Can You Really Save Money by Avoiding Insurance?

For this month’s blog, I wanted to focus on why visiting a direct-pay medical practice like VibrantSkin Dermatology and Laser makes sense for a lot of you and how it can save you money—whether you’re insured or not. I decided to write this as we get MANY calls from prospective patients wanting to schedule and often the first thing they ask is, “Do you take XYZ insurance?” When we explain how things work at our office (pricing model explained) some understand, but others assume this will be a costly option and elect to wait months to get in to see a dermatologist or a non-physician dermatology provider elsewhere who is on their plan. There is nothing wrong with either option, but I want to show you why the wait may not be necessary even if on a tight budget. Below are a few hypothetical but realistic scenarios to demonstrate. Charges listed for VibrantSkin are the current actual cash prices. Under insurance, the actual charges to you and the plan may be higher or lower than those in the scenarios depending on the contracted rate between your insurance and your physician/lab as well as your plan details including co-insurance and deductible.

Examples of Saving for Direct Pay Dermatology

Scenario 1: Joe Smith

Joe has a high deductible insurance plan. He pays $600 per month for his premium and has a $6000 personal deductible. He is 50 years old and has never met his deductible so he does not anticipate meeting it this year either. He has a health savings account into which he deposits funds to use towards his health expenses. Joe is seen for a full-body skin exam and has a biopsy of a suspicious lesion. He also has five benign (non-cancerous) growths that are only cosmetically bothersome so the dermatologist freezes them off with liquid nitrogen at his request. The dermatologist discusses skin cancer risks and lifestyle modifications Joe can make to minimize his risk of skin cancer.

Option A: Joe sees Dr. Buster at VibrantSkin. Treating the few cosmetically bothersome growths is included in the cost of the visit plus a $20 charge for the liquid nitrogen supply. He pays out of pocket or uses his HSA card. His charges for this visit are:

25-minute office visit: $160
liquid nitrogen: $20
(biopsy is included as the visit was already more than the 15 minute minimum for a biopsy)
Typical cash rate from the pathology lab for one biopsy is $75 (*This is billed to the patient directly from the pathology lab and is not paid by the patient to VibrantSkin)

Total paid at appointment at VibrantSkin: $180

Grand Total (including charges from VibrantSkin AND the pathology lab): $255

Option B: Joe is seen by an in-network dermatologist. He has NOT met his deductible. He is (appropriately) told that treatment of the cosmetically bothersome growths cannot be billed to his insurance as cosmetic treatments are not a covered benefit for any insurance. He is given the option of having them treated and paying out of pocket for this and elects to do so. This dermatology office confirmed with his insurance prior to his visit that he had not met his deductible and instructs patients that payment is due at time of service.

New patient office visit: $120
Cash rate for the cosmetic treatment of the benign growths: $120
Biopsy: $115
Contracted rate (between your insurance and the lab) for pathology lab to read biopsy: $90

Total paid at appointment at in network dermatology office: $355

Grand Total (including pathology portion billed by lab): $445

Above paid charges will go towards Joe’s $6000 deductible.

Option C: Joe is seen by an in-network dermatologist. He HAS met his deductible on his 80/20 plan.

Office visit charges for which the patient is responsible (20%): $24
Cash rate for the cosmetic treatment of the benign growths: $120
Biopsy: $23
Patient portion of the contracted rate for pathology lab to read biopsy: $18

Total paid at appointment at in-network dermatology office: $167

Grand Total (including pathology portion billed by lab): $185

Scenario 2: Annie Brown

Annie Brown has insurance through her employer. She pays $150 per month for her premium and has a $75 co-pay for visits to specialists (like dermatologists). She is 36 years old. Annie is following up for acne and is on an oral as well as several topical medications. She has improved nicely on the regimen and mainly needs refills, small adjustments in her topical regimen, and recheck of her blood work.

Option A: Annie sees Dr. Buster at VibrantSkin. She pays out of pocket or uses her HSA card. Her charges for this visit are:

15 minute office visit: $100
Prescriptions purchased from our office: $12 (1 month supply of pills), $75 (51 gram container of cream)
Blood work done in our office including lab draw fee: $14

Total paid at VibrantSkin for visit, labs, and prescriptions dispensed in office: $201

Option B: Annie uses her insurance at the office of an in-network dermatologist.

Return office visit co-pay: $75
Prescription at current approximate retail pharmacy price*: $43.29 (1 month supply of pills), 208.99 (45-gram tube of cream)
Blood work at standard lab pricing done in office including lab draw fee: $42

Total paid for in-network dermatology visit, labs, and prescriptions: $369.28

*Prices obtained from Epocrates/GoodRx.com. The actual rate for prescriptions with use of insurance could be higher or lower than this amount.

Of course, the above scenarios do not cover all of the potential circumstances. For those with excellent coverage that was common in years past, seeking care at an in-network facility can sometimes save a lot of money. Also, prescription coverage varies widely. When I needed to pick up a prescription medication a couple of years ago, I had the pharmacy run it with my insurance. It was just over $80. I asked the pharmacy to run it with a GoodRx coupon (always a good idea, in my opinion) and it was about $34. So instead of using my insurance, I used the GoodRx coupon.

So who is saving the most money from this?

Some who could highly benefit from seeking out cash practices like VibrantSkin Dermatology and Laser include:

People utilizing health sharing ministries (more on this next month)
Those without health insurance
Individuals/families who do not anticipate meeting their high deductible
Patients wishing to avoid their medical insurance obtaining information about their medical care (see link here)
Those who wish to pick their physicians rather than be limited to a list provided by a plan

What about Medicare? Medicare is federal medical insurance for people 65 and older, some disabled persons, and those with end-stage kidney disease. Premiums for Medicare are dependent on income and currently range from $135.50 to $460.50 per month. (1) Deductible is $185 and coinsurance (the percentage of covered health care costs that you pay once deductible met) is 20%. A patient on Medicare can see physicians who have opted out of the program provided that s/he (the patient) signs a private contract with the opted-out physician(s) and pays the opted-out physician directly. Medicare cannot be billed for any services provided by an opted-out physician (except in the case of an emergency). Medicare is a lifesaver for many patients, but it does not cover everything. For example, Medicare does not cover removal or destruction of a painful callus. (2) Of course, treatment of benign growths that are only cosmetically bothersome and not inflamed is also not covered by Medicare (or any insurance for that matter). So even though the majority of patients on Medicare seek a physician enrolled in it for their medical needs, there may be times that an opted-out physician is a good option.

TAKE HOME POINTS:

Whether you have insurance or not, you may be able to save a lot of $ and still get excellent care by seeking out a direct pay/cash medical practice like VibrantSkin Dermatology and Laser. With pricing available online for all medical and surgical treatments, you can get a ballpark idea of your costs ahead of time. Our staff can help by giving estimated visit times and charges so you can plan accordingly.

If you have insurance, don’t assume that getting care at an in-network office is the lowest priced or best option. Know your plan and what it covers to get the most out of it. Be sure to weigh the benefits of using insurance against the costs. You may find that you’ll come out on top by paying out of pocket.

Warmly,