It’s always hard to predict what will happen in the future, but medical expenses are a fact of life. Even if you don’t get sick and don’t get injured, you’re still probably going to be paying for health insurance because otherwise even a short trip to the ER can send you spiraling into bankruptcy.
If you’ve chosen a plan with a higher deductible to save money on your premiums, you have to pay up to that “deductible” on your own before your insurance will kick in at all. If the deductible is high enough, for our purposes $1,350 for a single person or $2,700 for a family, you can also create a “HSA” a health savings account to put aside money to help you pay for that deductible (doing it this way saves you from having to pay taxes on the money in the HSA). The current law allows you to set aside up to $3,450 if you’re single or $6,900 for a family tax free.
The other way to possibly save money is to go the other way, to get a more expensive plan with a lower deductible, if you know that you’ll be paying for healthcare costs anyway. You may be paying more in premiums, but since your insurance kicks in faster, you’ll pay less of the overall costs of your medical care, especially as the costs mount higher.
The best way to figure this out is by considering your own situation. How often do you get badly hurt or seriously ill? Do serious medical conditions run in your family, and what age to your family members usually start getting ill? Do you have ongoing medical concerns?
There are always the surprises too: A car accident, cancer, or cancer going into remission. Sometimes things are drastically different than what we expect them to be. That’s why insurance exists in the first place.
We aren’t insurance salespeople, but we can help you evaluate plans if you need an outside opinion. We can also help you with the taxes around an HSA if you’re putting money in or pulling money out for medical bills. If you have more questions, let us know.