Switching from self-pay to employer health insurance?

Jessica4Bama

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I have self-pay health insurance and I’ll be starting a new job in June, which will allow me to go on an employer plan. The plan would take effect on July 1, so my question is how do I go about getting this switched? Do I just tell BCBS that I’ll be switching to an employer plan and tell them the date I want to cancel my self-pay plan or what? I’ve never had anything but self-pay insurance so I’m not sure the best way to go about this especially with the whole open enrollment/penalty for not having insurance for a full year thing.
 

GrayTide

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Jessica, I agree with Bazz this is something your HR department normally takes care of. I would caution you to make sure when your new coverage goes into affect before dropping your current coverage because there could possibly be a waiting period before the new coverage begins. Good luck.
 

seebell

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You'll probably have to cancel your self pay insurance yourself, but as GrayTide said, don't cancel it until the new insurance goes into effect.
 

BamaNation

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Congrats on the new job ( I hope!)

Make sure you check out the high deductible options if you’re relatively healthy. You can save a ton of money PLUS save money in an HSA and use the HSA as a a pre-tax investment fund that is never taxed so long as you use withdrawals as reimbursement for incurred healthcare expenses.

See my recent post on investing for further thoughts in this regard.


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Jessica4Bama

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Congrats on the new job ( I hope!)

Make sure you check out the high deductible options if you’re relatively healthy. You can save a ton of money PLUS save money in an HSA and use the HSA as a a pre-tax investment fund that is never taxed so long as you use withdrawals as reimbursement for incurred healthcare expenses.

See my recent post on investing for further thoughts in this regard.


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Can you elaborate on the HSA? Not sure what that means. I have to get testing twice a year for breast cancer since I have the cancer gene. Will the high deductible option make me have to pay more for those tests? I have to get an MRI/ultrasound/mammogram yearly. That’s my only reservation about the higher deductible option. I’m healthy otherwise and hardly ever go to the doctor.
 

BamaNation

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Can you elaborate on the HSA? Not sure what that means. I have to get testing twice a year for breast cancer since I have the cancer gene. Will the high deductible option make me have to pay more for those tests? I have to get an MRI/ultrasound/mammogram yearly. That’s my only reservation about the higher deductible option. I’m healthy otherwise and hardly ever go to the doctor.
Great question!
Sounds like you might be a good candidate but make sure you read up on your options before being forced into a decision.


Here's the short of it...
High deductible plans allow you to have a Health Savings Account (HSA). You can put up to $3500 for a single person plan or up to $7000 for family in a health savings account that you can then use to pay anything that the insurance does not pay.

HSA savings come out of your check BEFORE taxes are computed (like 401k etc) so you're actually getting a bigger benefit than whatever you put in there (just like 401k). It goes into whatever HSA plan your employer has designated and you can then keep it in a low-interest earning account or invest it like you would your 401k. It can only be used on your health costs but can also include smaller items like bandages, medicine, normal doctors/dentist visits, etc. that you would normally pay out of your pocketbook.

Unlike a Flexible Spending Account (FSA) which is a "use it or lose it" account to pay vision/dentist costs each year, HSA can be saved and is available to you / your spouse to withdraw at any time - tax free if used for healthcare - until you die! This makes it more like a Roth IRA.

We use HSA as just another long-term investment vehicle, saving for those bigger health costs of older age but also do save healthcare bills we have now (and pay for with "cash") so that we could withdraw that amount at anytime tax-free. Once per year we actually transfer the money in the employer-designated account to Lively which has had better investment options (i.e. low-cost passive index funds) through TDAmeritrade.

I will put together some further resources on HSA, Roth, etc.
 
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Jessica4Bama

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So, I’m not sure the high deductible plan will be good for me since I do have to get MRI/mammogram every year. The info I’ve received so far states preventive care is 100% covered and the calendar year deductible is $1,350 for individual and out-of-pocket-max is $5,000. If I have one MRI, that costs over $3,000 I believe. I would have to pay $1,350 of that upfront. I guess that’s how it works. Then I don’t know what insurance would pay after that or if I would be responsible for everything else. The only doctors I go to each year for yearly checkups are the dermatologist and gyno. So I’m not sure if those would be paid or if I would responsible.

The high deductible plan is $27.00/single bi-monthly. The PPO plan is $75.50/single bi-monthly. The PPO plan has a $40 co-pay and a $100 co-pay on MRI/CT/mammograms. The calendar year deductible is $500 that applies to inpatient/outpatient surgery; maternity; procedures; anesthesia charges. Also, this plan has an annual $5,400 out-of-pocket max.

I really don’t know which way to go. I’m thinking I’ll have to go with the PPO plan instead of the high deductible option simply due to the mammogram and mri I get done every year.
 

BamaNation

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I would talk to your doctors offices now and say, “here are the plans I have the option of getting. What / how much is covered under each one.” If you have (or can get) your plans’ group codes from your employer then the doctor offices should be able to tell. Otherwise talk to the insurance providers before committing. Never assume on investing or insurance! :)

As you state, given your personal situation the PPO plan may be the right path but just make sure. Also remember you get to reassess each year around November for the following year and anytime your family situation changes (marriage, births, divorce, etc).
 

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