Save Your Money
The American family has turned a corner financially with a new set of rules for budgeting. In the past, our budgets included vacations, movies, eating out once or twice a week and other pleasurable items. The way of financing our pleasures was usually the wonderful plastic credit card. Well, we have put down to the Criminal Court Fung Bare necessities: housing, food, utilities, transportation and insurance costs. What we have for once in our life is over, at least for now.
We have had to cut back drastically. How do we cut back on health insurance and still have the coverage we need? Many families are facing potential financial ruin because they cannot seem to afford adequate health insurance.
The question I get asked the most is "What is my yearly deductible?" Many people are so afraid of more than a $1000-$2000 deductible. You may be surprised to find out how much money you can save with a higher deductible and what the bottom line really is. Below is a simple formula to use:
Deductible + Out of pocket maximum + Yearly premiums = The Total amount you are responsible for in the event of a major health catastrophe.
You will be surprised to learn, this is not always clear. Let us take an example of a family of 4 persons (father, mother and 2 children).
* Sample Policy Option 1: A major medical policy with unlimited doctor office visits with a $35 co-pay. The annual deductible is $1000, maximum out of pocket $2000, monthly premium $664 X 12= $7968. Using our formula: $1000 + $2000 + $7968 = $10,968. This is the total yearly expense this family would be responsible for for a major illness/accident with this plan.
* Sample Policy Option 2: A major medical policy with 6 doctor office visits (per family member) with a $35 co-pay. The annual deductible is $5000, maximum out of pocket is $2000, monthly premium $256 X 12= $3072. Our new formula: $5000 + $2000 + $3072 = $$10,072. This is the total yearly expense this family would be responsible for a major illness/accident.
The difference in monthly premiums between 1 and Plan 2 $ 664 $ 256 $ 408 per month! Even more important is the actual financial responsibility in the event of a major hospital is the same!
Please keep in mind, each state has its own insurance regulations. Residents of Tennessee and North Carolina can visit www.theinsurancehelp.com and click on save money for additional information particularly for those states.
By using an independent health insurance agent in your state, you can compare premiums with different companies and hopefully save money!
