POLL: How much is too much?

[Silver]

In light of the current thread discussing the cost of health care insurance, and the hundreds of previous posts discussing this issue, I thought it might be interesting to find out when the cost of purchasing health insurance would be considered to much, and therefore of no value.

For the purpose of this poll, the stated alternative to having health insurance coverage would be to "self-insure", meaning that 100% of all health care costs would be paid from your own funds. This is your "skin in the game". No free rides. (This poll is primarily targeted toward people under age 65 years, or pre-medicare.)

Here is the question......."I would self-insure my/my families health care costs if health care insurance cost more than________ per year:"

 

[Webzter]

I pay $283 a month + a $5k deductible on an individual plan plus we pay about another $200 a month for some things not covered by our plan so I guess I'm willing to pay at least $10k since I'm on the hook for that now.

Beyond that, I'd need to think about it. As portfolio and emergency savings grows, if our health continues to look decent, I'll likely switch to some sort of catastrophic coverage and pay out of pocket for routine care. I'm more interested in solving the "hey, you have operable stage 1 cancer" or "hello heart attack" issues than the routine doctor visits. I'm never interested in truly self-insuring.

 

[VaCollector]

My DW quit her j*b last February and while we had the opportunity to pick up COBRA insurance coverage, the $1400/month for continued family coverage was (WAAAAY) more than I was willing to pay....and so we continue to be self insured....at least for now....


As my DW will eventually be returning to the w*rk force (seems to be imminent) I did not even take time to look at high deductible plans...but I WOULD consider something in the $5K/year range....over $10K...toooo much!!

 

[REWahoo]

I don't think I would willingly self-insure unless I had a net worth of $50M or thereabouts. But if I were that wealthy paying $50k per year for coverage would be small change, so I suppose the real answer is "never".

Note: DW and I have individual policies with $5K or larger annual deductibles and currently pay ~$11k in annual premiums.

 

[SteveL]

Without being rude, I would like to point out that this use of the word self-insured is not correct. Self-insurance means knowing what losses one can expect to pay, and providing for these losses via a fund set aside to pay the losses.

A person who does not buy insurance is not self-insured, unless they have millions of dollars. The correct term is uninsured. Or, in slang, going bare.

The largest risk for individuals is the catastrophic loss. Any uninsured diagnosis of cancer, MS, RA, or many other dread conditions for which the treatment cost may be in the high 6 figures.

 

[ziggy29]

I'd have to have Gates/Buffett money or close to it to even consider self-insuring completely (and if I had that kind of money, paying for health insurance isn't an issue). Having said that, depending on circumstances I can see "dropping down" to catastrophic coverage to self-insure everything except that which would otherwise bankrupt us.

[edit to add: Pretty much what REW said. I wouldn't consider going uninsured unless I had the kind of money which would make paying health insurance premiums fairly trivial.]

 

[FUEGO]

I didn't put much thought into it, but I voted $25k.

At some point, I would be willing to take on all the risk. I know that could mean paying out of pocket for real emergencies (heart attacks, strokes) and getting healthcare abroad for serious (seriously expensive) issues that are less urgent.

And at some point, it would be worth it to get domiciled somewhere with universal coverage as long as the cost savings were sufficient to offset expense or inconvenience of moving.

In reality, if health insurance premiums ever hit $25,000 a year, I imagine DW and I could do some combination of working off and on to maintain coverage and/or just get a job if someone needed insurance. My thinking is that by the time premiums hit $25k a year, there would be a critical mass of people pushing for some type of changes to bring costs down.

 

[Trawler]

I would self insure if I had $2,000,000 to set aside for HC only and still had enough in a sepaerate portoflio to support all other expenses.

 

[unclemick]

12 years - no health insurance. 1993-2005. age 49-62. It was that or do something stupid like go back to work. My COBRA in LA back then would have been ballpark 721/mo if memory serves. Cheapest high deduct from Fortis? was around $400/mo.

One hairline wrist fracture I fixed with duct tape and a couple sticks - just kidding. I recall it cost about $400 for a doc to refer me to a another doc, x-ray and wrist brace.

Age 62-65 paid about $168/mo for BC/BS of Kansas City waaay cheaper than LA.

heh heh heh - I also kept an American Passport for medical tourism if the establishment really pissed me off. Basically I feel too curmudgeonly to get sick. . Don't do this at home folks - there is always one knot head in every crowd and that was me. . Post 65 - about $198/mo for supplemental - no part D for drug help.

 

[devans0]

I didn't answer the poll. I'm still on the fence on this topic, but it is one that I take seriously. Systemic waste, inefficiency, and political corruption makes the US health care system and the insurance industry losers in providing world class health care IMO. If I remember correctly, U.S.A. ranks somewhere around 18th while costing double of what is ranked best. Even with low millions of dollars, being bare means being one or two major event away from financial ruin. The repercussions from this is dragging the U.S.A. down to drown in deficits.

I don't see this as changing, both major political parties are pretending to address the problems, but are so transparent in not effecting change that would hurt their vested interest donors that I have lost faith in this part of U.S.A.'s political system. I don't want to make this a political discussion but I see this as a fundamental reason that I am exploring expatriate possibilities. I am using affordable health care as one of my main criteria in thinking of relocating to another country after retirement.

 

[GregLee]

I went without health insurance from age 30-50, roughly, but then started to get nervous about that, so subscribed to a group policy at work. That was in time to pay most of my expenses when I found at 63 that I had cancer. Pretty lucky timing. My cancer seems to be cured, but just continuing follow up testing costs about $200 a month, which my insurance covers. So, I guess it's obvious that going bare makes much less sense for us older folks.

 

[Mulligan]

For the average healthly ER person, I believe large deductible with HSA should be strongly considered. Pay yourself before giving it to the insurance companies. Yes, you might get stuck to you hard right before Medicare, but the savings of lower premiums the prior decade should more than make up for it. Prudent people worry about health care problems and costs, but the vast majority of people don't incur health problems until their 60's or later. I would get a job, however that paid it, before I would ever go uninsured.

 

[ERD50]

Without being rude, I would like to point out that this use of the word self-insured is not correct. Self-insurance means knowing what losses one can expect to pay, and providing for these losses via a fund set aside to pay the losses.

A person who does not buy insurance is not self-insured, unless they have millions of dollars. The correct term is uninsured. Or, in slang, going bare.
.

I agree. This has always bugged me.

DW used to work in the office of a large corp that settled injury claims from customers of the company. She always said they were self-insured, and I always said, no, the company does not have insurance, they just handle the matter internally.

I'm not sure why you add ' unless they have millions of dollars'? They are still uninsured.

-ERD50

 

[SteveL]

Many large companies self-insure their vehicles for collision damage. They set up an account based on their history, and then pay the claims out of the account. For an individual with sufficient funds, he/she could self-insure various risks including health insurance. Technically you need a separate fund, but a person can do this mentally I think without actually putting the money aside. I am not buying LTC with this approach.

What would be great for health insurance for those between 55 and 65 would be stop-loss coverage. This is basically a very high deductible policy say 15k or more. The insurance company would avoid all the claims processing for the vast majority of customers. I don't think it is available.

 

[Silver]

I understand the issues with the term "self-insured". Point taken.

Language such as "uninsured" or "going bare" have had some energy/emotions/judgement around them at times, so I wanted to try and avoid that.

I am curious about the perceived "value" of health insurance, and I appreciate everyone's response so far.

 

[SteveL]

One important fact about having some form of health insurance vs. going bare....

If you have no insurance, you get the high price at every interaction with the health provider community. For example, I go to the dr. and the dr. then bills me $180 for the visit. Because I have health insurance, the dr. has agreed to accept about half of this amount as full payment. This about 50% savings occurs across the board. Without HIns, you have to pay the full price, or go beg/negotiate to get it reduced.

 

[ohyes]

After I retire in June 2012, our insurance will run $1159.00 a month (Family plan because we have a 21yo included) . I hate it. This is with a group policy (retired teachers).

However, I am too scared to go with a cheaper individual policy; the group route sounds so much safer.

This next year, when DH is retired, I am adding him to my policy for $243.00 a month. Right now, that sounds like such a bargain.

 

[Fireup2020]

Having been spoiled by the military, good private civilian company with cheap (but good - BC/BS) insurance, and the VA - I am still in awe of Joe Q. Public's situation regarding health care. I count my blessings I made some of the choices I did along the way. I cannot fathom paying more than 5K (in today's dollars) per year regardless of my personal health. (they can just stick me in a Veteran's home - which I visited today, and is a lot nicer than the nice "Rest Home" DBF's Grandma is in!) Bless you all with health and wealth!!

 

[Moscyn]

Not sure what my answer would be as it would also depend on how old DH and I would be at that time, general health situation and how much we have in our retirement funds. Assuming, the choice is to be made today, I guess I will I would self-insure our health care costs if health care insurance cost more than 15k per year.

 

[lemming]

i hate paying $$ to the insurance co. Don't mind so much paying it to the doctor.
Don't have enough to self-insure and would hate to waste half a million on medical care.
I would pay for insurance with a $20k deductible Just to get the insurance preferred rate, example, my blood work bill said it was $532 or $129 allowed by BCBS.
No wonder the uninsured rack up such high medical bills. It's that bogus price tab that the system puts on to show what a good deal the insurers get you.

 

[haha]

but I see this as a fundamental reason that I am exploring expatriate possibilities. I am using affordable health care as one of my main criteria in thinking of relocating to another country after retirement.

Be sure to share the results of your explorations with us. I too am absolutely alienated from that whole corrupt mess.

Ha

 

[Alan]

I voted $35k in the poll but that is just a WAG as I don't really know how I'd react as the costs escalated. In reality I think I would re-settle back to the UK long before I was spending $35k/year on HI.

 

[IBWino]

Health care costs are my prime concern for ER. I voted $20K, but I don't think I would ever go bare or "self-insure". In all likelyhood, if our healthcare costs got higher than that, I would simply go back to work.

 

[Purron]

Great thread Silver. This is a topic of major interest to many of us. ER often means not having the luxury of guaranteed and reasonably priced health care coverage. Plus, this is an issue primarily for those who have significant assets but are not super wealthy.

As others have pointed out, people like Bill Gates and Oprah have so many millions that even a catastrophic illness would not result in bankruptcy. Those who are poor don't have much to loose.

I too am very disappointed in our failure to address health care in the USA. It's become purely political and I see no signs of our esteemed leaders from either side of the aisle coming together to solve this mess.

Like many others, I have a hard time picking a number for your poll. The cost has become outrageous but going without insurance is terrifying. BTW, DH and I are in a retiree group plan, but pay the full cost. I worked for the Federal Government, but left way to early to qualify for retiree coverage. Sometimes I wish I had stayed those extra years, but it probably would have killed me rendering the issue of continued coverage irrelevant.

 

[chinaco]

The higher the insurance would likely mean the higher your risk of having major health problems.... which could ruin you financially.

A more appropriate question might be.... at what cost would you (or your spouse) decide to go back to work so you could get into a group plan!