If you’ve had your health insurance coverage for six months or more, you’ve most likely had the opportunity (fortunately or unfortunately) to use your health plan. How’s it going?
Many individuals, especially those that recently went from being uninsured to gaining coverage, are shocked by the price of healthcare. You buy health insurance to help pay your medical bills. However, you may not have realized how much you have to pay out of your own pocket before your health insurance actually kicks in. Many individuals are unaware what their health insurance deductible is, or what “coinsurance” means when the medical bills arrive. All they know is they are paying thousands of dollars out of their own wallets because they haven’t met the minimum financial requirements outlined in their insurance certificate.
To give your health plan a thorough check-up, here are some options that complement your existing coverage, and can help ease the financial strain of medical expenses:
Supplemental health insurance
An insurance product that is growing quickly in popularity with the high deductible health insurance crowd is supplemental health insurance. Supplemental insurance is insurance that helps cover the gap in coverage between your first medical bill and when you reach your deductible amount. The coverage allows you to pay for bills or life expenses should you become sick with a critical illness or suffer injury from an accident. Many plan levels are available for both individuals or families, and costs average around $50 a month.
Statistics show only 1 of every 2 insured Americans have enough money in their savings to cover a $5,000 family deductible. As health plan deductibles continue to drive up to keep monthly premium costs lower, more and more individuals are going to be shelling out thousands of dollars in cash before their health insurance company is responsible for paying a claim. With supplemental insurance coverage, Little Johnny’s broken arm or an unexpected cancer diagnosis is covered with a flat cash benefit to pay medical costs, the mortgage or fill gaps in income from being unable to work. It’s your choice. The cash can be used for any need.
Special open enrollment
If you are finding that your health insurance plan isn’t meeting your medical needs and you need more coverage, there are specific life circumstances that allow you to switch to a different plan. If you have moved to a new ZIP code in the last 60 days, gotten married or divorced, added a new baby to the family or adopted a child, lost your job (and your employer health plan) or have had a change in income than previously reported to the federal government when applying for a tax subsidy, you could be eligible to change out your health insurance plan for more suitable coverage.
Shopping for a different plan during open enrollment
If you don’t qualify for the special open enrollment period, you still have several months during the regular open enrollment period to update your medical plan. The objective is to do the math before you buy. For example:
In Salt Lake City, Utah, a couple with no children has 235 plans available to choose from. That’s a ton of insurance plans to sift through. But the couple needs to look at not only price, but prescription drug benefits. One spouse currently spends $500 a month on prescription medication, so drug coverage is important.
A Silver Humana plan at $375.97 has a $4,600 deductible, $25 primary care office visits and 20% coinsurance. The pharmacy drug benefit has a $1,500 deductible, and retail prescriptions are $50 if they visit a network pharmacy.
A Gold Humana plan at $477.22 has a $2,500 deductible, $25 primary care office visits and 20% coinsurance. The pharmacy drug benefit has a $500 deductible, and retail prescriptions are $20 if they visit a network pharmacy.
By purchasing the Gold plan for about $100 more a month, but with a small $500 drug deductible, this Utah couple pays $720 a year on drugs vs. $1,950 if they purchased the Silver plan. They might only save $50 a year by having the richer Gold plan, but they also gain a lower doctor and hospital deductible at the same time. Monthly cost can be enticing, but over the course of 12 months, more expensive health plans that fit your medical needs can actually save money. *These are examples from 2015. This year, there may be even more reason to shop.
It pays to look for alternatives like supplemental health insurance or take advantage of the special open enrollment period, if you qualify. For more details about shopping for health insurance, visit Healthcare.com to view plans