Should I Buy Health Insurance?

From a "conversation" I recently had on Facebook:

Anonymous:  I don't get the logic in the entire thing. I'm forced to have car insurance in case I hit someone else. I'm forced to have home owners insurance because the bank owns about 75% of my home. I get those. I'd have the choice to buy life insurance if I had a family, but I don't get why I'm forced to have health insurance (even though I wish I did). Is this in case I fall off a building and damage property and or someone else?

My Response:

I can give you a couple of reasons why you should have health insurance. The first is that it makes sense from a purely financial and risk management standpoint. You brought up a house and the mortgage company requiring insurance. They make this requirement to protect their financial interest in the property against catastrophic loss - e.g. a fire. You should have health insurance for the same reason - to protect your financial interests in the case of a catastrophic illness or injury. You might argue that you have little in the way of assets to protect, but an appendectomy will set you back $37,000 on average (http://archinte.jamanetwork.com/article.aspx?articleid=1151669#Results).

Moving on to the other example you provided, car insurance. We required people to have car insurance so that if they cause an accident, the other party, who is without fault, does not have to pick up the tab. That sounds reasonable and fair, right? For the same reason then, health insurance should be mandated, even for those who are young and healthy, because it is not fair for someone else to pick up the tab if your appendix is about to rupture and you do not have insurance. Should a hospital refuse to treat you? No, as a society we agree that in an emergency we want life-saving treatment afforded to everyone without proof of insurance. The problem is that without requiring everyone to have health insurance, others will have to pick up the tab for your appendectomy. Forcing you to do something that is in your self-interest makes sense in terms of fairness and the interests of others. Those who elect to pay for insurance should not have to bear the cost of paying for those who decide to go without. In effect, your decision to go without insurance imposes a liability on the rest of society.

JAMA Network | Archives of Internal Medicine | Health Care as a “Market Good”? Appendicitis as a Cas

archinte.jamanetwork.com

We examined a total of 19 368 adult patients hospitalized with appendicitis. The median hospital charge among all patients was $33 611, with a lowest observed charge of $1529 and highest of $182 955.