As was forecast in in a previous post, we selected the Cigna Global Silver plan. Hopefully we’ll never find out how good, bad, or mediocre our new international health plan is. Wasting thousands of dollars on premiums and never using health insurance is a great outcome. A better outcome would be not buying health insurance at all and never needing it.

Peer Pressure

The need for health insurance is more a product of peer pressure than it is truly a need. I have lost count of the number of people who asked me what we are doing for health insurance on our gap year. The question is really delivered as an accusation disguised as a question. Interpreting the question translates roughly to “Hey dumb fuck, I bet you didn’t think about health insurance”.

We have all lost our minds a bit on the health insurance cost/benefit front, myself included. The faulty thinking is that going without insurance is just flat out crazy. It’s the only insurance we treat this way even though the math doesn’t support it. The math doesn’t support any insurance, but it especially doesn’t support health insurance. The cost is high (without subsidies), and your claim will be denied for any justifiable reason in the extensive fine print.

What If…

Imagine a scenario where a young family of four with no health conditions gets and keeps themselves in shape. With a good diet, cardio, strength training, and a normal BMI, they are maximizing their health outcomes. Take that family and have them roll the dice without health insurance for a period of time. They would save $6,296 per year on just their contributions to an employer-sponsored plan. Investing that money would net them $38,437 over 5 years, $100,342 in 10 years, and $200K in 15 years.

That money can buy a lot of cash medical services with hospitals and providers offering steep discounts when paying cash. My family of four is 13 years into this would be timeline starting after the birth of AC, and I estimate that we would have spent about 30K on cash services. That’s including a surgery, an uncomplicated child delivery (BC), preventive procedures (colonoscopy, mammograms, etc). We would be somewhere around $106K to the positive had we passed on health insurance.

Internationally the value of insurance is even more questionable. Medical services in many of the countries we will be visiting are far cheaper than we are used to in the US. That is why medical tourism is a very real and practical thing.

Our New Insurance Plan

The Good

Our Cigna sales rep was pretty awesome. He was never pushy, always helpful, and kept us informed of specials they were running. I thought the “special” was some sales crap, but in the end it turned out to be real. Our final price for the year is $6,701 (paid up front) which is cheaper than the price I was quoted through Cigna’s website. This was great because we actually missed the May special by two days and they gave it to us anyway.

The coverage is pretty decent for the price in my opinion. Here’s some highlights:

• $1M/person total coverage per year
• Inpatient/Day patient/Outpatient coverage
• International evacuations and crisis assistance
• US coverage that is almost unlimited. We just can’t exceed 180 days in a hospital per year in the US.
• $1K/person/year of emergency dental. It was timely learning of this benefit with AC smashing a tooth on her knee.

The Bad

There are some curiously bad parts of the plan though:

• International outpatient coverage is only $15,00/person/year. That might go further in other countries I guess.
• No maternity coverage, which is my preference to not pay for this when we don’t need it.
• No dental/vision. I see these as barely useful coverages anyway.

Todo Esta Bien

This is the single biggest purchase we had to make this year, and it feels great to have it settled and out of the way. Is it the best plan? Probably not, and there’s no way to know that. If you read reviews for any health insurance product you are going to see terrible reviews. Insurance companies screw some people, and those people write reviews. It’s hard to see through that to get to the reality of the product. In any case we checked the box, partly to have health coverage and partly to keep everyone off our back.