Americans spend a lot on health care. In 2016, national health expenditures grew 4.3 percent to $3.3 trillion, which amounts to $10,348 per person.1 It’s interesting that you’ll find few people who say our health care system is fine as is, and medical services, facilities, drugs and equipment are all reasonably priced. However, there is little consensus on ways to fix the system.

Health care is fast becoming one of the most dominant expenses in our lives, right up there with vehicles, a mortgage and college education. Just as we do for other big-ticket expenses, we have to plan and save for health care and even consider a possible contingency plan.

Another common feature of big-ticket expenses is that they often are best covered by insurance. If your family history indicates it, you may want to consider going further than health insurance by purchasing disability or critical illness policies. If you could use some help assessing your needs to determine what type of coverage is appropriate for you, please contact us.


Unfortunately, many patients aren’t in a position to lower health care costs because they aren’t able to control the care they receive. Many situations may offer a variety of treatment options, but patients often rely on their providers to recommend the best course of action. Further, it may be difficult to tell what is necessary and what is discretionary.

In fact, some procedures may be selected by health care professionals in response to internal pressure to increase revenues.2 Others may be concerned that if they don’t order what may be considered “unnecessary” extra tests and procedures, a wrong call could end up in a malpractice lawsuit. All things being even, physicians may err toward the more expensive route.

Worse yet, emergency care expenses may be completely out of our hands. For example, did you know that if you have to be rushed to the hospital by ambulance, you may be charged a fee even if you have insurance to cover the service? That’s because some cities charge a “paramedic response fee” that is not covered by insurance.3

Another challenge is the rising cost of prescription drugs. One reason for this could be the rebates and other discounts that drug companies pay to insurers, pharmacy benefit managers (PBMs) and government programs for selling or administering brand-name drugs. The amount of these rebates increased from $67 billion in 2013 to $106 billion in 2015. Unfortunately, while these middlemen may save money thanks to rebates, they don’t always pass on these savings to consumers.4

The problem of health care expenses is so widespread that it could even influence the way we grow as a society. This is evidenced by the sage advice one mother gave to her children about entering the workforce: “You need to go to a company with good health insurance, even before you look at the salary or whether you’ll be happy there, your first priority is health insurance.”5

Content prepared by Kara Stefan Communications.

1 Centers for Medicare & Medicaid Services. Dec. 6, 2017. “NHE Fact Sheet.” Accessed Jan. 8, 2018.

2 Marshall Allen. NPR. Nov. 28, 2017. “Epidemic of Health Care Waste: From $1,877 Ear Piercing to ICU Overuse.” Accessed Dec. 30, 2017.

3 Anna Gorman. Kaiser Health News. Feb. 3, 2016. “Surprise! Here’s Another Bill for That ‘Paramedic Response’.” Accessed Dec. 30, 2017.

4 NBC News/Kaiser Health News. Dec. 21, 2017. “Arthritis drugs show how U.S. drug prices defy economics.” Accessed Dec. 30, 2017.

5 Ibid.


Disability and critical illness policies are not a replacement for traditional health insurance and are subject to eligibility requirements. Insurance product guarantees rely on the financial strength and claims-paying ability of the issuing insurer.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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