Do i need Health Insurance

Why you can’t afford not to have health insurance

If you have health insurance, keep it.  If you don’t have health insurance, try to purchase it.  Health insurance is as important as having good health.  You can’t live without it.

But there are two major obstacles preventing many Americans from having health insurance – cost and the current law that enables insurance companies to deny coverage to individuals who have pre-existing conditions.

Health insurance premiums continue to rise because of the rising cost of health care.  Popular opinion places most of the blame on insurance companies’ greed for huge profits.  And although insurance companies need to please their shareholders with nice profits, there are other factors contributing to the rising costs.  New, more effective prescription drugs and state-of-the-art diagnostic equipment enter the medical field every few years carrying hefty price tags because research and development costs must be recouped.  Also, the nature of health care is much different than a decade ago.  People with chronic diseases are living longer creating higher costs to be paid over longer periods of time.

Despite the cost, it’s worth it to have health insurance.  People that do not have health insurance are seriously risking their finances as well as their health.   Most people that don’t have health insurance file for bankruptcy after an injury or illness because they can’t pay the shockingly high medical bills.  Keep in mind that a car accident or fall on the ice can take you to the hospital and the average night in the hospital can cost about  $5,000; while a stay in the ICU can cost a whopping $10,000 per night!

Finances aside, not having health insurance can be bad for your health.  Most people without health insurance postpone routine exams or other necessary medical treatment because of cost.  As a result, uninsured people are more likely to be hospitalized for health conditions that could have been prevented in a more economical fashion.

Don’t confuse health care with health insurance.  Under 1968 federal law, all patients who seek care in a hospital emergency room must be given a minimum level of treatment regardless of their ability to pay or health insurance status.   However, that doesn’t mean they will receive the same level of care.   For example, a Michigan woman took extreme measures to obtain medical attention because of her lack of health insurance coverage.   After suffering serious shoulder pain and not knowing if the shoulder was dislocated, she went to the emergency room.  However, because of her lack of insurance, she was only given anti-inflammatory medication which did nothing for the pain.  Desperate for a solution, the woman returned home, shot her own shoulder with her friend’s gun, just to get the medical attention she needed.  While this is not the typical challenge of the uninsured, it does make a point.  Then there is the pain of the bill.  This woman’s hospital bill will be higher than the bill for an insurance company and the insured patient would pay for the same exact treatment.  How can that be?  Doctors and hospitals “over charge” for their services because they know the insurance companies are going to discount them.  Doctors and hospitals join the insurance company’s network by agreeing to accept the discounted amount as payment in full.  For example, if the hospital bills $2,500 for an emergency room visit and the insurance company discounts it down to $800, that is the total amount the insurance and the patient will have to pay.  Let’s say the patient’s emergency room visit copay is $100 per the insurance policy.  The patient will pay $100 and the insurance company will pay $700.  However, the Michigan woman will be responsible for the full $2,500, because she doesn’t have the insurance that discounts the cost.

Also, keep in mind that there are ways to manage the cost of health insurance.   Most US workers are fortunate to have a large portion of the insurance premium paid by their employers.  Also, different plan benefits, such as a higher deductible, can lower the premium cost.  Relatively new to the market, health savings account plans (H.S.As) not only have a lower premium due to their high deductibles, but they also allow the policy holder to deposit tax free funds into a health savings account to be used for qualified medical expenses.  And many health plans offer “extras” such as discounts on fitness club memberships, weight loss programs and alternative medical treatment.  They also have programs to help manage chronic disease like diabetes.  Finally, because of recent health care reform, health plans provide preventive services at no cost to the policy holder.

Even worse than the insurance being too expensive, it can be impossible to obtain.  Unfortunately, there are many Americans who want to purchase health insurance, but can’t because insurance companies won’t offer it to them.  Insurance companies cannot deny coverage to employers who are purchasing insurance for their employees.  However, insurers can deny coverage to an individual who wants to purchase “individual insurance” for themselves and their families if any member has a significant pre-existing condition.  Health care reform intends to change this by providing access to all Americans. 

If you are in between jobs, you should not drop your insurance.  COBRA allows most people to continue their health insurance for a period of time.  It is expensive because you will have to pay the full premium, plus a 2% administrative fee, but it is well worth it.  Most people don’t know that insurance companies can place a pre-existing condition exclusion on your coverage if you have gone more than 63 days without health insurance.  For example, if you have diabetes and have gone without health insurance for more than 63 days, when you next enroll on a health plan that insurance company does not have to cover any service or treatment related to the diabetes, even though you are paying for the insurance premium.  This exclusion can continue for up to a year.

Having health insurance is a must.  If your employer offers it, grab it.  If you are not as lucky, contact an insurance agent to purchase an individual health plan.  Having health insurance not only protects your from financial ruin, but also keeps you healthier and happier.