High-deductible health plans are on the rise.
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For example, according to a recent study, by 2015, nearly one in three large companies will offer only high-deductible health insurance plans to employees.
If you’re unfamiliar with these plans, here is the basic idea: You buy an insurance plan that comes with lower premiums than traditional plans. But it has much higher deductibles. This means you spend a higher amount of money out of pocket — usually through a pre-tax arrangement — before your coverage kicks in.
In some cases, patients choose these plans. In other cases, employers choose them. If either of these applies to you, there are ways to make sure you don’t neglect your care — no matter what your coverage is.
1. Know the details of your plan
Let’s say you’re a healthy 24-year-old on your first job out of college. You have that sense of invincibility that often comes with youth.
You’re willing to roll the dice and hope you don’t have a serious illness or hospitalization. Just be aware that the unexpected can happen — and if it does, any large expenses will come out of your pocket. Financial planning isn’t the first thing on most 24-year-olds’ minds, but it’s helpful to have an emergency fund for such occurrences, and knowing the details of your plan can help you figure out how big such a fund should be.
Also, if you have an injury or long-lasting illness and know deep down that you need help, don’t avoid seeking care out of fear of a large hospital bill. That’s short-term thinking that can backfire in the case of something serious.
2. Don’t skip out on chronic disease management
For those of us who care for people with chronic diseases, our biggest fear is that people will skip crucial chronic disease management if they have high-deductible plans. It’s a major concern for people living at or near the poverty line, who have to make hard choices about how much they spend out of pocket.
You don’t always feel the symptoms of conditions such as diabetes or hypertension — they’re silent killers. Because of this, it can be far too easy to skip trips to the doctor when the cost is expensive.
Our message is simple, even if it’s difficult: Don’t skimp on your management of chronic disease because the long-term costs will be even greater than the short-term costs. Failure to manage a disease such as hypertension or diabetes can lead to heart attacks, strokes or other serious events, even years down the road. Recovering from such events is much more expensive than managing a disease — and they could cost you more than money.
3. Don’t defer routine or elective care
Anecdotally, we’re seeing a decrease in primary care visits, which may connect to the rise in high-deductible plans. But annual visits are still the cornerstone of care, for everything from preventive screenings to gathering family health history. You shouldn’t avoid them, for financial or other reasons.
In addition, be aware of any serious medical needs. If you have ongoing medical conditions or suspect you may need care beyond typical check-ups in the future, weigh your insurance decisions carefully. But if a high-deductible plan is your only option, be mindful that sometimes the extra expense is necessary for long-term health.
4. Plan for other needs
Health savings accounts or flexible spending accounts are key features of many high-deductible plans. They allow your out-of-pocket spending to come before taxes.
If you choose a high-deductible plan, it’s worth taking a close look at these options. If you have access to a financial planner who can help you weigh the pros and cons, that’s all the better.
The bottom line: High-deductible plans are a major trend. If you choose one for yourself or your employer chooses one for you, educate yourself as much as possible on the plan details. And even if it requires some careful financial planning, don’t neglect your long-term health because of a change in coverage.