How to choose health insurance

Most of the time it's a lady shopping for the wellness Insurance, in household it's Mom, in companies it's paysheet/book-keeper (also sometimes Mom in small companies). The guys just say 'I never use it', and leave the room.

The primary election concerns are normally Office Visits, Rx (Prescription Drugs) and infirmary stays. Since ladies are normally looking more closely, we often find pregnancy in the list of concerns, when the guys stay in the room, sometimes we are asked about Chiropractic. This is not ever the case, just the usual mix of concerns. You should definitely read the summary of benefits BEFORE using my comparing method. Both plans should be acceptable to you, you just want to know which makes sense financially.

Having been in one thousand of discussions about wellness Insurance I have found a simple way to comparison High Deductible plans that cost less every month, to Low Deductible Plans that cost a lot of money every month. It is fundamentally this:

• Add up the annual cost of the High Deductible plan, say $100 per month times 12 = $1200 per year.
• Add up the annual cost of the Low Deductible plan, say $300 per month times 12 = $3600 per year.
• Subtract the smaller: $3600 minus $1200 = $2400, that is the annually savings if you choose a High Deductible Plan.

Now, you don't use the deductible to comparison, but a characteristic of PPOs called "Maximum out of Pocket" or "Stop Loss". That is your worst case scenario, everyone is sick, or everyone is injured and you all meet your deductible and co insurance up to that figure, say $10,000 for a household.

At that rate, economy $2400 per year, you would have to go about 4 years to save the money you would need in a worst case scenario.

In my own case, household of 5, Los Angeles rates, a Low Deductible Plan is over $1000 per month, a high deductible plan is less than $300, we save over $8000 per year, and have been saving for over 12 years (we have an HSA, with a $3400 deductible, $10,000 max out for the family).

Many newer High Deductible plans like TONIK, from Anthem Blue Cross ,include Preventative, Dental and Vision benefits, which are more likely to be used than major medical. We all need a teeth cleaning, we don't all need a transplant, so those plans make sense to many people, and are extremely popular.

My comparison system still works, you simply add the cost of buying separate Dental and Vision to the cost of the plan without them, that really makes the newer plan including those benefits desirable, if you would use those extra benefits.

It's a simple rule really, and can be applied to other benefits, like Glasses on a Vision plan:

• Vision coverage is $3 per person per month, with Lenses and Glasses covered it's $10.
• You have 10 in your group, so that is $100 per month, $1200 per year.
• Only two wear glasses, everyone else just needs the exam.
• You only need exams for most, so that's $3 per month times 10, $30 = $360 per year.
• You simply buy new glasses every two years for the two who wear them, and save $840 per year.

Once again, the focus here is on financial aspects of insurance, not the benefits, which must be weighed separately, and could be called "Getting a good deal". This method can tell you if you are "Getting a good deal" financially, comparing benefits is another story. Which I intend to write soon!