Rising insurance premium is stressing me out!!!
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  1. #1
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    Default Rising insurance premium is stressing me out!!!

    DH just called in today to confirm our coverage through his company for next year. Basically, our rate is going to go up about 75% and the only thing extra we will have the coming year is a FSA added to our coverage. Gaw, when I heard that, it was like I could feel the stress just beating me down. I was even more annoyed that hubby didn't seemed particularly bothered by the news. I guess that's because I'm the one who manages the money (pay the bills, created the budget, ect) and know that this is no small matter. I keep him in the loop about these things, but I think his way to cope with this stuff is to not think about it and hope things will work out somehow like they always do.

    Hopefully DH will get the raise that he anticipates next month. If he does, it will be enough to cover the increase cost of insurance, so we will come out even in the end. If not, this certainly won't break us, but it will take longer to pay off our debt and build up our EF to a respectable amount.

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    Rude and Vile Master Greebo's Avatar
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    Does DH have the option of changing to a High Deductible Health Plan (HDHP) with an attached Health Savings Account (HSA)?

    Those are much cheaper, but you DO need to make sure you put money into the HSA over time because the deductible is several thousand per person.
    If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.

    Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"


    Greebo
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    Registered User Mochashello's Avatar
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    That's a huge increase! What are they thinking? I would try to find some way out of it, like with Greebo's idea or something. That seems ridiculous to me. I would be upset with the company if I were an employee.

    Your DH sounds a lot like mine. And when he DOES take a closer look at the finances, he always freaks out and panics and I have to calm him down. I wish I could be as stress-free as he is about money matters, but I doubt that will happen soon!

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    They are ridiculous increases, but the reason they're so ridiculous is in no small part because the health care companies are pushing people into the HDHP/HSA plans.

    The HDHP plans save a lot of money for the insurance companies, because employees end up frequently covering all of their own costs for the year. The HSA, being funded by pre-tax money, ends up saving the employee a bundle as well.

    To give a personal example - our company gave the option to switch, and the diff between the premium we were paying previously under the HMO plan vs. what we ended up paying under the HDHP amounted to $82.60 per pay, or $2,147.60 per year. We redirected that amount into our HSA, which almost saves enough per year to meet one of our deductibles ($2,400 each).

    We're relatively healthy, so we've never used up the HSA account, and it rolls over from year to year, so every year we're putting more money away for later health care.

    And since I'm putting in $82.60 per pay, pre-tax, in my bracket I'm only actually seeing $61.95 actually not coming into my pocket. The other $20.65 is money that otherwise would have gone to Uncle Sam.
    If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.

    Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"


    Greebo
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    Two mortgages, two one no car loans, one no credit cards, and a partridge in pear tree!

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    Does DH have the option of changing to a High Deductible Health Plan (HDHP) with an attached Health Savings Account (HSA)?
    I don't believe so, I went over all the information provided by the company that explained how the policy was changing. I'm looking over things again now and there is a way we could have done this cheaper. 70/30 coverage, higher deductible, but less out of pocket for premiums. Drop the FSA even. These two things will save us almost $150 a month.

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    We're relatively healthy, so we've never used up the HSA account, and it rolls over from year to year, so every year we're putting more money away for later health care.
    Wish the FSA worked the same way with this company. It is pre-tax, but has to be used up by the end of the year or we loose it. We've never had one before, so we thought we would give it a try this year, but after adding up what everything was going to cost us, I'm seeing how every little bit adds to it. Still not sure if we should keep it or not.

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    Registered User Mochashello's Avatar
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    what is FSA?

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    Rude and Vile Master Greebo's Avatar
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    Quote Originally Posted by tmffv View Post
    I don't believe so, I went over all the information provided by the company that explained how the policy was changing. I'm looking over things again now and there is a way we could have done this cheaper. 70/30 coverage, higher deductible, but less out of pocket for premiums. Drop the FSA even. These two things will save us almost $150 a month.
    Be sure you maintain a higher reserve to cover the higher deductible, in that case.

    The FSA can be a good option, but ONLY if you can reliably predict that you'll actually use it, since FSA is use it or lose it.
    If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.

    Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"


    Greebo
    (Nerd Spender): Loving and extremely patiently tolerated husband of ceashels.
    WARNING: Y Chromosome behind the keyboard. Adjust your listening filters appropriately!

    Three
    Two mortgages, two one no car loans, one no credit cards, and a partridge in pear tree!

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    what is FSA?
    Flexiable Spending Account. Can be used for things not normally covered by the insurance and other health releated items. You tell the company how much you want to put in for the year and they take out a small amount each paycheck pre-tax. At least, that's how it was explained to us.

    The FSA can be a good option, but ONLY if you can reliably predict that you'll actually use it, since FSA is use it or lose it.
    And that's the one thing I'm worried about. We've never had one before, so I'm not sure what amount to put in/if we would use it all.
    Last edited by tmffv; 10-17-2008 at 01:38 PM.

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    Registered User Mochashello's Avatar
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    Does it earn interest or something? I don't understand why you'd do that instead of putting aside your own cash-stash in a savings account where it won't disappear if it's not used. There must be an incentive?

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    The incentive is that the money is taken out pre-tax.

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    Quote Originally Posted by Mochashello View Post
    Does it earn interest or something? I don't understand why you'd do that instead of putting aside your own cash-stash in a savings account where it won't disappear if it's not used. There must be an incentive?
    No, it earns no interest. As she said, its pre-tax. In cases where you *know* you will use the money - ie a family member with a need for regular treatments - its a big benefit, as pre-tax money saves you {your tax bracket}% over post-tax money.
    If you could kick in the pants the person responsible for your problems, you wouldn't be able to sit for a month.

    Did you know that a 4 year student paying $20,000/year who finances their education graduates with over $103,000 in debt to start? But a student who works and pays cash and takes 6 years to graduate ends with $6,300 in their pocket! So much for "getting a head start by financing!"


    Greebo
    (Nerd Spender): Loving and extremely patiently tolerated husband of ceashels.
    WARNING: Y Chromosome behind the keyboard. Adjust your listening filters appropriately!

    Three
    Two mortgages, two one no car loans, one no credit cards, and a partridge in pear tree!

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    Registered User Mochashello's Avatar
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    makes sense, but I would still prefer to keep it in a high-interest savings account where the interest would offset the tax savings anyway and there is no risk of losing a dime. But that's jut me I guess. I don't like not having control of my money. But if you do have known expenses, like a family member who needs regular treatment for something, then I can see how the risk is negligible. But barring that circumstance, I would keep my money.

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    Registered User Mochashello's Avatar
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    I do like the idea of the HSA, and better yet to have it in your own bank once you have finished all the baby steps! This concept has always made more sense to me. That if you can save up some earmarked money it is much better than paying a "just in case" fee every month for "insurance" that MOST OF THE TIME you won't need to use much of.

    Same with auto insurance. I think the law should allow, for those who can afford it, the option of purchasing a bond to cover you in case of an accident. If the bond gets used, you have to replenish it, but otherwise, once it is funded you don't have to keep paying out of pocket every month "just in case". Obviously until you have enough to buy the bond, you would have to keep insurance on yourself. But wouldn't it be nice to be able to get out from under that monthly bill? Accidents do happen of course, but how many of us have paid and paid and paid auto insurance for years and never filed a claim? Could you imagine having all that money back in your pocket now?

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    OP, sorry things are going kinda wacky, hope you can make your budget work. :hug:
    We have a fsa account, you decide how much you will use in a year & money taken out every paycheck. If you do not use up your account balance within a set time you lose it. Ours is used for copays, vision, dental, prescriptions and can also be used for otc meds. You pay for these things & need to save receipts and mail them in with a completed form to get reimbursed.
    Last edited by Darlene; 10-17-2008 at 03:13 PM.

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