Some Health Insurance Plans Lead to Larger Bills

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iStock_000016604045_SmallHealth insurance plans in the Marketplace, created by the federal government, are divided into four primary categories: Bronze, Silver, Gold and Platinum. The plan category typically pays a specific percentage of your healthcare costs, leaving you to pay the remainder. On average, a bronze plan pays approximately 60% of your healthcare costs, silver pays 70%, gold pays 80% and platinum pays 90%. This means that if you purchase a bronze plan, chances are that you’re going to pay approximately 40% of your healthcare costs out of pocket. This is on top of the monthly premium you must pay to have that insurance.

Even someone who can afford the higher premium of a silver plan may have to pay approximately 30% of his or her own healthcare expenses out of pocket. One trip to the hospital could potentially cost that patient tens of thousands of dollars. Owing this much money to a healthcare facility has been known to bankrupt many Americans. In fact, healthcare costs are now the number one reason for filing bankruptcy in the U.S. A 2014 Nerd Wallet study found that approximately 1.7 million Americans lived in households that declared bankruptcy last year and that three states accounted for a fourth of this medical-related bankruptcy: California, Illinois and Florida.

When an illness strikes, it can devastate a family’s – or an individual’s – finances. Although a bronze health insurance plan has the least expensive monthly premiums, it also has the highest deductibles and other out-of-pocket costs. But if a bronze premium is all that a person can afford, then he or she should strive to stay healthy.

We should also consider the possible implications of a gold or platinum plan in the Marketplace. The typical out-of-pocket expense for a gold plan is 20%. With a platinum health insurance plan, you can plan on paying for 10% of your healthcare out of pocket. Here at Medical Billing Advocates of America, it’s not unusual to see a lengthy hospital stay cost hundreds of thousands of dollars. If you were to have a major accident or illness, your hospital stay could cost $250,000. Would you be able to pay $25,000 or $50,000 out of pocket? Many Americans feel that they are completely protected if they opt for the plan with the more expensive monthly premium. Although overall, you have better coverage with a gold or platinum plan, either can still leave you open to a hefty financial responsibility.

Bronze and silver plans have not necessarily created the “under-insured” population, but they have certainly added to the number of Americans who fit in this category. In recent years, more and more people fall into this category because before the implementation of the Affordable Care Act, those who were not offered an affordable rate on health insurance at work and who could not afford an individual policy on their own would often go without health insurance. However, now that more people are insured but can’t afford the plans with better coverage, Americans often feel forced to pay for a policy that does not give adequate coverage, leaving them open for large medical bills after an illness or accident. Hopefully, by raising awareness of this growing issue, we will find a way to help close this gap and help protect our financial future and prevent more healthcare-related bankruptcies in the U.S.

In the meantime, Medical Billing Advocates of America has resources to help you protect yourself from high healthcare costs and to get your medical bills down to True and Accurate charges and Fair and Reasonable prices. Give us a call and let us guide you to those resources: 855-203-7058.


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