Why I (Heart) My High Deductible Health Insurance Plan
I won’t lie. My romance with my health plan wasn’t love at first sight. I was newly self-employed, and looking for just the right balance of benefits and affordability was nerve-racking. I was lucky. Many of my friends were smokers, had a long list of pre-existing conditions, or just waited until they had an illness to look into getting a self-insured plan. Being a worrier, I knew that now was the time to lock in something, anything, while I was still in good health.
Low monthly payments. Sure I could COBRA my previous employer’s plan. It was, after all, an excellent plan with all the benefits of free health visits and a low deductible. It was also $1400 a month for my family. I’m sure on my self-employed salary I could swing that (but also give up food and clothing for the next two years.) The high deductible plan, on the other hand, came in at a nice price tag, making it much less painful when they automatically took the premiums out of my checking each month.
Basic preventative care. In order to keep my monthly premium low, I needed to be sure it wasn’t loaded up with too much preventative care coverage that wasn’t subject to the deductible. It was a careful balance finding a plan that gave me the basics (once a year health checks, an annual OBGYN testing, etc.) without going overboard. Since I had been to the doctor exactly 1 time in 2 years, I know that the deluxe plan with 6 free visits a year (and costing about $200 more a month) was a want and not a need. I opted for the plan that gave me essential preventative care before meeting my deductible requirement, and nothing more.
HSA eligibility. In reality, I don’t use my Health Savings Account much. It was easy to set up, however, and it helped me to avoid taking a tax hit on extra income this year. Being self-employed, it’s painful enough paying my own Social Security Tax. My HSA hooked me up with a debit/credit card that I just swipe at the pharmacy or give to the billing office at the hospital. (And did you know that many of the Walgreens Free After Rebate deals are HSA eligible? Double whammy.)
Accountability. Being accountable for my own healthcare costs may not seem like an advantage at first. After all, when it comes to any medical expenses below my deductible, I’m the only one responsible for paying. Being forced to pay these expenses, however, has made me take a good look at what I’m using my medical care for, and I’ve taken steps to reduce my cost, while making sure I take care of medical issues while they are still affordable. I will be getting my flu shot. I’ll eat healthy, try to maintain a healthy weight, and not overindulge in behavior that could be risky to my body or my premium rates. I’ll also be mindful of DIY preventative practices like breast self-exams, using sunscreen, wearing my seatbelt at all times, and having regular dental cleanings. These are things I should have been doing anyway, but with the burden of the high deductible on my back alone, I’m taking extra steps to cut costs while ensuring my insurability in the future.
Negotiated pricing. People often roll their eyes at the mention of a high-deductible health plan. “You pay $5,000 before insurance covers anything?” They don’t see the benefit of such a plan – especially since I’m not likely to use anywhere near $5,000 in medical services in a typical year. Then I explain the benefits of insurance negotiated pricing. I can walk into my doctor, present my card, and arrange for my insurance to be billed. Yeah, I understand that eventually the bill will come back to me (without my insurance paying a dime), but the wonderful thing is that it is usually 40-60% cheaper than when I first walked in. My insurance company can use their pre-contracted rates to get me savings I might not have had on my own. (Note: It is possible to ask your doctor to bill you at a negotiated rate, but they don’t have to. By sending it through your insurance, you are guaranteed their contracted rates, plus you get an additional 30-60 days to get your finances in order until the bill comes.)
I understand that a plan of this type isn’t for everyone. My parents, who are older, have a few medical conditions, and use services more regularly, wouldn’t get as much mileage from this type of plan. For someone with a pre-existing condition that needs constant treatment, this could be too pricey to justify. For a typically healthy self-employed person, however, it is a good start. Assuming you are in good health, and can get a deal where they lock in your rates for a given time period (2-3 years, for example), it gives you decent coverage for the near future at an affordable price.
Maybe, with the economy changing and an election on the horizon, my love affair with my health plan will fade into a fond memory. But for now, I still truly (heart) my high-deductible health insurance plan.