What's the biggest threat to your long-term financial outlook? I could easily make the case that it's paying for health care. Each year throngs of uninsured people go bankrupt due to their inability to pay medical bills. It may be that they couldn't get insurance due to preexisting conditions that an insurer wouldn't cover. Or they simply couldn't afford health insurance at all.
And they're not the only ones feeling the pain. For those lucky enough to have health insurance through an employer, they're finding that more and more of the costs of maintaining that insurance are being pushed onto their shoulders as business owners' premiums rise. It's a problem that everyone knows about, but no one has done much to correct.
The new book Health Care on Less Than You Think by Fred Brock takes the approach that until the current health care system collapses under the weight of unmet expectations, you're stuck dealing with it – so it's best to learn how to cut your costs as much as possible. At the same time, the book has a loftier goal – to teach you how the health care system works today and to suggest ways that it could change for the better. Maybe all is not lost?
Now, if you're going to title your book Health Care on Less Than You Think, you'd better have some real tips on how to lower costs, and this book does. For example, Brock goes into detail on health savings accounts (HSAs), which allow you to put money aside tax-free to pay for the deductible portions of your health care. If you don't use all the money in your account, it can continue to grow year to year. In many cases, having an HSA will allow you to get lower premiums because you can keep insurance deductibles higher. (Of course you need to have the money to set aside in the first place for this to work.)
Brock cites a quirk in the prescription drug market that allows pills of different strengths to be sold for virtually the same price. If you have a pill that can be split in half, get your doctor to write you a prescription for the double-strength pills and suddenly your drug price is halved.
There are many other suggestions, some more doable than others depending on your situation. Brocks covers common ways that insurance companies deny claims that you're entitled to, with the thought that most people don't know enough to question or won't go through the hassle to make it right. He discusses the different health insurance rates you might expect in different states – if you're in dire straits, you might consider moving. His information on the costs of branded versus generic drugs is an eye-opener. (Generic drugs may be cheaper to you, but their pricing varies widely, with some pharmacies making a killing on them in comparison to brand-name pharmaceuticals.) And there are plenty of other interesting and/or useful ideas on cutting your costs.
This book is subtitled "The New York Times Guide to Getting More Affordable Coverage" and so it might not be surprising that this book has more to offer than just handy tips. Brock also wants to discuss options for fixing the underlying problems, not just being crafty in circumventing them. He offers several ideas that he believes are workable, but perhaps the most interesting to me is an idea that's actually been around since the Nixon years.
In 1972, Senator Russell B. Long of Louisiana suggested a federal catastrophic health insurance plan that would require the government pay all medical expenses beyond a fairly high annual deductbile. (The proposal was $2,000 in 1972, which Brock equates to between $8,000 and $10,000 now.) Insurers could then sell individual policies for those who wanted lower deductibles.
The big upside to this plan is that it would take away the haves and have-nots situation we have today based on who has employer-based health insurance, and it would relieve employers of taking on insurance costs that they clearly are becoming less able and/or less inclined to pay. (Employer-based health insurance is a perk; there are absolutely no laws that require a company to provide any health insurance.) At the same time, it would make sure that no one is uninsured to the point that they can lose everything if a major health problem strikes. It also gives insurance companies a role, in that they can still sell policies that lower the deductibles for those unwilling to take their chances on paying a large out-of-pocket expense.
Of course getting our government to seriously take up any of the proposals in the book is another story. Until then, get out your pill-cutter and plan your next road trip to Canada.Powered by Sidelines