Getting health insurance isn’t just for your benefit

I have a client with an adult child who is choosing not to buy health insurance. Asked for my opinion, I responded that insurance is a fundamental building block for financial security.

Insurance works on the principle of the Law of Large Numbers. The chance that any one individual or family experiences an insurable incident is small, but the results can be financially catastrophic if you are the one who experiences an accident or has a major health incident. That’s why we buy insurance.

Health care in the United States is expensive. The Organisation for Economic Co-operation and Development comprises 38 member countries, primarily high-income economies, that collectively account for a significant portion of global GDP and GDP growth. It publishes various statistical comparisons of member countries. In 2022, the United States had the highest health care costs per capita spent, with an estimated $12,742 per person. Switzerland was the second-highest-spending country, with $9,044. The average spending, excluding the United States, was only $6,850 per person.

Health care spending is driven by use (the number of services used) and price (the amount charged per service). United States usage is comparable to other developed countries, but our prices are higher. Higher health care spending can be beneficial if it results in better health outcomes. However, America’s health outcomes are not any better. The U.S. performs worse in some common health metrics like life expectancy, infant mortality, unmanaged diabetes and safety during childbirth.

Healthy people and young adults might feel they don’t need health insurance. Some reasons for not getting health care coverage are that it can be expensive and have high deductibles, lengthy waiting times for screenings, and restrictions on where and who can provide care. No one plans to get sick or hurt, but sometimes life throws you a curve and you find you do need care. Sports injuries, a slip on the ice or an unforeseen illness, while rare, will derail your financial health and limit options for years.

Most of the time, individuals don’t need health insurance. However, studies have shown that without coverage, many people delay care until their conditions worsen. This leads to higher costs for both patients and the broader health care system. People with coverage have access to preventive care, which can help people manage new and ongoing health conditions and avoid expensive treatments and

hospitalizations.

In addition to poorer health outcomes, uninsured individuals are exposed to increased financial risk. Uninsured people often face unaffordable medical bills when they do seek care. For example, a broken leg can cost around $8,000, a three-day hospital stay can cost more than $30,000, and a cancer diagnosis can lead to hundreds of thousands of dollars in bills. Without insurance, these costs can translate into deep debt or even bankruptcy. Health insurance provides a cap on the most you could spend on health care each year.

In addition to the individual benefits of having health insurance, there are also societal benefits of having a large percentage of the population covered. Individuals with health care coverage are more likely to use preventive care services and screenings.

Payments from insurance companies are crucial for keeping hospitals open and medical professionals available in our communities, especially in rural and underserved communities. When more people have health coverage, hospitals’ funding is more reliable and stable. This allows them to invest in staff, technology and expanded care options.

People who have health care coverage are better employees. They miss fewer days of work, thanks to preventive care. Employees are more productive because they feel healthy and well.

You might not be able to buy health and happiness, but enrolling in health insurance coverage can help. Research shows that people who stay covered have better health outcomes, pay less out-of-pocket for medical care and are less likely to go bankrupt. Having health insurance also facilitates access to care, resulting in lower death rates.

Having health insurance can mean the difference between

sickness and health or even life and death.