Choosing to not have insurance

[skyline]

I'm too chickens**t to do this, but I can see the author's reasoning behind this. I thought I'd check to see if anyone's read any relatively unbiased analysis on whether health insurance, as it is in the US today, is worth having.

I think it's worth pointing out too, that the article doesn't take into account the option of offshoring expensive medical procedures to make the math work more in the favor of being uninsured.

Choosing to not have medical insurance -- latimes.com

 

[Walt34]

If one has to pay the entire premium and is in otherwise good health it's a roll of the dice anyway, like not buying extended warranties on cars and appliances. The equation changes when one's employer or former employer pays the majority of the premium. Then it's a no-brainer. Further complicating things is that the insurance companies never pay "sticker price" for medical care.

 

[crazy connie]

I tend to agree in principal but would not choose to go down this road. Health Insurance as it exists is not what most folks need rather it has evolved into this mess. Group/Private Insurance covers Medicare patients whose rates are below cost. Co-pays are so low that few care about being a good consumer and pity the poor bloke who has none and gets the highes rates.

I would be very happy with a good MAJOR MEDICAL/Catastrophic plan for myself in return for a healthy premium reduction. But, then I know how to save for tomorrow and do without some of the nice to haves. Most folks do not appear to have that concept and are still caught up in obscene over-consumerism consumpution disorder mode.

 

[Alan]

That guy is a lot braver than I am. I've hung onto my job this last few years because of the health insurance that I'll get as a retiree. Even though I and DW feel very fit at present I would be completely stressed out worrying about an accident or sudden illness to one of us.

 

[Bestwifeever]

I don't know if the article writer should or shouldn't carry health insurance, but as a former journalist specializing in health-insurance issues, he reminds me of Edmund Andrews, the New York Times financial reporter who declared bankruptcy. Both are do as I say, not as I do, I guess.

 

[easysurfer]

The reason I was able to FIRE early is because I was healthy enough to qualify with a High Deductible , HSA plan at a reasonable premium. Otherwise, I'd still be spending a third of my life in a cubicle. Good to know if something major should happen, I have that peace of mind.

 

[Brat]

IMHO the fine assessed the uninsured under the proposed health insurance re-org should go into a fund to reimburse those with insurance for that portion of their premium attributable to 'charity care'. For a moment I considered paying the care providers but I wonder if that would deter their collection efforts.

Yes, requiring residents to have health insurance seems very intrusive, but when the uninsured require care but don't pay for it they are shifting the cost of care to those who do have insurance. Community health requires treatment for infectious diseases and I don't see us wheeling the uninsured to the curb to die.

 

[ERD50]

Yes, requiring residents to have health insurance seems very intrusive, but when the uninsured require care but don't pay for it they are shifting the cost of care to those who do have insurance.

I'd agree, but after reading so much of the debate here on health ins, I think there is another way to look at this. Check my thinking, in case the caffeine has not settled in yet:

A) We are told that ins overhead and waste adds ~ 30% to the cost of health care.

B) The costs of treating uninsured people is borne by the rest of us now.

C) If they need ins, and can't afford it, that cost will be borne by the rest of.

D) Since C > B, maybe the "status quo" is better (in this case)?

So (caffeine kicking in), maybe this would be offset by the people who *can* afford ins, but *choose* not to buy it. I don't know if that's a big number though, and if they are young and healthy, maybe their costs are not that high (on average)?

-ERD50

 

[farmerEd]

Living without health insurance would be a lot easier if you could actually pay out-of-pocket the same rate that doctors accept from insurance companies. At least locally, I tried this a few times and was completely rebuffed. Seems (some) doctors try and makeup for the low reimbursements from insurance companies by sticking it to the people who have the desire to "pay cash". Doesn't make sense to me...

 

[Tesaje]

So long as Ins companies can reject you and not pay for any pre-existing conditions, it is a huge gamble. If you wait until you have some big problem, you won't be able to get insurance at all. When treatment can cost $50-100k and more, it is a ruinous gamble.

The other underlying thing about health care as capitalism is we cannot actually shop around and choose the best deal or best value for the dollar like you can for buying a car. We cannot get the information needed to make a decision and we don't have any way to find out what a provider will charge us. Or even if that provider is a good doctor.

 

[Brat]

So long as Ins companies can reject you and not pay for any pre-existing conditions, it is a huge gamble. If you wait until you have some big problem, you won't be able to get insurance at all. When treatment can cost $50-100k and more, it is a ruinous gamble.

The other underlying thing about health care as capitalism is we cannot actually shop around and choose the best deal or best value for the dollar like you can for buying a car. We cannot get the information needed to make a decision and we don't have any way to find out what a provider will charge us. Or even if that provider is a good doctor.

I agree!!

 

[toofrugalformycat]

He is a brave man in some ways, but perhaps uninformed as well. I chose to pay enormous premiums to a state high-risk pool to bridge the few years between my ER and when I could pick up retiree insurance through my former employer. I've had stuff happen to me so I knew that if the fickle finger of fate pointed at me even once, a lifetime of savings could be wiped out in no time. If I hadn't been frugal and saved for so many years, my perspective would be different.
I have noticed a high negative correlation between those who say they'll pay for whatever happens to them, and those who have HAD something happen to them and therefore have an idea of what things cost these days. A friend was recently accosted by some thugs while on a walk (in the daylight, no fault of his own) and the ER visit alone cost $9000. He walks for his health!

 

[Martha]

Living without health insurance would be a lot easier if you could actually pay out-of-pocket the same rate that doctors accept from insurance companies. At least locally, I tried this a few times and was completely rebuffed. Seems (some) doctors try and makeup for the low reimbursements from insurance companies by sticking it to the people who have the desire to "pay cash". Doesn't make sense to me...

Hey Ed, long time!

I think part of the problem is that to get the discounts the providers must have a price off of which the discount is figured and if the provider does't charge that price the insurer may argue that the price is not the true price. It is a problem. The whole discount thing is a problem as it is such a false construct.

 

[farmerEd]

OT: Yes, its been an awfully long time...almost 2 years to the day since my last post...don't remember why I even wandered off the reservation in the first place...

Funny to come back after two years and see a lot of the same names. Glad to know the smart folks on this forum haven't been wiped out and forced back to work by the last 2 years of market turmoil...

 

[John Galt III]

Living without health insurance would be a lot easier if you could actually pay out-of-pocket the same rate that doctors accept from insurance companies. At least locally, I tried this a few times and was completely rebuffed. Seems (some) doctors try and makeup for the low reimbursements from insurance companies by sticking it to the people who have the desire to "pay cash". Doesn't make sense to me...

FarmerEd,

Don't give up. I went without health ins for a few years, from age 51 to 53. I was able to get a "physical" for $45 cash, and bloodtest for a thyroid condition for $18 cash. That's right, $18 cash for a bloodtest.

I had to shop around to get the $18 price. Some other labs wanted over a $100 for the same test !


I had been using a medical facility for years, as an insured patient, and they were the ones that gave me the physical for $45 cash.

As an interesting aside, I would have been able to skate by with less expense, but my doctor insisted I have a physical once a year in order to write my prescription for the thyroid meds.

Luckily I had no big medical problems during that uninsured phase.


I live in Pa.

 

[Brat]

Devastating medical expenses happen when you are not in a position to shop for best cost or care: heart attack, stroke, cancer come to mind immediately. Few of us have sufficient reserves to pay for that care out of pocket. The cost of the care that the patient doesn't pay is shifted to those of us with insurance.

I have no problem with people who choose large deductible policies so long as they keep that deductible in the bank.

 

[John Galt III]

Devastating medical expenses happen when you are not in a position to shop for best cost or care: heart attack, stroke, cancer come to mind immediately. Few of us have sufficient reserves to pay for that care out of pocket. The cost of the care that the patient doesn't pay is shifted to those of us with insurance.

I have no problem with people who choose large deductible policies so long as they keep that deductible in the bank.

Some folks who have High Deductible Health Plans are saying they are having claims denied, or payment stopped on claims, when the ins co goes looking for reasons to deny coverage, after the claim is made. People who forget to mention something in their medical history are then confronted with it by the ins co. Somehow the ins co gets the medical history ( or perhaps additional and more detailed medical history after the initial background check was done), and then denies coverage. Makes me wonder why they don't find the offending medical history upfront, but wait until a claim is made.

If someone lies on the application, then gets denied, after paying lots of premiums, that's one thing, but I believe a lot of denying is being done to folks who are scrupulously honest on their applications.

Speaking of background checks, where do ins cos go to get your medical history? Your primary care physician? The MIB ( medical information bureau) ?

 

[ERD50]

Makes me wonder why they don't find the offending medical history upfront, but wait until a claim is made.

I think it is simple economics, not some conspiracy theory. For example, I got a high deductible policy for my son when our coverage was going to end for him. I hope to be able to drop it soon, once we have a clearer picture that he can obtain good coverage. In all likelihood, he will never make a claim. So why should the insurance co waste time/money checking everything now, when they can check it if it looks questionable at the time a claim is made?

It's a bit like fire ins on my house. I'm sure my ins would deny me if I was running a welding business out of my house. But would it make sense for them to inspect everybody's house every year to make sure they are not running a welding business out of their house? No, it would be obvious from the fire report when the claim is made, and then they can deny it.

If someone lies on the application, then gets denied, after paying lots of premiums, that's one thing, but I believe a lot of denying is being done to folks who are scrupulously honest on their applications.

I wish we had some real data on this, rather than a few anecdotes (and some of those I've seen were clearly someone trying to hide something, and then acting all innocent and self-righteous when they got caught). It is a concern of mine. We are paying these premiums, and all we can do is hope that the coverage is really there if we need it. I tried my best to be complete and accurate on the application, but my records are not all that great.

-ERD50

 

[toofrugalformycat]

I wish we had some real data on this, rather than a few anecdotes (and some of those I've seen were clearly someone trying to hide something, and then acting all innocent and self-righteous when they got caught). It is a concern of mine. We are paying these premiums, and all we can do is hope that the coverage is really there if we need it. I tried my best to be complete and accurate on the application, but my records are not all that great.

-ERD50

We do have real data on this.
I don't know if I'm out of line, making this too political. If I am, please delete this post, Moderator.
I happened to be listening to NPR when they were broadcasting some of the hearing of the House Energy and Commerce Committee. They were (among other things) interviewing insurance company executives on the subject of rescission. Here is a small excerpt I made of the report they compiled, filed by the link to the PDF document. I've included only some small snippets from the executive summary, and deleted some of the supporting examples - I'll let you read the PDF to get it all.

...The documents produced to the Committee also include other examples of controversial
practices, including the following:
• Insurance companies rescind coverage even when discrepancies are unintentional or caused by others.
• Insurance companies rescind coverage for conditions that are unknown to policyholders.
• Insurance companies rescind coverage for discrepancies unrelated to the medical conditions for which patients seek medical care.
• Insurance companies rescind coverage for family members who were not involved in misrepresentations.
• Insurance companies automatically investigate medical histories for all
policyholders with certain conditions. WellPoint and Assurant informed the
Committee that they automatically investigate the medical records of every policyholder with certain conditions, including leukemia, ovarian cancer, brain cancer, and even becoming pregnant with twins. UnitedHealth was unable to explain specifically how its
investigations are triggered, claiming that it utilized a computer program so complex that no single individual in the company could explain it.
• Insurance companies have evaluated employee performance based on the amount of money their employees saved the company through rescissions. The Committee obtained an annual performance evaluation of the Director of Group Underwriting ~t
WellPoint. Under "results achieved" for meeting financial "targets" and improving financial "stability," the review stated that this official obtained "Retro savings of $9,835,564" through rescissions. The official was awarded a perfect "5" for "exceptional performance."

Here's the link:
http://energycommerce.house.gov/Press_111/20090616/rescission_supplemental.pdf

 

[samclem]

We do have real data on this.

You've cited instances and anecdotes (which are, as you promised, "data.") I think what would be useful is actual refined statistics and information that allows us to determine if the insurance companies are abusing these retrospective determinations of eligibility.

 

[farmerEd]

You've cited instances and anecdotes (which are, as you promised, "data.") I think what would be useful is actual refined statistics and information that allows us to determine if the insurance companies are abusing these retrospective determinations of eligibility.

Did you actually read the link that was provided?

 

[ERD50]

We do have real data on this.

Here's the link:
http://energycommerce.house.gov/Press_111/20090616/rescission_supplemental.pdf

Thanks for the link. It was interesting, but there really was not much in the form of (useful) data that I was looking for (unless I missed it, I read most of it, skimmed some). They report that "they rescinded at least 19,776 policies from 2003 to 2007.", but we have no denominator, and we have no idea how many of those were clearly fraudulent applications. So somewhere around 5,000 per year; need to subtract actual fraudulent applicants, then divide by the number insured by those cos and we start to get a picture. Sure, one is too many, but we need to be realistic.

I never had a doubt that these practices take place. I'm not defending the ins cos here, but under the current system they need to do much of this or they won't stay in business (look at my welding example below for one reason why) and then none of us will have ins. And I'm not even surprised (though I am horrified) that in some cases the system is abused by the ins cos. But that hearing reads mostly like a string of anecdotes, "In this case this, In that case that".

The data I was looking for was something to tell me the % of cases where abuse took place. Abuse by the ins cos, and abuse by the insured. The latter is important, because if a high % of applicants are lying it does show that the ins cos need to be more aggressive in weeding those out. And when you deal with big numbers, I'm sure that some cases of abuse will occur - some simply by error, some from over-achieving, misguided individuals.

For a bit of balance, I also would not be surprised if someone could post a string of horrifying cases of abuse from the large list of Medicare/Medicaid cases. Do we throw the baby out with the bath water?

This is why I keep offering up the voucher system. With nationalized competition for the ins cos (yes, with some important regulations), and a public option that had to play under the same rules (take one take all), you eliminate the problems with underwriting.

-ERD50

 

[unclemick]

12 years 1993 to 2005. age 49 to 61. I would not recommend it for someone else.

Remember the line from 'Star Wars' -"never tell me the odds."



heh heh heh - now moving from LA to MO post Katrina and high deductible got me to a place where I could afford it and stay ER'd - that and time in the market in the 90's.

I just got back from New Orleans - friend passed at age 58 with health insurance out the whazooo - luckily he ER'd at 53 and got a lot of good licks in.

Like the man say's - never tell me the odds. And don't sniff rocket fuel.

 

[Zathras]

I agree with ERD, we need a better picture of the data.
I also agree with frugal, that link shows a 'systematic' issue and should be taken more seriously than 'last night uncle joe told me of a story about a co-worker's friend's insurance company denying....' type of anecdote.
The full data is the next step, hopefully we will see it soon.

 

[toofrugalformycat]

You've cited instances and anecdotes (which are, as you promised, "data.") I think what would be useful is actual refined statistics and information that allows us to determine if the insurance companies are abusing these retrospective determinations of eligibility.

You're right, it is frustrating that the information is not available to consumers. It's not even available to Congress!

Quoting from the same document:
"In October 2008, the Oversight Committee requested information from 50 state insurance regulators about the size of the individual insurance market in each state, legal standards governing rescissions, and investigations relating to rescissions. Most states were unable to answer basic questions about rescissions and the individual health insurance markets in their states. For example:
• Only four states, Hawaii, Kansas, Texas, and Washington, were able to provide the total number of rescissions that occurred within their jurisdictions.
• Only ten states were able to provide the number of individual health insurance policies in effect in their jurisdictions.
• Over one-third of state commissioners were unable to supply a complete list of the companies within their jurisdictions that offer individual health insurance policies."

I did find in this document, a few numbers about California (but admittedly not enough on which to generate a probability of rescission there).

"But WellPoint has been forced to reverse thousands of rescissions and pay millions of dollars for improperly terminating health insurance coverage in recent years. In July 2008, a subsidiary of WellPoint, Anthem Blue Cross, entered into a settlement with the California Department of Managed Health Care under which the company reversed 1,770 rescissions and
paid a $10 million fine. 6s This year, in February 2009, the company entered into an additional settlement with the California Department of Insurance under which it reversed 2,300 more rescissions and paid an additional $15 million penalty. The practice does not appear to be an isolated incident. In 2008, a judge ruled that another health insurance company, Health Net, had rescinded a California woman undergoing
chemotherapy in bad faith and awarded $9 million in damages. It was revealed that Health Net paid bonuses in part based on meeting or exceeding annual targets for rescinding policies."