Hear me out on this, please.
Let’s say that I spend $5k on health insurance in a year, but don’t go to the doctor or have any medical issues in that year. Where does my money go? It disappears. I basically just gave away my money, and received nothing in return. However, if I took that $5k and simply put it into a personal savings account instead of giving it away to a health insurance provider - that money stays right there if and whenever I decide to use it. It even collects interest.
I realize that with a health insurance provider, you’re (supposedly) getting discounted rates on medical services - but if your money is just disappearing into thin air if you don’t happen to need those medical services in a given year, are you really saving money? It just seems like a really big scam to me - what am I missing?
One, as many point out, insurance is about covering the extremes. Most people won’t use as much money as the premium, but others…
For example, a relative of mine got a rare cancer, that is pretty treatable, but the medicine alone would have cost 10k a month, ignoring the frequent oncologist appointments. No amount of savings would have covered that. Even a single visit to an ER could more than wipe out a couple of years of premiums.
The other thing is the discounts are no joke. Now if you are truly uninsured, many of the providers will upon negotiation give you some severe “break”, but you have to fight every time and your results are unpredictable. The insurance companies have lots of leverage, and the providers jack up prices to make the negotiated rates look good compared to their alleged list prices.
Most people lose money to insurance. It’s a method of mitigating risk. You’re accepting a modest regular payment in exchange for not needing to build up a big reserve (or go into debt) in case something really expensive comes down the line.
Life insurance is kind of similar. If people saved the money they pay for it until they do die, on average that saved amount would be more. But having life insurance while healthy and working means that in the unlikely event of your death, your beneficiaries will be compensated for the loss of the income you provide when otherwise they would be SOL.
Congrats you just described high deductible plans with an HSA.
So I’m not sure what is happening in this post. The premise is ludacris and the top responses are nonsense.
A five mile ambulance ride to the hospital for non emergency services is like 5k alone.
A simple conversation and basic exam by a doctor is 300 bucks on the low side. That’s just the doctor with a stethoscope checking your heart and lungs.
If you have to go to the emergency room you’re done.
That’s why we have health insurance here. It’s basically a racket.
Like all insurance it deals with the possibility of a bill so large no savings could cover it. Its like life insurance does not make sense unless you die young assuming you paid into it your whole life. The savings is better right up to the point you get some catastrophic medical issue which could happen in your twenties.
You don’t want a personal savings, you want a health savings account (HSA). this is a pre-tax account that you own and can use to pay medical bills. This is usually in addition to regular insurance though.
It’s usually used to pay out of pocket medical bills. For instance, you have a surgery and need to pay 5K out of pocket and insurance pays the rest. You can use the HSA to pay your portion so nothing needs to come from your personal savings.
its a risky gamble, if you suddenly get injured, or have a severe infection you will be paying OUT OF THE POCKET from a general hospital, and its many times more than paying multiple months of insurance. same goes for dental care, if you have sudden tooth pain, if you are lucky to find emergency dentists, they can charge several hundred for a limited exam w/o insurance. you can try free clinics, or universities for "healthcare’, but often time they are booked weeks to months in advanced and they take a long time to register you as a new patient, due to them being students which have priority over providing dental care.
let only prescriptions are very expensive wholesale/retail cost, even if you use a coupon for it somehow. my parents opted of not paying dental care 1-2years and they had worsening teeth issues, and they ended delaying care and it costed alot more now since it precipitated into root canals, and implants.
and yes general healthcare insurance is quite scammy. UHC being one the worst offenders out there. its also political asf since health insurance has a vested interest in discouraging any laws for universal or regulated heatlhcare cost.
the scammy part is most insurance have DEDUCTIBLE you might reach before covering some of your cost, and OOP, out of pocket maximum where you pay a certain amount each year max, then they will 100% cover all your medical costs. most people dont reach these maximums, so they pay partially or full price for certain things.
this all depends on your INSURANCE you got. dental insurance is not bundled with healthcare insurance, must be bought seperate, and they have thier whole own can of worms to deal with.
Because hospitals charge a thousands dollars for an aspirin.
Insurance only has to pay like a dollar. But YOU would be lucky to haggle it down to $40.
So pretty much: the RAM crysis situation but it can literally kill you
IOW: a racket
Let try this, why don’t we pool our money into a big savings account of pretax dollars for everyone in the entire country and add a supervising org that works with hospital networks to keep cost low through collective bargaining. At some point we the hospital networks become a single national network.
Ok so I hear you, but where do I get to deny claims and make $638,384,274,836.67 for myself while you die of a completely treatable disease? It’s not a fair system to me so I’m going to
bribelobby Congress and get my way.The fix is clearly to have a group of non-medical people in charge of that pooled pot of money who can deny payments for arbitrary reasons.
I think this is the most sane solutionMost sane seems a bit of a stretch, but I will grant you that given the current system sane-er definitely works.
Lol well we have video from last year that showed what we should do with you in that case.
Sounds like communism to me smh
Insurance is always a technical gamble. If you need it for something moderate to big you’ll easily run up a much higher bill than 5k. Could even be enough to eat the years of savings you had.
If you had paid that 5k that year, you’d still have your savings.
Until we get to the total plan limits. They don’t cover costs to infinity, you know. And for something like cancer treatment, most plans don’t actually offer enough coverage to sustain it for years, so you’re still on the hook for tens or hundreds of thousands of dollars after all is said and done.
A single complex surgery can have billed charges approaching $1,000,000, and that’s if they will even perform the surgery if you’re ininsured. Your $5,000 a year won’t even cover the interest charges and your only way out if the hospital won’t reduce the debt is bankruptcy.
Because everything costs more than you think. Having a child without insurance is often over $100,000. Any visit to the ER for an emergency? $25,000 to get in the door and often millions of dollars if you need lots of interventions. Heck, even with insurance, chronic conditions often cost thousands of dollars per year. Even simple procedures like my daughter’s tympanostomy tubes have self-pay prices in the tens of thousands of dollars.
You may have conflated ‘costs’ with ‘profit’ - countries with actual healthcare don’t allow providers to inflate their costs like the USA does.
I have Acute Myloid Leukemia.
In the State of Oregon, to treat that with a side trip through “lets get a bone marrow transplant land” it costs $2 million dollars.
I had a doctor state that they don’t know what causes Leukemia, but it’s not genetic, so there is nothing I could have done to prevent it and my family didn’t give it to me.
Are you going to save up $2 million dollars in case you get diagnosed with something that does not have any symptoms? Because I didn’t have any. One month I was fine, and the next I couldn’t get to from my car to my desk at work without stopping somewhere along the way to rest.
To a certain degree, I see your point about paying for something that you are not really using. It sucks. But if you need it, it is really nice that you already have it.
There is a reason why some people literally go bankrupt with medical bills. Even with insurance, it can still get pretty costly.
Ask yourself what happens if you get diagnosed with cancer in that first year instead of staying healthy.
Spend the savings account on a sweet funeral?
Unfortunately, $5k doesn’t buy you a sweet funeral. You’re lucky to be cremated and remains in a plain plastic coated cardboard box for $5k.
$5k might cover the costs of moving a country with proper healthcare though.
Sounds very expensive there… Pretty sure funerals relatives of mine have had were priced in 2-3 digits.
That is an extremely foreign concept to my indoctrinated american brain… My grandmother pre-paid for her entire funeral, casket and burial plot included, back in the early 1980s and didn’t pass until 2005. It cost her like $3000 in 1980s money and we were told at the time the same arrangements would have cost about $25000 in 2005. Another family member died that same year and was cremated and that cost about $4000 just for the basic plain box mentioned above. I’m sure today it is at least double that… (guessing based on how much more EVERYTHING else costs vs 20 years ago).
Jeez just haul me out to the woods and plant a tree overtop of me, I need nothing but to return my borrowed stardust back to nature
Oh, no, that’s illegal. You’re legally required to spend at least 10k on your death, it’s good for the economy.
You can spend a few thousand here, but at that point you are getting a fairly large service and feeding everyone too. Burial is also another way to add a lot to the cost.
Because you probably won’t get a multi-million-dollar cancer, but might. Or, looked at another way, someone will get cancer, and with insurance everyone is just a little less well off, instead of a few people being absolutely ruined.
I know little about American healthcare, but that’s how insurance in general works. (From what I’ve heard, there’s also a premium that just goes to anticompetitive bullshit in that specific case)
Exactly. Health insurance covers more than I could ever save. The fact that we all she pretty well means that well need more medical support for a longer time when were old. Once your personal savings account is empty you won’t have acces to expensive treatments anymore.
The more people buy in to healthcare, the cheaper the individual cost gets.
…in theory.
Thats how health care works in civilized countries. In the US its more like “everyone is way worse off, the people who get really sick are still ruined because insurance fucks them over and you still have to pay for going to the doctor”.
Private health insurance doesn’t get involved with doctors or hospital treatments at all where I live. It’s more for various outpatient goods, and dentists/eye doctors if you’re too rich to qualify for the federal program.
