Consumer Comeback Blog

Why everybody needs health insurance

I’m not a huge fan of politics. So I’m not really interested in discussing whether the PPACA is a good or a bad bill, whether the mandate is a tax or penalty, or get involved in any of the other partisan bickering about the specifics of “Obamacare”. The truth is, whether or not you like the idea of the government coercing you to buy insurance is irrelevant to whether or not you should have it.

Here’s a simple fact: health care is friggin’ expensive! Without some kind of help to pay for it, the costs can literally ruin your life.

Everybody needs to have health insurance. Not because the government tells you to (or will tax you), but because if you don’t, I believe you’re making a huge financial mistake. Here’s why:

Regular exams and other preventative care

Just about all insurance policies include regular checkups as well as other preemptive care in their coverage. Why? Because it saves them money in the long-run. You can actually save up to 50% on lifetime health care costs with regular check-ups, a balanced diet, and exercise, doctors say. The reason is because many (if not most) medical conditions, diseases, and other issues can become more complicated, and therefore more expensive, if left untreated.

Those without insurance are much less likely to go to the doctor for a regular check-up, because even the simplest visit to the doctor can be pretty pricey. But to make matters worse, because of the high costs, they’re also much more likely to go to the doctor only when it’s absolutely necessary. And that’s simply a huge financial mistake.

So, if you don’t have health insurance, getting regular exams and some of the other important preventative care is probably the least you can do. Having insurance so you don’t have to worry about the costs is better.

Going without health insurance is gambling with your health

In fact, it’s almost exactly like playing slots or the lottery, but in reverse. With slots, you pay a little bit each time in with hopes of getting a winner/jackpot. Going without insurance, you win a little bit each time you play (in premium savings), with the hopes you never lose (need coverage) – a sort of “reverse jackpot” if you will. And exactly like gambling, on a long enough time-line, you will almost always lose.

What happens if you don’t have insurance when you need it most?

Emergency Care

It’s one thing to pay out of pocket for a doctor’s visit to deal with something relatively minor, but when you need true emergency care, health insurance is an absolute must. Just visiting the ER can cost up to and around $5,000. Overnight stays in a hospital quickly get over $10k, and that’s not including any complicated procedures that might be needed.

In an emergency, the last thing you want to worry about is how everything is going to be paid for. It’s a moment that will likely already rank among the worst you will ever have. And without insurance, it’ll be that much worse…

Even still, you won’t really regret not having health insurance until you get the bill.

Chronic conditions

Some of the most costly types of health care is the treatment of chronic conditions, like asthma or diabetes. Treatments that include regular doctor visits and/or pricey medications can be a great deal more expensive than insurance premiums and co-pays. So if you’re caught without insurance and suddenly have the need for such care, you’re in big trouble.

One of the things the PPACA tries to ambitiously solve is the notion of pre-existing conditions. Before the bill, insurance companies could refuse to insure individuals or refuse to pay for certain treatments for conditions that were diagnosed before the individual attempted to purchase the insurance. And those that were covered, usually had to pay much higher premiums based on the pre-existing condition. With the PPACA, insurance companies won’t be able to do that.

Still, most of the provisions don’t take full effect until 2014. And banking on this as protection for a future diagnosis is both irresponsible and unwise; In fact, that’s why the insurance mandate is part of the law. So it is (and will always be) better to have coverage at all times than to wait until you are sick.

Living in fear

When you don’t have health insurance you live in fear of the unexpected- that is, if you’re smart. Fear of injury, sickness, and anything else that can cripple you financially, even if it doesn’t cripple you physically. I’ve seen it before:

A friend of mine will never play softball again thanks to a broken ankle he suffered once as a substitute. Not only did it cost him a fortune in medical bills, but also could not work for 6 months. Something as simple as a broken ankle nearly bankrupt him. But instead of getting insurance, he simply doesn’t play. He lives in fear.

Health insurance is a peace of mind for your finances.

Compromising your health

Another bad habit of those who go without health insurance is compromising on their health for the sake of financial savings. Self-diagnosing, self-medicating, ignoring doctor’s orders, missing follow-up visits, compromising on physical therapy, and a number of other ill advised trade-offs done in the name of frugality.

Don’t compromise your health in the attempt to save a few bucks. For one, you’re more than likely to fail (costing more in the long-run); but more importantly: you have a lot more to lose than money… it’s just not worth it.

Bankruptcy

Throughout health care reform debate, it was a widely reported statistic that about half of all U.S. bankruptcies are caused due to health related expenses (including loss of job – to be clear). But the fact is: going without insurance usually means you’re one bad day away from bankruptcy. It’s a huge financial risk that most financial advisers would agree is not worth it – or rather, even with the growing cost of health insurance, it’s still financially advantageous.

Death

The other major statistic thrown around a lot while the PPACA was being drafted was how many people die each year due to lack of health coverage: 45,000 according to a study by Harvard in 2009. That’s almost 10x the number U.S. casualties in both the Iraq and Afghanistan wars combined.

So if my personal financial advice doesn’t get through to you, perhaps the very real life threatening danger that going without insurance presents will.

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