Planning on dropping Health Insurance. Change my mind.

[MossRoad]

I'm in America. In this country, about 30 million working Americans have no health insurance. Small businesses are not required to provide health insurance to their employees, and low wage earners can't afford to buy insurance on the open market. I realize the US is the only developed country in the world without a national health care plan, but we're used to it.

60% of Americans are dealing with unpaid medical debt thanks to high "deductibles." 56% of Americans had medical debt sent to collections. Medical bankruptcies represent 66.5% of personal bankruptcies in the US.

Where'd you get those numbers?

 

[KennyG]

Where'd you get those numbers?

Larry's numbers are well publicized but a bit misleading. About half of Americans have medical debt but that just means they have an outstanding debt that hasn't been paid yet. The amount sent to collection is much smaller but I couldn't find a good number but I have seen information that indicates that much less than 10% have "large" medical debt. Just try to imagine a system trying to collect from over 50% of Americans. The debt collection business would have to be larger than the IRS.

The medical bankruptcy number stems from Elizabeth Warren's research. It was flawed in that it did not differentiate between bankruptcy WITH medical debt and CAUSED by medical debt. When you are in financial trouble, a medical bill is the last one you pay. They can evict you, repossess your car, etc. but they can't repossess your body. Later research indicates that medical bills are the primary cause of bankruptcy is closer to 10%.

Medical debt is a real problem, but there is a lot of misinformation about it.

 

[MossRoad]

Larry's numbers are well publicized but a bit misleading. About half of Americans have medical debt but that just means they have an outstanding debt that hasn't been paid yet. The amount sent to collection is much smaller but I couldn't find a good number but I have seen information that indicates that much less than 10% have "large" medical debt. Just try to imagine a system trying to collect from over 50% of Americans. The debt collection business would have to be larger than the IRS.

The medical bankruptcy number stems from Elizabeth Warren's research. It was flawed in that it did not differentiate between bankruptcy WITH medical debt and CAUSED by medical debt. When you are in financial trouble, a medical bill is the last one you pay. They can evict you, repossess your car, etc. but they can't repossess your body. Later research indicates that medical bills are the primary cause of bankruptcy is closer to 10%.

Medical debt is a real problem, but there is a lot of misinformation about it.

Thanks. That's what I was finding looking things up for myself. I could not find anything supporting those large numbers.

 

[Snobdds]

Pre-obamacare I wanted the highest deductible I could find which ended up being $10K. Really good insurance but catastrophic insurance. $100/month.
$10,000 no big deal, not like $10 mil. The low premium meant I could save that difference which I paid out of pocket. So in say, 10 years saving $400/month=about $50K.
Most people don't figure it like that.

After my mother retired, she had 4 years before Medicare kicked in. Since I know this stuff inside and out, I set her up with a BCBS high deductible plan with a 20K deductible. Then we purchased a couple of aflac policies that cover the deductible for diagnosis of Cancer or if she looses 2 of the 5 necessary life function. Basically the only things that would require her to meet her deductible. Her pension provided $800/mo to use for the purchase of health insurance. Well, between her High deductible and aflac policies, she was only paying out 350 for those a month, meaning she could bank the other 450 in a HSA account. She kind of self insured herself, but she also was able to build a sizeable balance in her HSA.

Healthcare is a complex game, and if you play it right...you can beat it. But the biggest truisms in Healthcare is...If you have your health, you have your wealth.

 

[buckeyefarmer]

I looked into the Health exchange recently, open to all without employee medical coverage. For low income people it is basically free for the individual, your tax dollars at work. There is no excuse for not having medical coverage.

 

[ljjhouser]

While I understand your feelings, I don't think canceling health insurance is a very good idea. There are many reasons t0 do that or not to do that. But there are two reasons for keeping it that is important to me, Also, I might mention - $2200 - $183 and $4200 - $350 a month is somewhat cheap for Health Insurance.
The two reasons are this.
1. We don't buy health insurance for what has or has not happened in the past or what is normal. Be buy it so we can get care without being bankrupted.
2. If you go a few years without insurance, you will find it difficult to purchase it in the future. That is because ins companies feel you have not invested in your health care, and now find you are sick and need help.

Or then you can always get ins. through the ACA on the Healthcare.gov website. If you look at it, you will see that most plans run about $400 - $800 a month. Some have deductibles of around$7000 to $10000 BEFORE they pay anything. Still for short term ins. that may be better than nothing.

Good Luck. I might also add, many of the company health policies cost around $700 a month. My wife's policy is $750.

 

[ljjhouser]

I looked into the Health exchange recently, open to all without employee medical coverage. For low income people it is basically free for the individual, your tax dollars at work. There is no excuse for not having medical coverage.

Low-income people cannot afford the exchange insurance around here. Even if they qualify for the policy free. Most of those plans have HUGE deductible BEFORE they pay anything. And you are right, anyone without employee OR MEDICARE coverage.

 

[Snobdds]

Low-income people cannot afford the exchange insurance around here. Even if they qualify for the policy free. Most of those plans have HUGE deductible BEFORE they pay anything. And you are right, anyone without employee OR MEDICARE coverage.

Most smart low income people I know, know it's better to have a deductible to cover than a hospital bill.

Plus you can get some first dollar benefits like physicals without having to meet a deductible.

Again, there is no excuse to have have coverage today.

 

[Larry Caldwell]

Pre-obamacare I wanted the highest deductible I could find which ended up being $10K. Really good insurance but catastrophic insurance. $100/month.
$10,000 no big deal, not like $10 mil. The low premium meant I could save that difference which I paid out of pocket. So in say, 10 years saving $400/month=about $50K.
Most people don't figure it like that.

Great idea, except the deductible resets on January 1. $10,000/year = $833/month. If you have $100k in your pocket, 10 years of $10k deductibles might not be that bad.

 

[Larry Caldwell]

Where'd you get those numbers?

25+ Medical Bankruptcy Statistics To Know In 2025

Do you know medical bills are a leading cause of bankruptcy? Learn more amazing medical bankruptcy statistics in 2025. ✅

spendmenot.com