In the new age of high-deductible health insurance plans, smart planning can save you big bucks. You can’t predict health events, but by thinking ahead, you can make better use of your health care dollars when a significant illness occurs.
How do you prepare for an event? Some medical issues are an emergency, and some events can go on for a while without need for attention. Broken ankle—emergency. Bum knee that has been aching for a year—annoying, but you don’t need to see the doctor the minute you become annoyed. By approaching your medical care in a thoughtful manner, you may be able to bunch expenses into one year, thus needing to meet only one large deductible.
Let me share an example. I recently developed allergic reactions to certain foods. The initial serious reaction was financially a minor emergency—not close to meeting my deductible. However, I would need expensive allergy testing to figure out some of the offending foods causing my lips to swell and itching of my head and neck. Meanwhile, my husband had noticed some spots on his skin he was concerned about. And his bad knee from high school pole-vaulting days was giving him a fit.
What did we do? I ate only foods I knew for certain were safe, and decided to delay the testing to my new plan year. My husband also delayed getting treatment for his skin concerns and his knee. Between the testing for my allergies, the removal of his pre-cancerous skin lesions, and the MRI for his knee, we will hit our deductibles early in the year. If something serious happens the rest of the year, we won’t have to worry about the cost. And if we have something less serious bugging us during the year, we’ll take care of it promptly.
One important consideration to keep in mind: Do not wait until the end of the year to take care of mundane issues. The holidays create a natural slow-down of the health care system, and you may not be able to get an appointment. Also, if you need further testing that must be approved by your health insurer, remember that the company plays the game too. It may not approve your referral until the new plan year. So start early and try to complete everything by November.
One final medical event to consider is pregnancy. It can’t always be planned, but if you are starting a family, work hard at it between November and February. This way, the bulk of the pregnancy, delivery, and initial baby care will all occur in one plan year.
Maybe one day we’ll have a health care system where we don’t have to play these games. Until that time, be a smart consumer and plan wisely for your healthcare needs.
Carolyn McClanahan is a physician, financial planner, and founder of Life Planning Partners. In addition to running her financial planning practice, she educates financial planners, health care professionals, and the public on the intersections of health and personal finance.