Is it smart to drop my medical benefits altogether?
November 4, 2004 6:09 AM   Subscribe

It's November, and for many of us that means "Open Benefit Enrollment" time! It turns out that I'm paying about 200 bucks a MONTH for my benefits...the company I'm working for is paying the other 1200. This is the current setup at many companies..the company pays the bulk, and the employee pays just a little (on top of the deductible). But seriously, I don't use 2400 in services in a year. At full prices the various doctor and pediatrician visits are something like 400 bucks a year. That means I'm just burning 2000 in cash a year. At what point is it smarter to just drop it all together?
posted by taumeson to Work & Money (31 answers total)
Look at what your options are in terms of raising your deductables. If you're paying more for health insurance than you'd pay out for routine procedures, then try to get into a position where you pay for the routine procedures, but still have coverage for major illness and large scale traumas that generate medical bills that make $2400 look like chump change.
posted by jacquilynne at 6:22 AM on November 4, 2004

I have always kept insurance to provide in the case of catastrophic illness, they other discounts are gravy. Also, prescription drugs are hella expensive.

For instance, say you go crazy and have to spend 10 days in a psychiatric ward, then have to take Zyprexa forever. With no insurance you'll pay AT LEAST 10K for the hospital stay, and you'll spend $12 a day on meds. ... not to mention out patient services.

Cancer is expensive too. It is a safeguard against financial ruin in my book.
posted by pissfactory at 6:22 AM on November 4, 2004

To add to what pissfactory said, insurance is essentially a gamble. You're betting that some day you'll need very expensive health care. But maybe you won't, and your premium will go to cover the people who do.

Last year at this time I was recovering from brain surgery. Along with a spectacularly bad haircut, the hospital gave me a bill for nearly $20,000. Fortunately, I have insurance, and my total cost was $75 for the entire stay.
posted by baltimore at 6:45 AM on November 4, 2004

200/month for health insurance, and what else - dental? life insurance? disability? vision(glasses)? Not bad, really. You could have a sports injury and need physical therapy, or develop allergies and need prescriptions. To say nothing of a catastrophic accident or illness. And being covered by a major insurer usually gets you much better pricing on health care.
posted by theora55 at 6:54 AM on November 4, 2004

To agree with everyone else: catastrophic care insurance, to say nothing of drug coverage, is good to maintain for financial reasons. You never know when you might get hit by a bus, after all.

Look at it this way: you wouldn't give up homeowner's or renter's insurance, just because you'd never had a burglary, would you? Or give up car insurance (let's assume it isn't required by law) just because you're a good driver?
posted by Vidiot at 6:58 AM on November 4, 2004

Vidiot's point also reminds me that health insurance costs so much more than car insurance or homeowner's insurance because you're much more likely to need health care in your lifetime than you are to wreck your car or see your home burned to the ground like the Baudelaire orphans' mansion.

It's all about pooling the costs among all subscribers and doling it out in chunks when you need it.
posted by baltimore at 7:24 AM on November 4, 2004

Yeah. For years I was a reasonably healthy person, and then BAM! Thyroid cancer. Of course I had no health insurance. I figured I would end up paying for surgery and basically be done, right? Wrong. Four years later I am still kicking out a few grand a year for radiation treatment, lots of blood work, and the occasional head and neck ultrasound. Thyroid meds are cheap, but it's still 25 bucks a month for those. And yep. I still have cancer. So these treatments are basically just going to continue indefinitely.

It's never smarter to not have health insurance. It basically sucks.
posted by xyzzy at 7:25 AM on November 4, 2004

Response by poster: i'm happy about the catastrophic insurance. but i don't need prescription drugs and neither does my kid, and if we needed them for an illness, well i'll pay full price then.

vidiot's analogy is only half valid....those types of insurances protect me from OTHER insurance insures me against what, God?

on preview: xyzzy makes an interesting point.
posted by taumeson at 7:26 AM on November 4, 2004

DO NOT GET RID OF YOUR INSURANCE! You never, ever know what's going to happen. A 6 hour stay in the ER can cost $10,000. Drugs can cost $50-2,000 a month per prescription if you don't have insurance. Yes, it appears to be a waste of money when you're healthy, but YOU NEVER KNOW. ESPECIALLY if you have a child. You don't want to have to choose between paying the rent or paying for prescriptions for your child should something happen.

You can do things to bring down your part. Do they offer other plans? Higher co-pays when you visit a doctor or get meds usually means lower premiums. You can also opt for just catastrophic care (emergency care) but I don't recommend that either. You can choose a cheaper plan (Kaiser is usually the cheapest.) Do those type of things, but PLEASE don't get rid of your insurance.
posted by aacheson at 7:30 AM on November 4, 2004

YOu can also look at purchasing your own plan outside of your office plan. Some healthy people can get the bare minimum for cheaper on their own...but it's really hard if you have a kid.
posted by aacheson at 7:31 AM on November 4, 2004

taumeson, keep your insurance....trying to get it again if you wind up with a preexisting condition can be hard/expensive and or IMPOSSIBLE.

I know.
posted by konolia at 7:33 AM on November 4, 2004

Um, just to echo what everyone else here has been saying: do NOT get rid of insurance. I'm presently unemployed & paying $600/month to maintain health insurance. Until I stepped down to a more frugal plan, I'd been paying $900/month.

Because it's that important, and because I knew I'd be fucked if I ever let it lapse (preexisting condition baby! Wooo!)
posted by aramaic at 7:34 AM on November 4, 2004

A couple of years ago, before I got married, I didn't have health insurance and I got some really nasty food poisoning. After a night expelling from both ends (sorry) I ended up having to go to the hospital. My bill for 1/2 hour of time sitting in the ER and a saline IV? $1200. (Plus a test to find out what I had, which so didn't work.)

I will honestly never be without health insurance again.
posted by sugarfish at 7:35 AM on November 4, 2004

Yeah. For years I was a reasonably healthy person, and then BAM! Pituitary tumor. Living dormantly now in my head, but I need to get an MRI every year to make sure it's not growing. If it is, I need brain surgery, moderately quickly. I have the fear, it's true. When I lived in Washington state they had state-wide health care of some sort where you paid what you could on a sliding scale and you got actual pretty good health care. I pay 63% of my premiums thanks to being part-time [premiums which went up 20% last year and 15% this year]. If you want to cut it closer but don't want to go health care commando, you could combine a catastropic policy with something like the Ithaca health care alliance which is sort of a medical money co-op fund which they call "minor medical" with some other benefits if you're local. I don't know much about them, but as my health care payments eek up to 20% of my take-home pay, I'm looking more closely into them.
posted by jessamyn at 7:41 AM on November 4, 2004

At no point is it smarter to drop it all together. Your latest comment explains your world view: "i don't need prescription drugs and neither does my kid."

Unfortunately, you don't get to pick if you get sick, when you get sick, or what kind of illness you have. I'm not trying to scare you into this, but it's a reality that any number of diseases can pop-up out of nowhere (we like to call them "idiopathic" in medicine), and they all have different ages at which they occur. I think the food poisoning analogy is a great one, too.

And for your kid's sake, don't drop your coverage. Kids (and schools, nurseries, etc) are notorious breeding grounds for bacteria and viruses, and notorious for getting in accidents and breaking bones.

Health costs cause 45% of personal bankruptcies in the United States. Do *not* drop your coverage.
posted by gramcracker at 7:48 AM on November 4, 2004

The other thing to consider is the pre-existing condition deal. Healthy with uninterrupted coverage they have to cover if you get sick. No coverage and get sick and then get coverage they don't have to cover. More and more companies are getting aggressive about gaming this system.
posted by mss at 8:00 AM on November 4, 2004

At what point is it smarter to just drop it all together?

The exact instant you're sure you'll never, ever get sick or injured. Any sooner, and you'll run the risk of not being covered when you need it. Any later, and you're just wasting money.
posted by Hildago at 8:09 AM on November 4, 2004

I am literally begging you, as someone who went without health insurance for periods of time both as a teenager and in my 20s -- FOR YOUR CHILD'S SAKE, DO NOT GET RID OF YOUR INSURANCE. My parents had to choose between health insurance and mortgage payments for awhile when I was younger (mortgage won) and I didn't get much consistent care for awhile, except when something semi-disastrous happened... years later, it turned out that I had (have) a connective tissue disorder that, had it been a little more severe, could have killed me without ongoing care as a child. I also had thryoid cancer (it, too, possibly could have been diagnosed earlier if my parents had insurance) and I had to put off treating it -- cancer! Had to put off treating it! -- for years until I got insurance through open enrollment at my employer's.

So while you're certainly entitled to gamble with your own future needs for medical insurance (even though I think it's a monumentally stupid gamble, frankly), I really don't think you're entitled to gamble with your kid's. Seriously, what are you going to do if you go off insurance and your child breaks his/her neck in a hockey accident, or gets diagnosed with leukemia, or any matter of catastrophic things that could happen? Unless you're independently wealthy (you got a spare half a million to pay to save your kid's life? That's what it cost to save a friend of mine when he broke his neck) or think that holding community fundraisers is a safe bet, cough up the $200 a month (or possibly less, if your employer offers you a cheaper option) and don't be an idiot. (Sorry to be harsh, but the question of health insurance hits a pretty raw nerve with me.)
posted by scody at 8:39 AM on November 4, 2004

Don't cancel your health insurance. The $200 a month is not wasted. Have the $200 deducted from your paycheck before taxes. That way you lower your gross income by $2400 and decrease your tax liability for the year.
posted by lola at 8:47 AM on November 4, 2004

Be thankful you can even get health insurance, and keep it up. Go for a cheaper policy with a higher deductible if you need to, but keep it up. Even if you have no other health problems you could end up paying years and years worth of premiums in a single ER visit. A surprise hospitalization this spring would have cost me more than a half year's take home pay if I hadn't had insurance. I didn't have to pay that bill, and I got better too. I would never willingly give up health insurance, even for a day.
posted by Songdog at 8:50 AM on November 4, 2004

vidiot's analogy is only half valid....those types of insurances protect me from OTHER insurance insures me against what, God?

But car wrecks, burglaries, and your getting sick are all things that you have no control over, and can happen to you anytime, without warning, and with varying degrees of severity.
posted by Vidiot at 9:42 AM on November 4, 2004

Is this how much it costs in the US to have health insurance? Seriously, $16,800 a year in insurance?
posted by Jairus at 9:54 AM on November 4, 2004

No. $1400/month seems very high. Either his company is getting *reamed*, or they're offering some sort of very generous benefit plan, or taumeson has 300 kids.

I get a pretty good benefits package as a state-U employee, and the total for me and my wife -- my copay and the state's payment -- is ~$7200/year.
posted by ROU_Xenophobe at 10:13 AM on November 4, 2004

Is this how much it costs in the US to have health insurance? Seriously, $16,800 a year in insurance?

Not for me. I pay in the area of $230/mo and my employer pays something like $65-75. Roughly $3500/year total for just me. I'd pay more if I were trying to self-insure at the same level of care I'm getting, much more.
posted by jessamyn at 10:19 AM on November 4, 2004

to add to the chorus:

I visited the emergency room twice.

one x-ray.

the doctor didn't really treat me, just handed me a prescription for prevacid and vicodin.

total time? maybe 45 minutes.

unbeknownst to me, my company had stopped paying my medical insurance (the company was broke).

three months later i get a nice fat bill for around $3500.

insurance is good.
posted by fishfucker at 10:49 AM on November 4, 2004

Jairus, either taumeson's employer is lying to him/her, or the insurance company is ripping taumeson's employer off royally.

Both are possible. The average cost of a family health insurance plan in the US is $9806. I suppose that it's possible that taumeson's employer is rolling another $7000 of benefits in there somehow, but I don't see how.
posted by Sidhedevil at 12:07 PM on November 4, 2004

Either his company is getting *reamed*, or they're offering some sort of very generous benefit plan, or taumeson has 300 kids.

Seriously. I have 8 children, my husband's had cancer, there are a couple of chronic illnesses in the mix, and our total premiums are just slightly more than that. Like less than $500 more. There's either a metric butt-tonne of benefits going on in that plan (that are probably of little use to most in the plan) or the insurer is screwing the company over.

I echo the chorus - find something less expensive that will permit a lateral move, but do not go without insurance, ever.
posted by Dreama at 12:08 PM on November 4, 2004

I suggest getting a high deductible individual plan. My COBRA runs out and i'm going with a 2500.00 deductible deal. I can cope with 2500.00 of something that will happen to me. I can't cope with 25,000.00. It's going to run me about 100.00/month.
posted by pieoverdone at 12:57 PM on November 4, 2004

Response by poster: Seriously it's that much for me and my kid, but that's with all the bells and whistles.

I've got life insurance and dependent life insurance, short and long term disability, health, dental, vision, mental, etc.

I work for a healthcare organization, so it's REALLY GOOD insurance, but because I'm out of their network (Orlando based), it costs a lot more. It's also a PPO, if that makes any difference on cost.

I like what pieoverdone is mentioning. That's really what I'm thinking about doing.
posted by taumeson at 1:31 PM on November 4, 2004

Having gone without insurance, and the next four years of paying for a three day hospital visit, you really need some sort of protection. My present situation is interesting in that I have what amounts to a major medical policy with some wellness care rolled in. I pay less than $5/mo, get some modest benefits in re drug, optic, and the like, but have to pay the first $900 of any emergency. After that I'm covered like most insurance policies. The only cost is that I have to hold back $1800 in savings for our combined deductible, but I get to earn interest on it instead of providing gold plating for the ceiling of my insurer's lobby. I'm certainly not complaining.
posted by Fezboy! at 2:10 PM on November 4, 2004

It's very late but I want to point this out in case anyone else is still checking this thread: taumeson, you're lumping together a lot of kinds of insurance there. The rest of us are talking about whether you need health insurance, which we are certain you do. The costs for your life and disability insurance are significant. They could easily represent half of your total insurance cost. Whether you need to carry those or not is a valid question, to which I'm sure you'd get varied responses. Dental insurance is another wild card. The plans I've had have all been limited to a few thousand dollars a year in total costs and some fixed total amount of lifetime coverage. It's fine for paying for the occasional repair and for your regular checkups and x-rays, but it won't cover major mouthwork. My dental coverage through work is inexpensive enough that this is still a good deal for me.
posted by Songdog at 8:14 AM on November 9, 2004

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