
OP. you are not going to be able to negotiate OTC insurance rates. It’s not buying a car.

Two, you are not going to be able to buy insurance when you need it. No insurance company is going to have a policy that covers you when you are already in the hospital or have an existing and immediate diagnosis before you had bought the insurance.
I'm assuming DiehardDoc is thinking, whether correct or not I wouldn't know, that he can buy an ACA policy when he is "already in the hospital;" he thinks he "Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.

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Re: Ok to go without health insurance?

Post by fru-gal » Tue Oct 22, 2019 6:02 pm

Shallowpockets wrote:
Tue Oct 22, 2019 12:11 pm
Two, you are not going to be able to buy insurance when you need it. No insurance company is going to have a policy that covers you when you are already in the hospital or have an existing and immediate diagnosis before you had bought the insurance.
I think the OP's plan is crazy, but didn't Obamacare do away with insurance companies being able to refuse coverage because of preexisting conditions?

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Re: Ok to go without health insurance?

Post by TN_Boy » Tue Oct 22, 2019 6:13 pm

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
Back ground:

Physician couple, self employed, family of 4, 2 adults( 46, 43) 2 kids ( 9,15), S corp.

This year health insurance premium increase is almost 15%.

Will cost ~16K with family deductible of 12 K to stay in PPO network.

Cheapest Option ~ 13K with family deductible of 13.5K for restricted in state network without access to most major teaching hospitals.

Advantages : wellness visit per calender year covered for each family member, hsa eligible, hsa and health insurance paid through S corp as fringe benefit.

Disadvantages: Other than wellness visit, each year 13k-16k goes to insurance company. Can't contribute ~$6900 to HSA account.

So far balance in HSA is ~ 100K.

Now that penalty for not carrying health insurance is gone , thinking of investing premiums in a separate fund marked health care and invest in Vanguard health care fund.

So far, family fairly healthy and use healthcare services sparingly.

Have total assets in mid 7 figure range in case something unexpected in terms of health care happens.

Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation.

Is it too risky to go bare?

Thanks in advance for your advice.
Most of the responses have focused on the wisdom, or lack thereof, of skipping insurance. I tend to agree with the consensus -- get the insurance.

But I also think your plan of taking the premium money and investing in vanguard health care fund is bad. If you want to skip paying for insurance and invest the premiums, just invest them with the rest of your money via your existing asset allocation (I presume you have a decent sized brokerage account).

I see no point in segregating the funds; all it does is complicate your investments. And why Vanguard health care fund? Do you have good reason to believe it will outperform going forward?

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Re: Ok to go without health insurance?

Post by delamer » Tue Oct 22, 2019 6:16 pm

fru-gal wrote:
Tue Oct 22, 2019 6:02 pm
Shallowpockets wrote:
Tue Oct 22, 2019 12:11 pm
Two, you are not going to be able to buy insurance when you need it. No insurance company is going to have a policy that covers you when you are already in the hospital or have an existing and immediate diagnosis before you had bought the insurance.
I think the OP's plan is crazy, but didn't Obamacare do away with insurance companies being able to refuse coverage because of preexisting conditions?
But there is a difference between that and “retroactive” coverage. If you have $250,000 in medical bills in June, obtaining health insurance beginning July 1 isn’t going to help with the June bills.

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Re: Ok to go without health insurance?

Post by Grt2bOutdoors » Tue Oct 22, 2019 6:16 pm

sleepysurf wrote:
Tue Oct 22, 2019 10:50 am
You're physicians, and seriously considering this? :confused

Certainly you've both seen catastrophic accidents or unanticipated bad diagnoses!
+1. Post of the thread!
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Re: Ok to go without health insurance?

Post by NotWhoYouThink » Tue Oct 22, 2019 6:21 pm

aristotelian wrote:
Tue Oct 22, 2019 3:34 pm
NotWhoYouThink wrote:
Tue Oct 22, 2019 3:23 pm
aristotelian wrote:
Tue Oct 22, 2019 3:10 pm

The current administration brought them back, plus it removed the mandate.
Do you have a link for that? I know the mandate has been removed, but have seen nothing about catastrophic plans being legal again for those of us over 30, and it would have been big news because there is a market for it.

Note that proposed changes are not topics allowed on this board, only changes that have been enacted.
https://www.nytimes.com/2018/08/01/us/p ... rance.html
That's not what a catastrophic plan is.

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Re: Ok to go without health insurance?

Post by Grt2bOutdoors » Tue Oct 22, 2019 6:48 pm

Jack FFR1846 wrote:
Tue Oct 22, 2019 12:12 pm
I don't think you've considered worst case. Say one of you breaks a finger badly. Needs a couple pins. Of course, some time later, back in the OR to remove the pins. Silly broken finger. $75k. I broke my finger and saw the bills. One silly finger.

What if something actually major happens? 6 figures isn't going to take all that long.
I’ll do one better - 4 hour stay in an ER, I kid you not the bill was $21k. Four hours!!, not 4 days! You’d be nuts not to pay the insurance. You know how much a bill is for a MI? It could run you a cool 7 figures.
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MathIsMyWayr
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Re: Ok to go without health insurance?

Post by MathIsMyWayr » Tue Oct 22, 2019 6:50 pm

A physician doubting the need for a health insurance and an astronaut believing the earth is flat.

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dual
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Re: Ok to go without health insurance?

Post by dual » Tue Oct 22, 2019 6:55 pm

Those who are aghast at self-insuring should say at what monthly premiums they would self-insure. Suppose OP's monthly premiums were 10X his current, 100X, 1000X? Would you still insist on buying insurance?

The fact that OP's premiums are much less than the $millions being thrown around on this thread indicates that incurring medical costs that large is exceedingly rare. And the probability of incurring $millions in charges during the time before OP could purchase insurance is rare^2

Suppose the worst happened and OP incurs large medical bills. It is not the end of the world. He could clear his debts through bankruptcy and his family could go on Medicaid. Medicaid provides decent medical care. Here in CA about 1/3 of the population is on Medicaid (they call it MediCAL here). I am sure other states have similar proportions.

With the income earning potential of the OP and his wife, they can rapidly recover from this terrible and rare^2 probability event.

OP can invest the saved premiums in an index fund and build up a cushion for future expenses.

My bottom line: I think OP should self insure.

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Re: Ok to go without health insurance?

Post by goodenyou » Tue Oct 22, 2019 7:01 pm

Now that penalty for not carrying health insurance is gone , thinking of investing premiums in a separate fund marked health care and invest in Vanguard health care fund.
Do you think investing in Vanguard Healthcare Fund will give you health insurance? Just being a wiseguy :D

The two variables of risk are probability and severity. Don't conflate them. It's unlikely that you will get very sick, but if you do, the (financial) severity is devastating. Have you though of self-insuring in other areas? Disability, life, car, homeowners, malpractice, etc? If not, why not?

I am a physician who can control a lot of my costs in healthcare. I could easily self-insure by your "wealth" standard. I would never consider it. The numbers that I see in oncology and complex surgery are through the roof. The newer oncology drugs and monoclonal antibodies would wipe you out in a NY second.
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Re: Ok to go without health insurance?

Post by delamer » Tue Oct 22, 2019 7:10 pm

dual wrote:
Tue Oct 22, 2019 6:55 pm
Those who are aghast at self-insuring should say at what monthly premiums they would self-insure. Suppose OP's monthly premiums were 10X his current, 100X, 1000X? Would you still insist on buying insurance?
The issue is whether the OP’s family has the income to support their quoted insurance premium today. And whether not having insurance is worth the risk of incurring a low probability but catastrophically high cost event.

Who cares at what level that premium becomes too high? That has nothing to do with the current decision.

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Re: Ok to go without health insurance?

Post by Emilyjane » Tue Oct 22, 2019 7:22 pm

Fellow physician here. I was healthy till 11 months ago, till suddenly, I was not. Over last 11 months, total of $400,000+ worth of medical bills submitted. Makes the $12,000 in health insurance premiums for the year seem like a good deal.
"Real knowledge is to know the extent of one's ignorance", Confucius

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Re: Ok to go without health insurance?

Post by Nate79 » Tue Oct 22, 2019 7:27 pm

It's certainly in the realm of possibilities to have a car accident with both spouses injured and to rack up significant hospital bills before you could even attempt to get insurance in place. Your auto insurance isn't going to cover this unless you have medical as part of your coverage and most only cover a piddly amount. Umbrella also wouldn't cover your medical costs in most cases.

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Re: Ok to go without health insurance?

Post by RubyTuesday » Tue Oct 22, 2019 7:29 pm

Luckywon wrote:
Tue Oct 22, 2019 12:36 pm
DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am


Worst case scenario: In case need arises, will have to purchase health insurance at a short notice. Can do it any time of the year and will not have to wait until open enrollment as will be purchasing through corporation.

What if both of you are in an accident and incapacitated? You may incur huge medical expenses before one of you is in a condition to secure medical insurance, if that is indeed an option at the time.

I'd get insurance if I were you, not just for the reason above. Not even a close call, IMO.
This is the scenario that most concerned me as well. Low probability VERY HIGH risk. Why?

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dual
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Re: Ok to go without health insurance?

Post by dual » Tue Oct 22, 2019 7:37 pm

delamer wrote:
Tue Oct 22, 2019 7:10 pm

Who cares at what level that premium becomes too high? That has nothing to do with the current decision.
Of course you care. It is just that your judgement of the risk/reward for the current premiums is to pay them. My judgement of the risk is apparently lower than yours and I gave reasons in my post for this assessment.

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