Health Care

Most of us can’t afford to deal with the kinds of unexpectedly high costs that insurance is meant to cover. Look at those two words again: unexpectedly high cost. It doesn’t explain the obvious and cheap stuff. However, for a long time, whomever had the larger budget covered all of our expenses. Most of you had little out-of-pocket costs for our healthcare. To date, at least.

It’s a well-known fact that those with higher disposable income also have more discretionary spending. Insurance firms are much like any other wealthy organization. Doctors and nurses are aware of this as well. In the last 50–60 years, suppliers have been increasing rates to see how far they can go while insurance companies have been haggling for deeper reductions. This is how the healthcare industry grew so profitable. Insurance corporations fronted the money for this, and now we’re on the hook for paying the increased rates.

In the healthcare business, there is zero price transparency. Considering that someone else was footing the majority of the price, there was never any pressing need for us to find out. The second factor is that people didn’t compare prices for medical services the way they do for other services and goods. The medical professionals are aware of this, and they have taken advantage of it. Something’s ‘cash price’ and its ‘insurance price’ may be quite different from one another. To whom will you make the payment?

In my opinion, it amounts to highway robbery. Just get some generic medicine from the shelf at your neighborhood drugstore. The insurance company could pay $20 for one, but you might just have to pay $10 if you pay in cash. Why? To put it simply, they can.

The inverse is also valid. Cash payments may cost twice as much as the agreed-upon insurance premium. Many medical professionals will instead charge the individual in need the full, non-discounted fee. You may see this as me charging you extra just because you asked.

For example, my child recently hurt his hand. The doctor wasn’t sure whether it was broken or not. They were trying to err on an extra level of caution that but I was curious whether it was simply a bad bruise or if there was anything more serious going on. The doctor recommended an MRI of his hand to rule out any other possible causes. Having an expensive deductible on my health insurance plan, I naturally wondered how much this would cost them if I paid cash. He said that the maximum allowed by insurance was $350 (for a rather inexpensive MRI scanner). I don’t get any kind of profit from them, he went on to say. Therefore, the cash price is $450.

Many doctors and hospitals now accept patients with High Deductible Health Care Plans (HDHP) / Health Savings Accounts Plans (HSA) since they understand their patients will be liable for the first portion of the bill. This might be seen as both positive and terrible.

The first perspective is the critical one. Many people depend on their insurers to reimburse their first investment in a claim. You’ll have to pay for your own medical care before your insurance company will pay anything. This concept might be unpopular with certain people.

The flip side is lower premiums and more control over your spending. For many, the benefits outweigh the drawbacks. They are now free to inquire more about their medical treatment. Why? Because they’re their money at stake. You should inquire more often about your medical treatment, though.

You should take responsibility for your own heath and financial well-being. Finding a reasonable compromise between the price of insurance and the protection it provides may be a time-consuming and costly ordeal. Learning to prioritize your needs and asking insightful questions can help you save a ton of money in the long run. After all, the cash is yours.