By Kevin M
Let’s get this point out of the way upfront: everyone should have health insurance. We all know this without anyone emphasizing the point. But with job losses in recent years, companies canceling their coverage, and the cost of independent plans spiraling out of control, millions of people have been forced to drop coverage in favor of just surviving.
If you’re one of them, or think you might be in the near future, here are some suggestions that might help in the event that you absolutely can’t afford a traditional health insurance plan. One or a combination of several may at least partially offset the loss of the typical $1000-plus per month plans that cover all of the things we’re used to.
AFLAC
This isn’t health insurance in any sense of the term, but AFLAC offers plans that will pay flat amounts for specified illnesses and injuries. Far less expensive than health care plans, you can buy a plan for well under $100 per month that will pay thousands of dollars at the time of a covered injury or illness.
Healthcare providers won’t accept it as health insurance, but the company pays direct to you so that you will have some opportunity to pay bills at your option after the fact.
Take care of yourself
We’re told relentlessly by healthcare providers to take better care of ourselves, but that advice becomes critical if you don’t have health insurance. It goes beyond the standard eat-better-and-exercise-more advice. That’s important if you have no coverage, but perhaps even more so is avoiding dangerous behaviors.
Playing tackle football with your buddies on the weekend might help you blow off steam but it’s an accident waiting to happen. Alcohol consumption brings all kinds of potential for disaster, as does climbing a ladder to clean your gutters. And reckless driving is a complete no-go. Slow down and be more aware of what could go wrong, because now there’s no back up plan if it does.
Mini clinics
In the past few years, in house mini clinics have opened at retail outlets by the thousands. If you have no coverage these are a definate option.
We had problems with a health plan conversion recently, during which time my wife had an ear infection. Since our insurance was invalid (though fully paid!) we opted to go to a clinic at Walgreens. They diagnosed the problem and prescribed three medications. Total cost: $49 for the visit, plus $63 for the prescriptions.
Now with a plan in place, we’d have paid $20 for the office visit and $10 each for the meds, or about $50. But for just $112, we took care of it at Walgreens. I’m not minimizing spending $112, but it’s quite a bit cheaper than $1000 per month for a plan, plus $50 for the procedures.
Non-prescription substitutes for prescriptions
If you need a prescription and don’t have coverage, ask the pharmacist about a non-prescription alternative.
We’ve had two situations in the past couple of years where prescriptions were not covered under our plan for one reason or another. The alternative was for us to pay out of pocket. In both cases, the pharmacist recommended an over the counter alternative, and each time it did the job. Many over the counter meds were once prescription only.
We probably should be doing this all the time in an effort to keep healthcare costs down but it’s critical if you have no coverage.
Get your kids into a plan
If you can’t afford coverage for your entire family, at least try to get your children covered. I can think of no more tragic situation than a parent facing a medical emergency for their child with severely constrained treatment options due to finances.
You can generally get a plan for a child in the low 100s per month, and well below with reduced coverage. Eliminate your cable TV, cut back to eating rice and beans every day, sell your second car, or do what ever you need to do to make room in your budget to get your kids into a plan.
Government programs
Check and see what coverages may be available through Medicaid or state agencies. The income qualifications are stiff, but again try to at least get coverage for your kids, and to see what other benefits might be available.
Buy the LEAST EXPENSIVE plan available
Finally, consider buying the cheapest health insurance possible, sometimes referred to as “catastrophic coverage”. This isn’t the kind of coverage that will pay for all of your healthcare needs, but it will cover the big ones where it matters most.
As an example, let’s assume a married couple, both 40, with two children, considering a plan under Assurant’s popular CoreMed Plan. (This is not an endorsement of Assurant, but their website is extremely user friendly!)
With a $1000 deductible, $35 office co-pay, 80% coinsurance (to $3500) and a $6 million lifetime maximum, the monthly premium is $1213. That’s the size of a typical house payment! And your out-of-pocket maximum could be as high as $4500 (deductible plus coinsurance) on any single event.
But by going with a $10,000 deductible, no office visit coverage, but zero coinsurance with a $6 million lifetime maximum, the monthly premium falls to $303, or about the size of a modest car payment. You wouldn’t have much coverage for routine care, but your out of pocket maximum would be limited to $10,000—true catastrophic coverage.
Many people view the quality of a health plan by the routine care it covers, such as doctor visits and tests, but that kind of coverage is where the expensive premiums are and if you’re reading this article you probably can’t swing that level of protection right now.
While it’s true that the cheaper plan would leave you paying for most (or even all) of your medical costs in most years—in addition to your monthly premiums—it will offer undeniable advantages:
- Just having an insurance ID card will make it far easier to be admitted to a hospital
- You will be part of a network that requires providers to discount their services. My son had surgery a few months back in which the providers discounted their fees by up to two-thirds; absent network coverage, we’d have been on the hook for 100%.
- Though you will pay for routine procedures, you WILL have coverage for the truly big ones—the kind that land people in bankruptcy court when they have no coverage
- In a truly serious medical situation—where costs exceed $10,000—you will have coverage available that will enable you to have access to what ever treatment options are available.
Get a part-job with healh insurance
Many people are unaware that there are companies that offer health insurance to their part-time employees. I’ve compiled a list of prominent employers with health insurance for part-timers in the post, 20 Part-time Jobs With Health Insurance.
This is an excellent source to consider if you don’t have health insurance on your primary job, but can’t qualify for private coverage due to pre-existing conditions.
There’s a saying in the health insurance business, ”any coverage is better than no coverage”, and that’s generally true. Better to have low premium/high out of pocket coverage than none at all. One serious medical emergency will have made it money well spent.
Are you in, or have you had, a situation where you had to drop health insurance coverage due to job loss or financial problems? What did you do to deal with it?
I’m an emergency physician. By federal law, if you present to an emergency room with an EMERGENCY CONDITION (Note – that does not include a rash you’d had for a year!) the emergency department and the entire hospital must stabilize you up to their maximum capability, regardless of your ability to pay – that may include such things as a heart bypass or brain surgery. Of course, the hospital will send you a (huge) bill. But – if you have no assets (or no locatable assets), the hospital can’t get water out of a stone, and will write off the bill.
Good points. I have 2 brothers without health insurance. They do need at least catastrophic coverage. They’re minimal wage earners and don’t manage money well.
.-= Ken´s last blog ..Weekend Roundup =-.
Ishabaka – That’s an excellent point about true emergency cases. But it won’t help the person who needs something critical that falls short of an emergency.
But even if you’re accepted to the ER with a true emergency, you could come out with a catastrophic financial situation absent any insurance coverage at all.
Ken – If they’re minimum wage and don’t manage money well, they may be banking on the fact that they’re too poor to ever be forced to pay. But that still would leave them with very limited options in the event of a health problem, particularly one that’s progressive.
For me it’s not about being unable to afford health insurance, it’s about being unable to qualify for private insurance if I were no longer employed. Supposedly HIPPA is supposed to help with that, but I’ve heard horror stories.
.-= Jackie´s last blog ..Potato Success & Links =-.
So true Jackie. The health insurance companies are able to turn you down for just about anything. Some will turn you down if you’re on too many prescription therapies–like three or more.
It was said however that under President Obama’s healthcare bill that companies will no longer be able to decline applicants for pre-existing conditions. That’s one of the changes that needed to happen, but we’ll have to see what the insurance companies will charge. Approving coverage at 2-3 times the going rate will have the same net affect as a declination for most people.
Kevin, there is also an alternative out there called Short Term Medical – there are some reputable companies selling this and basically the way it works is you pay month by month and you have the choice of several different plans including lower or higher deductibles – coverage is really good, but it only lasts for 6 months. But, at least it’s something!
My brother-in-law signed up for this b/c he had no insurance and shortly after developed some pretty serious conditions – the insurance company paid their portion no problem – his premiums were right around or just under $100/mo!
.-= Jason @ Redeeming Riches´s last blog ..The Best Debt Everyone Should Have and Never Pay Off =-.
Thanks Jason, that sounds like something worth looking into, especially if the uninsured period is expected to be temporary.
Several general comments: most health insurance plans are health care “financing,” NOT health care “insurance.” Insurance is, by definition, the pooling of risk for an unexpected financial loss (like your house catching fire or a tree falling on your car during a tornado, or, health-wise, having heart surgery for $87,000). Question: does your auto insurance pay for oil changes, new tires, or that brake job? Of course not; those are routine maintenance items that you pay for on your own. What if your auto insurance offered to cover them – think your premium would go up? Same thing with health insurance: the “better” the coverage, the more expensive it is. When looking into this:
1. How “much” health care to you generally use? Don’t buy a Lexus if all you need is a used car.
2. What’s your real risk? Big, expensive stuff (like hospital stays & surgery)? Most folks could find a way to finance $5-10k if they had to, but how about $50,000+? That’s what health insurance is for.
3. While it’s okay to shop online “on your own,” most folks are better off dealing w/ a broker who specializes in health insurance. Find a broker near you by visiting http://www.nahu.org, the probessional association for brokers (full disclosure: like me) who specialize in health insurance. He’ll be able to present you with a wide range of plans and options designed to give you the best, most cost-effective coverage.
4. If you find it hard to get coverage, especially due to health reasons, remember: there are a LOT of different plans & companies around and, to be frank, there are very few people who find themselves completely out of luck. Again, deal w/ an NAHU broker who has a “vested interest” in helping you (remember: if you’re not happy, he doesn’t get paid!).
5. Finally, stick with the “brand name” companies. This stuff is too important to “play around” with and, sadly, there are a bunch of plans around that, frankly, are not all that great.
While there are certainly a lot of things that could/should be changed about our current health care & health insurance system, getting mad at your insurance company because of high prices is rather like being mad at the waiter because the food at the restaurant is too expensive. Your premium cost reflects (1) the cost of health care (MD, hospital, drugs, & lots of gov’t regulations), (2) how much health care “financing” you want or expect (i.e., routine care benefits like MD & drug copays, etc.), and (3) your specific “situation” (age, sex, dependents, location, &, especially, health because, just like auto insurance, if you have a bunch of tickets or accidents, you’re gonna’ pay more for your car insurance).
We don’t really have a health “insurance” crisis in this country. It’s the health “care” that’s expensive, and that’s reflected by the premium cost. Control the cost by:
1. Finding a good broker (see above).
2. Buy a plan with a big deductible.
3. Consider supplementing that big deductible plan with critical illness and accident coverage (73% of claims over $10,000 are due to either accident or the “big things” – heart, stroke, cancer, etc.).
4. Take better care of yourself; eat right, exercise, be smart about it.
Art – Very well said, and I endorse all that you’ve said for anyone in a position to be able to afford a health insurance plan.
What Art has pointed out is the critical difference between a true health insurance plan–a plan that pays for true catyclisms–and the better understood, but much more expensive health benefit plans that pay for all things medical. The former is what we all need, the latter is what we increasingly can no longer afford.
Knowing the differnce is critical.
I’m afraid this does little to uncover the big myth about Health Care. Insurance works best when it spreads the risk of low-probability, major losses among a lot of people (the law of large numbers). It does NOT work to run all of your expenses through a middle-man.
Catastrophic health insurance uses the insurance concept for it’s strengths. All those plans with small copay’s and coverage at the first dollar of expense are completely wrong and inefficient use of the concept of “insurance.”
Find the lowest cost policy you can and then use your premium savings to fund a cash reserve account (or better yet, an HSA). Use that money to pay your medical costs. Don’t be afraid to negotiate with the doctor on your fee. Many will be happy to be paid today at 50% of MSRP rather than wait 90-180 days for the insurance company to pay them nearly the same “negotiated” rate.
Unfortunately, the government doesn’t want that competition and will eventually crowd you (the individual) out of the market. Oh wait, they’ve already done that. It is called ObamaCare.
.-= John D. Buerger, CFP®´s last blog ..Money Matters =-.
So true John, they’re really benefit packages! Unfortunately, that’s what people have become accustomed to and how the prefer to consider “insurance”. That’s really caused the cost to explode.
I have been looking for insurance coverage for my wife and myself and wondered if it’s worth waiting to see how the presidents Health Reform Bill impacts me purchasing our health insurance. Does anyone have any idea on this.
Many Thanks,
Robert
I would also ask your church for help… welfare use to be the job of the church until the government took it over. It’s the church that is supposed to be helping those struggling and in need.
Good idea! Churches can be good places to get help in life’s emergencies. With huge medical bills, you might find someone at Church who can negotiate a lower and more tolerable payment arrangement, even if direct financial help isn’t available. The community aspect of Church is often forgotten, and if it doesn’t exist where you’re worshipping, it may be time to find another.
I also forgot to mention that it’s the church that should be helping out other Christians in trouble… and non-Christians. Many churches are struggling these days financially but it never hurts to ask.
Just don’t expect the church to write you a check and not ask questions or require you to do some things yourself… a good church will ask questions, get you on a budget if you’re not already doing so, and may ask you to do some financial training or read a book as part of giving you money… .which you should cheerfully agree to if you really need and want help.
hi,
my daughter is a food server until she finds a job in marketing. she pays about 100.00 for insurance but it hardly covers anything. she has had to have a colonoscopy and her tonsils removed (tonsils should have been done when she was on our insurance)and we have had to pay so would it be better for her to just drop her insurance for now and just go to emergency room….her boyfriend just had a seizure while driving my daughters car and spent 2 days in hospital with cat scan, etc and probably won’t have to pay a dime. by the way he’s allright…thank you, susie
Hi Susie – like the quote in the post reads, “any coverage is better than no coverage”, so my advice is to keep the coverage, but maybe do some digging to see exactly what it DOES cover. Hopefully, it at least covers catastrophic say anything above $5000 or $10,000.
I don’t know why the colonoscopy and tonsils weren’t covered, unless they fell below the plan deductible. If the deductible is $5000, and she had one procedure done in 2009 and the other in 2010, she would have to satisfy the deductible in both years, but that’s just a guess. Colonoscopies may fall under well care, and while group plans generally pay for well care, individual plans often don’t.
Did you contact the insurance company and ask why they didn’t cover anything?
Lost my job with excellent health insurance then COBRA ran out … now I have a job that only pays a fraction of what I used to make and with NO health insurance. To top it off I have an “indolent” cancer. Thank God I don’t need treatment. I looked into the new program for people like me offered by the government but it is still $500 per month for me … which I just can’t afford.
Well, I lived in Japan with my Japanese wife for 15 years so I know what a good medical system is like, and isn’t … I’ll be returning to Japan one day.
Things have changed in the past year. A lot of commenters are talking about horror stories when they lost their job. For people with no group coverage and pre-existing condition, there are now PCIP plans that were not available before. You can see this information on my updated site.
Shey@Student Health Insurance Quotes´s last [type] ..High Deductible Health Plan
There are also often state based health care plans and usually those that can’t afford health care can qualify for discount coverage.
Shaun @ Smart Family Finance´s last [type] ..Comment on Is Your Budget Easy to Beat? You are Probably Budgeting Wrong! by Shaun Fowler
Shey–That’s good information on your site. The President’s plan is supposed to require health insurers to accept clients regardless of pre-existing conditions, but I don’t think that will happen until January 2013, if memory serves. Either way we don’t know what the details will be or how much they’ll charge. Hitting someone with a pre-existing and charging them $2000 a month in premiums will be the same as declining them so it may not be the advantage that it sounds at first glance.
Hi Shaun–That’s true, but there are also income thresholds that are set pretty low. In many cases you’d have to be a certified poverty case to qualify. They’re always worth checking into, but don’t be surprised if your income is “too high” at $35,000 for a family of four. The healthcare problem really is greatest amoung the middle class.
I can’t afford insurance, and I do not qualify for state help…so when I get sick I just wait it out. I had an ear infection a couple of weeks ago. I had to just pop an Advil and wait it out. It sucks…In my family the men have a history of high blood pressure and heart disease, and colon cancer. I know I should get myself checked, but I can’t afford it. Even if I went, and they discovered something…I would have no financial means to get well…so I just bought a life insurance policy instead.
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