Commentary: Is it better for otherwise healthy Americans to have health insurance for themselves and their families or is it better for them to save those hard-earned premium, co-pay and deductible dollars, and use them as they see fit?
Let’s look at the facts:
Lets’ say that an individual goes uninsured till he/she reaches thirty. At that point he/she gets married and starts a family. Now 32 with a baby on, the way the couple decides to purchase health insurance. With a yearly family deductible for three family members, in their age bracket, the family will pay a insurance premium of about $800.00 per month ($9,600 per year). The first $1,000 (deductible) comes out of their pocket, followed by a $20 co-pay for office visits and a 20% co-insurance on all procedures.
Believe it or not, the average healthy American may never use their insurance, other than for their routine yearly physical. If that’s the case then they will never meet their yearly deductible and those visits will be out-of-pocket. Example: the first year the family (above) who is now having a baby will pay $9,600 for the year of insurance, $1,000 for the deductible (for having the baby – all visits and birth), and after the deductible is satisfied, then 20% co-insurance for all visits and procedures. In the first year it will cost the family over $11,000 to have health insurance. Note: I paid cash for all midwife visits, ultrasounds, blood tests and birthing. The total cost for my daughter to be delivered was $6,500,
The baby is now born and it’s a new year’s worth of premiums. This family is otherwise healthy. The family takes proactive actions to take care of themselves. They get their teeth checked once a year ($100 each), husband and wife both get a yearly physical with blood tests ($400-600 for both), and the baby gets well-baby visits and immunizations ($400). At this point the deductible has been met but the insurance is not needed for the remainder of the year. Yearly cost: with slight premium hike its $11,000.
Over the next four years their insurance premium goes-up slightly. The family is healthy, a few colds, maybe a visit here and there for routine check-ups, but not enough to meet the yearly deductible, so it’s all out-of-pocket. In that four year period they spend an estimated $47,000 on health insurance.
The couple is now 38 years of age. They have spent about $70,000 to have health insurance and have only recouped about $10,000 worth of received benefits. This is a net loss of $60,000 and the couple is only 38 years old.
Assuming the couple eats right, goes to the gym, gets a few chiropractic adjustments, gets routine physicals with blood tests and doesn’t get hit by a car, than the chance of them utilizing their health insurance for anything major will be very slim. The sad part is they are paying for insurance, a peace of mind, that god-forbid if anything happens they will be covered.
Another ten years goes by, the insurance premiums go up a bit and the total expenditure for the ten years is over $110,000. In sixteen years this couple has spent over $180,000 to have insurance and has only utilized $10,000 worth of benefits, a net loss of $170,000. But, they did have peace of mind.
Now for my theory:
I am 44.5 years of age and I have only had health insurance once. I sold a business and the company that bought it gave the entire family a policy for only $60 a month. So I said, “why not.”
Here are my facts:
I have had two shoulder surgeries ($20,000 cash total), one knee surgery (co-insurance $6,500), we had our daughter Maile ($6,500 cash total), and my wife had a Hernia repair (co-insurance $7,500). This is the total of my, my wife’s and my daughter’s medical history. My daughter is 4.5 years of age, is healthy and has never needed to step foot into a MD’s office. My wife and I get chiropractic adjustments, eat well, go to the gym, get routine blood work, and take nutritional supplements as a preventative measure. In total over my lifetime and including my wife and child, I have spent $45,000 on traditional health care.
Over my lifetime I have also spent an estimated $6,000 on gym memberships, and about 15,000-$20,000 on nutritional supplements, a new FAMILY grand total of $70,000 in expenditures, or a net gain of over $100,000.
My point is that health insurance is great if you use it or if you have hobbies that or potentially life threatening. The average healthy American, in my opinion, is better-off taking the money that they would be paying in premiums and putting it into an investment vehicle, that is liquid enough, that they can pull money-out when needed. Can you imagine if from age 30 you, or you and your wife, socked away $800 every month! At 40 you would have $96,000, at 50 you would have $192,000, and at 60 you would have $288,000!!!
Here is the important part. You have to spend money to stay healthy. Let’s say that you spent 20% a year of the $9,600 toward wellness-care, that’s about $2000. Two grand buys you: yearly gym memberships for two ($300), two routine physicals w/blood tests ($400), two dental check-ups ($200), and monthly chiropractic adjustments for two (1,200). Nutritional supplements are additional and would be based on need and quality of diet.
With the money saved, if you broke a bone or needed stitches, you pay cash. Here is the kicker: the cash price is half or less than the insurance price. If it’s a $10,000 procedure (ins.), it’s $5,000 cash. If you had insurance and hadn’t met your deductible yet, than you would have to pay the first $1,000 and any co-payment that’s due. The co-insurance portion for this procedure will be $2,000. So, your total will be $3,000 out of pocket, plus the $800 premium that month, for a grand total of $3,800 (remember you still have the other 11 months at $800).
I am not trying to be mean here but this is how I feel: As far as I am concerned, health insurance is for sick people, thrill seekers, or people who don’t take enough personal responsibility to keep themselves healthy. I personally like the freedom to spend my money on the types of medicine I feel will yield me the most benefit. I like that my health reserve account is making me money and not making the insurance companies rich. I am not against anyone having health care, it’s a personal choice. I just feel that people are scared into believing that having health insurance is mandatory, and that without it they would die if they ever got sick or had an accident. With proper wellness care, preventative medicine and financial planning, it make better sense, to me, to keep my money and only use when I want to and in a way I want to.
Yours in good health.
Dr. Marcus Ettinger
Marcus Ettinger DC, BSc is a 20 year practicing chiropractor in the city of Orange, California. Dr. Ettinger’s specialty other than chiropractic is integrative and holistic medicine.
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