Lately from time to time I’ve been talking about how much health insurance just really sucks. In fact, back last November I switched health insurance plans for a lot of reasons which I’m about to cover in this article, and have not been very impressed with the new policy I’ve switched to.
So in this article I pose the question is health insurance worth it anymore? Below are three reasons I believe it’s getting worse.
Premiums Are Increasing
First off, premiums are increasing at a very fast rate, in fact more than I’ve ever seen. The other day I was watching my local news station and a report came on that claimed in the state of Ohio rates were going to increase by 80% by the year 2017. That’s just four short years away.
Personally, I’ve seen my own rates increase big time over the last three years. In 2010 my group health insurance plan went up by 27%. In 2011 it went up by another 22%. That means our insurance rates have gone up by nearly 50% in those two years alone.
In fact we’ve gotten to the point were my company had to drop it’s group plan because coverage for me and my 3 kids was costing the company over $850 a month, and that’s not counting all the other employees that were on the plan.
What’s worse is I don’t see these rates slowing down one bit.
Higher Deductibles
Another thing that is getting worse is deductibles. Since signing up with my dud health insurance plan I’ve been talking to a lot of insurance agents lately and one of the big things they’ve been preaching is HSA high deductible plans.
Now I can’t blame insurance agents for pushing these plans because the premiums are usually the cheapest, however whenever I would ask about a plan with a lower deductible like $1500 I would usually get this awkward stare from them.
On top of that in order to have the health insurance cover any of the cost you will need to meet your entire deductible before the insurance company will cover one cent of your medical expenses.
For me even with a $3500 deductible I almost never hit this deductible, which begs the question, why even have the insurance if you never hit the deductible? It’s a perfectly logical question when I’m paying $459 a month for the insurance but still have to pay all of my own medical bills.
Where is the benefit in that.
Less Benefits
Finally, I feel the worse problem with health insurance is that they offer hardly any benefits. With a family of three the two biggest benefits on a health insurance plan are the doctors copay and the drug card coverage.
With most personal plans you can’t even get this kind of coverage. The last quote I ran with my insurance agent was a personal plan that had a $1500 deductible, 70/30 coinsurance, $35 doctors copay, and a drug card and the monthly premium was going to be $915 a month. Ouch!
With insurance companies offering less and less benefits, what risk are they really taking on anymore, especially those that never hit these huge deductibles.
Is Health Insurance Worth It
So is health insurance really worth it? In my opinion with the rising cost of insurance premiums, higher deductibles, and less benefits, you almost have to wonder how long will people and companies that offer group plans be able to afford it before it just becomes to expensive?
I personally feel health insurance is on a collision course and the results are not going to be pretty. So what are your thoughts on the current heath insurance situation?
Photo by ajithrockscc
I agree. People look at you weird when you say things like you’re saying. What’s the point in paying for insurance if I’m never even reaching the deductible? EXACTLY! And people will say, “well because it’s for emergencies.” A valid point, except then, why not just put $450/month in savings and by the time an emergency happens you’ll be able to cover it out of pocket??
Health insurance and health care is out of control.
Well said TB. If I were to save the the $450 a month it would at least help me pay down my medical bills not be going into some big black hole, unless something catastrophic happens which is always the fear in the back of everyone’s mind once you don’t have health insurance. Unless it’s surgery or some major accident I’ll never meet my deductible in a year either.
Our health system in Canada is pretty stellar as far as I’m concerned and from what I have read of my American friends who pay hundreds if not thousands of dollars out of pocket. I do pay a portion of health benefits from my employer that covers physio, massage, chiropractor, dietician, eye care, braces, medications, dentist etc up to 100% which is well worth it for us. There has been years we have used the full $1500 of Dentist that is offered and we certainly use the prescriptions.
Sounds like you got a pretty great health plan over there in Canada, I could only wish things were so nice here in the US. It also sounds like you get some pretty good benefits as well.
Chris, great post. We’ve got the same issues with our health care. We ended up doing a couple of things to make it easier on the pocketbook: 1, we moved to a self-directed plan that costs a lot less. 2, we are working at keeping ourselves healthier so that our trips to the doc are less frequent. 3, we are learning more about naturopath/homeopathic healing so that we can heal ourselves when possible. It’s so frustrating to blow all of that money for minimal benefits, isn’t it?
Good points Laurie. I’m currently on a personal plan right now actually, and I’ve recently looked into other plans but the cost is just going to be to high for right now to switch. As far as the health care goes I hardly ever go to the doctor but it’s more for my kids, since they have some ear issues and seeing an ENT it’s cost a pretty penny so far.
On the other hand the ENT suggested my oldest son should have tubes and we’ve refused to do it since he is in no pain and has no infection in his ear we have resorted to a chiropractor, and home therapy. We are also talking to a few people about natural health remedies as well.
As far a the minimal benefits go it’s crazy. You pay so much in premiums and get so little in return. What’s even more crazy is that if you go to a hospital, at least in my area, they will charge you less if you don’t have insurance than if you do. The whole system has gotten out of control and needs to be fixed. I don’t know how but it needs to be fixed.
You have to look at how long it would take you to save up $450/month for a huge emergency. If you had a car accident that required surgery and a long hospital stay, it could easily cost $100K. If you got cancer, same thing. Heaven forbid you or one of your kids had something majorly wrong that needed an organ transplant or something like that. (I actually had a cousin who had a baby that needed a liver transplant at 8 months old) I guess you could go uninsured and claim bankruptcy with that kind of medical debt, but I’d rather keep my $10K deductible policy even if it never covers anything. $10K won’t bankrupt me, but $100K might.
I agree Kim, that’s the big sticking point when it comes to health insurance. It’s those what if’s in life that could end up costing us big if we didn’t have insurance. In the end it’s a necessary evil and may save me from bankruptcy.