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Saving for the Unexpected

M’s comment about failing health on yesterday’s post has left me thinking more and more about unexpected illnesses and how best to prepare for them. When you are young you never think about becoming ill or being injured, at least I know I never did, but having lived through a medical crisis I now know there is a lot you can do to prepare.

Fortunately, I had unknowingly made a number of extremely important decisions long before I became ill. First, although a number of people, told me to save money by signing up with an HMO, I ultimately chose a PPO. At the time of open enrollment I had no signs of illness, but even then I knew that I wanted access to the best medical care my dollar could buy.

When you are sick your only desire is to be well. In your absolute worst state of mind, when fear has taken hold of you, you will find yourself being ignored by receptionists, not receiving call backs by technicians, and fighting with insurance companies to find the proper diagnosis code required for urgent tests. The last thing you want to contend with is the need for a primary doctor’s referral. In order to receive the referral you have to schedule an appointment with your primary doctor, wait to be seen, and then take the little piece of paper to the specialist who won’t be able to see you for at least a few weeks.

The PPO enabled me to schedule visits with specialists without a referral. My medical condition was rare, and throughout my medical ordeal I visited many incompetent doctors. I saw specialists, recommended by primary doctors, who didn’t look at my x-rays and test results and couldn’t understand my diagnosis. If I left a doctor’s office unsatisfied by the information I was given, I immediately visited another specialist for a second opinion. When it was finally determined that I would require an unusual surgery, I went straight to the top, and was operated on by the chief surgeon of a renowned hospital.

Your health is your number one asset. If you are not healthy you may not be able to work. Believe me, even if you are not sick, spend the extra money and get the best medical insurance your dollar can buy.

The second most important lesson. If your employer does not offer a long-term disability policy go out and buy one immediately. According to the Health Insurance Association of America, Approximately 30% of all people 35 to 65 will suffer a disability for at least 90 days, and about one in seven can expect to become disabled for five years or more. It is much more probable for individuals under age 55 to become disabled than die. You will hear a lot of new parents talk about purchasing life insurance policies but you rarely hear of individuals purchasing disability insurance. Although, I never required a long-term disability policy, I was back at work after a few months, I would never go without one today.

Also realize that you cannot turn back the hands of time. Once a major health issue occurs you will either be denied by insurance providers or pay quite a lot more than those who are healthy. If you are planning on having children, even if you do not have any now, you may want to think about taking out a life insurance policy. You can always cancel it a few years later if you decide it’s not necessary.

Lastly, definitely consider employee benefits when choosing your employer. My employer saved the day with a short-term disability policy that paid for my recovery after surgery. Thanks to this benefit my husband and I never had to tap our bank accounts to pay for medical bills and associated expenses. If you don’t have a short-term disability policy with your employer definitely build an emergency fund.

One Frugal Girl

Saturday 14th of July 2007

MSMommoney -- I'm sorry to hear of your battle with MS.

I used to include the details of my illness on this blog but removed them because my condition was rare and it would certainly identify me to friends and family. I would be happy to chat with you though, you can email me at onefrugalgirl @ gmail.com for more details.

Actually anyone who is reading this post and in need of a chat can feel free to email me.

MSMommoney

Friday 13th of July 2007

Very good post...I also liked your post about keeping a copy of ALL of your medical records, and a timeline--it can get so confusing. May I ask what your illness was/is?

I was dx with multiple sclerosis when I was 38. I will be 45 next month. Chronic illness can be so overwhelming...and no I don't have disability insurance, and of course now I can't get it.

Take care

One Frugal Girl

Friday 13th of July 2007

I have been amazed at the number of young people with health issues that I have encountered throughout the pf- blogosphere. It's comforting to know that we're not alone, and although our health issues are all different, we have a common goal in finding ways to heal ourselves without having to claim bankruptcy.

M

Thursday 12th of July 2007

Hey Frugal Girl,

I'm glad my comment partly inspried this post b/c it's such an important issue to be prepared for I think, as you said. Your tips are right on but I would point out that the PPO while much better medically in my opinion ends up being the more expensive option when you are sick. You end up paying usually larger copays, coinsurance, etc than with an HMO. Still I got not one medical issue properly tended to when I had an HMO (Kaiser) and I can say that at least with my PPO I have had better results, though it has cost me. Still I think the PPO option is def. worth it.

I totally agree with you about dis. ins. but I feel that many think this will take care of them if they are ill. In reality dis. ins. pays only a portion of your former salary and in many cases does NOT rise with infaltion, which renders it nearly useless for long term disability.

There's only so much one can prepare and I think our healthcare system needs some serious help, but planning ahead, having money saved, learning to live on less before you actually HAVE to, those are all helpful ways to be prepared for the unexpected.

Thanks for talking about this topic. It's close to my heart and really important. I have a post coming up about this issue and the one you discussed in your previous post (luck) soon--I hope you'll consider taking a look at it.

Ms. MiniDucky

Thursday 12th of July 2007

The pf-blogging world seems to be touching on the issue of health more resoundingly lately, and you make some very good points here. I opted for an HMO, even with my chronic problems, due to financial reasons but if I needed more expert care than I'm getting from my specialist it might be more difficult than it's been.

Luckily, my current doctor is quite a good advocate for the care I've required but he's an exception to the rule. In most other cases I would echo your recommendation of the PPO. And having an emergency fund, short-term disability and long-term disability policies are all essential!