Friday, October 21, 2016

Health insurance

When Peanut decided to stay home with the kids, we had to switch from his company's insurance to mine. It's been fine so far but it's really interesting to see the kinds of things we have to think about now that we didn't think about before.

Peanut's job paid for the entire premium for our health insurance. I have never seen that as a perk anywhere before, and it was awesome. It was a high deductible plan, but even so, the deductible wasn't that high (around $3,000) and the coinsurance/max out of pocket was an additional $3,000. Pretty much everything we ever threw at it was covered, and we didn't need to get referrals or anything. This is the insurance we were on when Pickle was born, and for the first couple years of her life we didn't have to pay that due to the state medical assistance she received. In all, that health insurance company paid out at least $1.5 million in claims for our family and we never had a single problem or issue with them at all.

So I was a little nervous about switching to a new health insurance company.

My job shares the premium payments with the employees, and both the deductibles and max out of pocket were higher than our old insurance. This is why at the end of the day, our take-home pay situation hasn't changed much even though my salary on paper is 14% higher than Peanut's was. On top of the increased actual cost to us, we also had to make decisions about primary care networks - one of which means we have to do a lot of legwork to get referrals documented appropriately but save $90 a month, or the other one that works more like the old plan worked where we just go to wherever we want for whatever care we need, but we pay for the privilege. If Pickle still had lots of specialists, we'd probably have to go with the latter, but we decided to take on the work ourselves of managing the paperwork and having slightly cheaper out of pocket expenses up front.

And it turns out, I'm really glad we went that route. We haven't needed and don't expect to need any referrals in the next three months, and it was just announced this week that in January my company is switching to yet another insurance company, which will have lower premiums and out of pocket expenses than we currently have. I don't know about their referral requirements yet, but I do know that we haven't spent any time to set up any primary care situations with our current insurance (at least not for Peanut or me) so we will have saved more than $300 to do nothing but take on a little risk.

Insurance was never something I thought a lot about, until we really needed a lot of it. We are so fortunate to have had such a good experience with an insurer (and a secondary state insurance) and it has drastically changed how I feel about that out of pocket amount now. I assume we'll spend it all in a year (4 out of the last 5 years, that's been true). I can start a year knowing that our max OOP is $6,000 or whatever, and just think, okay, that's about $500 a month for four people for all of the medical costs we can expect to have in a year (add in premiums and it's probably double that, but pre-tax stuff is so removed from my daily consciousness that it's like it doesn't exist). It's an easy way to budget for it, whatever we don't end up spending is bonus to our bottom line, and it takes a lot of the emotions and politics out of it.

I wish I could solve the health insurance system for everyone, but that mental shift has done a lot of solving it for our own budget. I used to begrudge paying anything on top of premiums for some reason, and now I treat it more like a sunk cost. The rest of it is a racket, but the perspective helps me deal with the bills that come in for an emergency room or urgent care visit.

2 comments:

  1. That's amazing coverage from Peanut's company, I wonder how the economics of those companies (Peanut and the health insurer) has worked out for them and whether that's sustainable. I hope it is, and the rest of the country can then take a lesson from them, because we all deserve to have good and humane healthcare.

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    1. I wonder, too. Peanut's former coworkers were mainly a bunch of twenty-something dudes who probably used $10 of medical care in a given year, until we came along. I know that their rates went up and the deductible and max OOP went up and the co-insurance split got wider after Pickle was born. So in a way, we made it a lot harder for the rest of his coworkers - facing hundreds of thousands in medical expenses each year, a $6,000 deductible didn't seem like a big deal to us, but if you might not otherwise expect to need much in medical care, that amount probably seems fairly staggering.

      One thing I've wondered is whether health insurance premiums are tax-deductible for companies.

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