How Important is Having a Co-Payment?

David · Joined: 12 Feb 2005 Posts: 7

Being a self employed business owner, the plans available that offer a co-payment are very expensive. For my wife and I the cost can easily top $500 per month for a decent plan that allows for a co-payment on doctor visits. To save money we opted for a plan that just covers major expenses and with a high deductable. Now when we are sick, we try to avoid going to the doctor because of the expense. Was it a bad choice to get a plan with no co-payment?

Zack · Joined: 12 Feb 2005 Posts: 6

I wouldnt say so. Most sicknesses can be cured on your own, going to the doctors isnt that important.

Guest · Posted: Sat Feb 12, 2005 7:54 pm Post subject:

Zack wrote: I wouldnt say so. Most sicknesses can be cured on your own, going to the doctors isnt that important.
I second that Zack but some of the sickness not "most".
Most of them are protected by doctors :)

Zack · Joined: 12 Feb 2005 Posts: 6

What I meant to say was that most everyday illnessess can be cured. Like the flu, a cold, or a sore throat. The chances of getting a truely harmful disease are not that great.

wizard · Joined: 12 Feb 2005 Posts: 4

Yeah FLU and COld can be easily cured with medicines but once we get some disease (god forbade) then we have to go the doctor.

STIBROKER@AUSTIN.RR.COM · Joined: 29 Jun 2005 Posts: 8

CO~PAYS is a very small part of health insurance these days.....

menotellname · Joined: 15 Jul 2005 Posts: 8

David wrote: Being a self employed business owner, the plans available that offer a co-payment are very expensive. For my wife and I the cost can easily top $500 per month for a decent plan that allows for a co-payment on doctor visits. To save money we opted for a plan that just covers major expenses and with a high deductable. Now when we are sick, we try to avoid going to the doctor because of the expense. Was it a bad choice to get a plan with no co-payment?

A co-pay is not a very important part of the health insurance policy but it does go a long way towards determining your premium. This is because the lower your co-pay, the greater the liability for payment of medical services for your insurance provider. After all, they will be paying EVERYTHING except your co-pay. Thus, the greater your co-pay the lower the policy premiums. And if you have no co-pay but rather only a co-insurance percentage, then you are taking a greater liability for the medical service payments and your policy premiums will be reduced even further.

Take a look at a high deductible HSA insurance plan and using a lump sum critical illness plan as arbitrage for any catastrophic event. With this set up you pay your insurance premiums into a "sinking fund" similar to a flexible spending account. These funds are used to cover everyday medical expenses up to the deductible. At that point your insurance kicks in. Having the high deductible will cause you to have very low premiums and you will essentially pay for everyday medical situations from this sinking fund. Unlike a cafeteria plan, the unused portion of the money in this sinking fund does not disappear at the end of each year. The excess money stays and continues to grow. You are actually able to invest these excess funds. Then you say..."This all sounds good but what if I get cancer and have to pay the $10,000 deductible all at once?" That is what the lump sum critical illness policy is for!!! Say you have a $50,000 lump sum critical illness policy that pays the entire benefit amount all at once (similar to a life insurance policy) once you are diagnosed with any one of a number of "critical" illnesses.

Viola!!! Low cost health insurance that allows the healthy individual to pay for routine expenses out of pocket and provides deep pocket insurance coverage for major illnesses!!!