Health insurance open enrollment is here again, and once again, it looks like costs are going up – we’re currently with PPO, but facing a 10% increase in costs, I’m actually considering switching us over to a HMO.
Depending on your situation, you’ll need to carefully weigh your options and consider the following:
1. Don’t go on autopilot. Assuming your plan and coverage will stay the same is a mistake (and I’m guilty!). It’s important to research and be informed of all new changes, possible price increases, and coverage. Oftentimes, monthly premiums, prescriptions, office visits, and co-pays will vary from year to year.
2. Any upcoming changes in the planned year? While all plans do allow for changes to be made during life events, such as marriage, a new birth, death, etc, if you are aware of something upcoming, such as a pregnancy in the next year, you may want to consider upgrading your plan to a higher premium that covers more doctors visits or prescriptions, and combining that with a HSA.
Will you need a surgery next year? Many healthcare websites, such as UnitedHealthcare.com, have a online cost estimator for several hundred medical procedures. If you know that you will need hip replacement next year, you’ll be able to search and compare different prices for an idea of how different costs may total up. You can then plan how to contribute to your HSA, as well as working work your doctor and their hospital affiliation in advance to finalize a cost. You may even be able to negotiate costs in advance and ensure reimbursement prior to having the surgery done, making it a much smoother and painless process for everyone involved.
3. Is there a possibility of being laid off next year? While most employees and employers agree that the economy is improving, there is still a chance for layoffs to take place if the economy does not continue improving at a faster pace. If you think there is a possibility that your position may be cut next year, look for the least costly plan. Since COBRA premiums are based on your current policy, having a lower cost policy will reduce the total premium due to keep you insured during unemployment.
4. Read the paperwork. Under a new federal mandate, all insurers nationwide must provide a clear, easy-to-read “Summary of Benefits and Coverage.” The SBC is intended to line out what is included in your plan, as well as what you will pay for deductibles, prescriptions, office visits, etc, as well as basic costs in total for several major medical events, such as a minor surgery, Type 2 diabetes, or having a baby. While this should be included in your signup paperwork, if you don’t see it, ask your employer, the HR department should be able to provide a copy upon request.
5. Watch the deadlines. Lastly, monitor the deadlines closely. Missing those key dates could make a huge impact on your bottom line in the next year!