From: "Cal Lester" 
Newsgroups: misc.invest.financial-plan
Subject: Re: Health insurance in NJ worth it?  Any other way to protect my assets?
Date: 10 May 2005 22:40:17 GMT
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Jay, there is a MUCH BETTER way to provide health coverage for you
and yours (if any). Look into a"Heath Savings Plan", which is an Income
Tax Deductible program, which permits you to set aside money Tax Free,
to use If & When you need it Income Tax Free.
What you do NOT use, you SAVE in an Income Tax Defeered account
(very similar to an IRA) for later. If you need any other info, contact me.

Cal Lester  CLU

jay wrote:
> I live in NJ.  I am self-employed and have to buy my own individual
> health insurance.  The cheapest comprehensive Health Insurance plan
> in NJ is currently $410 per month or $4920 per year.  This is an HMO
> with a 30 copayment.  The cheapest LIMITED plan is a Basic and
> Essential Plan for $220 per month, which is also an HMO, but there
> are a lot of exclusions such as prescription drugs, chemotherapy,
> medical supplies, etc.  The latter isn't a very good plan.  It better
> than nothing, but is only "half" a plan.
> Currently, I'm enrolled in a "catastrophic" health insurance plan
> with a $10,000 deductible and 50% coinsurance (up to an additional
> 10K).  This premiums for this plan have increased by around 25% to
> 35% per year.  They just raised my premiums to $328 per month and,
> based on past increases, this will be actually become more expensive
> than the comprehensive HMO in another year or two.  I don't know why
> my current plan increases by 25 to 35% per year.  All I know is I am
> being ripped off.
> I am 40 years old, in good health (so far), and have a net worth of
> approximately 1.7 million if you include the 500k house that I own
> without any mortgage.  I am self-employed, single, no kids, and only
> earn around 70K per year.
>
> I calculated that, based on the rate that the full HMO plan has
> increased over the past 5 years, if I were to sign up for the
> 410-per-month HMO, and stay with that plan, it will cost me a total
> of $435,406 in premiums over the next 25 years.  This is based on the
> plan increasing the premiums by around 10% per year, which is what
> has happened over the past 5 years.  At the end of 25 years, right
> before I become eligible for Medicare, the HMO will be over 40K per
> year in premiums.  This is assuming that nothing changes, and it
> could actually become worse since NJ is talking about scaling the HMO
> premiums based on age.
> Even the half-baked Basic and Essential plan would likely cost me
> roughly $250K or more over the next 25 years (actually more, because
> this plan is scaled based on age)
>
> Frankly, if I didn't already have 1.7 million in assets I would
> consider dropping Health Insurance altogether because it is a major
> rip-off.  I'm just wondering if there is any other way to protect my
> assets against the possibility of being wiped out by some
> catastrophic illness without having to sign up for these exorbitant
> plans.  Failing that, then would I be crazy to just go with the Basic
> and Health insurance or perhaps just drop Health Insurance
> altogether?  I really hate to give the insurance industry all that
> money.  It is a major rip-off.
> Any thoughts?
>
> J.