Catastrophic Health Insurance?

My health coverage is going up 5% again. That means I will pay $12,750.00 starting Jan 1st for my family plan before insurance will start paying 80% of a medical bill. What other alternatives are out there? I could put all that money into my own medical rainy day fund or maybe there is a catastrophic insurance option that would cover hospital bills above a certain amount and leave doctors’ offices up to me? Any ideas?

Is your current health insurance from the Government Health Insurance Marketplace (Affordable Care Act insurance)? Is the $12,750 just the premiums? Is it a high-deductible plan?

You certainly don’t want to go without any coverage as a major issue could be hundreds of thousands of dollars out of pocket and make the $12,750 look like peanuts.

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$3,600 deductible, $765 in premiums/month. It’s a plan available through my company. The other plan does not quality for an HSA but costs about the same. They take the deductable down but add the exact same amount to the monthly premiums.

“You certainly don’t want to go without any coverage as a major issue could be hundreds of thousands of dollars out of pocket and make the $12,750 look like peanuts.”

Yeah, I get that. Hence my original question. Is there anything out there that works like homeowners insurance that covers you for catastrophic things, but allows you to pay for your own epairs as they pop up but are there for catastrophic problems? Health coverage seems to be my only option, but I want an actual Insurance plan, not Full Coverage.

There are catastrophic plans available through the Government Exchange (I just Googled it), but they won’t necessarily be available in your state. I just looked up what I could get on the exchange in Washington State and I don’t see any catastrophic-only plans here. So, if I wanted a catastrophic only plan, it doesn’t look like I can get one. So, it seems my only two options for any health insurance is through my employer or through the exchange, which is more expensive.

I would poke around for Affordable Care Act plans in your state. Beyond that, your only option may be to get the highest deductible plan through your employer. Or maybe find a health insurance broker in your area to see what options are available. I’m not an expert, only to the extent that I have to pick a plan every year like most other people and have poked around on the exchange to see what options I have if I retire before Medicare kicks in. Good luck.

Remember “If you like your plan, you can keep your plan?” Yeah, that was always a lie, and what you want is basically illegal. I’m sorry your government sold you out to the highest bidder.


Like most govt programs, there’s just a new set of winners and losers. In order to satisfy the small set of losers previously, they made the majority of us losers.


They used to be available, but haven’t been for years. It ought to be an option…no coverage until some large out of pocket is met, then a large % covered.

What would make that different than a high deductible plan?

Basically a super high deductible with, hopefully, lower premiums.

But I suspect the OP will be out of luck.

I dont recall the specifics, but it did not cover any expenses that were less than a very high dollar amount, which would be things like being hospitalized, having surgery, etc. But the out of pocket for those were similar to what they’d be on a normal policy.

What about umbrella insurance? It’s mostly used by businesses to cover for catastrophic expenses. But, I believe it can also be used by individuals.

Best wishes

As a self-employeed individual, I have a ACA (Affordable Care Act) plan which costs over $400/month for single coverage with a high deductible. I looked at private plans through Blue Cross, which are less expensive, however, there are protections built into the ACA plans that aren’t offered by the private plans through Blue Cross. I don’t trust insurance companies, thus don’t trust private plans. You can see the private plans at the Blue Cross website.

My quick history: I retired early in 2016 at 57 without insurance. I got a heath care sharing plan (Google it) for $300 a month for my wife & I. It was okay but I never fully trusted it to pay if we had a serious medical condition. ACA bronze plan premiums were too high (>$1000/mo) at the time because our income was over $62k. When the Biden & the Dems got in they passed a new covid spending bill that raised the ACA income levels and we now have a high deductible ($14k) plan which is basically a catastrophic plan for about $60/mo. I would suggest you apply for an ACA high deductible plan and see what kind of premium you can get.


Quick update: I couldn’t find anything that would work with our situation, so I decided to drop coverage for my family. I am covered for “free” at work, but my wife and kids are on their own. I am now taking the money that would be going to a health coverage plan and putting it in a separate bank account to use solely on medical expenses. I am also maxing out my HSA. I can cover a lot of doctor visits for $16K+/year. if I spend less than that a year, I will add it to next year’s $16K+. I know people will think this is incredibly stupid, but honestly, even if there is a catastrophic event in our family, a hospital will not demand $1B immediately. Instead, they will work out a payment plan. One hiccup so far: my wife was diagnosed with arthritis. Our family doctor tried to refer her to a specialist, but there wasn’t one in our area who would take self-pay patients. I guess that means more money in our pockets. :wink: (We will keep looking.) I was surprised to hear that doctors prefer to battle it out with an insurance company rather than collect payment before exiting the clinic. Once we get older, I can always put my family back on my employer’s plan during open enrollment, but for now, I will keep rolling the dice.

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My wife had like $1,500,000 in cancer bills in 2022. $600,00 in 2023. No amount of self insuring and saving could have prepared us for that. She was healthy and active until she wasn’t. A catastrophic automobile crash can do the same.

My martial arts teacher’s wife passed in her 40s from pancreatic cancer. Left five small kids. No warnings. Sick, struggled for a year, dead. But she was supposed to be dead in 90 days. At least she had time to say goodbye.

Going without insurance is a terrible idea.


I definitely get it. Our first child birth cost over $50K for a normal, healthy, vaginal birth with no epidural (hospitals make up fake numbers on bills that they don’t expect any insurance company or person to ever pay. It cost $8K when all was said and done.) If something catastrophic happens we will just figure out how to deal with it. Like I said, we can negotiate a deal with the hospitals if it comes to that.

Would either of those people have gone without treatment if they didn’t have insurance? I’d probably do what sbro is doing if my company wasn’t paying 80% of the premiums. I could pay $50k in expenses if I really had to, especially if I’m saving $15k-$20k/year on premiums. The $2 million would bankrupt me if I had to pay full price for that. But $2 million is the made-up number they put on the bill. I’ll bet your insurance company paid less than half that amount. I suspect providers would discount their services for me it if came to that.

Insurance is just for moving money around. Once people start throwing in sob stories, it’s easier for insurance companies to justify higher prices.

“I’ll bet your insurance company paid less than half that amount.”

Most likely they pay much less than half. I went to the heart clinic last year. They took an EKG and charged me a little over $1000. Insurance slashed it to $74.00, which is the amount I paid and the amount the clinic accepted as payment in full. Insurance didn’t pay a dime, they just took the clinic’s procedural codes and the applied their negotiated rate for each code. (My insurance company is even known as a generous insurance company that every doctor in my area happily takes.) I figured I could look up the reasonable cost for the codes in my area and negotiate the bill down that way.

The main value I get out my health insurance is that they keep medical providers from ripping me off. Of course, they charge dearly for this service.