I’ve been watching all the pennies lately, trying to improve my financial well-being. I have reconfigured our budget, consolidated our debt, clipped coupons and overhauled our rewards programs. There are great resources out there to help the financially non-savvy, such as myself, educate themselves about how money works and what steps to take to reach your financial goals, whatever they may be. One of my favorites right now is The Black Belt of Finance blog. Check it out.
For many people, it is open enrollment time. Time to review and update your health insurance benefits, either through work or with the your state’s health insurance marketplace (which you can find via www.healthcare.gov.)
Once I got to the place in my career where health insurance was a given benefit, I naturally assumed the plans my job offered were the best that were available to me. Maybe at one time, that was true. Before the Affordable Care Act, it seemed reasonable to assume that because your employer was paying for a portion of your insurance premium, that you would never be able to find a comparable insurance plan for less money. Really, it wasn’t something that was even on my radar, to shop around for health insurance. If your employer offered it, you took it.
That seems to have changed, and people should sit up and take notice, because they could be saving themselves money!
For my particular situation, it was a few factors, all happening together, that made my insurance shopping a must.
First, my employer decided to so some shopping themselves. They did a review health plans, and decided they would stick with our current provider. That’s fine. However, as part of the review, they took into account changing to high- deductible health plans. They found it would save them money. Emphasis on them. The employees ended up getting a raw deal. The insurance company saved money, and my company saved money, but the employees ended up with big bills, even though my employer still paid 75% of our premium.
Second, the Affordable Care Act provided new ways to get health insurance along with subsidies to help you pay premiums. Really, you are trading having your employer pay a portion, to letting Uncle Sam pay a portion.
Third, my family grew quickly. I used to only have to insure my self and my son. Then I got married and had a baby, which doubled the number of people I had to find coverage for. It has also been discussed beginning to include my step-children on our insurance. If we choose to do that, I would be covering 6 people.
Let’s take a look at some real world numbers, to make the point clear:
Back in 2013, on my old health plan, I paid $434.16 a month for my portion of the insurance premium. What I got in return for my hard-earned money was a plan that did not require a Primary Care Physician (PCP), had no deductible, I didn’t need referrals to see a specialist, I paid a flat rate for my prescriptions, and I only spent $1990 that year out-of-pocket. I felt that maybe I wasn’t getting a deal, but the chuck of change that came out of my check bought me freedom from the dreaded medical bills, which can wreak havoc on a budget. Total expense: $7199.92
Now let’s look at 2014, when the new plans were offered. I opted for a High Deductible plan with a Health Savings Account. Our company (maybe out of guilt) offered to deposit $1500 in our HSA. This was a crucial selling point to those, like me, that were upset at losing our previous plan, while expensive, provided us a sense of peace that the bills were taken care of. It was also important, because my individual deductible was $1500 ($3000 for the family). I knew I would reach my deductible early in the year, because I had the baby in 2014, in April to be exact. So, for the rest of the year I enjoyed cheaper prescriptions, and no bills when seeing the doctor. We all did. For this, I had to pay $390.32 a month.
That’s right, $44 separated the nirvana of not worrying about medical bills, to me doing all the work, chasing down insurance payments and making sure nothing slipped through the cracks. How many times have I wished I could pay $44 a month for someone to take this headache off my To-Do list. On top of the premium deduction, I also put $180/month into my HSA. I spent the full $3000 deductible out of my HSA and rolled over $660 to 2015. I also spent $684.67 on prescriptions. Total Expense: $6868.51
When you compare the two years, the cost is very similar, if you include the cost of my time to handle all the bills.
So, then 2015 came along. The premium went up to $421.72. The new plan wasn’t so bad, maybe more work on my part, but what could I do, it’s what my work offered. The big difference was, since I didn’t have a big medical event (thank goodness), like the delivery in 2014, we didn’t hit our deductible until September. And forget the money in the HSA, it’s gone. Because not only do I have to pay the deductible, I have to pay full price on prescriptions until I meet that deductible. One prescription I had been on for years, I had to suddenly stop taking, because I went to refill it and it was $800! So far, I’m on track to spend more in 2015, than I did in either 2014 or 2013. Prescriptions alone will end up costing me $860. New glasses cost $329.93, I didn’t get myself any, I couldn’t afford new glasses, even though my prescription changed. And i have yet to re-order contacts for my husband and son. Total (Estimated) Expense: ~$8000
I found myself no longer making decisions based on what was best for my health, but what I could afford. Oh, how I missed 2013. Keep in mind, this is for a healthy family. My children only have been to the doctor for well-visits.
So, I took a look at what was offered through my state’s insurance marketplace, and found my children were eligible for insurance at no cost to me, and my husband and I were eligible for a subsidy. In fact, I can insure my family for $86 a month through this system. If I kept my plan through work, the rates for 2016 would be $441.54 per month.
Of course, this sounds too good to be true, so I had to check it out. I would be back to the old co-pay system $20 to visit the doctor, $50 to go to the E.R., my prescriptions would be $10 each. It doesn’t offer vision benefits, and I couldn’t find a place to even add vision, but the benefit I currently have is crap. It’s only good for 25% off my glasses and contacts (which we all wear except the baby), and when we got new glasses last month, we couldn’t even use my insurance vision benefit, because we took advantage of the buy one get one free promotion at the store. I would also have to go back to the old system of seeing my primary care physician any time I needed to see a specialist, to get a referral.
I’m not a financial guru, or any type of expert on insurance, I can only tell you how this change has felt. Seeing how things have played out in 2015, which is more indicative of how this new plan will work for my family, I feel betrayed by my company. But my upbringing tells me not to accept hand-outs. My company has shifted the health insurance cost onto me, but it is my choice as to whether or not I should pass that burden on the U.S. taxpayers, something frowned upon in my family.
And yet, my parents grew up in Ireland. When they went to the doctor, it was part of the public health care system. Today, people would say if you can’t afford health care, you shouldn’t have children. That wasn’t the case then, as my dad was 1 of 9 and my mother had 11 siblings. I remember clearly my father discussing that medical care was not sought in many cases in my extended family. Many of my relatives that stayed in Ireland died of different types of cancers, mostly weeks after consulting a doctor, because for them, you didn’t see a doctor until you were gravely ill.
So, here I am, with a decision to make. An extra $350 a month in my paycheck would be huge. The cost to my employer, if I opt to go with them would be $1766.16. The cost to the tax payer, if I opt for the subsidy, $408. I think no matter which I choose, the insurance company comes out on top.
Have you shopped around for health insurance? What has been your experience? Do you have any advice for me? Please comment below. Thanks!