Open Enrollment Health Insurance - How Your Employer's Plan May Not Be The Most Affordable Way

As a full-time working mom, Open Enrollment is always an annually dreaded, expensive event in the life of adulting.  Once again, and especially with the financial crunch brought on by the current pandemic economy, my employer is tightening its collective belt.  Our employer-provided medical, dental, and vision plans remind me again how outrageous the premiums, deductibles, and out-of-pocket maximums are, and just what little benefit we receive back in return.  I've done the math, and even with my employer covering me, the employee, we're still paying $17,000 out-of-pocket for medical insurance premiums and meeting our family deductible before this so-called "insurance" kicks in.  There's some over-simplifiction there, yes, but that's what it pretty much boils down to for our family and our situation.  The last time I bought into this was four years ago, and I can tell you, this mostly healthy family never even came close to meeting that family deductible.  Of course, knock on wood, there are catastrophic situations, major events, and chronic conditions that would be grateful of having such financial protection.  For us, we have much better ways we'd rather keep $17,000 in our own bank account, and invest this money in our own self-insured health fund.  At the end of the year, this money no longer disappears into the coffers of the medical establishment, disguised as "covering" our family.  So before you click on your employee portal and start locking in another year, talk to your coverage, tax, and medical professionals, and maybe explore some other, possibly less conventional, and more autonomous ways to protect yourself and your family.

#1 - Max Out Your HSA Contributions

Did you know money going into your HSA is tax-free?  Did you know that money coming out of your HSA is tax-free?  Did you also know that any interest earned while your HSA is sitting in its designated account is also accruing tax-free?  Did you also check with your employer to see if they provide a HSA match of these aforementioned tax-free funds?

For all those reasons above, this is why I max out our HSA contributions every year.

My employer covers me as an employee on a high-deductible health insurance plan, which then makes me eligible for a HSA.  If you and/or your spouse are eligible for a HSA, I highly suggest you speak to your tax professional and take advantage of this tax-free way to save and invest.  Over the course of the last few years, my employer has also flip-flopped periods where they've matched contributions.  These contributions over one particular year actually covered the payment plan to our orthodontist for my daughter's braces.  

Unlike FSA's which I've never trusted to be of anything useful, HSA money is yours, and yours to keep.  At the end of the year, it doesn't disappear just because you didn't spend it.  If you switch employers, you keep it.  As long as you follow the proper rules for what you can and cannot pay for with your HSA (basically, anything medical is covered), this is an easy way to set aside money for braces, glasses, LASIK, chiropractic adjustments, prescription drugs, some OTC drugs and medical devices, along with those pesky high deductibles.  HSAs are also how we negotiate better-than-employer-health-plan pricing on our annual healthcare expenses.

#2 - Cash is King

What if I told you that health care providers much preferred to be paid in cash?  There are countless brokers, processors, billers, and middle-men between you flashing your insurance card and the money that your doctor actually receives in their bank account.  Remember the $17,000 of health insurance premiums and deductibles that I used to pay?  That doesn't factor in co-pays for things like office visits, lab tests, and the various tiers of prescription drugs.  Even with the occasional visit to Urgent Care for respiratory illnesses and things like Strep tests, doctors gladly give us a 25% discount by paying in cash on the same day of the visit.  I've had doctors select a cheaper billing code for us as well, knowing that we'd be paying in cash in full for that day's visit.  And how do I pay?  With that tax-free HSA mentioned above.  Double-win!

#3 - In-House Dental Plans

Having just come from this year's Open Enrollment meeting, I can tell you that my available employer-sponsored dental plan is going to be $129 a month for my family in 2021.  What if I told you that I cover my family's twice a year check-ups, x-rays, and cleanings for a fraction of that?

Instead of $129 a month (plus co-pays at the time of service), my dentist offers his own in-house dental plan for about $150 a person a year.  That's almost $950 a year that stays in my own pocket from my paycheck.  On top of that, my dentist's in-house plan offers similar discounts for extra services, such as fillings, so we've been able to stay with the same dentist we like, and continue with the same level of care; all for a fraction of what we would be paying with the "help" of employer-sponsored dental coverage.  Be sure to call your dentist to see what his or her office may offer to those not using dental insurance.

#4 - See Better Thanks to Your Club Store

Everyone who knows me knows I've had an extensive resume of jobs over the years.  In my last year of college, I worked for the monopolistic empire known as Luxxottica; better known to some of you by their storefronts of LensCrafters and Sunglass Hut.  But did you also know that they own all the brands of all the products that they sell, right down to those Ray-Ban sunglasses and those Armani frames?  And did you know also that they own that vision insurance that your employer is offering you at your Open Enrollment meeting?  That's right: Luxxottica owns EyeMed.  And you are free to use your EyeMed coverage at your local Target Optical, which is also owned by Luxxottica; that same vision coverage that doesn't even make a dent in what you end up actually spending out-of-pocket for those new glasses or contacts.  Yes, what a racket is right!

Vision insurance premiums and my out-of-pocket for glasses for myself and my family is exactly what got me started on this path of exploring ways to save on our health coverage.  Even after paying for my employer-sponsored vision coverage, I was still paying out-of-pocket for everything from the optometrist visit, frames, lenses, lens coatings, and contacts.  This amounted to over $700 in out-of-pocket expenses each time.  Plus, vision insurance ensures you do this every single year, or risk losing the benefits that have been coming out of your paycheck all year long.  (Did you know you really only need to go get your eyes checked every 18 months?  Dig into this for yourself.)  

The solution?  You guessed it.  The HSA card to pay cash, and this time with the help of one more card: our existing warehouse club membership.  It's been a number of years since we've had Costco, but the vision discounts at both Costco and Sam's Club are substantial.  Why?  They don't have any influence whatsoever from the Luxxottica empire.  Sure, you may see some different brands from what you see at LensCrafters, but the savings will be worth it.  At Sam's Club, my oldest daughter still qualifies for their child plan (for anyone under 18).  At the last visit, she picked out fantastic titanium frames, lightweight, upgraded polycarbonate lenses, with anti-reflective and blue-light coating included, all for $180, cash.  For me, I kept my old pricey designer frames that I had purchased years ago from the Luxxottica empire back when we were enslaved to that beast, and changed out the lenses only, and even upgraded them to the Sam's Club version of "Transitions" for $70.  

The same strategy above for doctor's visits also works with many optometrists.  Ask for the cash price and pay from your HSA.  

Conclusion

Having grown up being told that a responsible adult and parent carries insurance for everything, it's time to question that fallacy.  Sure, being as financially responsible and prepared is still important, but that doesn't mean we do it by fattening up the wallets of those companies who have taken advantage and have turned this into a money-making game.  It's a game where they've created the board, the pieces, and the rules, and the rules are constantly in flux, and not in our favor!

It's time to take back control, and take back your own dollars.

To your health!

~ Mama On FIRE ~