To begin, let’s define what I mean by traditional health insurance. The traditional health insurance policy consists of:
The deductible: is the amount you must pay for a medical event before your health insurance begins to pay. In today’s world, that deductible is often $ 3000 or more.
Coinsurance: After reaching the deductible, most policies require the insured to pay a percentage of all medical costs up to a maximum. Usually, the insured pays between 20% and 50% of each dollar billed.
Copayments: In an attempt to make routine medical care accessible, many policies include a copayment for doctor visits and prescriptions instead of having to reach a deductible. An example of this is the $ 10 copayment per office visit.
Maximum disbursement costs: this is the maximum that an insured can expect to pay regardless of how large the medical bills are. As a general rule, the maximum out-of-pocket costs for an individual are limited to around $ 7,000. This can be a very misleading number because it assumes that all of your providers are in your network. If they are out of network, their costs can be significantly higher.
And finally, the “Network”: virtually all traditional individual health insurance policies are linked to a network of providers. The narrower the health care network, the lower the premium. There is too much wrong with the “networks” for this article. Suffice it to say that “networks” are the enemy of the health care consumer (you).
The problem facing American workers
The problem is simple: health insurance premiums are too high for most Americans who work in the absence of a subsidy and when combined with extremely high deductibles and out-of-pocket costs, medical care becomes unaffordable. Let’s look at a couple of examples here in North Carolina.
A 62- and 63-year-old non-smoking couple believes that their lowest premium option with BCBS of NC is $ 1999 per month for a family deductible of $ 13,300 without copayments. A plan with a $ 7000 deductible and co-payments for office visits of $ 25 would cost $ 2682 per month.
Assuming the least expensive plan, the annual cost would be $ 23,988 annually. And if someone had a medical event like cancer, the actual cost of medical care would be $ 37,288. You have to ask: “Why even have health insurance?”
A 30-year-old non-smoking couple discovered that the least expensive plan would cost $ 787.84 per month for a family deductible of $ 13,300 without copayments. The least expensive plan that included co-payments was $ 1056.88 but had a $ 7000 deductible and the most restrictive network. Assuming the least expensive plan, if any member of this young couple has a medical event, their total annual cost (deductible + premium) would be $ 16,454.08. That is a devastating amount of money for a young couple.
The simple solution to this problem is a fixed benefit health insurance. Unlike an important medical policy where the policy pays all eligible expenses after the deductible and the maximum outlay, a fixed-benefit health insurance policy states exactly how much will be paid for each specified service. Examples of specific services may include: daily benefit for a 24-hour hospital stay, specific dollar benefits for specific surgeries, a specific benefit for doctor visits and other specific charges. An excellent fixed-benefit health insurance policy will have very solid benefits, a wide range of specific covered charges, a very complete surgical program and more. The most important service that the fixed-benefit medical insurance policy may include is the negotiation of medical bills, a service that can significantly reduce out-of-pocket expenses.
The really good thing about this type of policy is that it allows the insured to be a better consumer. Knowing how much your policy will pay for a specific medical service allows you to buy better and negotiate the price. But the really good thing about this policy is the affordable premium.
The 62 and 63 year old couple is a client of mine who had no insurance for 5 years as a result of high premiums. I could include them in a solid Fixed Benefits Health Insurance Policy with a lifetime benefit of $ 5,000,000 for $ 683 per month. That is an annual savings of $ 15,792. As I explained to my client, the Fixed Benefits Health Insurance Policy will do a great job of covering 70% to 80% of everything that can happen. If they really saved the $ 15,792 difference in the premium, they would have incredible access to medical care with very little out of pocket.
In 2014 I was diagnosed with colon cancer and partially removed my large intestine (CP44205). At that time it was covered by a traditional traditional medical policy. My total out-of-pocket costs were more than $ 7,000. If I had had the Fixed Benefits Plan that I sell today, not only would my costs have been zero, but I would have received a check from the insurance company for $ 4619. Not all events doctors would have resulted in a check and many could have resulted in direct outlay costs of several thousand dollars, but in general the savings would have more than offset those costs.
Therefore, before choosing not to have any health insurance, I suggest that you carefully analyze a fixed-benefit health insurance Policy.