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Health Insurance Alternatives

We get it. Health insurance can be super expensive. Like how-am-I-ever-going-to-pay-for-this expensive. But you know what’s more expensive? Medical bills. That’s why you need some way to help you cover your medical expenses besides your own savings account—or worse, a credit card.

Well, don’t throw in the towel just yet, Rocky! There are some great health insurance alternatives out there. We’ll look at five alternatives so you can make sure you and your family are protected.

Benefits of Health Insurance Alternatives

You need some kind of health insurance. No ifs, ands or buts about it. But maybe you’re unemployed, or you can’t afford traditional health insurance policies. What do you do?

Good news! You’ve got options. Before diving in, let’s take a quick look at the benefits of health insurance alternatives.

  • Saving money: Some health insurance alternatives can be cheaper than your employer’s plan or plans you’ll find on the government’s marketplace.
  • Customizing your plan: Alternatives often allow you to customize your plan for your specific needs.
  • Picking your doctor: Some alternatives give you more flexibility in picking your doctor. And who doesn’t want that?

Now, let’s dig in to the first option.

1. Primary Care Memberships

Primary care memberships (sometimes called a concierge medical service or retainer medicine) are like joining a gym but for medical care. You pay a monthly fee to an independent primary care physician or a medical practice and they agree to take care of some of your medical needs.

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Primary care memberships can be good if you just need basic medical services. Since you’re already paying a monthly fee, there’s no co-pay. You’ll also be able to pick your primary physician and get pretty much unlimited visits.

Here’s a summary of standard services that are covered:

  • Pediatric care
  • Nearly unlimited visits to the doctor
  • Blood tests and lab work
  • Savings on prescriptions

The downsides? Primary care memberships won’t help if you need surgery, hospitalization or a specialist. This is why some people combine primary care memberships with a high-deductible, low-premium health plan. They’re also not considered insurance, so they’re not regulated like traditional policies are. That means what’s covered under one membership may not be covered under another. So just do your research before going down this trail.

2. Discount Cards

We’re going to be honest. Discount cards can be a little sketchy (like fake Rolex sketchy). But some are the real deal. Either way, they should never be used as your only form of healthcare coverage.

Here’s how they work. Discount cards give you big discounts (sometimes up to 80%) on things like prescriptions, dentistry or chiropractic care. But they won’t help with primary care services like doctor visits.

Like we said, not all discount card programs are as good as they might seem (kind of like that get-rich-quick scheme your uncle told you about). In fact, the U.S. Federal Trade Commission warns that some of them are outright scams.1

Check out legitimate discount card services (like GoodRx, ScriptSave WellRx or AARP’s partnership with OptumRx) if . . .

  • You already have some kind of basic health insurance coverage.
  • Your plan won’t cover your prescriptions until you’ve hit your deductible.

And if you’re looking for other ways to save on your health insurance costs, also check out the benefits of a Health Savings Account (HSA).

3. Indemnity Insurance

Another alternative to health insurance is called indemnity insurance. Indemnity basically helps offset some costs of medical care. For instance, if you go to the doctor four times a year, indemnity insurance will give you $50 for each visit. You’ll still have to pay out-of-pocket for your care, but at least you’ll get some help with the bills.

Like discount cards, indemnity insurance shouldn’t be your only health insurance coverage. It’s just supposed to be an extra layer of protection on top of a different policy.

4. Self-Insurance

If you have a high net worth and are in good health, you might be able to pay your medical expenses yourself, essentially making you self-insured. But that’s a bad idea. One big medical event, like a bad car wreck or heart attack could easily crack and scramble that nest egg.

Just go ahead and get health insurance (even if it’s just a catastrophic plan) and protect the wealth you worked so hard to build. Paying for healthcare totally out-of-pocket is way too risky, no matter how much money you have in the bank.

5. Cost-Sharing Programs

We’re saving the best for last with cost-sharing programs!

Like primary care memberships, medical cost-sharing programs are not technically insurance. They’re considered nonprofits. But they’re still one of the best alternatives to traditional health insurance to help you cover medical bills.

Essentially, people in cost-sharing programs pool their money and divvy it out to those in need (they’re sharing the costs).

You pay a monthly premium, which covers the medical bills of other members in the program. So let’s say a family in the program needs an expensive surgery. The members’ premiums are pooled together and used to cover the surgery. Then if you need care. . . 

  • You submit a claim, explaining your situation
  • Pay an “incident fee” (like a copay)
  • If approved, the program sends money your way

Cost-sharing programs don’t work directly with doctors or hospitals. Instead, the program sends you the money and you pay your own bills. 

This has a couple benefits:

  1. It keeps your premium low by decreasing the costs to manage the program.
  2. It means you’ll pay cash up front (which often comes with discounts) while you wait for reimbursement from the program. That can mean big savings!

If you’re looking into a cost-sharing program, just make sure it covers your family’s unique medical needs. Not all services are always covered. And some cost-sharing programs are not required to put a ceiling on out-of-pocket costs or cover preexisting conditions.

One of the Best Alternatives

The best health insurance alternative for you will depend on your specific situation.

But if you’re in the market for something other than traditional health insurance, check out our trusted partner, Christian Healthcare Ministries (CHM). They can help you figure out a plan that works for your family and your budget.

Thousands of people in all 50 states have used CHM to cover their healthcare needs. Plus, they’re RamseyTrusted, so you know they’ll cover the medical bills they’re supposed to and honor your coverage.

With Christian Healthcare Ministries, you’ll get great healthcare coverage and the opportunity to help others.

Connect with CHM today!

Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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