|
health care system choice
I just got a new job and the health care system is weird. I can choose to either pay $30 a month or $15 a month. If I pay $30 a month, the company pays for all my health care over $1600, if I spend more than that in the year. If I pay $15 a month, the company doesn't start paying until after $2800. I'm healthy and don't think I'll need more than $1600 for the year, so I think I might go with the cheap plan and save on my monthly payments. But I'll be screwed if something happens to me, like I fall off a bridge and need $4000 surgery, because I'll have to spend $2800 total instead of $1600. What would you do?
[ ]
Want to answer more questions in the Work & School category?
Maybe give some free advice about: Personal Finance?
If you can afford it, go with the $30/mo plan. Better to be safe than sorry.
]
Would having to come up $2800 all at once be an insurmountable challenge? If something bad (like $2800 bad) happens in the next 7 years or so, it'd be worth it to shell out for the better plan. I don't know too much about pricing in the US, but if you're doing regular check-ups and dentist's appointments, that's some amount, say $200, off the deductible already.
More insurance is nice, because savings month-to-month tend not to feel like much at the time, whereas paying 75% more for your surgery while recovering from that hypothetical fall off a bridge (or whatever) is just too much bad news all at once.
]
Should something happen you have to pay at least $1600 either way. So, you need to be ready to pay that already
Let us say you will not have an health problem until the 12th month.
the $30.00 way:
You need to pay and save $164.00 ($30 + $134)
the $15.00 way:
You need to pay and save $249.00 ($15 + $234)
each month to be ready by that month.
Usually these systems allow you to change your choice annually. It would be best if the <b>first</b> year you went the $30.00 / month route AND saved up for the $2800 so that next year:
the $30.00 way one year:
you pay and save $164.00 ($30 + $134) to gain a savings balance of <b>$1608</b>. Next opportunity change to the $15 plan. Then you have $2800 - <b>$1608</b> = $1192 left to add to savings. You also have more saving power since you will not be spending $30 but $15.
2nd year you pay and save $115 ($15 + $100) to get to the balance of: $2808 = <b>$1608 (saved last year)</b> + <b>$1200 (saved in second year)</b>.
Note 1: even if you get injured the 2nd month of the second year your total additional money you need to pay out should only be $1192 since you have <b>$1608</b> already in the bank!
Note 2: You will be <b>earning interest</b> on your <b>$1608</b> so the balance will actually be higher as you proceed through the second year.
]
I'd pay the $30, better safe than sorry.
]
More Questions: |