Ever think about the actual purpose of medical insurance? This is important to know because the main purpose of medical insurance is to protect us from financial devastation from major medical events right? Well…according to Harvard University (article here) medical events are the #1 cause of bankruptcy, and 78% of filers had some form of health insurance.
Here is more data on medical bankruptcy.
More Than A Quarter Of Adults Say Health Care Costs Have Caused A Serious Financial Problem
“Thinking about the cost of your health care over the past two years, how would you describe the overall impact of your health care costs on your family’s financial situation?”
- U.S. Health care costs caused a serious financial problem: 26%
- Set up a payment plan with a hospital or health care professional: 44%
- Spent all or most of my personal savings: 42%
- Contacted by bill collectors: 39%
- Unable to pay for basic necessities like food, heat or housing: 27%
- Taken on credit card debt that may be difficult to pay off: 23%
- Taken out a loan that may be hard to pay back: 19%
- Declared bankruptcy: 7%
Source: NPR/Robert Wood Johnson Foundation/Harvard T.H. Chan School of Public Health poll “Patients’ Perspectives on Health Care in the United States.” Interviews were conducted via telephone (landline and cellphone) in English and Spanish Sept. 8-Nov. 9, 2015. For national results, the margin of error is +/- 3.8 percentage points. Credit: Alyson Hurt/NPR
I see it all the time. A typical family I’ll talk with has $200,000.00 liquid assets, a household income of $250,000 a year, a home, cars, and plans for the future. Life is good, and the assets make them feel “safe” from the financial impact of a major medical event. After all…we have great medical insurance Steve. Little do they know the indirect costs of a major medical event can completely eradicate their savings even with full medical insurance.
The Co-Pays and Deductibles Are Only Part of the Costs
Too often families think their maximum out of pocket costs will be limited to the insurance limitations of their major medical insurance. For instance if the max out of pocket cost is $10,000.00 someone might think that is their total impact. It’s not. Let me explain:
What if someone in your immediate family gets diagnosed with cancer? How would life change? How would your schedule be affected?
This is a major area to consider because the odds of cancer are so high. 3 out of 4 families, 1 out of 2 men, and 1 out of 3 women will be diagnosed. I’ll spare you the rest of the details but you get the point.
One of the major issues with cancer is the lack of productivity (or inability to work consistent hours). Cancer is usually a long term battle, and can last months or even years.
Obviously sick pay only lasts so long. When is that up for you?
But now you have another problem, all the bills you’re currently paying don’t go away; however, your expenses will certainly increase. Sometimes drastically.
First off, if you have more than 5 years of life left in you odds are you are going to want to know what your options are for beating this disease. At least I would.
If you would quit…go ahead and stop reading. This isn’t for you. I want to talk with the fighters and warriors that don’t stop believing and want to see their children graduate, or have another Thanksgiving dinner.
The problem is your major medical insurance will typically only cover basic stuff like chemotherapy and radiation.
But the landscape of cancer treatment is growing rapidly… There are much more effective and targeted caner treatments that are possibly not 100% covered but can drastically increase your chances of beating the cancer.
So now you are faced with either getting the good stuff and possibly going bankrupt, or having crappy treatment that might kill you…but you can keep your house.
This is why people give up. They don’t know what is available to them, and even if they did they couldn’t get it anyway.
Beyond this, if you want the best treatment for the specific type of cancer your family is facing…odds are you will have to travel. There are more cases of Breast Cancer in Washington State than any other state in the Union.
Did you know the best place in the world to get treated for Breast cancer is the Mayo Clinic in Minnesota? Not exactly a hop skip and jump from here right?
Protect yourself from this disease.
If all you have is medical insurance, and life insurance, even disability insurance, you’re not covered.