I been between jobs and no longer has health insurance. With family and friends nagging at me to get insurance I figured let’s at least do some research on it.
Let’s take a look at the numbers: $380.21 is monthly rate, with $4000, and max out of pocket $7150. The quick plan detail is that it cover 50% of expenses after deductible. With that let’s do some mathing.
https://i.redd.it/f01zr71ojxa11.png
On the Y-axis higher number the more hurt for my wallet, X-axis is time. Green line is how much I will be paying if nothing happens (no doc visit), orange line is how much I have to pay at the time for the insurance to even kick in (at a measly 50% :P), red line is max I would have to pay for my medical expenses and beyond that insurance covers all.
Let’s get the boring scenarios out of the way first, I don’t need to see a doctor which would mean I simply lose money according to the green line. Next the very extreme, I have this life threatening extreme disease and I have to be flown all over the world for treatment and it’s a good thing I got the insurance, it feels like I have won the lottery. The probability of this case would be similar to winning the lottery but also sounds like a very miserable existence, I’m going to take a pass on that one.
Because I’m in my late 20s playing a lot of volleyball and other outdoor activities the scenario of interest would be a sprain or a broken bone, which would most likely require a x-ray, MRI, and of course doctor’s visit. Would such an event cost more than the orange line (~$4300)? Based on my brief research NO, and for cash payments there seems to be a discount at most care facilities.
So what’s the conclusion here? My conclusion is for a late 20s relatively healthy person paying $380.21 for insurance makes no sense. For this plan to make sense, I would need to have some medical issue planned out that costs me more than ~$6000 for this plan to make sense. How does this plan need to change for it to make sense for me? The answer is a lot in many ways, the cost and/or deducible needs to be lower, coverage, probably too much. In the meantime I will to keep my emergency fund intact and keep going about my business.
tl;dr
Beef up savings rather than buying insurance for short term, if medical care is needed try urgent care and lower cost facilities.
A lot of effort confirming conventional wisdom in my mind. Thoughts?
July 19, 2018 at 12:19PM
