I thought the same, until a my CPA (bit of a unconventional guy-doesn't believe in ANY insurance, as its a form of gambling) told me that you can walk into the hospital finance office and ask to pay "the cash rate" and that's about 20% of the bill. The same way the insurance companies themselves don't pay the billed amount..
Please don't get me started on CPAs (no offense to those around here).
I will currently limit my comments to saying that a vast majority of CPAs (the type that do your tax return) might understand numbers very well, but don't understand economics. Try a discussion with your CPA about behavioral economics.
But without getting into that, ask your CPA how many times did he ACTUALLY "walk into the hospital finance office and ask to pay "the cash rate" and that's about 20% of the bill"?
Many times you won't even get past admission without insurance.
Are you going to read through everything you are given to sign and start trying to haggle about the legal documents you are handed with a low level employee handing them to you, who can't even read them?
Insurance is a FINANCIAL TOOL of risk pooling.
To quote Ben Feldman (not verbatim): there are two kinds of problems, the small ones you can swallow, the big ones will swallow you!
Your CPA
might be excellent at what he does (though I've seen plenty of "excellent" CPAs that are clueless about certain items that go on a 1040!), but doesn't seem to be very competent when it comes finance and economics.
In an ideal world, a high deductible plan would be the right form of insurance for everyone (and possibly the only permissible form). What is currently mostly sold as health insurance is a combination of insurance, buying club, and prepaid medical.
If you are an expert at game theory, maybe "walk[ing] into the hospital finance office and ask to pay "the cash rate" and that's about 20% of the bill" might work (as long as you are poor or have proper asset protection), but for most people the huge insurance companies do a better job at negotiating fees*. But when faced with a major (or even not so major) medical issue, are you going to wait and put your haggling ability to the test?
__________________
* Interestingly, I have what is considered an excellent HDHP that gives me in and out of network access. However, probably because it's "excellent" in the access, it has higher negotiated rates. Which is why when I go (rarely) to my PCP for anything but a well visit, I tell them I no longer have insurance and negotiate a cash rate. I am also fed up with the way they treat my time, and tell them that if I have to be in the waiting room (as opposed to an exam room) for more than 5 minutes, I will reduce the amount I pay them. Hasn't been put to real test yet, because since I started with that approach I never had to be in the waiting room for even 5 minutes (except with my kids, that have different insurance).