Lifehack – Being Uninsured and Making Cash Payments

As a little bit of a follow up to my last post, I wanted to do our first ‘lifehack’ post.  Basically, a lifehack (credit to www.lifehack.com) is a little tip to make life easier or more productive.

Here’s one we learned due to my wife lacking insurance:  offer to pay cash up front when at the doctor’s office.

Every doctor we told we didn’t have insurance to offered us a minimum cash discount of 35%.  The anesthesiologist, where the bill was over $5000, gave us a 50% discount.

To get on my soap box a little bit…imagine how much cheaper medical services would be if our insurance system (both the old system and the new) were simpler and more effective.  Basically, most practices require several office personnel just to file insurance paperwork.  So offer to pay them cash, and they’ll take a big chunk off the bill.

More Thoughts (You can skip this, math coming!)

To be honest, I am considering whether it is in our best interest to actually cancel the new insurance I have on my wife and girls.  Here’s why:  We are paying $462 a month for their premiums, on top of a $11,000 family deductible.  Essentially, I would have to be out of pocket $16,500 or so before the insurance picks up anything (this isn’t counting my insurance and premiums).  Assuming all our doctors continued giving us a minimum 35% discount, we would be able to buy $25,000 worth of medical care for that same $16,500.

The one thing insurance of this type is essentially good for is catastrophic care.  I have a catastrophic policy on myself that runs $83/month, with a $10,000 deductible.  To me, this seems a reasonable precaution.  I spend $1000 a year to ensure an illness that occurs to me doesn’t bankrupt the family (this really defines the word ‘insurance’, which nowadays isn’t really how folks expect ‘health insurance’ to work).

Just for premiums, we are paying $6540 a year.  At our 35% discount that is about $10,000 worth of medical care.  My question becomes, what are the odds our family uses that much medical care, and is the risk of something catastrophic occurring worth being our 2nd largest expense?  If we only spent $300/month on medical care, that would be a savings of $245 to our budget.

I don’t know what we’ll do yet, but its something to ponder.

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03 2014

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