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These days, few topics are as politically charged as healthcare. On October 1st, The Patient Protection and Affordable Care Act moved to the next stage of implementation with the rollout of the state insurance exchanges, and we’re all waiting to see what impact the Act will have on our personal finances and government spending in the future.

Last week I attended a conference in Philadelphia for financial advisors, where the impact of healthcare costs was covered by Dr. Sanford Barth, a professor at Thomas Jefferson University who specializes in health care policy.

Based on research conducted by Dr. Barth and others, he believes health care cost inflation in the US has been driven by three factors: our focus on acute care vs. preventative care, insufficient medical outcomes data that can be shared by practitioners, and the large variance in medical practices and standards. General practitioners are not as well paid as surgeons, but their ability to diagnose and treat an illness in the early stages can prevent hospitalization; lowering costs and reducing patient trauma. The current drive to put more medical information on-line is helping doctors do a better job of comparing the success rate of various treatments before making a recommendation. Patients are already using the internet to conduct their own research and have better discussions with their doctors about treatment choices.

I recently had my own healthcare experience that allowed me to see these forces at work. A painful trip to the emergency room and a follow-up visit to my doctor confirmed I had a hernia. I was told surgery was necessary and I should expect a two night stay in the hospital. So I started doing research.

I learned the various ways hernias are repaired, the complications caused by where they’re located, and estimated recovery times. Using my insurance company’s website I was able to research cost and providers, and was shocked to learn the total cost could range from $2,600 at an ambulatory surgery center to $36,000 at a local hospital for the very same procedure. If I had the surgery in one location it would cost nearly 14 times the cost of another – but my out-of-pocket cost would not change. How many times do we know what our cost of medical treatment will be, or understand what causes the price differences? If I had no savings and no health insurance coverage, I had the potential to put myself into $36,000 of debt.

As we plan for our own health care costs, one of the biggest things we can do is stay as healthy as we can for as long as possible. It sounds incredibly obvious, but personal choices such as not smoking, exercising and controlling our diet so we don’t develop Type 2 diabetes are so impactful to our health. Before surgery, I was repeatedly asked whether I smoked or had diabetes as they filled out the necessary medical forms, and the physician anesthetist who handled my surgery said a non-diabetic, nonsmoking patient had a success rate over 10x that of less healthy patients.

Dr. Barth’s research indicates the average 65 year old couple in retirement should expect to pay $250,000 in out-of-pocket expenses for health care, and adjust upward if they have a poor health history. Health care costs should be separated out from your general living expenses, and inflated at a rate higher than the overall rate of inflation. Dr. Barth recommended 3 times the normal rate.

My surgery was October 2nd, and I was told I might not be cleared to attend the conference on the 8th, but I awoke from surgery to learn that everything had gone so well I didn’t even have to stay overnight. Based on this positive reinforcement, I am going to continue to do everything I can to stay as healthy as possible, so any future medical surprises remain as stress free and low cost as possible. That’s my health care plan.