I don’t think anyone can answer that question with complete certainty. It's especially complicated if you have an expensive disease like cancer, in relation to a moving treatment timeline and cost barometer. Consequently, the challenge of defining those costs becomes even harder.
The Lifetime of Healthcare Costs study has found that most people underestimate the cost of healthcare and that four out of five respondents do not have savings to cover medical emergencies. Because the majority of bankruptcies are the result of medical debt, I think it is time people dig in and consider the implications of not being able to pay for care when it's needed. According to the study, the ability to pay a medical debt by age group is even more striking. In fact, the same study also found that only 19% of baby boomers have medical debt that they can’t pay off, probably because more than half of them now qualify for Medicare. That compares to 34% of GenX and Millennials and 23% of Gen2’s.
Just a little over ten years ago, the estimated insured American with employer-sponsored health insurance could expect to spend more than $240,000 on health care over his/her lifetime. Imagine that cost for a couple! Fast forward ten years, and that cost is now at $320,000. The study estimates annual costs breakdown this way: $1,321 out-of-pocket expenses, $776 in co-insurance, and $3,180 in insurance premiums, then multiply that by 61 years.
For those of you who are laughing and can hardly pick yourselves off the floor, these estimates are not considering you, those with long-term chronic and costly diseases. Now consider for a moment what you spend annually on your healthcare. Cancer is expensive. And if you purchase your insurance, your healthcare cost is nearly double to $700,000 (those without employer-sponsored plans or government subsidies).
So, what are people doing if they cannot afford the cost of their health care? In a nutshell, they are gambling with their lives. Many are foregoing or delaying recommended tests or medical care and not taking medications as prescribed, forcing them to choose between financial health and physical/mental health. Unfortunately, these tactics can lead to further deterioration of health and more costly care in the future.
One of the best defenses to stay ahead of the game is to get annual screenings. Early detection is critical and can offer earlier and less expensive treatment. Adopting a healthier lifestyle with diet and exercise can also make a difference. Another option is securing alternative patient assistance to help cover treatment costs through private, non-profit organizations and Pharmaceutical companies’ Patient Assistance Programs.
Another way to help avoid unexpected medical expenses is to make sure you have chosen the right insurance for your needs. Don’t just consider the cost of premiums. Review your total out-of-pocket costs and your health insurance plan yearly. If you’re currently in treatment for an illness and anticipate it will continue or change, review your insurance plan with your employer. Make changes during open enrollment if you find a better plan to cover your expenses.
Keep up with Medicare Plan options. Don’t just sign-up for a Medicare plan and stay with it unless it is the best plan for you at that time. Review your Medicare Part D plan, as drugs often change in the tiers. Make sure your doctors are still in-network. If they aren’t, you may pay more for your care. And if you need emergency services, remember most ER doctors are not necessarily employees of the hospital where they work, so their fees may be significantly higher for care. Ambulatory transportation is not in the network and can also have higher fees.
Create a household budget. Take a month or so to record all the dollars coming in and all the dollars going out. This will help you better understand how you’re managing your money. Be aware of discretionary spending such as eating out or entertainment. You’ll see how these dollars add up when you do a budget. Not surprisingly, these areas can easily disrupt a budget. Redirecting those dollars toward an emergency fund for out-of-pocket medical expenses can allow you some financial breathing room.
Having an emergency account available to take care of unexpected expenses is your first line of defense in mitigating financial toxicity. Many people tend to reach for credit cards, but that increases their debt. And if you can’t afford to pay more than the minimum monthly payments, then the high-interest rates will quickly catch up to you.
You’ve probably all heard the phrase. ”If you fail to plan, then you plan to fail.” This is more true now than ever before. I implore you to ask questions of your healthcare team, really get to know your insurance coverage and your options, and keep up with your medical bills and your spending. The work and planning you put in now will save you so much time, money, and stress later.
HealthTree offers free help to patients and caregivers who have questions about financial help in paying for care, employer benefits, and work-related financial issues. Our Financial Coaches can help guide you to resources that may benefit you. We are always willing to help you navigate the financial challenges of a cancer diagnosis. Our Coaches are either patients themselves or caregivers with a lot of relevant experience and education that can benefit you.
Find or become a Healthtree coach
about the author
Diahanna is the Financial Program Manager for the HealthTree Foundation, specializing in financial help for multiple myeloma and AML patients. As a professional financial consultant and former caregiver of her husband who was diagnosed with multiple myeloma, Diahanna perfectly understands the financial issues facing myeloma patients.