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Is this insurance as worthless as it seems?

Discussion in 'The Okie Corral' started by Harper, Jun 20, 2012.

  1. Harper

    Harper

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    So I work part-time trying to put myself through school. I'm too old to be on my parents' insurance and my work offers a Aetna limited medical plan. However, it seems like it would be better financially to not enroll.

    The yearly outpatient coverage maximum is $1000.
    There's a $100 deductible so that's really a benefit of only $900.

    The yearly cost to me is $1006.08

    Yes, there is some inpatient coverage but it's very small and unlikely I'll need it so my question focuses only on outpatient coverage.

    I know "in-network" providers have a contract and give the insurance company a discount which in turn means that theoretically less of my benefits are used up. I'm trying to figure out if the discount the insurance company receives is significant enough to make up for the high cost of the plan. In other words, assuming all the money goes to medical bills, is $900 of insurance coverage worth more than $1000 of cash?
     
  2. devildog2067

    devildog2067

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    Unless you get very sick. Or hit by a truck. Or badly burned, or any of the multitude of things that people actually use medical insurance for.

    Forget about trying to justify the $1k/year. Medical insurance is something you buy just in case something really serious happens.
     

  3. Sam Spade

    Sam Spade Staff Member Lifetime Member

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    Except that he said he's paying $1006 for $900 coverage....


    Yeah, I'll hold your grand and give you back 90% of it if you ask nicely.
     
  4. DScottHewitt

    DScottHewitt EMT-B

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    Fixed it.
     
  5. devildog2067

    devildog2067

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    $900 of outpatient coverage.

    He skips over the "inpatient coverage" and says it's "very small" but what kind of medical insurance doesn't cover catastrophic care? If this insurance genuinely wouldn't offer coverage if you were in a car wreck, then yes, it's worthless. But it seems to me (just based on my reading of the OP) that it's more, "If I only need routine medical care I will pay $1000 and can only get back $900, but if I have some sort of accident it will pay more."
     
  6. DScottHewitt

    DScottHewitt EMT-B

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    A LOT of the crappy insurances you can get at a job cover very little these days.


    It's cheaper for the employer.....
     
    Last edited: Jun 20, 2012
  7. Harper

    Harper

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    Well the inpatient coverage is $1500 max for things other than the typical daily hospital stay charge.

    The plan has a $10,000 benefit overall max.
     
  8. jpa

    jpa CLM

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    It sounds pretty crappy to me. This is why I keep saying the consumer should be choosing their own insurance with a subsidy from their employer. If you want it to cover more, you pay more.

    It almost sounds like they're offering this insurance just to say they offer health insurance.
     
  9. glock_19guy1983

    glock_19guy1983

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    seems bad to me. Good insurance is worth its weight in gold. Make sure your plan has good inpatient benefits too. I was in a wreck 6 weeks ago, thrown through the windshield. A helecopter ride and two days in the med at memphis cost nearly 60k. I will tell you that the plastic surgeons there are miracle workers.
     
  10. DScottHewitt

    DScottHewitt EMT-B

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    Glad you are okay.


    Our local EMS helicopter offers yearly coverage for them flying you for $100 a year. It's a great deal, if you use it as much as once in 50 years......
     
    Last edited: Jun 20, 2012
  11. devildog2067

    devildog2067

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    Ah. In that case, yes, it's pretty worthless.
     
  12. edcrosbys

    edcrosbys

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    How long do you plan to be in this situation? I recently went through a job change where I was without employer provided health care for almost 6 months. I got a short term "oh *****" policy for my family (or 5) for less than $700.

    This had a $2.5k deductible, but it had a very high max payout. The two times we had to go to the Doc during this time was paid out of pocket.

    Try to think of medical insurance like car insurance. You don't call State Farm (or whoever) when you need new tires or an oil changed. You call them when something BIG has happened.
     
  13. Z71bill

    Z71bill

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    I have a high deductible policy with Blue Cross Texas - make it simple - the first $10K of medical coverage is 100% out of my pocket --

    The cost for my wife & I is around $700 a month.

    Sounds pretty crappy at first - but in reality it is like having free or very low cost insurance.

    If I bought my BP meds with out any insurance - it would cost me $25 a day - even though my insurance plan doesn't kick in anything until I hit $10K - I can buy my meds under the plan for less than $10 a day.

    Wife goes in for blood work 2x a year - with no insurance it would cost over $1K - under our plan the allowable cost for the lab tests is $250.

    Same thing with every doctors visit - normally the bill is more than cut in half -

    The medical system in the USA is messed up -

    You have the NORMAL CHARGE for a service - GROSSLY inflated - and then you have the amount that your insurance company has negotiated with medical providers.

    A few of the differences are crazy -

    One test my wife has done is billed at $300 - the insurance allowable amount - which is what we have to pay is less than $20. If we had no insurance we would pay the full $300.

    Plus I can deduct contributions to my HSA account - and at the end of the year pay myself back for the medical cost. I would never qualify for a medical expense deduction because of the limits (7.5% of AGI).

    Getting a lower price for the medical care & drugs you need is one of the biggest benefits of having insurance.

    Plus it protects you from a MAJOR multi-million hit if you need a heart transplant.
     
    Last edited: Jun 20, 2012
  14. jeager

    jeager

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    A friend got bit by a cat last month.
    Infected. Inpatient.
    Four days in Hospital and $23,000 later...

    Nephew broke his arm bike riding: $18,000
    Outpatient ?


    Checkout policies offered at school.
     
    Last edited: Jun 20, 2012
  15. norton

    norton

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    Unless you have a pre existing condition, you should be able to buy a stand alone policy for yourself much cheaper then that. When my son was in college after he could no longer be on my policy we purchased a policy from Golden Rule. Its for catastrophic coverage, meaning a high deductible.
     
  16. Harper

    Harper

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    This is the kind of plan I'm leaning toward now.
     
  17. certifiedfunds

    certifiedfunds Tewwowist

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    We had the exact same policy, different carrier, for a number of years. It really is the best deal and the way insurance should work.

    $12,600 max OOP. We hit the deductible once in 2011 when we had 2 surgeries in the family.
     
  18. Harper

    Harper

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    That's really what my initial question was. How do I know how much of a discount I would be getting.
     
  19. certifiedfunds

    certifiedfunds Tewwowist

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    Sounds like you're in your 20's. How much medical care do you really need?

    I'd suggest buying an inexpensive, high deductible plan just in case you get injured or God forbid get some unlikely major illness.
     
  20. Z71bill

    Z71bill

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    Very difficult until you use the insurance - best to stick with one of the major insurance companies - with thousands of customers they have to have good "discounts" VS the standard (grossly inflated ) charge.

    We switched from Assurant to BCBS of Texas a few years ago -

    I have 2 meds I take 2X a day - I can't recall exactly but it was something like --

    Assurant - Drug A was $8 drug B was $2

    BCBS - Drug A is $7 drug B $3

    Total is still about the same - I have no idea why the difference.