Open enrollment deadlines and dilemmas

May 18, 2012 9:06 AM

It's open enrollment time, and given the changes in all the policies, it's now a lot harder for a clear cut decision.

So my company offers 3 plans: a CDHP, PPO and EPO. (CDHP is not a high-deductible type plan)

I've always used the EPO since it's a premium + co-pays. IE everything is covered 100% after the co-pay. Even the flex-spend auto-reimburses me for all the co-pays. So there's very little paperwork/time I need to spend on it.

Only, now the premium has gone up considerably, the co-pays went up, and they dropped to 90% coverage (with a max-out-of-pocket 6k).

So I'm looking at the CDHP plan. Cost wise, it's ~15% of the EPO (1k vs 7k), has a HRA etc. It pays 80% after 1200 deductible is met, max out of pocket is 7.5k.

It'd be me (mis 30s) and 3 small kids. I can't carry the Mrs because work won't cover a spouse who has access to coverage through their employer.

So, why am I reluctant to move to the CDHP ? I think it's just fear that something "major bad" happens, and we get the shaft. The kids are almost all well-kid visits (viz the strep/whatever about twice a year - they are pretty healthy kids), and I don't get sick too often. The rational part of me says do the CDHP, but the desire to avoid risk is pushing me away, even at a higher cost.

Help convince me, please.

posted by k5.user to Health & Fitness (3 answers total)

If you enroll in the CDHP, you will get stuck with really big bills if something majorily (or even minorly) bad happens. For instance, if one of your kids breaks a leg, it's possible you'd be on the hook for the ambulance ride, the ER visit, the cast, the orthopedic consult, etc etc, which could easily add up to thousands of dollars. If you're in a financial position where that's not going to create major stress (like, you have a $10k to $15k emergency fund set aside for that sort of thing) then the CDHP could be a good choice. If not, I wouldn't touch it.

To repeat myself from an answer I gave someone else in 2010,

Keep your eye on the big picture of why you're buying health insurance. This is good advice for everyone, but particularly good advice for people with limited funds to procure health insurance, because you're going to have to compromise somewhere and it's really, really important that you do so in an area that actually makes sense. You want to be protected (financially and in the sense of actually being able to get care) in case the low-probability but high-cost catastrophe happens, so pay attention to how each potential plan you're looking at would work in *that* situation--and not so much at how it's going to work in the more common but lower-cost situations like going in for an annual physical. This is the #1 mistake that I think people make, getting all hung up on "how much of my current medical costs will this policy cover?" while totally ignoring "how much of the costs would this insurance cover if I get very, very sick?"

You are definitely not being financially foolish by choosing to be risk-averse when looking at insurance options. It's far, far, FAR more foolish to assume that just because you and your kids have had minimal health needs up until now that you don't need insurance that will protect you in case (or more likely, when) something more major occurs.
posted by iminurmefi at 9:20 AM on May 18, 2012

I don't know what EPOs and CDHPs are, so maybe I'm misunderstanding, but if the max out of pocket of the EPO is 6K and the max out of pocket of the CDHP is 7.5K it seems to me it might be worth switching over. It's hard to say without knowing every little detail, but if the difference in max out of pocket is only $1500 and the monthly premiums are much lower... does the EPO have a deductible? Add in what you're likely to spend in a year for copays and deductibles. It sounds like, since there's a cap on out of pocket on both, this is really just a math problem, not a gamble.
posted by rabbitrabbit at 10:10 AM on May 18, 2012

Break out the cost numbers, including what you will spend on premiums, at various levels for the different plans. What happens for $1,000 in medical costs + your premiums? $5,000? $10,000? $50,000 (not unrealistic for a hospital stay)?

That being said, it kind of sucks that the CDHP is NOT high-deductible, because if it were, then you could open an HSA, which has major tax bennies even if you don't make a lot of money. The fact that you can't do that makes it a less attractive option all around.
posted by Currer Belfry at 10:29 AM on May 18, 2012 [1 favorite]