Following up on the beginning of the series on “Should You Have”, which started by talking about investing in the stock market, today we talk about health insurance in a financial manner.

2008.11.25 - The physician
Creative Commons License Adrian Clark via Compfight

It’s been covered before here, such as this post titled 3 Reasons Skipping Health Insurance Is Not A Risk You Should Take and 4 Reasons You Need To Look At Your Medical Bill. Everyone knows health care is expensive; some have insurance, some don’t, and many are mad at the government and its health care bill.

I’m not. As a health care finance consultant, I know the benefits of having insurance. Sure, sometimes it seems expensive to get, and I’m not going to deny that for the half of people it’s either an expense you’re not going to touch upon for the year or you might break even. But for the other half, which anyone can easily move into at a moment’s notice, I’m going to make this a simple reason why you need to consider purchasing health insurance.

First, did you know that over 60% of the American population that files for bankruptcy has a significant medical bill on their list of obligations? Most people don’t try to take advantage of the posted options for trying to set up payment arrangements or try to get reductions on their bills, and there’s this truth which says people feel better later on, always find more fault with their health care treatment after the fact, thus don’t like how much they’ve been billed. And if it’s more than $10,000, which is often is, then it becomes part of a bankruptcy filing.

Second, did you know that even if you file bankruptcy and the court accepts it that it doesn’t mean the next time you need significant health care services that your local hospital has to take care of you, nor any of the other hospitals close by? They all have to provide emergency coverage, but what if you break your leg and then need physical therapy afterwards? They’ll all run your credit report and some of them won’t take a chance on you because you’re a horrible risk. At best you’d better hope you were in a car accident and that no fault pays for it, otherwise you’re in trouble.

Third, let’s look at how much health insurance might cost you. If you shoot for a traditional Blue Cross plan it could cost you anywhere between $7,500 and $20,000 depending on where you live. That $20,000 is probably for a family plan in a state like California, and I won’t deny that’s pretty steep. Now compare it to the cost of a mid level emergency room visit, attach to that the cost of a potential surgical procedure and just 2 overnight stays in a hospital… In some large cities across the country you’ve already hit $20,000 because all those things include incidentals like supplies and pharmaceuticals.

There are other insurance choices. A brief investigation online showed me options in some states where you can get a pretty good group plan through different types of organizations that might cost you between $400 and $650 a month. You might lose some things, but all the important stuff is covered, including emergency room and urgent care visits. If you’re really not feeling well do you really just want someone to triage you (check you to make sure you’re not critical) and, if you can’t pay for it, tell you to go buy some ibuprofen and send you home?

Some people who will try to scare you on the Health Care Bill will cite the $900 and $3,800 the government is going to hit you with if you don’t have health care when things go into effect. I say scare because it’s a lot of nonsense. If you’re single they’ll add $900 to your income, which means you’ll end up paying around $90 out of your refund or added to what you owe; that’s nothing to worry about in the scheme of things, as you pay more than that on your smartphone. For a family of 4, it’s even less of a hit because of the dependents you’d be claiming. If that’s what you’re worried about give up a few pizzas in the year and you’re covered.

As with most things, not having health care comes with risks on both ends. If you’re pretty healthy and you don’t take a lot of chances with your health, such as exercising, going out to dinner, etc, where something could happen to you, then you’re probably fine waiting on health care coverage. However, if you like to do anything where you’re not always in 100% control, such as walking outside and finding out that you’re suddenly allergic to something, paying for some kind of insurance will save you lots of money in the long run.

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