It’s open enrollment time at my husband’s work, and this year they’ve rolled out a bunch of new health insurance options. I was very excited at first because an HMO option was available instead of a PPO. In my experience, we always end up paying more out of pocket with a PPO. However, when I saw the price of the HMO, my excitement waned. It’s $363 a month, which is $4356 a year.
Happily, there was another option. It’s called a “High Deductible PPO Plan”, and it only costs $92 per month for a family. This will save us $271 a month, or $3252 a year in health insurance premiums. However, as the plan’s name says, we have a fairly high deductible to meet. It’s $1500 a person, or $3000 per family, and after the deductible is met, the plan pays 90% of everything.
Under this plan, we’ll have to pay 100% of our medical costs up to $3000, except for preventative visits(well-child visits and annual gyn checkups are free). Hopefully we won’t go to the doctor often enough to rack up $3000 in spending, but even if we do, we will still be a little bit ahead with this plan.
And, if we are blessed enough to be able to avoid the doctor a lot, we could be as much as $3252 ahead by the end of the year. It’s quite possible…we’ve been very healthy so far this year, and so our total medical spending has been $14.72(we’ve had a PPO plan and have only been to the doctor for preventative care).
After some thought, we decided to sign up for the high-deductible plan, and we’re going to put the $271(the amount this plan saves us per month) in the bank each month. That way if we do end up needing to go to the doctor we’ll have the money to pay for the bills, and if we don’t end up needing the money, then at the end of a year we’ll just have a nice $3252 in the bank, collecting interest.
This is a pretty low-risk plan, based on how healthy we tend to be. Even if something catastrophic happens to us healthwise, the most we have to pay out of pocket in a plan year is $6000(and our $3000 deductible counts towards that total). So, the best case scenario is that we’ll be $3252 ahead and the worst case scenario is that we’ll end up $2748 behind. We have nearly that amount in our emergency fund at the moment, so we’d come through even a worse-case scenario in decent financial shape.