Health Insurance Hassle

So just when you think you have your budget locked in, something goes and changes. In my case, health insurance costs. I currently have the double whammy of regular open enrollment rate hikes and a new company merger that is throwing everything into chaos.

To stay with the PPO style (think co-pays and a lower deductible) of health care I have always had I would be looking at an increase of about $100 a month. For many people $100 a month is not a huge deal, for someone who has budgeted down to her last $13 of discretionary income a month, it is a huge deal.

My other option is an HSA, Health Savings Account, which has a much lower monthly premium and a much higher deductible. The philosophy is, you take the money you would have paid on the premium and put it in a savings account (pre-tax) and then use that money to cover the higher deductible. Basically it gives you greater control over your money, privatizes health care a little bit.

I have been assured this plan is very good for people who do not visit the doctor frequently or have many prescriptions. I did not see a doctor at all the past year, if I had been funding my HSA this year I would have a sizable nest egg to use towards any medical costs that come up.

Good news is, in both instances, all preventive care is covered at 100% (including all cancer screenings) and there is no max cap with no pull on your deductible. So you can take good care of yourself for free.

The only real fear with switching to the HSA is a sudden catastrophic event, say I get hit by a bus. A wise friend pointed out that a catastrophic medical situation is a financial burden regardless of insurance plans though.

So I lean towards the HSA. My premium will go down about $100 a month and I will funnel that money into the HSA, so it should not effect my take home pay and I will have half my deductible covered by the end of the year. I can also fund it independently, say with my tax refund in February, with no penalty.

I consider myself to be fairly intelligent, but these past few days have left my head spinning, but with a commitment to making myself healthier so I don't have to deal with medical issues for awhile...