How To Choose A Health Insurance Plan From Your Employer
By Luke Opsahl, Advisor
Most workers take less time researching their benefits options (30 minutes) than they do shopping for a television (two hours). In 2018, the cost of healthcare for a typical American family of four, covered by an average employer-sponsored preferred provider organization (PPO) plan, was $28,166, according to the Milliman Medical Index (MMI). That is quite a bit more than your average TV!
Where do I even start?
The old way involved pulling out a pen and paper while looking back at your medical expenses from the last year. Did you visit the Doctor frequently? What prescriptions did you have? Any procedures? Will it be similar next year? How much did all of that cost?
Now think about the year ahead. Add up all of your copays and out of pocket expenses, including the premiums you paid for that plan. Does your head hurt yet?
There has to be a better way!
No need to bug your HR about picking a plan for you, meet ALEX! ALEX is a fun and interactive decision support portal that walks employees through all your benefits decisions and provides advice that fits your individual needs. If you’re single, and you’re worried about just you, ALEX can help. If you have a family and dependents, or if you have special circumstances, ALEX will help you think through all your options and find what’s best for you. Interact and review the plan options with ALEX.
If you didn’t spend much on healthcare last year, and that trend is likely to continue, the math may point to choosing a plan with a high deductible. This is because your expenses, including premiums and out of pocket expenses, might still be lower than the premiums and copays you would pay for a “richer” or lower deductible plan.
You must be prepared to cover the costs if your health care needs rise unexpectedly. You don’t want to come up short, and you certainly don’t want to hold back on receiving care to avoid spending money. Consider opening and contributing to an HSA (health savings account) to offset these costs.
If you did spend a lot on healthcare, you might want a low-deductible plan. This may also be a good option if you believe that your healthcare expenses will go up in the year ahead.
Examples of your healthcare rising would be a pregnancy, surgery or if you or someone in your family has a chronic medical condition. These are important things to consider.
Time to decide.
At the end of the day, it all comes down to the numbers. Take the time to make the best choice for you and your family. You have to live with this plan for the next year. Make the plan work for you!