Hear me out on this, please.
Let’s say that I spend $5k on health insurance in a year, but don’t go to the doctor or have any medical issues in that year. Where does my money go? It disappears. I basically just gave away my money, and received nothing in return. However, if I took that $5k and simply put it into a personal savings account instead of giving it away to a health insurance provider - that money stays right there if and whenever I decide to use it. It even collects interest.
I realize that with a health insurance provider, you’re (supposedly) getting discounted rates on medical services - but if your money is just disappearing into thin air if you don’t happen to need those medical services in a given year, are you really saving money? It just seems like a really big scam to me - what am I missing?
Insurance is always a technical gamble. If you need it for something moderate to big you’ll easily run up a much higher bill than 5k. Could even be enough to eat the years of savings you had.
If you had paid that 5k that year, you’d still have your savings.
Until we get to the total plan limits. They don’t cover costs to infinity, you know. And for something like cancer treatment, most plans don’t actually offer enough coverage to sustain it for years, so you’re still on the hook for tens or hundreds of thousands of dollars after all is said and done.