Health Insurance – Open Mind http://open-mind.org/ Tue, 22 Nov 2022 14:12:05 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://open-mind.org/wp-content/uploads/2021/06/icon-6-150x150.png Health Insurance – Open Mind http://open-mind.org/ 32 32 Three ways to reduce the cost of your workplace insurance https://open-mind.org/three-ways-to-reduce-the-cost-of-your-workplace-insurance/ Tue, 22 Nov 2022 14:12:05 +0000 https://open-mind.org/three-ways-to-reduce-the-cost-of-your-workplace-insurance/ Inflation has had its upside for some people – increases to offset higher prices – but there’s a catch. Health insurance prices have also increased, so you may have to pay more for a 2023 plan. According to Aon, the professional services company, the average cost per employee will reach $13,800 in 2023. That’s more […]]]>

Inflation has had its upside for some people – increases to offset higher prices – but there’s a catch. Health insurance prices have also increased, so you may have to pay more for a 2023 plan. According to Aon, the professional services company, the average cost per employee will reach $13,800 in 2023. That’s more than double the 3 percent increase that companies saw last year, although it’s well below the current inflation index.

When open enrollment begins for many employer-provided health insurance plans, take a close look at what’s on offer. Sticking with the same plan you were previously using is not always the best choice. In fact, according to several studies, most people are terrible at choosing the health plan that gives them good coverage at the cheapest price. While it sounds counterintuitive, simply going for the plan with the higher premium and lower deductible might not be the best choice.

The following strategies challenge some common beliefs about health insurance plans. and they can help you save money on the health insurance your employer offers.

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High deductibles can be lower than you think

Employer-sponsored high-deductible plans can actually give you a deductible that is lower than some plans that aren’t labeled as high-deductible. The advantage of high-deductible plans is that they generally qualify for a health savings account (HSA). As long as the plan has a minimum deductible of $1,500 for an individual and $3,000 for a family in 2023, it qualifies for an HSA.

Of course, your employer can set the deductible higher in exchange for the lower premiums you typically pay with a high-deductible plan. Run the numbers with a calculator like this one from HSA provider Lively so you can compare estimated health care utilization, premiums, and deductibles for different plans.

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Consider saving in an HSA

What makes a Health Savings Account (HSA) so magical is that it’s the only investment account with a triple tax benefit. First, the money goes into your account pre-tax. The money you invest in this account grows tax-free. Finally, the money is withdrawn tax-free when used for qualifying medical expenses. Donations can help you reduce your taxable income and give you a valuable fund for medical emergencies.

How HSA contribution limits work

Your employer can contribute to your HSA just like they can contribute to a company pension plan. Also similar to your old-age provision, people over the age of 55 can make catch-up contributions. But unlike a 401(k), your employer contributions are part of the preset limit. If your employer contributes to an HSA, contribute less to maximize the account.

2022 2023
Individually $3,650 $3,850
family $7,300 $7,750
catch-up fee $1,000 $1,000

There is no time limit for using the HSA. This means you can keep receipts for eligible medical expenses and reimburse yourself several years later as your HSA investments grow.

How to compare premiums and deductibles

First, narrow down the choices by filtering out any deal breakers. For example, you may want to see providers that certain networks do not work with.

Three main numbers are important: the annual premium, the deductible, and any employer contribution to an HSA or FSA.

Many employers pay a certain amount annually into a health savings account or flexible savings account on your behalf if you choose a high-deductible plan.

If you have this option, you need to determine the actual amount of contribution that the employer pays for you and take this into account when using the calculator.

Comparing a preferred provider organization plan (PPO) to a high deductible plan is not a complete comparison. For one, high-deductible plans have lower premiums but higher deductibles. Second, high-deductible plans generally allow you to save pre-tax dollars in a spending account, and employers often put money into that account for you.

Use a calculator like that provided by health savings account provider HSA Bank to compare different types of health insurance. They state how much you would pay for premiums, the amount of deductible you need to meet, and other factors like prescriptions, whether you pay for them, and any coinsurance.

Depending on how much healthcare you consume, the difference can be significant.

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Look at plans from the outside

You may want to consider other options than those offered by your employer. If you have a partner who can insure you, they may offer better and cheaper coverage than your employer’s plan. Depending on the employer’s policy, you may not have to be married.

You are not eligible for a Marketplace plan subsidy if your employer coverage meets minimum value standards, but even without a subsidy, coverage may be better for less money depending on the state and income. However, your family members may still be eligible for a Marketplace plan and premium support. You can verify your eligibility and compare plans by visiting healthcare.gov.