If you’ve been suffering for years with hip pain and have run out of treatment options, your doctor may suggest hip replacement surgery. During the procedure, the hip joint is removed and replaced with an artificial joint made from plastic and metal components. Hip replacement surgery is invasive and requires four days in the hospital, physical therapy, and 6-12 months of recovery time.
Needless to say, getting the surgery is a major decision. On top of the physical aspect, paying for the procedure and the follow-up care can also cause a lot of concerns to patients. Here is a breakdown of hip replacement surgery costs and ways you can finance it.
Hip Replacement Surgery Cost
Hip replacement cost varies by location, but the average cost is around $31,000. Medicare reportedly paid for 400,000 hip replacement surgeries in 2014 that totaled around $7 billion. Their costs ranged by location from $16,500 to $33,000.
Keep in mind that cost can vary much more considerably, adding uncertainty. Blue Cross Blue Shield issued a report on the total cost and cost variation for hip and knee replacement surgeries which showed even greater variations than Medicare. Those figures, however, are just for the hip replacement surgery itself. Follow-up visits and months of physical therapy are not included in those figures and can add tens of thousands of dollars to the total cost.
Just as hip replacement cost can vary, so can the insurance coverage. According to Healthcare.gov, the average insurance policy has an annual deductible of between $1,000 and $2,000, and co-insurance of 20%. The maximum out-of-pocket expense for an insurance policy in the Healthcare marketplace is $7,150. Depending on their insurance coverage, some patients are left trying to figure out how to cover the cost of the hip replacement surgery.
There are a few viable options for patients looking to finance their share of the hip replacement surgery.
Those who own a home might look at taking out a home equity loan to pay for the surgery. Home equity loans come with both disadvantages and advantages. The interest rates are low, but it could be a risky plan for those looking to sell their home in the next year or two. Additionally, this option is only available to homeowners in the position to dip into their home equity
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- Finance all medical expenses at a low interest rate
- No collateral, no fees, no home equity requirements
Those who have high enough limits on credit cards may consider using them to pay for the surgery. Interest rates on credit cards, however, are extremely high. Failing to pay down the balance can lead to high interest charges which would increase the cost of hip replacement significantly. Furthermore, it’s not a guarantee that a credit limit is high enough to cover the medical expenses.
Personal loans are another option for financing hip replacement surgery. Many financial institutions offer personal loans specifically for financing medical expenses. Since a personal loan is a form of unsecured debt, there is no underlying collateral requirement. However, this also means low credit borrowers could get stuck with high-interest debt.
All of these options are viable, but they all have their drawbacks.
Interest rates have a big impact on the final cost of financing surgery. Personal loan rates can vary depending upon credit score and loan amount, so there is a chance to get a great deal (but also a chance for a high interest). Credit cards might be the most convenient option, but they generally come with high interest which would virtually guarantee higher costs. Home equity loans come with the lowest interest rates, but they also require the borrower to dip into their equity, another risk.
Author: Jeff Gitlen
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