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Should young healthy people buy health insurance?

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Assuming there's no penalty, is it financially smart to not buy health insurance as a young and healthy person? People keep talking about, without the penalty, young people wouldn't buy insurance. I would imagine that's true, but would that be the financially smart thing to do? If the healthy people subsidize the sicker people, is it better to be out of that environment?

If the risk is the devasting health condition that costs hundreds of thousands of dollars, is it worth just taking that risk and the fact that you'd have to file for bankruptcy?

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rated:
I vote yes.

Self insure up to the point of a high deductible but get a plan with a high deductible.

Insurance for young healthy people is relatively cheap. Catastrophic plans in my zip are ~$100 for a 20 year old and a silver plan is under $150.   (ETA:   I may be citing the best case cost here, a 30 year old in Memphis pays nearly $300 but thats still relatively cheap.

Keep in mind the risk isn't just that you'll face a "devastating health condition that costs hundreds of thousands" but more likely you'll break an arm or get appendicitis or any other random condition or injury that people get. Those risks are higher and the costs can be significant.

Even if you are hit with a very high cost condition then plan A should not be to just file bankruptcy.

disclosure:   I went without insurance in my 20's for a time and the world didn't end.   When it comes down to it, its a financial risk.   But if I had the choice to make again, I'd have gotten insurance.
 

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it's a question of cost.  If your actuarially expected cost as a young healthy person is a few $1000/year, paying a slightly higher amount in insurance to avoid the risk of a potentially expensive accident would be reasonable.  However, if it costs $10k-20k/year, including very large deductibles before you see any insurance benefit, it's probably not worth it.  Under the ACA, the latter is more like what you will be offered on the exchanges. 

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xerty said:   it's a question of cost.  If your actuarially expected cost as a young healthy person is a few $1000/year, paying a slightly higher amount in insurance to avoid the risk of a potentially expensive accident would be reasonable.  However, if it costs $10k-20k/year, including very large deductibles before you see any insurance benefit, it's probably not worth it.  Under the ACA, the latter is more like what you will be offered on the exchanges. 
  
OP is a "young and healthy" person.    I suppose it depends on what you define as young but people in their 20-30's are not spending $10-20k a year on insurance.  

I agree with your sentiment in general.

 

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Remember that health insurance is not only there to pay for your medical expenses but it's a cost-control mechanism even when they're not on the hook to pay a dime.

The only reason not to have any health insurance is if you have no assets. Otherwise before you're able to file for bankruptcy, your hard-earned assets might be depleted. Some exceptions may apply depending on the state - retirement plans, primary residence, etc. but still it's no good. Buy a high-deductible plan and get an HSA. Tax savings on HSA will partially subsidize your relatively low premium.

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Young healthy people with no assets are getting fleeced by buying health insurance.

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It depends on their assets. If they're rich, then they need health insurance. If they're healthy and broke, they can take a free roll on the rest of us.

We could probably eliminate free riders by not allowing uninsured people to discharge medical debts in BK. Garnish their wages forever.

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Without health insurance, most of my liquid assets would have been wiped out fifteen years ago. I had enough assets and income that BK wouldn't have been an option.

So, like other insurance, it seems like you don't need it until you do.

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Would love "JepJepJep" come up and explain the reds.

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TravelerMSY said:   We could probably eliminate free riders by not allowing uninsured people to discharge medical debts in BK. Garnish their wages forever.
  This should really be the case with any kind of debts. Good financial behavior and personal responsibility needs to be enforced.

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Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars

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The folks saying just to file bankruptcy in the event of a severe issue, what if you get cancer? You can go to the emergency room for an accident or emergency surgery, but they don't dispense chemotherapy there. That's the real problem, an expensive medical issue that isn't an urgent style emergency but still ruins your life or kills you.

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Related side question: if auto insurance wasn't mandatory would you still buy it? How many of us buy the bare minimum liability coverage?

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Perhaps the OP meant that when you do need treatment outside the scope of an ER, such as chemotherapy, diabetes/dialysis, etc., then you sign up for a health plan, since Obamacare allows for pre-existing conditions.

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ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars


The proposed solution to that kind of bill while uninsured is to declare bankruptcy.


But that does assume relatively low income to forgive the debt.

Or hospitals may often forgive debt as charity / not collectible.

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jerosen said:   Insurance for young healthy people is relatively cheap. Catastrophic plans in my zip are ~$100 for a 20 year old and a silver plan is under $150.   (ETA:   I may be citing the best case cost here, a 30 year old in Memphis pays nearly $300 but thats still relatively cheap.
 

It used to be cheap.  Now because the ACA you pay a lot for only catastrophic coverage.  These high deductible plans only kick after $10k out of pocket for the year.

I agree with the posters above, if you are single, young with no assets and making over $47k year (non-subsidized plans), it's probably not worth it.

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mapen said:   Perhaps the OP meant that when you do need treatment outside the scope of an ER, such as chemotherapy, diabetes/dialysis, etc., then you sign up for a health plan, since Obamacare allows for pre-existing conditions.
  I guess you better hope then that you don't have your problem right after open enrollment, and that the resulting year wait doesn't kill or maim you. Also, realize the current politicians in power are trying to end Obamacare, or gut it.

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ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?

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quaters said:   ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?



How do you time that with open enrollment?

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quaters said:   jerosen said:   Insurance for young healthy people is relatively cheap. Catastrophic plans in my zip are ~$100 for a 20 year old and a silver plan is under $150.   (ETA:   I may be citing the best case cost here, a 30 year old in Memphis pays nearly $300 but thats still relatively cheap.
 

It used to be cheap.  Now because the ACA you pay a lot for only catastrophic coverage.  These high deductible plans only kick after $10k out of pocket for the year.

I agree with the posters above, if you are single, young with no assets and making over $47k year (non-subsidized plans), it's probably not worth it.




$150 a month is the actual cost for a silver plan for a 20 year old here.


That is *relatively * cheap.

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OP: how young are you talking? Where do you live?

The details will matter.

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Yoksel said:   
TravelerMSY said:   We could probably eliminate free riders by not allowing uninsured people to discharge medical debts in BK. Garnish their wages forever.
  This should really be the case with any kind of debts. Good financial behavior and personal responsibility needs to be enforced.

  It's not purely a moral thing though. Our economy is more dynamic and presumably a lot bigger because of the bankruptcy option. There would be a lot less innovation and risk-taking if mistakes followed you to the grave.

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So many factors. I'll just throw up some. Genetics, lifestyle, risk aversion, personal moral ethics of using public funds or going BK if personal funds or lack of insurance don't cover, taking food off the table, calculated financial decision or being greedy.

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jerosen said:   
quaters said:   
ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?

How do you time that with open enrollment?

A simple change of address makes you eligible for "Special Enrollment", just move back in with your parents, ha.  

These are the loopholes that are in the law now, another reason I hate this law.

https://www.healthcare.gov/coverage-outside-open-enrollment/your-options/

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TravelerMSY said:   
Yoksel said:   
TravelerMSY said:   We could probably eliminate free riders by not allowing uninsured people to discharge medical debts in BK. Garnish their wages forever.
  This should really be the case with any kind of debts. Good financial behavior and personal responsibility needs to be enforced.

  It's not purely a moral thing though. Our economy is more dynamic and presumably a lot bigger because of the bankruptcy option. There would be a lot less innovation and risk-taking if mistakes followed you to the grave.

  That's controlled by separating personal and corporate liability. I'm totally fine with that part. Personal debts should not be forgiven IMO.

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quaters said:   
jerosen said:   
quaters said:   
ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?

How do you time that with open enrollment?

A simple change of address makes you eligible for "Special Enrollment", just move back in with your parents, ha.  

These are the loopholes that are in the law now, another reason I hate this law.

https://www.healthcare.gov/coverage-outside-open-enrollment/your-options/

  
Not so easy...

"To qualify for a special enrollment period, you must prove you had qualifying helth coverage fr at least one day during the 60 days before your move.
(except moves from a foreign country or U.S. territory)."

However, quitting your job might qualify you for special enrollment since it constitutes a change in income.   Of course now you'd be both sick and unemployed.   But if you're seriously ill its unlikely you'd be able to work anyway.
 

rated:
Yoksel said:   
TravelerMSY said:   
Yoksel said:   
TravelerMSY said:   We could probably eliminate free riders by not allowing uninsured people to discharge medical debts in BK. Garnish their wages forever.
  This should really be the case with any kind of debts. Good financial behavior and personal responsibility needs to be enforced.

  It's not purely a moral thing though. Our economy is more dynamic and presumably a lot bigger because of the bankruptcy option. There would be a lot less innovation and risk-taking if mistakes followed you to the grave.

  That's controlled by separating personal and corporate liability. I'm totally fine with that part. Personal debts should not be forgiven IMO.

  That is not correct. Most startup type companies the banks want personal guarantees.

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Can anyone imagine an auto insurance company insuring only people from 18-30 who drive Porsche, Mustangs, Camaros and Ferrari?
Who would want that risk....what too many Republicans do not understand is that : Insurance companies make money NOT by paying claims
but by Denying Claims....think of homeowners insurance....98% of homeowners have NEVER had a claim...they pay and the mortgage company
actually owns the home.....Insurance firms make billions and their CEO's all make 2-25 million dollars a year ....

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If you are a motorcycle rider....16 to any age...your motorcycle insurance has a SEVERE cap on medical coverage.....go to Bestgore.com
and you will see pics of men and women who lose legs, arms etc from accidents.....who is going to pay for your surgery..your bio-leg...etc?
Not that motorcycle insurance...they know the risk and they don't want to pay for the injuries or your funeral.

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I was not able to afford health insurance when not employed by a company that offered it. When I was employed, I got it. As an independent contractor, I could not afford it and failed to get it. I was extremely lucky. I was forced by my parents to go to ER on one occasion for an afternoon .. cost $2500.00 which I did not have.
 I was blessed not to need a lot of medical care in my adult years.  Several people I know were not so blessed.
For the time my parents forced me to go. IF my parents did not pay for it, I would have been in bad way including clouding my credit for a decade.
IF you can afford it, get it.  For me. I made the choice not to have to live with my parents or on the street.

I failed to get dental insurance and had a couple of dental abscesses which became root canals.  I was able to use my credit cards and some balance transfers to cover over $5000 in fees.  Needless to say, I was financially hit hard compared to my level of finances by this event.

All this was pre-Obamacare, so that was not a consideration.

rated:
jerosen said:   quaters said:   ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?



How do you time that with open enrollment?

Serious question: What if you buy a short-term policy that expires -- does that allow you to sign up?

rated:
should a house not on fire buy fire insurance? it seems to me that i'm subsidizing all those houses that catch fire when i pay my premiums and i don't have a fire.

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stanolshefski said:   
jerosen said:   
quaters said:   
ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?



How do you time that with open enrollment?

Serious question: What if you buy a short-term policy that expires -- does that allow you to sign up?

 
I'm not sure but probably not.

I wouldn't think losing a short term plan would count because they don't meet the rules to be minimum essential coverage.
But the healthcare.gov basic info on the topic doesn't address it specifically.

ETA   :    on the healthcare.gov site where you see if you qualify for special enrollment it asks : "Did you or anyone in your household lose qualifying health coverage in the past 60 days "    short term plans are not qualifying health coverage.  
 

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miserly said:   should a house not on fire buy fire insurance? it seems to me that i'm subsidizing all those houses that catch fire when i pay my premiums and i don't have a fire.
Homeowner's insurance is actuarially rated to your risk.

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stanolshefski said:   
miserly said:   should a house not on fire buy fire insurance? it seems to me that i'm subsidizing all those houses that catch fire when i pay my premiums and i don't have a fire.
Homeowner's insurance is actuarially rated to your risk.

  
The banks holding mortgages force people to buy it too.

 

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jerosen said:   I vote yes.

Self insure up to the point of a high deductible but get a plan with a high deductible.

Insurance for young healthy people is relatively cheap. Catastrophic plans in my zip are ~$100 for a 20 year old and a silver plan is under $150.   (ETA:   I may be citing the best case cost here, a 30 year old in Memphis pays nearly $300 but thats still relatively cheap.

Keep in mind the risk isn't just that you'll face a "devastating health condition that costs hundreds of thousands" but more likely you'll break an arm or get appendicitis or any other random condition or injury that people get. Those risks are higher and the costs can be significant.

Even if you are hit with a very high cost condition then plan A should not be to just file bankruptcy.

disclosure:   I went without insurance in my 20's for a time and the world didn't end.   When it comes down to it, its a financial risk.   But if I had the choice to make again, I'd have gotten insurance.

  Jerosan is just cherrypicking premiums. S/he has no idea where the OP lives nor how old the OP is.  Yet is proclaiming that the premium will be less than $100. Unbelievable.

I guess young means 20 to Jersoun but if that was the case the OP would be leeching off his parents plan and we would not have the question.

My guess is that the OP is, at least, 27.

I would not be wasting my money on premiums if you are under 40.  Put the money in an emergency fund.

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32 years old in Illinois. No subsidies. paying 900 a month for two healthy adults.......for a crap plan with HSA. highway robbery.

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JepJepJep said:   jerosen said:   I vote yes.

Self insure up to the point of a high deductible but get a plan with a high deductible.

Insurance for young healthy people is relatively cheap. Catastrophic plans in my zip are ~$100 for a 20 year old and a silver plan is under $150.   (ETA:   I may be citing the best case cost here, a 30 year old in Memphis pays nearly $300 but thats still relatively cheap.

Keep in mind the risk isn't just that you'll face a "devastating health condition that costs hundreds of thousands" but more likely you'll break an arm or get appendicitis or any other random condition or injury that people get. Those risks are higher and the costs can be significant.

Even if you are hit with a very high cost condition then plan A should not be to just file bankruptcy.

disclosure:   I went without insurance in my 20's for a time and the world didn't end.   When it comes down to it, its a financial risk.   But if I had the choice to make again, I'd have gotten insurance.

  Jerosan is just cherrypicking premiums. S/he has no idea where the OP lives nor how old the OP is.  Yet is proclaiming that the premium will be less than $100. Unbelievable.

I guess young means 20 to Jersoun but if that was the case the OP would be leeching off his parents plan and we would not have the question.

My guess is that the OP is, at least, 27.

I would not be wasting my money on premiums if you are under 40.  Put the money in an emergency fund.



I posted a couple example prices and explicitly said the cheaper one may be a best case.
I'm not cherry picking. I did not say ops cost would be anything. I explicitly said the costs were for my zip or for Memphis ( a relatively more expensive market).

Fell free to cite other costs for other cities / ages if you want.

40 isn't young in my mind but I can understand if people think otherwise. (it is over half of expected life span)

You have no reason to think op is talking about someone over 26 and getting on a parent's plan is not generally free to the parents.

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jerosen said:   
stanolshefski said:   
miserly said:   should a house not on fire buy fire insurance? it seems to me that i'm subsidizing all those houses that catch fire when i pay my premiums and i don't have a fire.
Homeowner's insurance is actuarially rated to your risk.

 The banks holding mortgages force people to buy it too.
 

  That's irrelevant.

Skipping 128 Messages...
rated:
debtblag said:   
jerosen said:   
quaters said:   
ellory said:   Right. Everyone posting did not face significant medical costs. I challenge you to explain how you would pay, if it happened for even a one time event of several hundred thousand dolars
  The current law doesn't allow for discrimination of pre-existing conditions.  Why would you not wait till you got sick?

How do you time that with open enrollment?

With my employer-based benefits, I'm allowed to change when "significant life events" occur; is such an allowance built into health exchanges?

  You can change your exchange plan following qualified life events.

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