Health insurance can give you the peace of mind that comes with knowing that you won’t be left on the hook for thousands of dollars’ worth of medical bills if you’re involved in an accident.
Unfortunately, it can also be prohibitively expensive — especially if you cannot get coverage through your employer. Our guide will introduce you to a few more cost-effective ways to control your medical expenses without traditional health insurance.
Quick Look: Best Health Insurance Alternatives
- Cash-Only Doctor’s Office
- Short-Term Health Insurance
- Primary Care Memberships
- Health-Sharing Plans
- High-Deductible Health Plans (HDHPs)
Best Health Insurance Alternatives
If you’re having trouble covering the costs of traditional health insurance, you might want to consider one of our favorite health insurance alternatives.
1. Cash-Only Doctor’s Office
If you’ve ever dealt with a health insurance company, you probably already know that getting your insurance to cover your health care can be like pulling teeth. What you might not know is that doctors usually hate dealing with insurance companies as well.
If you can’t afford insurance, you might want to look for a doctor’s office in your area that accepts cash payments. These doctors may only accept cash payments (or limit insurance accepted to Medicare or Medicaid) because they don’t want to go through the hassle of dealing with insurance companies.
You can usually avoid insurance altogether when you get care through a cash-only doctor’s office — and you’ll save a significant percentage on any care that you receive.
2. Short-Term Health Insurance
Short-term health insurance plans are limited insurance plans that provide you with a limited amount of coverage in exchange for very low premiums. These plans often have maximum limitations on the amount of money that you can claim from your insurance provider, but it’s possible to find coverage from just $200 a month for individuals.
If you’re considering investing in a short-term health insurance plan, it’s incredibly important that you fully understand what exactly is covered under your plan. Short-term health insurance plans don’t need to cover the 10 Essential Health Benefits put forth by the Affordable Care Act, and plan providers have no obligation to extend coverage to pre-existing conditions that you have when you sign onto your plan.
Short-term health insurance plans are often very limited in their range of coverage. An analysis of short-term health insurance plans completed by the Kaiser Family Foundation (a health research nonprofit) found that:
- 71% of short-term insurance plans surveyed did not cover outpatient prescription drugs
- 62% of short-term plans surveyed did not cover substance abuse issues
- 43% of short-term plans surveyed offered no coverage for mental health services or care
- 100% of short-term plans surveyed did not cover maternity care services
Though short-term plans might be useful for traumatic accidents and emergency care, they do not provide a solution for ongoing medical care needs and health maintenance. It’s also important to note that these types of plans are not available in every state. In 2020, there are 11 states where there were no short-term plans available for sale.
3. Primary Care Memberships
A primary care membership (sometimes referred to as “concierge medical services”) is a type of network that allows you to access basic medical care (like physicals and pediatric care) in exchange for a membership fee.
These membership fees usually range from $60 to $100 a month, which makes them significantly more affordable than traditional health insurance plans. You’ll also be able to access priority scheduling and personalized care through this type of plan.
The drawback of primary care membership plans is that only a very limited range of services are covered. These memberships are offered directly by healthcare providers, and usually only cover maintenance appointments.
They rarely cover things like surgery or more complex health care needs. Most people who buy a primary care membership also carry some form of health insurance to protect themselves in the event that they need emergency care.
4. Health-Sharing Plans
A health-sharing plan is a type of program that allows multiple participants to pool resources together to cover the cost of medical care. Each month, you’ll pay fees into the pool to maintain your status in the program. If you need medical care, you’ll pay an “incident fee” that’s similar to a co-pay. The pool will then cover the remainder of your medical care costs.
Many health-sharing programs are independent operations run by faith-based organizations, so they may limit access to some types of services and treatments. For example, your contract might state that you cannot use pooled funds to access birth control, abortion, select mental health services or substance abuse treatments.
These plans may also include a clause that says that you aren’t guaranteed to have all of your outstanding treatment costs covered beyond a certain threshold, and many include lifetime benefit caps. If you do decide to participate in a health-sharing plan, be sure to read the fine print thoroughly.
5. High-Deductible Health Plans (HDHPs)
High-deductible health plans (HDHPs) are insurance plans that come with low monthly premiums but which also have extremely high deductibles. It’s normal for these types of plans to have deductibles starting at $8,000 — your plan might have a deductible as high as $14,000.
The only people who should consider these types of plans are those who are rarely sick and who don’t need regular medical attention. These types of plans are often sold alongside health savings accounts (HSAs), which allow you to save pre-tax dollars for qualified medical expenses.
Why Would You Avoid Health Insurance?
The primary reason why people would avoid health insurance is the cost. Health insurance premiums (especially on private health insurance plans) can be too expensive for many people to reasonably fit into their monthly budget. In 2020, the average cost of a health insurance plan was $456 per month for individuals and $1,152 per month for families.
Your monthly premium doesn’t encompass everything that you’ll pay for on a health insurance plan. When you use your coverage, you’ll first pay a “deductible” before your plan starts providing you with benefits. A deductible is a set dollar amount that you need to spend on your own health insurance costs before your plan “kicks in” and begins covering your medical expenses.
For example, imagine that your health insurance plan includes a $2,000 deductible. If you need to use your health insurance plan and receive medical care, you’ll need to cover $2,000 worth of your own healthcare expenses before your plan starts covering costs.
After you reach your deductible, you’ll be responsible for paying your co-insurance percentage. For example, your plan might have a 20% coinsurance percentage. If you received a $5,000 medical bill, you’d need to pay for the first $2,000 of this bill out-of-pocket.
When it comes to the remaining $3,000, you’ll need to pay 20% of the bill — your health insurance will cover the remainder. This means that out of this $5,000, you’d need to pay a total of $2,600 if you haven’t yet reached your deductible. Keep in mind that premiums do not contribute towards your deductible, and you’ll need to pay your premium every month, regardless of whether you use your coverage or not.
Deductibles can be another significant expense associated with traditional health insurance. In 2020, the average deductible for an individual plan was $4,364 and $8,439 for a family plan. This deductible resets each year, which means that you’ll need to budget for deductible expenses as well as your monthly premium expenses every year. For many families, this is simply out of the realm of expenses that they can afford.
What is a Health Insurance Alternative?
Traditional health insurance plans (either purchased through your employer or through a private provider on the Affordable Care Act Marketplace) are the most comprehensive way to protect yourself, they aren’t the only choice that you have to lower your medical expenses.
As the name suggests, health insurance alternatives are other types of plans or accounts that can help you control what you pay for healthcare. These alternatives often come with limitations on the types of services and treatments that are covered but can also be significantly more affordable than monthly health insurance premiums. If you’re basically healthy and only need occasional medical care, you may be able to save money by choosing a health insurance alternative over a traditional plan option.
Benzinga’s Top Health Insurance Providers
If you know that you need regular medical care or services, you may be better off searching for an affordable health insurance plan. Not sure where to start your search? Consider a few of our favorite options below.
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securely through Blue Cross Blue Shield Health Insurance’s website
Best For:
Nationwide coverage
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securely through Sidecar Health Access Plan’s website
Best For:
No enrollment period health insurance
Plans referred to above are excepted benefit fixed indemnity insurance products marketed and administered by Sidecar Health Insurance Solutions, LLC and underwritten by Sirius America Insurance Company or United States Fire Insurance Company, depending on the state. As an excepted benefit plan, it does not provide comprehensive/major medical expenses coverage, minimum essential coverage, or essential health benefits. You cannot receive a subsidy (premium tax credit and/or cost-sharing reduction) under the ACA in connection with your purchase of such an excepted benefit fixed indemnity insurance plan. Also, the termination or loss of this policy does not entitle you to a special enrollment period to purchase a health benefit plan that qualifies as minimum essential coverage outside of an open enrollment period. Coverage and plan options may vary or may not be available in all states.
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Best For:
Access to Kaiser medical specialists
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Best For:
Same day coverage available
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Best For:
Pharmacy programs
Find Affordable Health Coverage
Health insurance alternatives can be appealing. After all, if you don’t need to visit the doctor frequently, why would you pay almost $500 a month for coverage?
While many people can save tons of money with a health insurance alternative, many will also find that the care that they need isn’t covered by the most popular health insurance alternatives — or that they actually end up paying more money for care with these alternatives than they would with a traditional health insurance plan.
Be sure to do plenty of research and know exactly what is and is not covered before you invest in one of these alternatives.
Frequently Asked Questions
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If you’re in need of emergency medical care, many hospitals will treat you regardless of your ability to pay for your medical bills. Make sure you know each healthcare provider’s policies in your area so you know where to go in the event that you need urgent medical care. You can also invest in a health insurance alternative to lessen your medical care expenses.
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If you cannot afford health insurance, you’re not alone. You can research doctors’ offices in your area that accept cash to lower your health care costs. You can also invest in an affordable alternative plan that protects you when you’re most vulnerable.
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It is possible to live without health insurance in the US, but it is not advisable. Health insurance provides financial protection in case of medical emergencies and helps cover the cost of healthcare services. Without health insurance, individuals may be responsible for paying the full price of medical treatments out of pocket, which can often be very expensive. It is important to have health insurance to ensure access to necessary medical care and to protect oneself from potentially devastating financial burdens.
Related content: ARE HEALTH INSURANCE PREMIUMS TAX DEDUCTIBLE?
