Comments on: Eschewing Insurance and Cashing out the 401(k), Part 1 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/ Simple. Frugal. Fabulous. Mon, 08 Sep 2008 02:21:31 +0000 http://wordpress.org/?v=2.6.1 By: Past Averages Do Not Predict the Future | Colorado Health Insurance Insider http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-7318 Past Averages Do Not Predict the Future | Colorado Health Insurance Insider Thu, 24 Apr 2008 01:14:02 +0000 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-7318 [...] just read a blog post by Dani at Living Behind the Curve. She writes about her thoughts on going without health insurance in order to work part-time. Initially, she goes looking for individual health insurance, but talks [...] [...] just read a blog post by Dani at Living Behind the Curve. She writes about her thoughts on going without health insurance in order to work part-time. Initially, she goes looking for individual health insurance, but talks [...]

]]> By: FrugalBabe http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-172 FrugalBabe Tue, 31 Jul 2007 07:10:25 +0000 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-172 I'd say you're in a pretty big crowd (myself included) that would have a tough time without an income for three months. My dad had long term disability insurance aswell (he's a big believer in insurance) and for the last 6 years has been getting 60% of his previous income. This will continue until he's 65. I've toyed with the idea of disability insurance, but I have to admit that we don't have any. My mom is a SAHM, so my dad's income was all they had. In our case, there are two earners, and a pretty tight budget. Haven't been able to justify disability ins yet, but thinking about it. There are lots of reasons that health care costs are rising so fast, but I'm in the health insurance industry and I can assure you that the nearly 45 million uninsured Americans is absolutely a factor. Sorry if my description wasn't clear earlier - I didn't mean that the unpaid bills from uninsured patients are passed directly to insured patients and their insurance carriers. But when hospitals and doctors have to write off bills that don't get collected, they include this in their operating expenses and pass on the higher cost to insurance companies and paying patients. All of the reasons you mentioned for rising costs are true, but so is mine. I have a brother who has gone without health insurance for several years. He and I have had this debate too many times to count, and we never can see eye to eye on it. My husband and I have always had insurance, even when we were so poor that just about all of our living expenses were going on a credit card. I'm glad you got a job that offers full benefits - I'm a believer in universal health coverage (even with the tax increases and government intervention that would go along with it). I think that health insurance should be mandatory, but I also think that it should be a fair and equitable system. There are too many people who fall through the cracks because of pre-existing conditions or shady agents. The system is not regulated enough, varies far too much from one state to another, and should not be a for-profit industry. So I'm not in favor of the status quo. But I don't think that going without is a good solution either. I’d say you’re in a pretty big crowd (myself included) that would have a tough time without an income for three months. My dad had long term disability insurance aswell (he’s a big believer in insurance) and for the last 6 years has been getting 60% of his previous income. This will continue until he’s 65. I’ve toyed with the idea of disability insurance, but I have to admit that we don’t have any. My mom is a SAHM, so my dad’s income was all they had. In our case, there are two earners, and a pretty tight budget. Haven’t been able to justify disability ins yet, but thinking about it.
There are lots of reasons that health care costs are rising so fast, but I’m in the health insurance industry and I can assure you that the nearly 45 million uninsured Americans is absolutely a factor. Sorry if my description wasn’t clear earlier - I didn’t mean that the unpaid bills from uninsured patients are passed directly to insured patients and their insurance carriers. But when hospitals and doctors have to write off bills that don’t get collected, they include this in their operating expenses and pass on the higher cost to insurance companies and paying patients. All of the reasons you mentioned for rising costs are true, but so is mine.
I have a brother who has gone without health insurance for several years. He and I have had this debate too many times to count, and we never can see eye to eye on it. My husband and I have always had insurance, even when we were so poor that just about all of our living expenses were going on a credit card.
I’m glad you got a job that offers full benefits - I’m a believer in universal health coverage (even with the tax increases and government intervention that would go along with it). I think that health insurance should be mandatory, but I also think that it should be a fair and equitable system. There are too many people who fall through the cracks because of pre-existing conditions or shady agents. The system is not regulated enough, varies far too much from one state to another, and should not be a for-profit industry. So I’m not in favor of the status quo. But I don’t think that going without is a good solution either.

]]> By: Dani http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-171 Dani Mon, 30 Jul 2007 20:24:49 +0000 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-171 @FrugalBabe - I'm sorry your dad had to go through that. I can't imagine how royally that must have sucked. To clarify from the original article, I did not mean to imply that my health could be completely insured for $10,000; it was simply the minimum amount I would be comfortable having in highly liquid assets if I were to attempt something like this. As I stated in my response to Rebecca above, if I were to be seriously ill, even if I had insurance, we would be completely and utterly screwed. The loss of my income, even if it were only a part-time income, would be enough that we would need to sell our cars, re-mortgage or sell our house, and go into debt just so Mer could cope with monthly expenses. If I were out of work for more than about 3 months, that would be the situation <b>whether or not I had health insurance</b>. If it would lead us to bankruptcy, it would be due to loss of income in addition to, but not because of, medical bills. As far as medical bills, I call bullshit on your logic. Medical bills are subject to the same collections procedure that standard credit bills are: the credit issuer attempts collection, and if the debt is not paid, it is sold to a collection agency for a fee. This is standard procedure and is not the cost for rising medical bills. The cost of health care does outpace inflation, but that is due to so many other things. The price of drugs and new high-tech equipment is skyrocketing. Bullshit malpractice claims are high. (I used to review malpractice claims; I know all too well that there are legit ones and non-legit ones.) Doctors over-test and over-drug because of the fear of malpractice. The biggest factor, though, may very well be that patients <i>with insurance</i> see trips to the doctor and ER and "free" or nearly free, and go for <i>everything</i>, and demand every new drug, test, and technology in the market. I am not out to say that insurance is bad and evil, etc. I'm pretty damn happy that I have it at the job I'm about to start, so that I don't have to worry about all this nonsense. I do not want to be scared every time I cough that I'm coming down with something that will eventually wipe every last bit of cash, equity, and retirement. (I am an ex-smoker, so that is not an unreal possibility.) What I am out to say is that there's information out there. When you get an idea, or you see something, research it for yourself and <b>challenge assumptions</b>. Life isn't about how things have always been, and it damn sure isn't a popularity contest. Figure out your options, and form an opinion on them. Thanks for sharing yours. :) @FrugalBabe -

I’m sorry your dad had to go through that. I can’t imagine how royally that must have sucked.

To clarify from the original article, I did not mean to imply that my health could be completely insured for $10,000; it was simply the minimum amount I would be comfortable having in highly liquid assets if I were to attempt something like this. As I stated in my response to Rebecca above, if I were to be seriously ill, even if I had insurance, we would be completely and utterly screwed. The loss of my income, even if it were only a part-time income, would be enough that we would need to sell our cars, re-mortgage or sell our house, and go into debt just so Mer could cope with monthly expenses. If I were out of work for more than about 3 months, that would be the situation whether or not I had health insurance. If it would lead us to bankruptcy, it would be due to loss of income in addition to, but not because of, medical bills.

As far as medical bills, I call bullshit on your logic. Medical bills are subject to the same collections procedure that standard credit bills are: the credit issuer attempts collection, and if the debt is not paid, it is sold to a collection agency for a fee. This is standard procedure and is not the cost for rising medical bills. The cost of health care does outpace inflation, but that is due to so many other things. The price of drugs and new high-tech equipment is skyrocketing. Bullshit malpractice claims are high. (I used to review malpractice claims; I know all too well that there are legit ones and non-legit ones.) Doctors over-test and over-drug because of the fear of malpractice. The biggest factor, though, may very well be that patients with insurance see trips to the doctor and ER and “free” or nearly free, and go for everything, and demand every new drug, test, and technology in the market.

I am not out to say that insurance is bad and evil, etc. I’m pretty damn happy that I have it at the job I’m about to start, so that I don’t have to worry about all this nonsense. I do not want to be scared every time I cough that I’m coming down with something that will eventually wipe every last bit of cash, equity, and retirement. (I am an ex-smoker, so that is not an unreal possibility.)

What I am out to say is that there’s information out there. When you get an idea, or you see something, research it for yourself and challenge assumptions. Life isn’t about how things have always been, and it damn sure isn’t a popularity contest. Figure out your options, and form an opinion on them. Thanks for sharing yours. :)

]]> By: FrugalBabe http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-170 FrugalBabe Mon, 30 Jul 2007 16:20:53 +0000 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-170 I have to agree with Rebecca here. Self-insuring a car is pretty easy to do, since you know the replacement value of the vehicle. But self-insuring your health is a completely different animal, since nobody knows when their health could take a sudden turn for the worse. My father had never taken a sick day from work in 30 years, was athletic and fit, didn't drink or smoke, was basically a picture of health. Then in the summer of 2001, his kidneys failed, and he was diagnosed with Wegener's Granulomatosis. He's been on dialysis for 6 years, and spent 4 months in the hospital in 2004, including 2 weeks in ICU. His medical bills for 2004 alone were half a million dollars. Luckily my parents have always had health insurance, including all the years that they were self-employed and had to buy the insurance themselves. Other than my dad's sudden, unexplainable illness, my family has not needed medical insurance. All of us were born at home with midwives that my parents paid in cash. None of us take medications, and my 61 year old mother has never had a single medical condition. Good thing my parents didn't go on the assumption that just because they had been healthy for 54 years, they didn't need health insurance. If they had, they would have lost their life savings in addition to all that they have lost in terms of hopes and dreams for the future. I strongly disagree that the decision to have health insurance is a personal one. That would be true if the decision only affected the person or family that chooses to go without health insurance. But unfortunately, when people who have chosen to go without health insurance have a serious medical condition, the result is often bankruptcy, which means that the bills go unpaid. So the provider has to charge more to insured patients to make up the difference. This means that those of us with health insurance are subsidizing the care for those who don't have health insurance. High-deductible, catastrophic health insurance should be mandatory, just as liability auto insurance is. I have to agree with Rebecca here. Self-insuring a car is pretty easy to do, since you know the replacement value of the vehicle. But self-insuring your health is a completely different animal, since nobody knows when their health could take a sudden turn for the worse. My father had never taken a sick day from work in 30 years, was athletic and fit, didn’t drink or smoke, was basically a picture of health. Then in the summer of 2001, his kidneys failed, and he was diagnosed with Wegener’s Granulomatosis. He’s been on dialysis for 6 years, and spent 4 months in the hospital in 2004, including 2 weeks in ICU. His medical bills for 2004 alone were half a million dollars. Luckily my parents have always had health insurance, including all the years that they were self-employed and had to buy the insurance themselves. Other than my dad’s sudden, unexplainable illness, my family has not needed medical insurance. All of us were born at home with midwives that my parents paid in cash. None of us take medications, and my 61 year old mother has never had a single medical condition. Good thing my parents didn’t go on the assumption that just because they had been healthy for 54 years, they didn’t need health insurance. If they had, they would have lost their life savings in addition to all that they have lost in terms of hopes and dreams for the future.
I strongly disagree that the decision to have health insurance is a personal one. That would be true if the decision only affected the person or family that chooses to go without health insurance. But unfortunately, when people who have chosen to go without health insurance have a serious medical condition, the result is often bankruptcy, which means that the bills go unpaid. So the provider has to charge more to insured patients to make up the difference. This means that those of us with health insurance are subsidizing the care for those who don’t have health insurance. High-deductible, catastrophic health insurance should be mandatory, just as liability auto insurance is.

]]> By: Living Behind The Curve » Eschewing Insurance and Cashing out the 401(k), Part 2 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-169 Living Behind The Curve » Eschewing Insurance and Cashing out the 401(k), Part 2 Mon, 30 Jul 2007 09:01:40 +0000 http://www.livingbehindthecurve.com/2007/07/23/eschewing-insurance-and-cashing-out-the-401k-part-1/#comment-169 [...] last we left our tale of financial intrigue, I had given up on the medical insurance game and was seeking a $10,000 self-insurance starter kit, [...] [...] last we left our tale of financial intrigue, I had given up on the medical insurance game and was seeking a $10,000 self-insurance starter kit, [...]

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