As health care costs continue to outpace inflation, companies are finding additional ways to have employees bear more financial responsibility for their coverage. Among the changes you could see during open enrollment this year: Your employer might be offering a slimmer list of in-network doctors, making you pay extra for your spouse’s coverage, or pushing you into a high-deductible plan.
As a result, the insurance you chose last year may no longer be the best deal. Use these strategies to compare your options.
Price Your Spouse
Next year, 37% of employers plan to levy a surcharge on spousal coverage—$100 a month on average—when spouses can get health care from their own jobs, Towers Watson found. That’s up from 25% two years ago. What to do:
• Compare separate and shared. If you and your spouse both have coverage through work, “you have to look at three options,” says financial planner Rick Kahler: putting both of you on your plan, both on your spouse’s plan, or each of you on your own plan. Start with the monthly costs for each. Then compare your medical-spending history over the past year with what you would have paid out of pocket on each plan—including deductibles, co-insurance, out-of-pocket maximums, and prescription benefits—to identify the plan with the lowest projected outlay.
• Factor in the kids. Only 3% of large employers make you pay higher premiums for each new dependent, Mercer says. Likewise, while 32% of family PPOs have individual deductibles ($944 on average), on 52% of the plans, the entire family shares an aggregate deductible ($2,012 on average), according to the Kaiser Family Foundation. Families of three or more should opt for these “group discounts.”
Be a Savvy Networker
In 2016, 22% of employers plan to offer so-called narrow network plans, which can cost less but include fewer in-network providers, according to Towers Watson. Another 39% say they’re considering such plans for 2017 or 2018.
Why does this matter? Because you’ll pay a lot more for doctors who aren’t in your network. Here’s how to evaluate your options:
• Check who’s in. Rule out plans that don’t cover your main health providers. Call your family’s primary care doctors and regular specialists and ask if they are in a plan’s network, says Robin Gelburd, president of nonprofit FAIR Health. And use your insurer’s online tools (or call the billing office) to see if your local hospital is in-network.
• Prevent cost surprises. Next, look at each plan’s out-of-network co-insurance rates, deductibles, and out-of-pocket maximums to see where you’d pay the least for out-of-network care. Even if your doctor is in your insurer’s network, her lab or anesthesiologist may not be. With out-of-network costs, you generally pay twice as much out of your own pocket before you hit the deductible and insurance kicks in, Mercer finds; then you pay a bigger share of the cost. If an otherwise favorable plan could leave you on the hook for out-of-pocket surprises, budget for that risk with an HSA or other savings, Gelburd says.
Evaluate Your Risk
In 2016, three-fourths of employers plan to offer a high-deductible plan, where you’d be likely to pay less in premiums but more out of pocket before insurance covers part of the bill. At 22% of employers, high-deductible plans will be the only option, Towers Watson says. If you have a choice, should you risk a higher cost? How to calculate your potential out-of-pocket outlay:
• Know your past costs. Check your spending history, says Kahler; you should be able to find it on your insurer’s website. Calculate how much you’d pay on each plan if you got the same care this year. Didn’t hit your deductible last year? Unless you anticipate a change—a pregnancy, say, or a newly diagnosed illness—opt for a higher deductible and save on premiums.
• Weigh HSA cash. Families with plan deductibles of more than $2,600 can open tax-preferred health savings accounts; for singles the threshold is $1,300. And 56% of employers even contribute to your family HSA—an average $1,412, Kaiser Family Foundation says—to encourage you to pick a high-deductible plan. When calculating expected out-of-pocket costs, make sure you factor in that contribution.