Ok to go without health insurance?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Random Poster
Posts: 1887
Joined: Wed Feb 03, 2010 10:17 am

Re: Ok to go without health insurance?

Post by Random Poster » Tue Oct 22, 2019 7:40 pm

dual wrote:
Tue Oct 22, 2019 6:55 pm
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.
Help me out here:

If one “clear(s)” one’s medical debts through bankruptcy, how much money would one have left over at the conclusion of the bankruptcy process?

And if one plans on using the bankruptcy process to deal with medical debt, what would be the point of saving the (unpaid) insurance premium amount in an index fund?

delamer
Posts: 9299
Joined: Tue Feb 08, 2011 6:13 pm

Re: Ok to go without health insurance?

Post by delamer » Tue Oct 22, 2019 7:56 pm

dual wrote:
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.
You raised the theoretical of “suppose.”

My point was that the premium isn’t 10X higher today, and so that scenario has no bearing on the decision to pay (or not) for insurance today.

We are agree that this is a cost/benefit risk assessment.

junior
Posts: 887
Joined: Wed Sep 10, 2008 6:14 pm
Contact:

Re: Ok to go without health insurance?

Post by junior » Tue Oct 22, 2019 8:12 pm

dual wrote:
Tue Oct 22, 2019 6:55 pm
He could clear his debts through bankruptcy
Not clear that a high earning doctor would be eligible for bankruptcy, you could certainly talk to a lawyer, but this is a massive assumption.

iasw
Posts: 233
Joined: Mon Dec 05, 2016 2:02 pm

Re: Ok to go without health insurance?

Post by iasw » Tue Oct 22, 2019 8:23 pm

As self employed people, don't forget your premiums should be deductible. So that $16k/year will be less net after you do your taxes.

Another vote for keeping the insurance, and shaking my head at the mess of the health insurance system.

User avatar
bottlecap
Posts: 6234
Joined: Tue Mar 06, 2007 11:21 pm
Location: Tennessee

Re: Ok to go without health insurance?

Post by bottlecap » Tue Oct 22, 2019 9:06 pm

If you want to come out on the plus side of the risk equation, go without insurance. It's a no brainer, despite whatever else you hear from others. Somebody is paying for unhealthy people. It is you.

However, you presumably earn a lot of money each year. Healthcare is not a big expense for you, like it is for others. You have to measure that against the worst case consequence.

But you are right, the worst case is a slim chance and its consequences are limited by your ability to get right back on an insurance plan at the next enrollment period.

The emotional response is to say never go without. The rational response is that in many cases the costs are not really worth it anymore unless you have some sort of family history or unhealthy habits to worry about.

But you are in a spot where you can afford health insurance, unlike many others. Since you can afford it, you are simply buying peace of mind. Is the price worth the peace of mind to you? I can't tell you that.

JT
Last edited by bottlecap on Tue Oct 22, 2019 9:07 pm, edited 1 time in total.

User avatar
LadyGeek
Site Admin
Posts: 57760
Joined: Sat Dec 20, 2008 5:34 pm
Location: Philadelphia
Contact:

Re: Ok to go without health insurance?

Post by LadyGeek » Tue Oct 22, 2019 9:07 pm

Please stay on-topic, which is helping the OP to decide to carry insurance (or not).

Rants about the health care system are off-topic.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Tue Oct 22, 2019 9:20 pm

Random Poster wrote:
Tue Oct 22, 2019 7:40 pm
dual wrote:
Tue Oct 22, 2019 6:55 pm
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.
Help me out here:

If one “clear(s)” one’s medical debts through bankruptcy, how much money would one have left over at the conclusion of the bankruptcy process?

And if one plans on using the bankruptcy process to deal with medical debt, what would be the point of saving the (unpaid) insurance premium amount in an index fund?
^^^^
This. Bankruptcy is not the point of avoiding the premiums. He can easily pay the premiums, he just doesn't want to. Or she. Wasn't clear in the OP.

User avatar
grabiner
Advisory Board
Posts: 25389
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

Re: Ok to go without health insurance?

Post by grabiner » Tue Oct 22, 2019 9:27 pm

The other advantage of health insurance is that the expected value of buying insurance is positive. Even if you have a high-deductible plan so that the plan pays nothing for most of your medical coverage, the payment is at the in-network rate. (And HDHPs make this even better by giving you more tax-advantaged savings.) Thus you can pay $5000 for an insurance plan which expects to pay $4000 in medical bills, and still come out ahead because the expected medical bills would have been $8000 if you paid them out of pocket.
Wiki David Grabiner

TheDDC
Posts: 489
Joined: Mon Jan 08, 2018 11:11 am

Re: Ok to go without health insurance?

Post by TheDDC » Tue Oct 22, 2019 9:33 pm

I’m thinking about a different risk: a vulnerable individual (or family) with high net worth who is hospitalized would be a real target for financial abuse especially one who throws it around “on self insurance” and made it known to the health care community. If I were unscrupulous I may want to take a HNW for everything they’re worth during a crisis.

Perhaps look at a health share ministry? They a cheap. They would probably pay. I know several folks in my circle who have them and they work.

This is all a bit rich though... a doc not wanting health insurance because of the cost. Really? Can you maybe use your HNW to influence your own employers when it comes to billing/insurance practices?

-TheDDC
Refreshingly, a double barrel shotgun blast of truth...

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Tue Oct 22, 2019 9:35 pm

A health share ministry makes a lot more sense to me.

gch
Posts: 20
Joined: Thu May 30, 2019 2:47 pm

Re: Ok to go without health insurance?

Post by gch » Tue Oct 22, 2019 9:45 pm

So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.

Luckywon
Posts: 546
Joined: Tue Mar 28, 2017 10:33 am

Re: Ok to go without health insurance?

Post by Luckywon » Tue Oct 22, 2019 10:40 pm

gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
Absent a contract or in at least some states an emergency situation, accepting less than the billed rate would be at the discretion of the provider. This would be routine for patients with limited ability to pay but is not guaranteed, especially if the patient is a multimillionaire physician.

Afty
Posts: 1094
Joined: Sun Sep 07, 2014 5:31 pm

Re: Ok to go without health insurance?

Post by Afty » Wed Oct 23, 2019 12:45 am

gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
I understand this is true in general, but most uninsured people are poor and it makes sense for hospitals to negotiate with them since any payment is better than nothing. But what incentive does the hospital have to negotiate with a rich family who can obviously afford list price?

Cyanide123
Posts: 195
Joined: Sun May 05, 2019 9:14 am

Re: Ok to go without health insurance?

Post by Cyanide123 » Wed Oct 23, 2019 2:19 am

Well logically if you think you could get insurance immediately when needed, then it's not the worst idea.

But man.... Life can change within minutes. One serious MVC and the bills will just keep pouring. Trauma activation - 20k. Trauma panel - 5k. CT imaging bill, hospital facility bill, radiology bill, ER bill. ICU roughly 10-15k a night.

The money you will save over 10 years, could easily be wiped out in 1 day.

And what about all the medical emergencies? A SAH and you're in the ICU for 2 weeks. A MI and needing a couple of stents, or even worse an emergency cabg?

If you're going through the worst time of your life, do you really want to be stressing and fighting with insurance companies to get coverage as soon as possible?

Will you even have that ability to get health insurance in the event of an emergency? I intubated an attending with a SDH a couple years ago, with his GCS of 5-6, he definitely didn't have the ability to get insurance. All I'm saying is that life is unpredictable.

Also, i feel that the richer you are, the more you need to protect your assets. You just have a lot more to lose. I mean.... Someone with very limited net worth is probably much better off without insurance. If they incur hospital bills, there isn't much the hospital can go after. It's not worth their time. When you have something to lose, people will go after it. Protect your assets.

As a new attending, my net worth is still negative because of student loans, but i still carry a 2 million umbrella, great health insurance, disability and maximum limit of vehicle liability. I don't even have assets to protect yet, but I'm protecting my future wages. You have a lot more to lose than i do. 16k a year won't change your lifestyle but a few million off your net worth could. Maybe you'll sleep well at night knowing your family is protected.

onourway
Posts: 2074
Joined: Thu Dec 08, 2016 3:39 pm

Re: Ok to go without health insurance?

Post by onourway » Wed Oct 23, 2019 7:21 am

In my view, the primary value of insurance is to protect you against catastrophic tail-risk. In the case of health insurance for a family of means (and being doctors, everyone assumes you are at least as rich as you really are) the tail risk is incredibly high. Thus, you should purchase the insurance.

Psychologically it may be easier to view this as a business expense. Whatever your views on the situation, the current reality is that employers generally pay for health insurance and tax rates are at an historical low point. I would pay less attention to which bucket your dollars are going towards and just treat it as a cost of doing business.

User avatar
JoeRetire
Posts: 3872
Joined: Tue Jan 16, 2018 2:44 pm

Re: Ok to go without health insurance?

Post by JoeRetire » Wed Oct 23, 2019 7:35 am

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
So far, family fairly healthy and use healthcare services sparingly.
I was healthy until I was diagnosed with cancer.

If the same were to happen in your family, would you still be able to purchase insurance on short notice despite the pre-existing conditions? How much would it cost?

It surprises me that a family of physicians would take this risk.
Don't be a lemming.

HoosierJim
Posts: 700
Joined: Wed Mar 24, 2010 7:11 pm

Re: Ok to go without health insurance?

Post by HoosierJim » Wed Oct 23, 2019 7:47 am

nisiprius wrote:
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."

Preexisting conditions don't matter - you need a qualifying event. For example, after the catastrophic auto accident, while you are waiting for the ambulance, call the adoption agency and say "I'd like to adopt a kid" - that's a qualifying event. But you might even have trouble speaking or staying conscious. Or say to the spouse, let's agreed to get divorced but let's have the ambulance swing by the attorney's office before the hospital.


Here are qualifying events:
There are 4 basic types of qualifying life events. (The following are examples, not a full list.)

Loss of health coverage

Losing existing health coverage, including job-based, individual, and student plans
Losing eligibility for Medicare, Medicaid, or CHIP
Turning 26 and losing coverage through a parent’s plan
Changes in household

Getting married or divorced
Having a baby or adopting a child
Death in the family
Changes in residence

Moving to a different ZIP code or county
A student moving to or from the place they attend school
A seasonal worker moving to or from the place they both live and work
Moving to or from a shelter or other transitional housing
Other qualifying events

Changes in your income that affect the coverage you qualify for
Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act (ANCSA) Corporation shareholder
Becoming a U.S. citizen
Leaving incarceration (jail or prison)
AmeriCorps members starting or ending their service
Last edited by HoosierJim on Wed Oct 23, 2019 7:55 am, edited 3 times in total.

Jack FFR1846
Posts: 10454
Joined: Tue Dec 31, 2013 7:05 am
Location: 26 miles, 385 yards west of Copley Square

Re: Ok to go without health insurance?

Post by Jack FFR1846 » Wed Oct 23, 2019 7:48 am

JoeRetire wrote:
Wed Oct 23, 2019 7:35 am
DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
So far, family fairly healthy and use healthcare services sparingly.
I was healthy until I was diagnosed with cancer.

If the same were to happen in your family, would you still be able to purchase insurance on short notice despite the pre-existing conditions? How much would it cost?

It surprises me that a family of physicians would take this risk.
Good example. I'll use a kid example.

My son was 16 and in good health until he exhibited some symptoms worth checking out. Blood sugar of over 500. Yup.....type 1 diabetes out of nowhere. Insulin is now $300 a vial if you pay out of pocket. So there's $1200 a month. Equipment costs money.
Bogle: Smart Beta is stupid

camden
Posts: 268
Joined: Sun Sep 27, 2009 12:22 pm

Re: Ok to go without health insurance?

Post by camden » Wed Oct 23, 2019 8:04 am

Like others, I cannot really fathom any doctor would seriously consider this. To self insure against catastrophic medical expense would require mega wealth; a mid 7 figure portfolio could be wiped out with one massive accident, and anyone in the medical profession should know that more than others. And if you have mega wealth, the premiums would be trivial to you anyway.

Can’t help but think that this post was intended to get a rise out of the community and spark (yet again) a contentious discussion of the problems of the financial aspects of our health care system which will eventually cross the line and get locked by the mods.

carolinaman
Posts: 3885
Joined: Wed Dec 28, 2011 9:56 am
Location: North Carolina

Re: Ok to go without health insurance?

Post by carolinaman » Wed Oct 23, 2019 8:52 am

This is a bad idea as others have cited. The ability to get health insurance through your company on short notice is a nice benefit. However, I am assuming that it will not cover pre existing conditions. If you are diagnosed with a serious illness and then get health insurance, treatment for that illness would not be covered.

Health insurance provides coverage for catastrophic conditions that can literally bankrupt even high net worth people. Why take that risk?

sschoe2
Posts: 449
Joined: Fri Feb 24, 2017 4:42 pm

Re: Ok to go without health insurance?

Post by sschoe2 » Wed Oct 23, 2019 9:01 am

Very bad idea. If either of you have a serious illness and ends up with major surgery or a long hospital stay you could be looking at easily a million or several in bills. You need a HDHP that would cover catastrophic health care costs and also give you access to negotiated rates as healthcare providers will stick it to non-insured or out of network people.

NotWhoYouThink
Posts: 2747
Joined: Fri Dec 26, 2014 4:19 pm

Re: Ok to go without health insurance?

Post by NotWhoYouThink » Wed Oct 23, 2019 9:05 am

grabiner wrote:
Tue Oct 22, 2019 9:27 pm
The other advantage of health insurance is that the expected value of buying insurance is positive. Even if you have a high-deductible plan so that the plan pays nothing for most of your medical coverage, the payment is at the in-network rate. (And HDHPs make this even better by giving you more tax-advantaged savings.) Thus you can pay $5000 for an insurance plan which expects to pay $4000 in medical bills, and still come out ahead because the expected medical bills would have been $8000 if you paid them out of pocket.
Is it? Even if we had paid full billed price for all our health care over the past 10 years, we'd have still been much better off being uninsured and self-pay than paying for insurance coverage. (Ours is paid by Megacorp now, but looking at their assessment of what it costs to insure us, and doing a sanity check by looking at applicable unsubsidized ACA rates demonstrates this.)

But we'll pay COBRA and then ACA until Medicare kicks in, because a 7 figure net worth is not enough to insure against a catastrophic accident.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Wed Oct 23, 2019 9:18 am

HoosierJim wrote:
Wed Oct 23, 2019 7:47 am
nisiprius wrote:
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."

Preexisting conditions don't matter - you need a qualifying event. For example, after the catastrophic auto accident, while you are waiting for the ambulance, call the adoption agency and say "I'd like to adopt a kid" - that's a qualifying event. But you might even have trouble speaking or staying conscious. Or say to the spouse, let's agreed to get divorced but let's have the ambulance swing by the attorney's office before the hospital.

You can start an employer based insurance plan at any time.

gch
Posts: 20
Joined: Thu May 30, 2019 2:47 pm

Re: Ok to go without health insurance?

Post by gch » Wed Oct 23, 2019 5:32 pm

Afty wrote:
Wed Oct 23, 2019 12:45 am
gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
I understand this is true in general, but most uninsured people are poor and it makes sense for hospitals to negotiate with them since any payment is better than nothing. But what incentive does the hospital have to negotiate with a rich family who can obviously afford list price?
You don’t have provide income verification to get emergency medical services or reduced prices from the hospital.

Big Worm
Posts: 161
Joined: Thu Apr 18, 2013 10:20 am

Re: Ok to go without health insurance?

Post by Big Worm » Wed Oct 23, 2019 6:05 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.
You are a physician for gods sake.

Unless you are trolling you know the answer to the question.

HoosierJim
Posts: 700
Joined: Wed Mar 24, 2010 7:11 pm

Re: Ok to go without health insurance?

Post by HoosierJim » Wed Oct 23, 2019 6:43 pm

Lee_WSP wrote:
Wed Oct 23, 2019 9:18 am
You can start an employer based insurance plan at any time.
So you get in an açcident on Friday at 5:01 pm after HR closes. You sustain massive injuries and it takes a 12 person surgical team via a 96 hour operation to put Humpdey Dumpdey back together again. You call on Monday and get on the plan. Your hospital stay and some of the rehab is covered but the $4,000,000 surgery isn't.

This good news is you could swing this with Cobra.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Wed Oct 23, 2019 6:52 pm

HoosierJim wrote:
Wed Oct 23, 2019 6:43 pm
Lee_WSP wrote:
Wed Oct 23, 2019 9:18 am
You can start an employer based insurance plan at any time.
So you get in an açcident on Friday at 5:01 pm after HR closes. You sustain massive injuries and it takes a 12 person surgical team via a 96 hour operation to put Humpdey Dumpdey back together again. You call on Monday and get on the plan. Your hospital stay and some of the rehab is covered but the $4,000,000 surgery isn't.

This good news is you could swing this with Cobra.
I said earlier that it takes a couple of months to actually go it into effect.

I was simply pointing out that there are other plans out there. You do not need a qualifying event to start coverage.

I also have stated earlier in this thread that I don't think this is a good idea.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Wed Oct 23, 2019 6:54 pm

gch wrote:
Wed Oct 23, 2019 5:32 pm
Afty wrote:
Wed Oct 23, 2019 12:45 am
gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
I understand this is true in general, but most uninsured people are poor and it makes sense for hospitals to negotiate with them since any payment is better than nothing. But what incentive does the hospital have to negotiate with a rich family who can obviously afford list price?
You don’t have provide income verification to get emergency medical services or reduced prices from the hospital.
Emergency services cannot refuse treatment.

Yes, the hospital can request income verification for reduced billing.

User avatar
ClevrChico
Posts: 1556
Joined: Tue Apr 03, 2012 8:24 pm

Re: Ok to go without health insurance?

Post by ClevrChico » Wed Oct 23, 2019 7:02 pm

I frequently see GoFundMe campaigns by those that chose this path.

Casimir
Posts: 27
Joined: Wed Dec 30, 2015 5:45 pm

Re: Ok to go without health insurance?

Post by Casimir » Wed Oct 23, 2019 7:06 pm

Save the money on health insurance and get your head examined.

User avatar
grabiner
Advisory Board
Posts: 25389
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

Re: Ok to go without health insurance?

Post by grabiner » Wed Oct 23, 2019 8:21 pm

NotWhoYouThink wrote:
Wed Oct 23, 2019 9:05 am
grabiner wrote:
Tue Oct 22, 2019 9:27 pm
The other advantage of health insurance is that the expected value of buying insurance is positive. Even if you have a high-deductible plan so that the plan pays nothing for most of your medical coverage, the payment is at the in-network rate. (And HDHPs make this even better by giving you more tax-advantaged savings.) Thus you can pay $5000 for an insurance plan which expects to pay $4000 in medical bills, and still come out ahead because the expected medical bills would have been $8000 if you paid them out of pocket.
Is it? Even if we had paid full billed price for all our health care over the past 10 years, we'd have still been much better off being uninsured and self-pay than paying for insurance coverage. (Ours is paid by Megacorp now, but looking at their assessment of what it costs to insure us, and doing a sanity check by looking at applicable unsubsidized ACA rates demonstrates this.)
I am looking at expected value. With most insurance, the majority of policyholders get back less than they paid, but a few people use the insurance to cover huge bills.
But we'll pay COBRA and then ACA until Medicare kicks in, because a 7 figure net worth is not enough to insure against a catastrophic accident.
And that is the other reason for buying insurance against various catastrophes; you probably have liability insurance for the same reason (if you are at fault in an accident which injures someone else), even though this has a negative expected value.
Wiki David Grabiner

Lanerious
Posts: 8
Joined: Wed May 21, 2014 3:06 pm

Re: Ok to go without health insurance?

Post by Lanerious » Wed Oct 23, 2019 8:47 pm

If philosophically/religiously compatible, you could consider one of the health sharing ministries as a sort of catastrophic coverage alternative. A family your size should cost around $5,000 per year.

bltn
Posts: 578
Joined: Mon Feb 20, 2017 9:32 pm

Re: Ok to go without health insurance?

Post by bltn » Wed Oct 23, 2019 10:17 pm

Hard to believe two doctors are considering self insuring the family for medical care. Particularly with mid 7 figure assets. A couple of bad breaks could cut your assets in half.
The question becomes why not self insure everything at some point? Homeowners insurance? Disability insurance ? Life insurance? Part of the peace of mind of financial security is proper insurance.
I would think that self insurance in most matters is feasible when one hits the mid eight figures. Except liability insurance.

User avatar
whodidntante
Posts: 6673
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: Ok to go without health insurance?

Post by whodidntante » Wed Oct 23, 2019 10:29 pm

For those who suggest health ministries, those aren't insurance. And clearly the OP doesn't need 40k boo boo coverage. They need 400k a year for the foreseeable future coverage. That's exactly when a health ministry is going to stop paying your bills.

Also, is anyone else enjoying this thread as much as I am?

brolytiz
Posts: 15
Joined: Sat Sep 21, 2019 8:40 pm

Re: Ok to go without health insurance?

Post by brolytiz » Wed Oct 23, 2019 10:42 pm

My personal story about health insurance sounds like this. I arrived to US with green card in 2004 and didn't had health insurance until 2011. Then I got health insurance from my employer. 2011 was the year I first time went to ER. And used ER 3 more times during next couple of years. Without health insurance I would be wiped out of everything I saved over the years. Oh and payed only $1500 deductible when my kid was born, instead of $50,000 in bills we got.
My father in law went without insurance for 12 years until he got coverage though his wife job. Next year he got some bleeding going on from his nose and was diagnosed with stage 4 liver cirrhosis. (Never had PCP or need to go to hospital before that) Countless ER visits and hospital stays he finally got his liver transplant last year. Without insurance he would be dead 10 times. Today he is alive and slowly returning to his previuos job.
I will try to never go without health insurance ever in my life.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Wed Oct 23, 2019 10:44 pm

whodidntante wrote:
Wed Oct 23, 2019 10:29 pm
For those who suggest health ministries, those aren't insurance. And clearly the OP doesn't need 40k boo boo coverage. They need 400k a year for the foreseeable future coverage. That's exactly when a health ministry is going to stop paying your bills.

Also, is anyone else enjoying this thread as much as I am?
I'm no expert, but it seems like any singular catastrophic event that would eat up 400k would be extraordinarily rare. For cancer or the like, they have time to switch to employer sponsored health insurance. Therefore, I don't see why the health ministry is worse than no insurance if they really don't want to get actual insurance.

But re-reading the OP, I also don't understand why a higher deductible, lower premium plan is not available in the state.

Topic Author
DiehardDoc
Posts: 76
Joined: Thu Dec 06, 2007 1:05 am

Re: Ok to go without health insurance?

Post by DiehardDoc » Wed Oct 23, 2019 11:37 pm

Thanks to all forum members who have responded.

Apologies for not responding sooner.

Have been busy with patient care.

Have not read all the posts.

As expected, almost everyone agrees we should carry catastrophic high deductible HSA eligible health insurance plan.

Although we do not like ever increasing premiums , there appears to be no alternative.

In case of auto insurance etc if some one is a good driver , one gets rewarded with possible reduced premiums/discounts.

In cases like ours ( small business owners with very few employees and almost everyone as well) end up paying ~ 12-15% more each year without making any claims other than one annual wellness visit.

On top of that, these are high deductible plans. To make calculations simpler, family of 4 has to pay 16K + 12K of annual family deductible ( total 28K) before insurance starts covering 100%/80% depending upon plan for one calender year.

In summary , risks of remaining uninsured even for 1 day >>> potential savings of 28 K and growth of that amount if invested in healthcare/ total stock index fund.

Topic Author
DiehardDoc
Posts: 76
Joined: Thu Dec 06, 2007 1:05 am

Re: Ok to go without health insurance?

Post by DiehardDoc » Thu Oct 24, 2019 12:06 am

Some members have commented on utility of carrying disability/life/home/auto/business/malpractice insurance etc at our asset level and stage in life.

We did drop life insurance policy for one of us.

Thinking of dropping disability insurance too.

We are in cognitive fields. We have already paid premiums of ~ 8K each year since age 30( so say 16 x 8=128K) for disability policy.

In our physician friend circle/hospital staff and talking to insurance broker who sold us policy, only 1-2 physicians out of sample size of several hundred have been collecting disability payments after age 50-65 without attorney intermediation/private investigators constantly monitoring them.

We are thinking of dropping 1/2 disability policy and investing premiums in that company's stock/sector.

Auto/Home we kind of use everyday. We find value in keeping them( auto is mandatary anyways).

Business/malpractice: first can be optional- cost is negligible and premiums have remained steady over last 9 years/second is mandatary if a physician is to step foot in hospital for patient care. Possible to go bare only if physician does not accept any insurance / medicare/medicaid and gives up hospital privileges( simplified version)

User avatar
dual
Posts: 642
Joined: Mon Feb 26, 2007 7:02 pm

Re: Ok to go without health insurance?

Post by dual » Thu Oct 24, 2019 1:00 am

Random Poster wrote:
Tue Oct 22, 2019 7:40 pm

Help me out here:

If one “clear(s)” one’s medical debts through bankruptcy, how much money would one have left over at the conclusion of the bankruptcy process?
Sure, happy to help :D

The amount of money leftover from bankruptcy depends on the OP's state's bankruptcy laws but could include his house and other assets under a homestead exemption. But recall that bankruptcy would only occur on the rare^2 occurrence of a large bill before OP could buy ACA insurance.
And if one plans on using the bankruptcy process to deal with medical debt, what would be the point of saving the (unpaid) insurance premium amount in an index fund?
You are confusing two scenarios. OP would use Bankruptcy only in rare^2 probability cases. For ordinary medical expenses in (1-rare^2) fractions of cases, the saved premium amount is used for run of the mill medical expenses.

StealthRabbit
Posts: 436
Joined: Sat Jun 13, 2009 1:25 am

Re: Ok to go without health insurance?

Post by StealthRabbit » Thu Oct 24, 2019 1:13 am

DiehardDoc wrote:
Tue Oct 22, 2019 10:44 am
...
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.
////
each year 13k-16k goes to insurance company. ...

Is it too risky to go bare?

Thanks in advance for your advice.
It's too risky to go bare,

Single earner factory night shift, been paying 25% of GROSS into HC for yrs to keep ill spouse insured.

You have a few choices that most of us don't, But going W/O HC insurance can 'Readjust' your NW, and for many can dictate if they are alive next yr at this time. 3 of my friends died and left their spouses impoverished because they chose the Dr recommended treatment (?) plan.

Better to die early and leave the spouse a few more assets to struggle through life on.

Several friend have chose that route. (Early OUT / OFF)

Makes insurance sound pretty cheap if you can afford it.

Our HC rates would be $28000 this yr (if we could afford it).

Income = zero (pre medicare, pre SSA)

Get sick?
Die

But... it funds "The American way to prosperity" (for HC industry).

Sad

delamer
Posts: 9299
Joined: Tue Feb 08, 2011 6:13 pm

Re: Ok to go without health insurance?

Post by delamer » Thu Oct 24, 2019 10:22 am

DiehardDoc wrote:
Wed Oct 23, 2019 11:37 pm
Thanks to all forum members who have responded.

Apologies for not responding sooner.

Have been busy with patient care.

Have not read all the posts.

As expected, almost everyone agrees we should carry catastrophic high deductible HSA eligible health insurance plan.

Although we do not like ever increasing premiums , there appears to be no alternative.

In case of auto insurance etc if some one is a good driver , one gets rewarded with possible reduced premiums/discounts.

In cases like ours ( small business owners with very few employees and almost everyone as well) end up paying ~ 12-15% more each year without making any claims other than one annual wellness visit.

On top of that, these are high deductible plans. To make calculations simpler, family of 4 has to pay 16K + 12K of annual family deductible ( total 28K) before insurance starts covering 100%/80% depending upon plan for one calender year.

In summary , risks of remaining uninsured even for 1 day >>> potential savings of 28 K and growth of that amount if invested in healthcare/ total stock index fund.
If your family is really healthy, then your costs above the $16,000 premium are going to be minimal.

If one or more of you becomes seriously “unhealthy” then another $12,000 is going to be a drop-in-the bucket relative to the expenses that the insurance will cover.

daheld
Posts: 697
Joined: Wed Sep 13, 2017 8:14 am
Location: Midwest US

Re: Ok to go without health insurance?

Post by daheld » Thu Oct 24, 2019 10:27 am

delamer wrote:
Thu Oct 24, 2019 10:22 am
DiehardDoc wrote:
Wed Oct 23, 2019 11:37 pm
Thanks to all forum members who have responded.

Apologies for not responding sooner.

Have been busy with patient care.

Have not read all the posts.

As expected, almost everyone agrees we should carry catastrophic high deductible HSA eligible health insurance plan.

Although we do not like ever increasing premiums , there appears to be no alternative.

In case of auto insurance etc if some one is a good driver , one gets rewarded with possible reduced premiums/discounts.

In cases like ours ( small business owners with very few employees and almost everyone as well) end up paying ~ 12-15% more each year without making any claims other than one annual wellness visit.

On top of that, these are high deductible plans. To make calculations simpler, family of 4 has to pay 16K + 12K of annual family deductible ( total 28K) before insurance starts covering 100%/80% depending upon plan for one calender year.

In summary , risks of remaining uninsured even for 1 day >>> potential savings of 28 K and growth of that amount if invested in healthcare/ total stock index fund.
If your family is really healthy, then your costs above the $16,000 premium are going to be minimal.

If one or more of you becomes seriously “unhealthy” then another $12,000 is going to be a drop-in-the bucket relative to the expenses that the insurance will cover.
This is probably the best analysis of this situation I've seen thus far.

delamer
Posts: 9299
Joined: Tue Feb 08, 2011 6:13 pm

Re: Ok to go without health insurance?

Post by delamer » Thu Oct 24, 2019 10:31 am

Lee_WSP wrote:
Wed Oct 23, 2019 6:54 pm
gch wrote:
Wed Oct 23, 2019 5:32 pm
Afty wrote:
Wed Oct 23, 2019 12:45 am
gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
I understand this is true in general, but most uninsured people are poor and it makes sense for hospitals to negotiate with them since any payment is better than nothing. But what incentive does the hospital have to negotiate with a rich family who can obviously afford list price?
You don’t have provide income verification to get emergency medical services or reduced prices from the hospital.
Emergency services cannot refuse treatment.

Yes, the hospital can request income verification for reduced billing.
What exactly does “cannot refuse treatment” mean in reality?

Let’s say I am in a single-vehicle car accident. I am taken to the emergency room where it is determined that I’ve suffered a serious brain injury. And I don’t have health insurance.

The neurosurgeon on call is contacted by the hospital and is told that I don’t have insurance.

Is the neurosurgeon legally obligated to treat or operate on me, regardless of my insurance status?

Does it matter if the neurosurgeon has an independent practice versus bring employed by the hospital?

It seems to me that these are the situations that most people (and certainly me) don’t really understand.

EDIT: I don’t want to introduce a medical advice issue. I am trying to understand the financial implications of being uninsured when hospitals can’t refuse “emergency treatment” because there seems to be misinformation on the topic.
Last edited by delamer on Thu Oct 24, 2019 11:35 am, edited 2 times in total.

NotWhoYouThink
Posts: 2747
Joined: Fri Dec 26, 2014 4:19 pm

Re: Ok to go without health insurance?

Post by NotWhoYouThink » Thu Oct 24, 2019 10:43 am

My family and I have had a few ER and Urgent Care visits over the last 5 years or so.
(By the way, the list-price cost of these, combined, did not begin to reach the cost of our annual insurance premiums. )

In all cases, treatment was at least started and usually completed before anyone asked about insurance. I don't think the trauma team checks insurance when minutes count. Maybe for elective or experimental treatment they would.

delamer
Posts: 9299
Joined: Tue Feb 08, 2011 6:13 pm

Re: Ok to go without health insurance?

Post by delamer » Thu Oct 24, 2019 10:58 am

NotWhoYouThink wrote:
Thu Oct 24, 2019 10:43 am
My family and I have had a few ER and Urgent Care visits over the last 5 years or so.
(By the way, the list-price cost of these, combined, did not begin to reach the cost of our annual insurance premiums. )

In all cases, treatment was at least started and usually completed before anyone asked about insurance. I don't think the trauma team checks insurance when minutes count. Maybe for elective or experimental treatment they would.
I am no medical expert.

But the trauma team stabilizing a patient is different than calling it a specialist to perform a lengthy, risky operation,

Without being callous, what good does being stabilized do if you can’t get the operation you need to survive?

In other words if you are financially unable to pay for the care you really need?
Last edited by delamer on Thu Oct 24, 2019 10:59 am, edited 2 times in total.

rantk81
Posts: 254
Joined: Tue Apr 18, 2017 8:12 am

Re: Ok to go without health insurance?

Post by rantk81 » Thu Oct 24, 2019 10:58 am

Putting aside anything relating to the OP's income and net worth....

The "more expensive" PPO plan, at $16K/yr for a family of four. Let's put it into perspective. That's $333 per person, per month. A lot of folks with employer "sponsored" insurance can pay similar'ish amounts.

That's a pretty good deal for a broad network PPO plan. Even if it has deductibles/maximums that approach the maximums allowed by the ACA in the current year. You're capping your potential annual expense at a fixed amount, and you can see almost any doctor you want.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Thu Oct 24, 2019 3:09 pm

delamer wrote:
Thu Oct 24, 2019 10:31 am
Lee_WSP wrote:
Wed Oct 23, 2019 6:54 pm
gch wrote:
Wed Oct 23, 2019 5:32 pm
Afty wrote:
Wed Oct 23, 2019 12:45 am
gch wrote:
Tue Oct 22, 2019 9:45 pm
So many people see the original billing rate then the insurance negotiated rate, and assume the former is what a non-insured patient would pay. That's not the case, as most practices/hospitals have a non-insured rate (and even a lower non-insured cash rate) which could be even lower than the insurance negotiated rate.
I understand this is true in general, but most uninsured people are poor and it makes sense for hospitals to negotiate with them since any payment is better than nothing. But what incentive does the hospital have to negotiate with a rich family who can obviously afford list price?
You don’t have provide income verification to get emergency medical services or reduced prices from the hospital.
Emergency services cannot refuse treatment.

Yes, the hospital can request income verification for reduced billing.
What exactly does “cannot refuse treatment” mean in reality?

Let’s say I am in a single-vehicle car accident. I am taken to the emergency room where it is determined that I’ve suffered a serious brain injury. And I don’t have health insurance.

The neurosurgeon on call is contacted by the hospital and is told that I don’t have insurance.

Is the neurosurgeon legally obligated to treat or operate on me, regardless of my insurance status?

Does it matter if the neurosurgeon has an independent practice versus bring employed by the hospital?

It seems to me that these are the situations that most people (and certainly me) don’t really understand.

EDIT: I don’t want to introduce a medical advice issue. I am trying to understand the financial implications of being uninsured when hospitals can’t refuse “emergency treatment” because there seems to be misinformation on the topic.
Yes. As long as it is life threatening. Once you are stabilized you are discharged.

The neurosurgeon will remove the life threatening brain clot and stitch you back up. Anything else is not an emergency.
Last edited by Lee_WSP on Thu Oct 24, 2019 3:13 pm, edited 1 time in total.

Lee_WSP
Posts: 1208
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ok to go without health insurance?

Post by Lee_WSP » Thu Oct 24, 2019 3:11 pm

rantk81 wrote:
Thu Oct 24, 2019 10:58 am
Putting aside anything relating to the OP's income and net worth....

The "more expensive" PPO plan, at $16K/yr for a family of four. Let's put it into perspective. That's $333 per person, per month. A lot of folks with employer "sponsored" insurance can pay similar'ish amounts.

That's a pretty good deal for a broad network PPO plan. Even if it has deductibles/maximums that approach the maximums allowed by the ACA in the current year. You're capping your potential annual expense at a fixed amount, and you can see almost any doctor you want.
It's also deductible. Especially if bought through the business.

MichCPA
Posts: 828
Joined: Fri Jul 06, 2018 9:06 pm

Re: Ok to go without health insurance?

Post by MichCPA » Thu Oct 24, 2019 3:21 pm

junior wrote:
Tue Oct 22, 2019 8:12 pm
dual wrote:
Tue Oct 22, 2019 6:55 pm
He could clear his debts through bankruptcy
Not clear that a high earning doctor would be eligible for bankruptcy, you could certainly talk to a lawyer, but this is a massive assumption.
Odds that you will get through bankruptcy with the mid 7 figure NW intact are appox 0%. Odds that mid 7 figure NW will still be mid 7 figure after 16k insurance are 100%.

User avatar
TomatoTomahto
Posts: 9544
Joined: Mon Apr 11, 2011 1:48 pm

Re: Ok to go without health insurance?

Post by TomatoTomahto » Thu Oct 24, 2019 3:32 pm

MichCPA wrote:
Thu Oct 24, 2019 3:21 pm
junior wrote:
Tue Oct 22, 2019 8:12 pm
dual wrote:
Tue Oct 22, 2019 6:55 pm
He could clear his debts through bankruptcy
Not clear that a high earning doctor would be eligible for bankruptcy, you could certainly talk to a lawyer, but this is a massive assumption.
Odds that you will get through bankruptcy with the mid 7 figure NW intact are appox 0%. Odds that mid 7 figure NW will still be mid 7 figure after 16k insurance are 100%.
Gosh, when you put it that way, it seems like a no-brainer
:D
Okay, I get it; I won't be political or controversial. The Earth is flat.

Post Reply