Open Enrollment: Finding Affordable Health Insurance
In order to produce the podcast and keep content up free for you, I work with partners so this post may contain affiliate links. Please read my full disclosure for more info.
Feel like your premiums are too expensive? Learn how you can significantly save money and find an affordable health insurance plan for your family!
Choosing an Affordable Health Insurance Plan
Like many families, we want affordable health insurance. Unfortunately, it's not always easy.
In 2019, the average annual premium for a family was over $20,000!
That’s quite a bit of money so it’s absolutely crucial that you’re 1) getting the most out of it and 2) if there is a more affordable option, you can make that transition easier.
The good news is with open enrollment, you can have some big wins with your benefits for next year.
I want to make sure that when you two sit down, I want you to feel comfortable and confident about tackling your benefits.
Of course, every couple is different, I’m grateful Andy Hill, the creator of Marriage, Kids, and Money and the co-founder of Thriving Families Facebook Group is here to chat with me about his and Nicole’s process with choosing a health plan.
We’re going to compare how each of us approached finding the best health insurance plan for our families.
In this episode we’ll get into:
- The differences between the most common options given
- What to consider when deciding if a high deductible plan is right for you
- Maximizing your available health care benefits
Let’s get started!
How to Master Your Small Business Finances (Even If You're Busy!) – Couple Money Podcast
Resources to Save Money on Healthcare
Are you looking for more help with keeping health care within your budget? Here are some resources:
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- Grow Your Stash Faster: High Yield Savings with CiT Bank
- Free 401(k) Analysis: blooom
- Jumpstart Your Marriage and Your Money
- Simplify and Enjoy: Financial Freedom for Families
- 5 Days to $5K Course
- How to Save Money on Your Health Insurance and Expenses
- Hack the Affordable Care Act Guide
- Why We’re Switching to a High Deductible Health Plan
- How to Spend Less on Insurance
Thank You to Our Sponsor Coastal!
Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.
They have competitive rates on checking and savings accounts!
Key Takeaways on Finding an Affordable Option for Healthcare
Before we wrap up, I want to focus on a few key takeaways I got from speaking with Andy and preparing this episode.
- Invest time in choosing your healthcare plan. Health care can be expensive, but simply going with the cheapest option can hurt you in several ways.
- High deductible health plans aren’t for everyone. We have an HDHP and so far love it and so do many in the FI space, but that doesn’t mean it’s the best option for you.
- Use tax-advantaged accounts to maximize your money.
If you want to discuss this more, please come chat with us on Facebook in the Thriving Families Group. We’re supportive. We’d love to see you there!
Finding Affordable Healthcare Options for Your Family
Elle Martinez: Open enrollment is coming up and for families, this is that one time of the year where they are dealing with a huge expense- healthcare.
Making that right decision for the upcoming year finding that Goldilocks sweet spot of enough coverage and not paying too much.
So we've both kind of had similar experiences where we had to make a change with our health insurance plan.
I don't know about you, but it felt like, and it still does plans go up every year with the premiums, the coverage doesn't seem to change if it does, it almost seems like it's going down.
When you have two kids, it can eat up a chunk of your budget. So how do you deal with it? How did that conversation open up with you and Nicole about making that switch?
Andy Hill: I'll start off when I was a full-time employee because there's some people who are in that, in that camp and then other folks who are entrepreneurs too.
When I was a full-time employee, I've worked for a company and they had great benefits. They really did. and. One time. At one point, I think this was maybe 2017, something like that.
I was on this super exciting, financial independence plan. Like what can I do to decrease my expenses for things that don't bring me that much more joy and then increase my my spending on fun things, vacations and , kids' activities and things that we fun in our family.
And one of the areas that I was on a hunt for was why is insurance so expensive? So I looked at home insurance, I looked at, our umbrella policy. I looked at auto things like that, and we found ways to bring those down and still had similar coverage.
And then another area I wanted to look at was health insurance. So at work, I looked at a high deductible plan. And then I looked at what I had and to switch over to the high deductible plan, we'd save around 300 bucks a month. And I'm like, wow. Okay. Well that seems like a lot of money essentially our premium would go to zero.
If we went to the high deductible plan, that's based on my company, they had a really, really generous plan.
Luckily enough, during that timeframe, we had a healthy history and, it ended up being a good bet for us. That's what I did as an employee.
Getting Health Insurance as an Entrepreneur
Andy Hill: And then, when I moved over to, the entrepreneur world, I again want to know the look for a high deductible plan just because it worked well for us.
And that's where our search began at the beginning of the year.
Elle Martinez: Yeah. We're kind of in the same boat. My husband has a nine to five and then I'm self-employed. So we were having the kind of these conversations.
His company had some pretty good plans and the premiums were competitive, if not as great as yours, but we were noticing , we had the family premium plan for a few years and then the price went up.
So we dropped to the family base it because like you, and we're grateful for this. We're relatively healthy. The only time we visited the doctor was for the annual visits. And so it just, it kept rising and that got to the point where the premiums, even with his discount [were] approaching our mortgage payment.
Andy Hill: Yeah.
Elle Martinez: Yeah. And it was insane. And then we heard about the high deductible plan. They started offering it. We didn't take it the first year because just the name itself kind of scared us with a high deductible. Like, am I on the hook for-
Andy Hill: High cost plan, right.
Elle Martinez: Yeah, but I've been noticing the last few years, even though yes, it is. You're on the hook for a larger amount. It's not as big of a leap as you may think.
So definitely want to run the numbers with that. And like you, we are saving like $300/month. I think now the difference is like $400/month.
Andy Hill: That's great.
Maximizing Your Health Saving Account
Elle Martinez: And of course there's so many different ways you can use that money.
And you have that typically is offered with a high deductible plan is an HSA, which is kind of what we've been doing with that money saved.
So I want to talk to you about what attracted you to that option of the high deductible plan and the HSA?
Andy Hill: Sure. And it's funny, cause I was just thinking about, you know, the parents that are going from pre-K to their kids being in school full time. And then, then having that money now, like saying, making that decision, well, what are we going to do with this extra money? It's kind of like your health insurance decision, right?
You, save that 400 bucks. You're like, okay. Wow. Oh, we could use that to live on or have more fun with, or you could do, you know, do something to save for that rainy day. Cause that might happen.
that's kind of what the HSA is. You put away that money for them a rainy day, or if you need to pay that deductible, but there's tax advantages to it.
So in my situation at my company, they actually didn't offer an HSA, but, I had a high deductible plan. So I was able to go out of my company, get an HSA and I did it through lively.
with that I would pay into the plan post-tax as opposed to, if you had plan with your company, you'd pay in pretax.
So it was a little bit, I'm a little bit backwards, but it's still were really worked out for us and we've seen ended up saving and haven't had the tap it. Really at all,. We've ended up saving about $15,000 in there over the past couple of years and enough to cover the deductible. If we really had something bad happen, and that's the point.
Elle Martinez: Yeah. And I do want to point that out for those that are considering like what option is good for me?
An HSA, health savings account, it sounds like a flexible spending account in that you can take, if you have it through your employee, your pre tax dollars. Which lowers your taxable income.
So that's the one, and then you can use that for expenses, but the difference is with the flexible spending plan, that's what you have to do. You have to spend it every year or you lose that money.
What attracted us and probably you is if you don't need it. And that's what we're hoping for. You can roll that over.
You keep money and, Another thing that I found fascinating with an HSA is, yes, you want to cover that deductible that should you to need it. You have that money saved.
But if you already have that saved in that savings account, you can actually start investing as you increase . So for families that are relatively healthy, this can be an incredible option for saving money.
For future expenses, whether that's immediately while your kids are young or while they're growing up if it's a health-related expense or when it comes time to retirement, you can take it out tax free.
So I think it HSA provided that, you know, it makes sense number-wise which we'll probably get into a little bit more, can be an incredible way to go.
So you can use it now or you can save and invest some of it. Which can improve the growth that, you can't just put it in a regular savings account.
Andy Hill: And one stealth thing about that too. After 65, you can take it out. Penalty free. Even if you don't use it for healthcare expenses, you can use it for whatever you want retirement at that point.
if you are lucky enough to have a healthy thirties, forties, fifties into your sixties, and you haven't had to use that money, it can be, like a little stealth, a retirement savings account, too.
Elle Martinez: Yeah. So I don't think we give enough attention to like these tax benefit accounts, but it can really add up when you combine it because the immediate benefit is your taxable income goes down, which is fantastic. And then later, if you need to use it, you can take that out tax free.
So. Andy. I want to chat with you about this. You're now in this new frontier.
2020 is not going the way anybody expected. there's a lot of things everyone's trying to figure out and healthcare being so important. How are you and Nicole having these discussions what's been on your mind, going forward about what's the best option for your family?
Andy Hill: For sure. Yeah. So before I made the leap to entrepreneurship in January, I had gone on healthcare.gov, the affordable through the affordable care act and found a policy that was very similar to what I had with my full time job. A high deductible plan. It was around 1200 bucks a month. So this was quite a big jump from zero
Elle Martinez: Yes.
Andy Hill: but I knew before I made the leap, I'm like, I want to have the same protection that I have through my job with my new venture. So we got that coverage and Nicole has been in a part time working situation.
She's considering going back full time. So that might change our healthcare. Situation come this fall or early next year, but for now I've been covering it with my, you know, business income .
It can be a deductible for my business income cause I have a S-corp so it's a benefit for me as well, employee of my company. So, yeah, it's worked out pretty well.
and if my income can continues to go down as it has, there are subsidies through ACA that can help you save a little bit of money too.
So if the downward trend of my income, as it has been over the summer, continues to go down that way. I'll be able to save a little bit of money on the health insurance heading into my tax season next year, too. So that's what we've been doing.
Elle Martinez: I appreciate that because I mean, all of us are in a state of flux.
I'm glad I have certain contracts and then you just see this every month. You're like, what's coming next quarter. I have no idea, but , it's about those conversations we have, In the family about, health insurance, those big expenses to make the best decision.
We can't give specific information about what's the best health plan for you, but I wanted you to see and hear from us. Like here's what we're considering. Here's why we chose this and why it's working for us.
So. If you guys are relatively healthy, you're not having, for example, a lot of doctors appointments, you don't have medical expenses like equipment or prescriptions. Then you may want to look at a high deductible plan.
That could offset. Some of that money and nowadays we need a free up, space in our budget for options.
Support the Podcast!
Thank you so much for listening to the podcast! If you enjoyed this episode and found it helpful, here are some ways to support it.
- Spread the word! If you enjoyed this episode and think it can help a buddy get on the path to dumping debt and become financially free, please share.
- Leave a review. Honest feedback and reviews make a big difference and gets the word out about the podcast. Leave your review on Apple or Stitcher.
- Grab a copy of Jumpstart Your Marriage and Your Money. My book is designed for a busy couple to set up their finances in 4 weeks. Get tips and tools that have worked for other couples on their journey of building their marriage and wealth together!
Like the music in this episode? Our theme song is by Gentle Regime.
Additional music by Lee Rosevere and Logan from Music for Makers in this episode.