Earlier this year, I shared about the company that my husband was working for had switched insurance companies and went to a High Deductible Health Plan (HDHP) which basically meant that our deductibles had more than quadrupled.

We researched different options but since we were only given a few days to decide, we just ended up going with the insurance company that they were providing.

Then our daughter, at two months old ended up in the hospital which ended up being way more costly than we had anticipated and set us back months on reaching our financial goals for this year.

Now in case you don’t know what a HDHP is, it’s a health care plan with a deductible of a $1,000 or more. The benefit to this plan is that the premiums are lower – which means that your monthly payment is cheaper, but if a medical emergency happens (like what happened with our daughter) you could potentially be stuck with a high medical bill.

Not to mention, depending on how much of the bill your insurance provider is willing to cover, may mean you will owe additional money on top of having to meet the deductible.

Did I just confuse you?

It’s confusing, so don’t feel bad if you don’t understand everything. In fact, according to the 2016 Aflac Open Enrollment Survey, “more than half (56%) of millennials say there are aspects they don’t understand about their overall health care policy, including elements like deductibles, copays or in-network providers”.

So, let’s try to break this down a little…

If you have an 80/20 plan, that means after you have met your deductible, your insurance provider will cover 80% of the bill and you’ll be responsible for 20%. This is AFTER you’ve met your deductible so you’ll still have to meet whatever your deductible is for that year before this kicks in.

Let’s be real for a moment – when our daughter was in the hospital, we were actively saving up our emergency fund (goal was $10,500) which meant that account wasn’t fully funded yet. So when we got the nearly $9,000 bill in the mail we didn’t have enough in savings to even pay for it in full if we had wanted to.

And if you know me in real life, you know that I don’t believe you should wipe out your savings to pay off a medical bill. Instead, I believe that you should negotiate a payment plan and pay it off as fast as you can like any other debt.

Another Option

Okay, so even if the only insurance option available with your employer is a HDHP, you may still have another option on the table…

It’s called Voluntary Insurance.

Voluntary insurance works hand in hand with major medical plans to help ensure individuals who are sick or hurt have the funds needed to pay health-related costs their primary insurance might not cover, as well as other out-of-pocket costs. After all, when a medical event occurs, there are things like deductibles, copayments and treatment costs that may not be covered to consider.

Why is voluntary insurance worth considering?

Voluntary insurance pays cash when you’re sick or hurt so you can focus on recovery, not financial stress. Major medical policies pay doctors and hospitals, but voluntary policies pay cash directly to you, the insured (unless otherwise assigned), which means you get decide how the cash is used.

This can be a great benefit if you feel that your current plan may not be enough to protect you from a high medical bill. I know this is something that I wish we had considered earlier this year as it could have saved us thousands, but the choice is totally up to you and what works best for your budget.

So, spend some time researching benefits options to help ensure you make the best health care and financial decisions for yourself and your family this open enrollment period. Don’t forget to utilize the resources available through your employer since many workplaces offer the option to speak with a benefits expert about your specific needs and provide online portals to compare plans.

If you have a HDHP how have you managed an event where you were responsible for a large medical bill?

Aflac herein means American Family Life Assurance Company of Columbus and American Family Life Assurance Company of New York.
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I was selected for this opportunity as a member of CLEVER and the content and opinions expressed here are all my own.

The post Do you have a HDHP? This may be an option for you! appeared first on Jessi Fearon.