So you’ve got a health plan with a (gulp) high deductible. That’s pretty common these days, so you’re not alone. In fact, a good chunk of the plans sold on the insurance exchanges are high deductible health plans (HDHPs).
High deductible plans are great because they cost less when it comes to the monthly premium. But you need to be prepared for when, or if, the bills start coming in.
Here are five things you can do now to make managing your deductible easier.
1) Save save save
One of the worst things you can do if you have a HDHP is to go without savings sufficient to cover your deductible. This is why all HDHPs come paired with a Health Savings Account option. HSAs let you save money tax-free. If you’re going to save for medical expenses anyway, why not get a break on taxes too? If your health plan is through your employer, they may already be making contributions to your HSA. In addition, you might also consider putting in your own monthly contribution, as most employers only contribute enough to fund the full deductible over the course of an entire year. If you want the savings to build up faster, you’ll need to kick in some funds yourself.
2) Know what’s excluded
Because of the Affordable Care Act, all health plans must provide preventive care free of cost. That means these services won’t count towards your deductible. It’s also common for plans to exclude certain co-pays or have a separate deductible for prescription drugs or for out-of-network providers. What you don’t want is to be in a situation where you thought you were fulfilling your deductible when you uhh, really weren’t.
3) Understand family deductibles
Do you have your spouse or children on your health plan? Each member of the family may have a separate deductible. To make things more confusing, there are no standard rules for how plans calculate these. Each individual member may just need to meet their deductible separately. Or it may be the case that one member of the family must meet the entire family deductible for coverage for everyone to start. Check with your health plan if you’re unsure.
4) Know the plan year
Most plans use the calendar year (January to January) for resetting deductibles. However some use a fiscal or academic year. Also keep in mind that the deductible year could be different from the rollover period for FSAs or HRAs for your plan.
5) Reevaluate if needed
HDHPs tend to work best for people who either don’t use a lot of health care or who, if they are sick, have a lot saved up. If you anticipate a lot of expenses year after year, you may find a lower deductible plan works better. Don’t be afraid to switch plans at your next opportunity if this feels like you–remember, you won’t lose any money left in your HSA if you choose to do this. HSA funds belong to you once they are in your account, regardless of if you change plans or employers.