October 12, 2023
There could be an unpleasant bit of news when you review your workplace benefit offers for 2024. A recent survey of employers reports that their cost to provide health insurance to their employees could rise more than 6% next year.
It’s not out of the question that employers may pass along some (or all) of that rising cost to workers. Higher premiums. Maybe higher deductibles. Or higher copays.
You should always carefully review your benefits package during each open enrollment season. But this year, it’s extra important to carefully read through your health insurance coverage.
If you do face a much higher cost, and you see that your employer offers a high-deductible health insurance plan (HDHP) with a much lower premium, please be careful before making the switch.
An HDHP can work out great, as long as you have the cash or savings to cover the high deductible. And be sure to check whether the deductible is for your entire family, or per person.
Be honest here. If paying off that deductible would be hard, or if it would mean running up credit card debt, an HDHP is not for you.
Another hidden risk with an HDHP is psychological. When people know they have to pay a hefty deductible before coverage kicks in, it can lead them to avoid seeking out care for non-emergency issues. Again, you need to be honest with yourself: Could you be that person who lets something linger to avoid the high deductible of some tests? If so, I would rather you stick with a higher premium/lower deductible plan.
And if you have adult children who are working but are still covered by your plan, I say it’s time to kick them off. Or have them pay you for their share of the premium cost. Just because plans are allowed to cover adult children up to age 26 does not make it a smart choice for each family.
At their young age, an ACA plan will not be expensive, and if they are just starting out at work their income might qualify them for subsidies that can bring the premium down even more. Don’t tell me it’s no big deal to keep them on your plan. Beyond the cost to you, there’s the missed opportunity of helping them become a fully functioning adult who takes care of their own health insurance. (They can start looking for plans at healthcare.gov.)