Medical Bills

[tkaraszewski]

This month is my first of really buckling down and trying to save a lot, and move towards a more mustachian lifestyle. But I'm being continually disheartened by a stream of medical bills. You see, last month my wife was in the hospital for a night. It seems like every day since, I've gotten a medical bill for something or other in the mail. So far they total about $2,500. I hope I'm getting close to the end of them.

This is about the fourth or fifth time my wife has been in the hospital in the last three years, and although this one has been the shortest stay, it's ending up as one of the more expensive ones (maybe because we were out of the area when this happened). I know that MMM's stance on medical costs is essentially, "Don't be sick, I'm healthy, see, it's easy!" but that's not really the case for everyone.

I hope that someday soon we'll have a sane healthcare system in this country such that you're not required to work for a big corporation to be able to afford to get sick, so that financial independence might actually be a realistic option for me. As it stands now, it's not really even a possibility. If I paid off my house and put a million dollars away tomorrow, I'd still need to keep my job so that I can have health insurance. I know that the pre-insurance cost of the care my wife has received, just this summer, is about $125,000.

$125,000 for essentially four days of treatment. You have to have a pretty big 'stach set aside to absorb bills like that. I know, you say I could get "catastrophic coverage" health insurance. I couldn't. Not with my wife's condition and a history of things like this happening. Nobody would insure us.

I *hope* that the end to exclusions for pre-existing conditions taking effect as a part the Affordable Care Act in 2014 mean that my family will be able to buy affordable, reasonable health insurance even if I do want to stop working full-time. For now though, I don't see anything else I can do.

I'll pay these bills, and start again on that 'stach I wanted to get going. Hopefully we'll get a break for a year or two before the next hospital stay.

[keith]

I do need to correct you in one point. MMM's attitude on health insurance does not equate to "Don't ever get sick". He specifically has said high-deductable (catastrophic) plans are the way to go, and thats what his family uses. Read his post on it here.

Regarding attempting to get a plan and getting turned down for pre-existing conditions - that sucks and I don't know of any way around that. Maybe someone more well versed in the new healthcare laws can respond.

I wouldn't lose hope for FI though - once you can get yourself onto a catostrophic plan, you won't have to store millions away for future medical bills.

[zhelud]

Catastrophic plans usually have very high deductibles- like, say, $10,000 per year. If you are regularly incurring hospital bills, or you have to take expensive medication, you might have to pay that deductible every year. So you have to think about that in your FI plans.

This consideration is what keeps me at my job, too, since my son has a condition that requires regular treatment that can be very expensive.

[twinge]

The other thing I've noticed slipping into some high deductible family plans is that there's a clause that the costs have to come from more than one patient to add up to the deductible or else the actual deductible is higher.
And there's sometimes things that don't "count" towards the deductible like co-pays etc.  So when you are budgeting it's important to look at the fine print -- you can't just say that you're going to make sure your budget can withstand 5K or 10K each year if need be because that's your deductible because sometimes it's going to be more than that, plus the premiums etc. 
We had a relatively minor infant health issue that racked up 90K bills over two calendar years.  Fortunately our insurance covered about 85%.

[tooqk4u22]

I do need to correct you in one point. MMM's attitude on health insurance does not equate to "Don't ever get sick". He specifically has said high-deductable (catastrophic) plans are the way to go, and thats what his family uses. Read his post on it here.

Regarding attempting to get a plan and getting turned down for pre-existing conditions - that sucks and I don't know of any way around that. Maybe someone more well versed in the new healthcare laws can respond.

I wouldn't lose hope for FI though - once you can get yourself onto a catostrophic plan, you won't have to store millions away for future medical bills.

To further correct this MMM did say this is the way to go and what he planned to do - until recently his wife has worked and that has been the source of their healthcare. They are also relatively young and as the OP points out health status can chance.  I too am a fan of high deductible plans but feel that you can't budget for just the premium like he suggests - it is just not realistic.  I don't necessarily think you need to budget for the full deductible (although that would be the most conservative) but some number in between.  If healthy it doesn't matter but if something becomes chronic/recurring year in year out then it will become part of your regular expenses. While I am not FIRE yet health care is the thing I am struggling with as to how to plan for it - there are so many variables and unknowns, not the least of which is the government screw ups.

[Paul der Krake]

If the medical bills keep piling up and her condition is unlikely to improve, have you considered leaving the country for one with a state-funded health system? Depending on your occupation you could get work visas in Europe.

[artistache]

Tkara--
I feel your pain.  Thanks for taking on MMM about health insurance--I feel very much that he downplays the challenges many of us (who were born with weird heart valves, for example) face with affording health insurance and health care.

[tkaraszewski]

Paul: I actually hadn't considered that, but it's not a crazy idea. My wife is actually a Canadian citizen, so we could probably move there if we wanted to. I do have hope that the healthcare situation in this country will improve in the next few years, though, so I'm not really ready to just leave. My wife's condition varies. She was mostly OK for several years and the last couple years things have been more difficult.

artistache: I'm really not trying to call MMM out, but you're right, he does downplay this issue. I understand why he does, too. If it was just me, I'm pretty healthy, I could get by with minimal health coverage. But that's not the case for my wife, and she has no choice: she's can't just get better by eating better or getting more exercise, which is the sort of stuff MMM advocates for keeping you healthy. It's a good idea if you're otherwise healthy, but it doesn't work if you have a real health condition.

[Orvell]

Glad for this thread. Health (and insurance) a pretty big problem for a lot of people and although eating and working out can help us and our bodies in a thousand ways, it's not a cure-all for everything. I hope your wife's condition improves or is at least stable!

[Jaherman99]

Also, consider taking advantage of the HSA that comes in conjunction with high deductible health care plans.  You can save ahead of time pre tax dollars to use for health expenses.  Not perfect, but it saves you 30%.

[DocCyane]

Thanks for taking on MMM about health insurance--I feel very much that he downplays the challenges many of us (who were born with weird heart valves, for example) face with affording health insurance and health care.

Right there with you. Atrioventricular heart block, here. Pre-existing condition. I have insurance through work, but if I ever want to retire early, what are my real choices? That's a rhetorical question, by the way. No clue what health care in this country will be in the future.

[Amalgamator]

Maybe it's because you guys haven't actually dealt with this, but one can get health insurance not thru your job with a pre-existing condition.  Each state has a high-risk insurance pool, which is partially funded by health insurance premiums.  It is pretty reasonably priced.  My dad is on it since he has lupus in Illinois and my wife is on it in Colorado.  We pay $150 a month for a $2000 deductible plan for her. Me and the kids have a individual HSA plan ($450/mo).  My employer plan would have been $1400/mo.  So we are saving by doing it this way.