Medical costs are going through the roof, there is little or any effective cost containment. These skyrocketing costs have to be passed on some how to the policy holder and the most effective way is under insurance.
The purpose of insurance is to protect you financially from loss such as home insurance or auto insurance. Under insurance gives you little if any real protection in a medical emergency. Under insurance leaves you holding the bag in case of a major medical event and places a severe financial hardship on you and your family often bankrupting them. As a guideline about 60% of all bankruptcies in the country are because of medical bills and about 70% of those going bankrupt because of medical bills have medical insurance - medical under insurance that is. If they had real protection odds are they wouldn't be going banko.
Under insurance really isn't worth more than the paper than it's written own. More people are opting to be under insured because it's more affordable than real medical insurance protection which is often unavailable because of pre-existing conditions or is simply not affordable to most people. Many employers are also priced out of offering real insurance programs and cannot offer a decent medical insurance policy to their employees.
Signs of under insurance
- Not being able to afford all of your medications even though you have an insurance policy.
- Having to borrow money or take out a second mortgage to pay medical bills even though you have an insurance policy.
- Not being able to pay for necessities such as utility bills, food, transportation etc, beccause of medical bills.
- No coverage on eye exams or glasses.
- Large out of pockets medical costs.
- Large deductibles, the largest I heard of was $10,000 but I'm sure there are other that could be larger.
Let's take a look at a few of the more common forms of under insurance.
80/20- That may have been OK 25-30 years ago but medical costs has exceeded the rate of inflation and wages. This means the protection value has dropped dramatically over the years and thus represents under insurance. In a typical 80/20 you pay a deductible of let's say the first 3,000 bucks and the insurance company splits the remainder on a 80/20 split.
On a 80,000 dollar procedure means you'll be on the hook for about $18,400 bucks. If you have the misfortune to have another family member get sick or need emergency care for let's say a 60,000 heart attack this will tack on another $14,400 there about and leave you with about $33,000 in medical bills rounded. Add on physical therapy or some type of rehab and prescriptions and you really under stand why this is under insurance. This is an affordable under insurance policy that will leave most people broke or in debt for years. Also remember while you got this 33,000 buck medical bill you also have to pay your mortgage, car note, save for retirement, save for your kids college etc.
1400 per month COBRA- COBRA is a continuation of your former employer medical insurance after you get laid off. This is a joke in and of itself because how can a person pay a 1,000, 1,200 or 1,400 dollars a month for an insurance policy and they don't have a job! And need to think about keeping a roof over their head and some food in the kids stomach.
The $1400 per month COBRA
The $10,000 deductible- Just watch the clip on this one but someone found a policy with a 10,000 buck deductible because of some pre-existing condition. With a 10,000 buck deductible this policy really isn't worth the paper it's written on.
There you have it, the difference between insurance and under insurance which is becoming more and more pervasive as medical costs exceed the rate of inflation and wages.
Some folks say that on a large medical bills let's say 60,000 bucks you can pay 25 bucks a month to keep the wolf (bill collector) from the front door- I never heard of this actually working. Paying a 60,000 buck medical bill at 25 dollar per month will take only 200 years to pay off ,not counting interest!
The $10,000 deductible
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Comments: 15
When we racked up big medical bills, years ago...(Pher was about 2)....we didn't have insurance. We paid it all back, but yes, it did take years. We paid what we could every month.
I've also recently read that those bankrupcies you keep talking about are not always about health care. If there are any outstanding medical bills - no matter how small - they've been categorizing them as health care related...to make a point about how expensive health care is and how many people are in trouble.
For instance, we don't have a car payment. We don't eat out. We don't have any credit card debt. We budget for health care costs. And we are not underinsured.
We also go to a group of doctors and specialists who will bill us for our 20% and allow us to pay as little as $50 per month to pay it off - without any penalties or interest.
Their profits comes first and foremost. As for your personal insurance situation that's your business but I do want other folks out there to keep in mind the old saying "buyer beware." And understand typical under insurance schemes commonly offered by medical insurance companies that will leave the policy holder literally holding the bag.
I, also, had a horrible experience with insurance *in general* when I had my 2nd child (13 years ago.) We changed insurances, didn't have a lapse, and I spent 5 months arguing with the insurance company that my pregnancy didn't count as a "pre-existing condition" as we had consistent coverage. Keep in mind, this was a high-risk pregnancy and the stress of dealing with insurance companies who were saying, "Nope, not covering it" was enough to put me on doctor-ordered bed rest for the remainder of the pregnancy.
Insurance companies suck. Simply put. Or, as my husband would say, "I wouldn't pee on them if they were on fire."
You are a perfect example of our YOYO system with YOYO meaning "you're on your own."
Congress cannot delay. It is tragic that it took us this long to get serious about national health care. This is an item that has been on the Democratic Party platform since the days of FDR.