I saved $3,000 a couple of years ago when choosing a new health insurance plan. My wife and I decided to have a child; after plenty of research, we picked a plan with higher premiums but lower out-of-pocket costs. Coupled with the $1,000 benefit we got for signing up for an indemnity plan, we ended up $3,000 better off than we would have been under the status quo.
How long did this take? It took one hour of planning and research. That’s an excellent hourly rate.
Most corporate executives and senior-level managers often go with the status quo rather than diving into the details. I get it.
With their demanding jobs, they work late nights and have never-ending to-do lists. Open enrollment documents can be confusing, consisting of an alphabet soup of acronyms. Should I enroll in a PPO or an HDHP? Do I qualify for an HSA? Do I need STDI and LTDI?
Prior to becoming a wealth planner, in my eight years as a firefighter/paramedic, I saw people from every walk of life battling injuries, illnesses and loss. No one ever wants that to happen, but if it does, the right insurance (i.e., medical, life, disability) can make a significant difference in your finances and your well-being.
Like most other tasks done well, getting it right takes time and research. Instead of becoming bogged down in the minutiae of your plan, here are four recommendations for anyone enrolling in corporate benefits plans this fall:
A Top Priority – Choose the Right Health Plan for You
Let’s look at three common types of health insurance. Here’s how they work:
A Health Maintenance Organization (HMO) plan usually offers the lowest cost but the least flexibility. A group of medical providers has a contract to provide care; HMOs emphasize cost control and preventive care to offer low premiums and out-of-pocket expenses. But you need to work with a primary doctor to coordinate all care, keep costs down, and see doctors in the network — except for emergencies. A referral is needed to see a specialist.
A Preferred Provider Organization (PPO) is an association of medical providers. It works with an insurance company to offer its services at discounted prices, so getting care within this network holds down costs. There is more freedom under a PPO, because you don’t need a referral to see a specialist. But there are likely higher out-of-pocket costs.
As its name says, a High Deductible Health Plan (HDHP) has lower premiums but higher deductibles. These plans often appeal to people with few health issues who likely will not reach the deductible …….