Budgeting / Cash Flow

[SlumTodd_Millionaire]

So in my particular case, I changed jobs, bought gap insurance, and got unbelievably sick. Not anyone's fault. There was no way I could have "seen this coming" and the end result was bills we're still paying off a year later. Granted, we're going to be fine, and I am paying them, but if it would have been "oh I need chemo therapy and surgery" which was a distinct possibility when I first went in to get checked out...well, it would have been different, and instead of insurance getting most of the bill and me being on the hook for $5k, I'd have been on the hook for $100k, I would have fought that tooth and nail so I could make sure I could feed my kids and keep a roof over my head. Paying the hospital their "cut" probably wouldn't have been an option. "Ok, you'll get $40/mo for the next 208 years" probably would have been all I could do at the time.

My buddy's wife just had cancer. It was atrocious, she'll live, and everything is "ok" for now...but yeah...him getting slammed with well over $100k in fees for something he didn't plan on after his insurance (which was kind of crappy to begin with) paid is nonsense. You can be "responsible" do everything "right" and still get handed a crap sandwich - as was his case. For that reason, I recommend negotiation.

It's not the same as buying a house, or a car, or anything of that nature - in those scenarios, I'd even suggest that getting a product, using it, then demanding some of your money back would be unethical - still, with medical bills, I can no longer agree. No one chooses illness and you can do everything "right" and still get screwed. It's not "consensual" in any sense of the word. It's not like you have choice in most communities, and the nature of healthcare forces monopolies. There's no good "free market" solution to this that doesn't have terrifying downsides (like turning away dying people because they're not insured).

http://money.cnn.com/2017/10/25/pf/insurance/las-vegas-shooting-health-care/index.html

Take a gander at this stuff about the Vegas shooting. This could literally bankrupt people - even people with insurance. How can you be sure the ambulance that pulls your unconscious butt out of the mangled car wreck where the drunk hit you takes you to an "in-network" hospital? Obviously, the right answer is "get awesome insurance" but for millions of people that's not really an affordable answer, and even when I did have "awesome insurance" (by my part 135 standards) it didn't cover every hospital. When my kids had gotten sick and my wife took my son to the hospital several years back there was no "in network" hospital, and we paid out the nose. Not really anyone's fault - the insurance companies and hospitals are just trying to protect themselves too, but you cannot and should not feel an ethical duty to pay in certain circumstances.

When my adventures in healthcare started, I had about $10k in cash to spend on stuff just "lying around" and a reasonable amount in savings. After several months off work and doctor's bills where my copay was $1000...well, that went away quick. It could happen to everyone and anyone, and it's really easy to say, "pay your debts" until you see an unexpected $15,000 bill. If I didn't have my poop-in-a-group before all this and some family to lean on, we'd have been homeless. It's that simple.

In short, take care of yourself and your family's cashflow needs first, then contribute to the hospital's pocketbook.

I feel for people who genuinely can't get or can't afford real insurance. That's why I support universal single payer health care. But for a lot of people out there, it's really their own fault. They make enough money, but they're too cheap or cocky about their health to buy it. You mention people in Vegas. If someone can afford to buy tickets to a Vegas music festival, they really have no excuse for not having real insurance. It's a matter of priorities.

 

[ppragman]

I feel for people who genuinely can't get or can't afford real insurance. That's why I support universal single payer health care. But for a lot of people out there, it's really their own fault. They make enough money, but they're too cheap or cocky about their health to buy it. You mention people in Vegas. If someone can afford to buy tickets to a Vegas music festival, they really have no excuse for not having real insurance. It's a matter of priorities.

My insurance when I worked 135 up here in Alaska was $900/mo for my family and I (this was right when the exchange was starting), the cheapest insurance on the exchange that wasn't a ticking time bomb was around $600/mo and it was kind of crummy, so I went with my employer's insurance plan which still had a $4000 max out of pocket. A ticket to Vegas and a concert can be well with in the "discretionary income" if spent once a year, as opposed to $900/month for good insurance that's simply impossible to afford in general.

I support single payer too, or some other variation of socialized medicine, but mistakes happen, accidents happen, and sometimes "poop" happens. Even if you have "good insurance" there's literally no plan available to me that would cover every hospital in the country. If someone straight up shoots you and you are hauled off to an "out of network hospital" you could be on the hook for a lot of money regardless of what priorities you had before you got shot.

In my city there are two hospitals (well really three but I won't count the Native Hospital). I have awesome insurance (through my wife's badass federal job) but if I got shot on my way to work tomorrow, and I happened to get a first responder who took me to the wrong hospital because it was closer, I could be in a world of hurt with my insurance provider (I wouldn't be, the costs would be close to the same here in town, but in the lower 48 that equation could be WILDLY different, regardless, I would still pay more). If I had insurance that was only "ok..." for whatever reason, well, I'd be screwed.

This stuff about "it's a matter of priorities" is a super privileged thing to say from someone who has the discretionary income to own their own airplane. It's not so black and white, and the equation isn't so simple. As is usually the case in life. I know as a businessman, you likely balk at the idea of having a customer renegotiate price after eating their icecream (or whatever) - but the truth is this is a fundamentally different equation than most goods and services. At least I think this - and by the way, I'm a guy who's paying the insurance companies out the ass right now to keep my credit intact. That said, if we didn't have the ability to, or I was single, I probably would have told them to jam if they would have wanted me to be responsible for medical bills that exceed my considerable student loans for aviation.

Also, after dealing with insurance companies for the last year, let me tell you something, I'd much rather pay the federal government's massive bloated bureaucracy in taxes than pay the insurance company. They're a pain in the ass to deal with, at least with the government, I can vote to change it, when there's barely any choice in the insurance markets up here, it's hard to be a part of changing stuff.

 

[SlumTodd_Millionaire]

This is the part where people with kids get mad because I say "if you can't afford a family insurance plan, maybe wait to have a family."

But FYI, I actually ignore medical and student loan debt when we're screening tenants. While I think people largely get themselves into trouble, I also think the American health care system is such a mess that I just can't just deny people housing because of medical debt.

 

[ppragman]

This is the part where people with kids get mad because I say "if you can't afford a family insurance plan, maybe wait to have a family."

But FYI, I actually ignore medical and student loan debt when we're screening tenants. While I think people largely get themselves into trouble, I also think the American health care system is such a mess that I just can't just deny people housing because of medical debt.

That's fantastic that you do - and I commend you for it. (Indeed I respect the hell out of that, as I have many friends doing the landlord thing who I gave a hard time for being skeevy about it).

I get it, and to an extent, I'd agree. But as you know, past performance is no guarantee of future returns. When I got married I could afford a family insurance plan, were it not for my wife's insurance - if I had to pay $800 or $900 a month now? It might be a little tough. We'd make do, and I'd hustle, but I tend to believe "there but for the grace of god go I" (you can leave out the god part if that ain't your thing - really it means, "HOLY CRAP I'VE BEEN SO LUCKY!") Just a slight adjustment to my history could have rendered my safety-net entirely gone and us on the street. I'd have hustled something, but it wouldn't have been pretty.

When I was a kid - like just after I was born, my dad damaged his back and spine so much for awhile he couldn't even walk without excruciating pain. It was an "on the job injury" in the 80s in AK, so given that there was basically no oversight, the scumbags fired him. My folks, who both had awesome jobs at the time (my dad was a former GI turned steel worker, and my mom was working at a bank with ok benes) went from "heros" to "zeros" with a quickness. They lucked out - were it not for my dad's VA benes, they probably would have lost their house that they just bought, and my dad stayed home with me for a few years while mom was the bread-winner. It worked, and I never knew it (I was too young) but for the better part of 3 years they were totally hand-to-mouth. And they were making the proverbial "F-YOU" money at the time.

The truth of the matter is, until you're basically able to make passive income off of your money, you're never "really" all that secure, and even then, you're still at the mercy of the economy to an extent. We all assume that life is this linear progression of "more, better, faster." It's not. For many people it can be, and many people also like to believe that by sheer force of will you can will that into existence...but recent experiences of myself and several close friends (kind of all at once, it's weird) has certainly but a damper on that belief for me. It's not that I won't try - but hard work is no guarantee of success and security.

 

[TC_ABM]

@ppragman, thank you for the additional context.

I will say that my policies explicitly state that loss of life/limb/eyesight is covered at any provider for emergent injuries and provides a process for after the fact referral in such cases. Further treatment obviously requires me to see my provider for in network care.