Annual open enrollment 2020 felt just like the rest of the year (not to mention every other open enrollment) – frustrating and discouraging. My options were to pay more, get less, or both. In the past, I’ve grudgingly went along with the program. I assumed it was all just part of the process—you get your renewal in the mail, you complain about it, then just pick the least painful option.
This year, I decided that I’d finally had enough.
Constantly paying more and getting less is simply not a sustainable solution. It’s almost comical how we’ve become accustomed to the idea that annual rate increases are just the way it is. Having my rates steadily stairstep every year is just something I should expect and be ok with. Right?
I’m not. And you shouldn’t be either.
How long can we expect to be able to absorb higher costs and lower benefits? Eventually (ie, now) we’ll be paying a ton of money every year in premiums, only to turn around and spend a ton of money out of pocket on our care.
That “system” just isn’t working for me anymore.
So this year, I chose to opt out altogether.
Open Enrollment 2020
The plan I was on this past year was a high-deductible health plan (HDHP) with a health savings account (HSA). I’ve been a fan of these types of plans since they were first introduced. I treat health insurance as any other insurance—for protection against the big, unexpected stuff that happens. I’m not a believer in “front-loading” paying for the care I may or may not need by paying for it in advance every month in the form of higher premiums. I want to pay for care when I need it, knowing I’m covered if something goes south, while keeping my money in my own pocket.
HDHPs were perfect for someone like me. A tax-incentivized way to pay for unexpected care, and since the plan doesn’t actually pay for anything until you reach a certain deductible amount, there were some sweet savings with the premiums.
This used to work really well. The premiums for HDHP plans were about half of what you’d spend on a plan with a lower deductible, copays, etc. This allowed you to use that difference in premium costs to fund your HSA. For the same cost as one of those higher priced plans, you had your premiums covered and your HSA funded should something come up. Done and done. Unfortunately, the premium gap has tightened considerably. There isn’t much wiggle room anymore.
As a matter of fact, the monthly premium for my HDHP was now higher than some plans with a copay. Doesn’t exactly leave much to fund my HSA with…
Insurance used to be insurance.
Health insurance as we know it today is the result of a gradual, disjointed patchwork of efforts and regulations over the last 90 years. The original concept was a simple, straightforward system—a far cry from the complex, tedious, and convoluted supply chain we all hate navigating today.
Blue Cross was formed in 1929. Not really “insurance,” it allowed teachers to pay a hospital 50 cents per month as a way to prepay for if/when they ever had kids. That eventually grew and morphed to include care for illness and injuries. As the idea grew and spread, a group of doctors decided to adopt the concept, forming Blue Shield in 1939 to help cover the costs they were delivering to patients. The two groups finally joined forces in 1982.
Since then, what started out as a simple system has continually been adulterated by independent, incremental regulations at both the state and federal level; the growing costs of care; the increasing availability of new technologies and services; and the consumer demand to have everything covered with a simple copay.
We’re now feeling the results of these disconnected, fragmented efforts.
There has to be a better way. (Spoiler: there is.)
Folks without insurance want the government to step in and provide coverage for them. Those with insurance want more choices and less restrictions from the states and feds. Providers are continually coming up with new procedures. Innovative technologies continue to hit the market. All of these things fuel both rising costs, demand, and disjointed regulations. So what do we do when no one seems to be on the same page?
We pump the brakes, stop banging our heads against the same wall, and actually do something different.
For me, that meant opting out of health insurance altogether and giving a medical cost-sharing membership with Sedera a try.
I like the simplicity. Medical cost-sharing is a community where members contribute each month to help each other with large, unexpected medical expenses.
I like the fact that this program believes there is strength in community and members are connected through a shared commitment to living a healthy lifestyle. It’s not faith-based like most other medical cost-sharing programs.
I like the belief in personal accountability. Sadly, this is something that is becoming more and more absent from our current system.
I like the idea that we all have the ability, and should be empowered, to make our own health decisions.
I like the idea that I’m now a cash pay patient and no longer have to think in terms of “in-network” or “out-of-network.” I can see any provider I want and shop based on price, provider ratings, and reviews, and whatever other criteria I find important. And, with the assistance Sedera gives its members, this also gives me more leverage and negotiating power with my bills.
I like the notion that by becoming educated, informed and empowered consumers, we can all have a profoundly positive impact on the direction of our healthcare system.
I like the fact that my monthly costs dropped while giving me arguably richer benefits (when coupled with a Health Access Solutions membership). Now, instead of paying $434 per month, I’m paying $333 ($218 for Sedera + $115 for Health Access Solutions).
How I’m covered this year.
Sedera is very transparent about the fact that they are not an insurance company. As a member, I have no right to any payments (they are voluntary), and my membership should not be considered to be like an individual insurance policy.
Not only does that not scare me away, but that last part is also another reason I was attracted to them in the first place. (Checking out of the system altogether remember?)
Sedera is an A+ rated accredited business with the Better Business Bureau. According to Sedera, as of September 2020, the community has shared over $32 million dollars, 100% of eligible needs have been shared, and members have saved 52% in medical costs. Not too shabby.
So how does it work?
Because medical cost-sharing is not insurance, the terminology and how it works are different. There are no deductibles, copays, or coinsurance. When I became a member, I had to select an Initial Unshareable Amount (IUA), which is the amount I need to pay for each Need before I can share. Needs are the medical expenses caused by a single accident or illness. I chose an IUA of $1,000 to get my monthly costs down even lower (you can choose an IUA between $500 and $5,000).
While there are some specific preventative care services that are eligible for sharing without having to meet my IUA, any other service is subject to meeting that initial amount before sharing. So, if I have an unexpected accident or illness, I pay my IUA, then submit the remaining medical bills to Sedera to be shared with the community. Once processed, contributions are pulled from other members’ medical cost-sharing accounts and deposited directly into my own sharing account. I then use those funds to pay my provider directly.
In my case, let’s assume I go to the doctor for a sore throat, get checked out, have a strep test done, and get some antibiotics, and the total of all that is $200. Because that is less than my $1,000 IUA, it’s not shareable and I pay for it myself. If when I went in, however, they discovered that I needed to have a tonsillectomy and ended up with bills for $7,000, I would pay the IUA of $1,000, and the remaining $6,000 would be shareable.
I do have a couple of pre-existing conditions, so looking at how those are handled was important to me. A pre-existing condition is a condition that has been active or needed treatment (even if not officially diagnosed) within 36 months prior to enrolling. Coverage for these conditions is stair-stepped, with no sharing eligibility for the first year, up to $15,000 shareable the second year, up to $30,000 shareable the third year, and fully shareable the fourth year on.
To help support both my health and decision-making when it comes to my health care, my plan also includes access to Teladoc and Expert Second Opinion services. Teladoc gives me 24/7/365 access to board-certified physicians. 2nd.MD gives me access to medical specialists at no cost so I can consult with experts for a second opinion whenever I’m considering a non-emergency surgical procedure.
And while all this works well for me, there were still a couple of holes I wanted to fill to give me a more complete solution. So I also enrolled with Health Access Solutions.
Health Access Solutions
- Access to virtual direct primary care (VDPC). This lets me schedule video calls with the same doctor with no co-pays or hidden fees. By having a membership with a VDPC, I also get a discount on my monthly Sedera membership cost.
- Reimbursement for preventive services and screenings. Services include annual physicals, lab tests, dental cleanings and/or vision exams. There are no provider network restrictions. I simply submit for reimbursement and am reimbursed based on their schedules and maximums.
- Out-of-Pocket costs assistance. With Sedera, I’m responsible for a max of 3 IUAs in a calendar year (it’s 5 for a family), after which all eligible needs are shareable without having to first meet my IUA. With this benefit from Health Access Solutions, I can submit my third IUA in a calendar year as a preventive expense and get 100% of that IUA reimbursed.
This year, I bailed on the traditional health insurance model and decided to give medical cost-sharing, coupled with a Health Access Solutions membership a go instead. By combining these two programs, I am covering myself against large, unexpected medical issues, while taking a more active role in my own care, gaining more control over my health care costs, and saving money. As an informed, engaged healthcare consumer, I am also now in a better position to be part of the solution.
Here’s to a healthy 2021!
Click here for more information on Sedera medical cost-sharing and to find out if it would be a good solution for you.
Click here to enroll in Health Access Solutions.