Which is better: Health Insurance, or a Health Care Payment Plan? (health care system, premium)

[Little-Acorn]

Which is better: Health Insurance, or a Health Care Payment Plan?

So what's the difference?

Health Insurance is something designed to prevent you being financially devastated by an injury or health problem. For routine doctor's checkups, medicines, and minor afflictions, you pay the full cost yourself. But if you come down with some major illness or injury and rack up $100,000 (or a few million) in doctor's and hospital bills, your Health Insurance pays for most of it, leaving you with "relatively minor" payments of several thousand dollars. Several thousand isn't easy, but it won't completely destroy you financially.

A Health Care Payment Plan, on the other hand, pays for ever pill, every sniffle, every cut and scratch. Plus the major illnesses etc. too, of course. Usually with a small "co-payment" you have to come up with, of maybe $20 or $30 each time you access the Health Care system.

Unsurprisingly, Health Care Payment Plans cost a LOT more than actual Health Insurance. Insurance companies don't have money trees, so anything they pay out, has to come from the money their clients pay in, 100%.

For people with actual Health Insurance, over the course of a routine year they insurance company usually pays out nothing. The client has normal doctor checkups, and maybe comes down with the flu, and his kid gets the same plus steps on a rusty nail and goes in for a tenanus shot. And the client himself pays for it all, maybe $800 or a thousand in a routine year.

Occasionally someone has very bad luck, and comes down with cancer or falls down a cliff, and winds up in a hospital with a million dollars in bills due. In his case the insurance company pays, say, all but $10,000, and the client must pay that $10,000 himself. Such events are rare - which is what the insurance company counts on. So the company can pay for that $990,000 with the money it got from the other clients who got nothing worse than the flu.

But when the company must pay for every pill, every doctor checkup, every flu case etc., in addition to the occasional huge catastrophe, there's only one place it can get the extra money to pay for all that: again, from all its clients. And their premium go WAY up... again since there is no money tree.

Monthly premiums for an actual insurance plan might cost $200-$300 per month, if that. But premiums for the Health Care Payment plan that pays for everything can easily exceed $1,000 per month, or more.

Most people who get their insurance through their employer, are actually getting Health Care Payment Plans. Ask your boss what your insurance would cost if you got laid off and wanted to continue it anyway. You might be shocked at the answer.

If you didn't have health plans through your employer, and had to buy it on your own, which would you choose? Actual Health Insurance that pays only for catastrophes? Or a lavish Health Care Payment Plan... as you probably have now? If YOU had to pay the full premiums for each?