Should you use your insurance or should you opt in as a cash patient (self-pay patient) based on the services you are receiving, your deductible left for the year or type of coverage you have? This is becoming the question for those that currently have health insurance coverage of almost any kind. Understanding the reasons behind this phenomenon may be essential to answering the question. Sometimes paying cash for health services might just be that answer.
The Monetary Costs
While everyone should have all the insurance they can afford, they should also understand what their insurance is going to cost them.
The break down of insurance cost is a somewhat confusing because there are so many costs that do not get counted when considering insurance cost.
Consider the following:
- Premiums – (monthly – average $425) The monthly payment for insurance coverage.
- Deductibles – (yearly – average $2,000) The amount of money that must be spent out of pocket every year before the insurance pays for any health care service (Granted, some high premium plans have preventive care built in with having to pay for deductibles).
- Co-Pay/Insurance – (average $25/20%) The only difference between these two is that Co-Pay is a flat fee, and Coinsurance is a percentage fee. This is the fee that is required for every service once the deductible is met.
- Outside of Coverage – This is anything your insurance will not cover. This includes some of the dental procedures, vitamins & supplements, cosmetic and elective procedures and special wound care supplies.
- Out of Network – This is what they call it when a health care provider, who is not contractually bound to an insurance agency. It means you will pay the full price of the health care service and it will not count towards the deductible.
- Over Area Average – If a provider charges more than the average for an area, the patient is required to pay the balance after insurance and it will not be counted towards the deductible.
- Coverage Maximum – The highest amount that insurance will pay for a given service. It can be a yearly or lifetime maximum, and once your insurance has paid that much for the service it becomes an out of pocket cost.
The estimated average cost of health care, including insurance, employer and out of pocket monetary costs, is $10,000 per person per year, and an estimated 45% of that is directly related to the administration and governmental costs. In 2014, US spent over 3 Trillion on health care.
The Non-Monetary Costs and Cash patients
The main non-monetary cost for health care is definitely the time spent. From researching before you choose your insurance company to further figuring out what providers you can see and when, you will have spent several days worth of time before you ever call a doctor the first time.
Once you have insurance, even more time will be spent on yearly reassessments, filling out forms, calling the company about disallowed services or to get services approved. It is a never ending cycle. A cycle that eats into precious time and can actually make your health worse with the stress of dealing with it all.
A hidden but possibly more important cost is the freedoms you are giving up when you use your insurance. In order for your health care services to be covered by the insurance plan you have, you must use the providers and services that the insurance company approves.
