Enhance Health

Choosing To Self-Pay When You Have Health Insurance

Have you ever faced a medical crisis and been unable to afford the treatment? That’s why health insurance exists. Health insurance can quite literally be a lifesaver on those occasions when you need lengthy, complex, or expensive medical procedures.

But are there any situations that justify choosing to self-pay when you have health insurance, and if so, what are they? We delve into the issue of self-payment vs. claiming from insurance to better understand why this is sometimes a reasonable option.

Is It Legal To Self-Pay When You Have Health Insurance?

First, let’s deal with the legalities. Is it legal to self-pay, even though you have insurance? Yes, it is legal to do so. No law states that just because you have insurance, you can’t self-pay your medical bills. There are a few types of situations where it makes sense to do so.

We’ll get to those in a moment. But first, let’s look at the benefits of the health insurance coverage that you’re enjoying. You can access primary health care, emergency services, surgical procedures, and even prescription medicine when needed. 

Medical emergencies rarely happen when it’s financially convenient. So having health insurance coverage that you can rely on is crucial. Sure, there may be times when paying out-of-pocket seems feasible. But that doesn’t negate the benefits of having insurance.

Understanding Health Insurance Requirements

To better understand health insurance requirements, we must examine how the introduction of the Affordable Care Act (ACA) changed things. 

In 2010, a law was passed called the Affordable Care Act. Signed into law by President Obama, it became known as Obamacare. The ACA brought with it many changes to the field of health insurance. 

For one, it made it easier for people to obtain affordable health insurance. Another major development was that insurers could no longer deny coverage to people with pre-existing conditions. 

Health Insurance Coverage

Health insurance coverage is always a good idea. Even if you think that you don’t need it, the time may come when you do. If you choose to go without it, out-of-pocket expenses for unexpected medical bills can leave you in dire financial straits. 

The most significant feature of the ACA was that it made health insurance coverage mandatory. All US citizens had to have health insurance once the ACA was passed. The aim was not to make life harder for Americans but to improve everyone’s access to good medical care.

There was a federal mandate to have insurance coverage. The reason behind it was to ensure people signed up for health insurance, thereby increasing the population of insured citizens. 

Unfortunately, this was not always successful, thanks to initial resistance to Obamacare. In time, more and more people got on board with applying for health plans on the ACA marketplace. But the main issue was that of the penalties.

Health Insurance Penalties  

Failure to comply with the mandate made one liable for penalties. These health insurance penalties were fines, usually in the form of tax penalties. The federal mandate was repealed in 2019, and people who did not obtain health coverage were no longer subject to penalties. At least not at the federal level.

Individual Mandates & Penalties

The states of California, Massachusetts, New Jersey, Rhode Island, and the District of Columbia have retained individual mandates. If you live in these states, you’ll still need health insurance coverage or face a tax penalty. 

Vermont also has a health insurance mandate but does not enforce it without penalty for non-compliance. A few other states are also considering individual mandates for their residents. That’s just one more reason why having health insurance is a good idea!

Health Insurance Exemptions

Even while the federal health insurance mandate was in force, there were exemptions. People who earned too little (or nothing at all) and could not afford health insurance, or who earned too little to file taxes, were generally exempt. 

Exemptions were also made for low-income people who didn’t qualify for Medicare and lived in states that had not expanded Medicaid. They could be exempt from getting health insurance coverage because they had no affordable alternatives. 

This was no longer an issue when the federal mandate for health insurance was scrapped. However, in states with an individual mandate and a penalty for non-compliance, it remains an issue. You might face penalties if you don’t apply to the state for an exemption.

When Does It Make Sense To Self-Pay?

Now that you understand the history of the Affordable Care Act and how it affected health insurance, you’re probably grateful that it’s no longer mandatory in most states. But without insurance, most people just can’t cope with medical bills. That said, you can choose to self-pay for health care if you want to. It may make sense in certain situations including: 

Cheaper Medication/ Or Alternative Drugs 

All ACA-compliant health insurance plans include prescription drug coverage. But your plan may not cover the medication you’re on or the alternatives you’d like to try. 

You may also find your prescription medicine cheaper when buying it for cash through pharmacies outside of the plan’s network of health providers.

Off-Network Medical Services Provider

Every insurance policy covers a specific list of conditions and medications and includes a network of preferred medical caregivers. 

As with the medications, you may also prefer to go to a doctor or clinic that is not a part of the network of medical providers on your specific health insurance plan. In such a case, you could self-pay, as your insurance coverage won’t apply, anyway.

You’re Far From Reaching The Deductible

If you’re far from reaching your health insurance deductible, you’ll be paying for yourself, anyway. 

Your deductible is the amount you must pay out-of-pocket before your insurance coverage takes over the payments. If you are in good health and don’t often go to the doctor or have a plan with a high deductible, you may still have a long way to go to reach it before the year’s end.

How Does The Self-Pay Process Work?

Wondering what happens if you self-pay, despite having insurance? Don’t decide to self-pay without understanding the circumstances first. There are some important considerations that you need to be aware of. 

This is how it works when you self-pay rather than use your health insurance:

  • You may choose to self-pay rather than process a claim from your insurance provider. Perhaps they don’t cover what you need, or you’d be paying out-of-pocket anyway (as in the deductible scenario above). Whatever the case, inquire if you can receive preferential rates if you pay in cash.
  • Unless you make other arrangements in advance and have this in writing, you’ll probably have to pay the same day you receive the service or treatment. You alone are responsible for these payments, so shop around for a better deal, if possible. For larger amounts, ask if you can pay the sum off over a set period of time. 
  • Remember that some cash payments will not count toward your insurance deductible. If you’re paying for medications not covered by your plan or at an out-of-network provider, you won’t be able to ask for reimbursement.
  • If you require medical treatment or medication that your insurance provider refuses to cover, but you believe it should be covered, it’s important to keep the documentation. However, challenging a denied claim doesn’t always result in success. Still, keeping the receipts is crucial if you plan to pursue the matter further.

Exploring Health Insurance Plans 

It’s not illegal to self-pay your medical bills, even if you have insurance, and sometimes it makes sense to do it. But if your insurance often doesn’t cover what you need, or you never reach the deductible amount, it may be time to make a switch.

At Enhance Health, our specialty is helping you find a health insurance plan that meets your particular needs. We have helped Americans like you from all across the country explore the best health plans on the market and choose the best one for their unique situation.

With the right health insurance, you’ll escape the pitfalls of unexpected medical expenses. The kind that leads to crippling debt. So don’t be tempted to forego health insurance. Rather, explore the available insurance plans on the market and find one that better suits your needs.


Unforeseen medical emergencies and their treatments can significantly dent your finances. That’s why it’s important to get the best health insurance for your needs that you can afford. While there are times when you’ll have to self-pay or choose to self-pay, reliable insurance remains important.

Have you been faced with one too many situations when self-payment seemed to be the best option? Contact us today, and let us help you find the right plan for you. Start enjoying all the benefits that health insurance is meant to provide, and have more of your hard-earned cash left for the fun things in life.

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