...
And as to the cost discussions, nobody seems to know what they're talking about. Most healthcare spending is coming from CMS. Old people use the most healthcare and almost all of them are on Medicare. CMS sets the price they are willing to pay at some percentage, less than 100%, of what the provider charges on average to non CMS customers. So, just to stay open for business, the providers have to jack up their prices so the CMS payout comes closer to being what they really need to charge. The lowest price you'll get, therefore, is not the insurance price. It's the cash price from a smaller facility that doesn't mind recording your "cash" price as a far higher invoice that was only partially paid. It's fraud yes, but the CMS payout rate has gone as low as 68% of average. Can you imagine? If it's a choice between starving to death and breaking the glass, it's right to break the glass. The consequence is the "spiraling costs of care" fake problem you think is happening.
Total shitshow.
Reviving this thread as I have gone back and done calcs on my insurance.
We decided to forego insurance in mid-2017 and haven't looked back. Below is the breakdown of 6 years worth of 'life' on if we had been cash-only vs insured. In 2013 and 2014, insurance (mostly) made mathematical sense. In 2019 its a joke...
WHAT MOST PEOPLE DON'T PAY ATTENTION TO:
1) The "Sticker Price" on healthcare is utter BS in order to make the insurance companies actually pay up.
2) If you call ahead for "XX" procedure and state that you are paying in cashiers check, you will get insurance price or better.
3) The hospital will let you extend the payments out over 12 months (or more) as long as you are making a reasonable payment. I have found that even in an emergency, these payments could be less than monthly insurance premiums.
4) This thing isn't getting 'fixed' until enough people opt out of the whole thing and pay cash. It is nice to see more and more doctors going to a cash-based model.
Cross posted from here:
Post 2
Post 1
Good luck getting out of the hospital for $25k, though.
How much do you think cash payment would be for a 2-night stay with 3 X-rays and 1 MRI? Back when we were on even better insurance, I paid $7,250 for that event in addition to the $8,400 paid in premiums throughout the year (that was early in the year, we cancelled insurance after that). That was the only major medical event that year. I had a long-time friend who worked in that hospital's billing department run through the numbers if we had agreed to pay in cash over 12 months. Had there been no insurance in the equation, she would have been able to do 12 payments of $1629.00 without even getting supervisor's approval, lower with permission. Considering that (and basically all other hospital stays for young people) is a statistical outlier, and we paid for 5 years of insurance with no major incidents other than that one, we come out WAY behind by having insurance.
People get sticker shock when they see a 84k bill for a hospital stay, but its artificially inflated pricing to get the numbers high enough to still turn a profit after the insurance companies pay out 1/3rd of that. People can (and regularly do) get pricing at the same levels as the insurance companies, especially if you call ahead for agreed amount and pay in cash.
FWI- I have done the math on his before. Until the medical market and insurance markets get fixed, my family won't be doing insurance at all.
Insurance Breakdown
2013 - $1768 Principle (YAY!) - $950 Deductible Per Person - $3500 Deductible Total - 25% copays beyond
2014 - $2178 Principle (Eh...) - $1100 Deductible Per Person - $4500 Deductible Total - 30% copays beyond
2015 - $3248 Principle (Boo.) - $1100 Deductible Per Person - $4500 Deductible Total - 30% copays beyond
2016 - $4504 Principle (Yuck) - $2500 Deductible Per Person - $4500 Deductible Total (May have been 5k here, but unsure so I'm going with the lower number). - 30% copays beyond
2017 - $8376 Principle (Ugh.) - $5000 Deductible Per Person - $5000 Deductible Total (NOTE: We didn't pay this. This is the year we said FU to the medical insurance industry) - 30% copays beyond
2018 - $10380 Principle (....) - $5000 Deductible Per Person - $5000 Deductible Total then copay. (Note: Again, we aren't paying.) - 33% copays beyond
Medical Spending had it been cash totals:
2013 - 1 ER visit - 4 doctors visits - 0 Hosp stays - Cash cost would have been about $420 to $720.
2014 - 1 ER visit - 5 doctors visits - 0 Hosp stays - Cash cost would have been about $665 to $965. ER was X-rays for broken collarbone. Total cost without insurance would have been $380 as it was quick and there was no cast. "Sticker price" was around $1200 but could have been drastically reduced per friend.
2015 - 0 ER visits - 5 doctors visits - 1 Hosp stays - Cash cost would have been about $225. PLUS OBGYN and birth costs would have been $9500 pre-agreed (we considered it).
2016 - 0 ER visits - 6 doctors visits - 0 Hosp stays - Cash cost would have been $270.
2017 - 1 ER visit but rolled into a hospital stay - 8 doctors visits - 1 Hosp stay - Cash cost would have been $19,550 for the hospital, MRIs and CAT scan. Doctors visits were higher due to specialty. $225 plus $495. $20270 cash cost for the whole year.
2018 - 0 ER visits - 4 doctors visits - 0 Hosp stays - Cash costs (have) been $180.
Medical spending WITH insurance...
2013 - $1768 + 4x$30 (Dr Copay) = $1888.00
2014 - $2178 + $75(EM Copay) + 5x$30 (Dr Copay) + $450 x 25% procedural copay (ER XRay Copay) = $2515.50
2015 - $3248 + 5x$30 (Dr Copay) + 14x$45 (OBGYN Copay with ins) + 4500 x 30% (Birth procedural copay) = $5378.00
2016 - $4504 + 6x$30 (Dr Copay) = $4684.00
2017 - $8376 + 5x$30 (Dr Copay) + 3x$45 (Specialist Copay) + $5000 max deductible + $7500 x 30% copay beyond deductible = $15911.00
2018 - $10380 + 4x$30 (Dr Copay) = $10500.00
So a true comparison of
all costs in on an insurance plans vs
cash pay comes out as follows:
2013 - $1888.00 on insurance vs $720.00 (worst case)
2014 - $2515.50 on insurance vs $965.00 (worst case)
2015 - $5378.00 on insurance vs $9725.00 (includes birth costs in both)
2016 - $4684.00 on insurance vs $270.00
2017 - $15911.00 on insurance vs $20270.00 (worst case)
2018 - $10500.00 on insurance vs $180.00
2013 - Cash wins by
$1168.00 (though, if anything had happened, 2013 insurance was MUCH better than now). (This includes an ER visit)
2014 - Cash wins by
$1150.00 (This includes a broken collarbone ER visit...)
2015 - Insurance wins by
$4347.00 (Due to childbirth being expensive... lol)
2016 - Cash wins by
$4414.00 2017 - Insurance wins by
4359.00 (NOTE: This includes an extremely expensive 2 night, CAT scan and MRIs hospital stay. A "worst of the worst" by medical cost standards aside from something like cancer, and insurance still only wins out by 5k or so. That should be VERY telling to people. After this fiasco I started running the numbers and we killed off the insurance bill. We paid a fee for it but it still came out ahead.)
2018 - Cash wins by
$10320.00 (Note: nothing happened to make insurance worth it. Some people might claim that if we had insurance in 2018 that we might have made different choices but we really wouldn't. We used regular kiddo's doctor when they got sick. We wouldn't have gone to the ER either way, because thats expensive and wasteful. Overall, I'm VERY glad we turned off the insurance leech...)
Overall, Cash would have won out by
$8,746.00 but once you account for (just a few years) worth of compounding, you would have ended up with $9,734.50 more. As such, we have been taking the exact same payment we would have made towards insurance and have been putting into investment accounts (IRAs and 401k mixed). If anything happens, we will negotiate out with the hospital to make 12 (or however many) payments to pay off the bill. As such, we could cash-roll the payments instead of paying insurance. The only way we lose out is if we have multiple statistically rare events in the same year.
Math doesn't work out in favor of that happening either... If something has a 1:40,000 chance of happening. The likelihood of that happening more than once is astronomically small (IE [1/40000]^2 or 1/1.6bil. It may be more likely for one 'major event' to lead to extremely high costs (like early onset cancer, heart attack in your 20s, etc), but that is the whole point of insurance... Insure against "reasonable" but unlikely events. As is, reasonable events would cost almost the same paying cash as paying insurance while still being extremely unlikely. So it doesn't make sense to buy insurance...
Note: 2018 isn't an outlier. Considering that is the "new price to play the game", had the premiums been similar for 2016 and 2014, you would have seen numbers that were just as drastic. That would be 30k in savings instead of just 8k...
It is the same as if I were to buy homeowners insurance to cover 165k house plus 45k of valuables. BUT if there were a fire, I would have to pay 50k in deductibles and copays and the premium is 35k a year... NO ONE WOULD PAY THAT. Why on earth do we pay it (and allow the merry-go-round to keep spinning) when it comes to healthcare...?
/off-soapbox.