Benefits Open Enrollment: The Decision Looms November 9, 2012

Every year I know I have to do this.  And every year I just pick something last minute and hope it works out.

Like many companies, my employer offers a bunch of different benefits.  I know I’m lucky in some respects, because not all companies provide as many benefits or coverage.  Every year, we get a packet with information, along with links to a few sites that help you compare options.  This year, we have the choice between a Point of Service (POS) plan, an Exclusive Provider Organization (EPO) plan, and two different High Deductible Health Plans (HDHP) that include a Health Savings Account (HSA).  Yeah, it’s basically an Alphabet Soup of Health Plans.

Every year, I think I pick the same plan (or the closest available option).  I’m not sure it’s actually the best plan for me.  There’s a questionnaire on my company’s benefits page that you can fill out and it tells you what plan is the best for my needs/wants.  According to the questionnaire  I should go for the slightly pricier HSA plan, where I pay a bit more for the plan, and the company puts $500 into my HSA (versus $750 into an HSA for the cheaper plan), where I pay a smaller percent of every medical expense than the cheaper HSA.  Confused?  Yeah.

My other options (the EPO and the POS) both have set copays rather than the coinsurance percentage that you have to pay for each service for the HSA plans.  And that’s part of the reason I’m shying away from the HSA-based plans.  I have no idea what anything costs.  I understand that HSA plans are great because they enable a patient to take control of their expenses and are especially good for people who don’t have a lot of medical expenses or problems (the young and healthy).  But with the current health care market, I have no idea how to shop around for medical services.  I have no idea how much a specialist at one practice charges versus another, or how much tests costs.  Granted, for most things, there’s probably a phone number I could call, and maybe I could track down a price.  But to be honest, I don’t want to deal with that.

Things to consider:

Premium costs:  This is the amount I’ll be paying for my insurance plan for the year.  For me, the range is $930/year for the “cheapest” and $1660/year for the most expensive.  Interesting to note, with the cheapest plan, my company will contribute $750 to my HSA, which does make that plan look a lot more appealing.  Other interesting note about premiums:  in my company (and many others) you can pay for the premium with pre-tax dollars.  Which does take a little bit of the sting out of the price.

Deductible:  This is the amount I pay on medical expenses out of pocket before my plan will pay for benefits.  Before you reach the deductible, you pay 100% of your medical costs.  Beyond that, the insurance either covers most or all of the costs, but you usually have to pay a set dollar amount or a percentage of the cost.  That cheapest HSA plan I mentioned comes with a $2000 annual deductible, which means if I need any medical services (beyond a few expenses that are covered 100% before deductible, like preventative care and some maintenance drugs listed on the Treasury Guidance list / Preventative Therapy Drug List [pdf]) I’ll have to pay for all of it either out of pocket or with the money in my HSA.

Maximum Out-of-Pocket:  This is the maximum amount of money I’ll have to spend in a year on medical expenses.  This is where it really acts as an “insurance”.  Heaven forbid something bad happens to you.  Disease, accidents, other scary things like that.  Well, the Maximum Out-of-Pocket amount means a $40k hospital bill will only cost you up to your maximum (for my plan options the maximum is anywhere from $1500 to $4000).  This is the kind of thing where you would be glad to have your HSAs, FSAs, and of course, your emergency funds.

In Network vs. Out-of-network requirements:  For the EPO plan, I’m only covered if I go to a doctor that’s “in network”, which means there’s a list of approved doctors/facilities that I can go to.  I haven’t had a problem with this in the past, except when it turned out only some of the members of the medical practice were in my network, so I had to go to a different doctor within a practice.  For the POS plan, it’s similar to the EPO plan, in that you have copays for each visit.  But you have the option of going to out-of-network doctors.  However, it is more expensive to go out-of-network than it is to stay in-network (i.e. the insurance covers a smaller percentage or requires a higher copay for the out-of-network services).

The other considerations I needed to make was my expected medical expenses (checkups (though some of those are already covered at 100% regardless of plan I choose) specialist appointments, prescriptions, etc.).  And I need to consider what is covered for anything unexpected (small things like sprained ankles or strep throat, or big bad diseases or accidents).  What will I have to pay for those?

So, what did I pick?  I went with the EPO plan.  That’s the one with the highest premium, but I know there are certain healthcare expenses I’ll be incurring and the way the plans are set up, this looks to be my best option.  Plus, this plan has the lowest Maximum out of pocket (and max + premium ends up being the lowest out of all 4 options).  Also, with the high-deductible plans, I feel like there’s a bit of a disincentive to visiting the doctor.  And since I’m already pretty bad at going to the doctor when I should be going, I don’t want the money issue to make things worse.

Have you had to sort through all these confusing different medical plans?  Or are you given one option?  Do you have an employer-based plan, or are you shopping on the open market?  What impacted your health insurance decisions?

Renter’s insurance: Worth the expense? September 27, 2011

The last 5 years, I was living on the edge.  I was living in an apartment, but I didn’t have renter’s insurance.  Of course our landlord had homeowner’s insurance.  But if our home was ever broken into, or caught on fire, we’d be out of luck.

I never really thought of renter’s insurance as being very important.  I figured I didn’t own enough “stuff” to make it worth it.  Insurance is always a gamble (it’s something you hope you never have to use). But renter’s insurance covers more than “getting your stuff back”.  Yes, most plans help you buy replacement clothes, furniture, and other items lost due to theft or fire.  And that’s definitely important, if all your work clothes are suddenly gone!  But this past winter, a good friend of mine was living in his condo, and one of the other condo owners had a fire that spread to his place.  Between the fire, smoke, and water damage, his place was unlivable.  He had homeowner’s insurance (I’m pretty sure it’s required if you have a mortgage…the bank wants to protect their investment!)  This meant that his place could be repaired.  But it also meant that in the interim, the insurance company would help pay for living expenses.

So, I bought renter’s insurance.  I figured it was better safe than sorry.  If something happened to our place, I’d want to be able to replace things and find a place to stay.  Plus it sounds like they also provide some legal assistance.  I bought it with the company I already have my auto insurance with, so there was a multi-policy discount.  Woo!  The total cost for the year of insurance is $171/year.  Also during that phone call, I negotiated a better car insurance rate.  I switched from a $500 deductible to a $1000 deductible.  Not sure if that was the best choice, but I wanted to bring down my premium.

So, what do you think of renter’s insurance?  A good decision?  Or a bit of a scam?  Is it better to just have an emergency fund for replacing your stuff than paying an insurance company?  Do you have renter’s insurance?  Why or why not?

And do you think I made the right choice in increasing my auto deductible so I could lower my premium?  It could end up being penny-wise pound foolish if I end up filing a claim, since the extra cost would outweigh the discount in premium.  But I guess in this case, I could use emergency fund money to pay for small issues.

Going to the Dentist December 12, 2010

I’ve got a weird past when it comes to going to the dentist.  I went plenty of times when I was a kid, and I even went every once in a while when I was home from college.  But once I was officially on my own (insurance and housing-wise), I completely failed.  I think it was a combination of laziness, confusion about dental/health insurance, trying to find a dentist, and scheduling.  To be honest, I didn’t go to the dentist until right after I had lost my last job.  They were still covering my medical and dental insurance for a month, and since I had all the time in the world, my schedule was wide open for a visit to the dentist.  That was in 2008.  I had gotten used to getting email or postcard reminders from my old dentists, so I assumed I was now going to be on a mailing list for every 6 months.  Wrong.  Apparently if you don’t schedule an appointment when you’re there, they don’t assume you’ll be back.  And since I really didn’t know that at the time, I was mildly oblivious.  Flash forward to 2010.  I finally remind myself to go to the dentist.  Set up an appointment and go.  When I arrive at the front desk to check in, they do the usual paperwork, then inform me that I owe them copays/balances from 2008.  I didn’t think I owed anything, and they never contacted me or sent me to collections or anything.  I would have paid up front back in 2008 had I known.  Who knows if I actually owed them, but I paid off my balance in full.  Interestingly, they also forgot about me in the waiting room.  I feel like this dentist office isn’t really big on following up on people…or at least not on new patients.  Seemed like most patients were regulars.

At any rate, when all was said and done, my dentist told me that I should probably get one of my wisdom teeth removed.  He gave me  a referral and my x-rays and sent me on my merry way.  Of course, again, me being lazy/not a fan of calling for appointments, I didn’t follow up until a few weeks ago.  But I had no clue how much this would all cost, and what my insurance would cover, or what exactly the surgery would entail.  So they actually were able to squeeze me in the Saturday right after I called them for a consult to figure out what to do.

When my name was called in the waiting room, they led me to a small room where they made me watch an “educational video” that was part advertisement, part educational, and part scary.  The video basically said, “you should probably get all of your wisdom teeth out ASAP, just in case, because the older you get, the worse things could get, and the probability that your wisdom teeth will cause trouble is pretty high”.  So, besides getting a bit squeamish, it also got me a bit worried…are all my teeth going to fall out and I’m going to have horrible diseases if I don’t get this taken care of right away?  The oral surgeon came in, looked at my x-ray really quickly, eyed my mouth, prodded around briefly with his gloved hands, and declared that I should get all four wisdom teeth removed.  Great.  How much is that going to cost me?

Well, when I checked out, they told me they’d run the numbers to see how much my surgery would cost and how much my insurance would cover.

Here’s where all the personal finance stuff really comes into play.  While waiting to hear about what my insurance would cover, I had a lot of questions:  Do I hold off a few more months, wait until the new calendar year for a better dental plan to kick in?  I could get a better dental plan, plus I could calculate how much to put into an FSA to cover the cost beyond what the insurance might cover.  But is this being pennywise, pound foolish?  Will holding off for a few more months mean my mouth gets all messed up and I have even more expensive problems to deal with in the future?

The good news?  All those worries were for naught.  Turns out, my health insurance would cover everything (except a copay).  So that meant $30 for the whole surgery.  WHAT?  I had to sign a form when I got my surgery that said that I agree to pay the copay, and it showed me how much it would have cost.  $2,100.  Another reason I’m glad I have health insurance.

I got the surgery this past Thursday, all 4 wisdom teeth were taken out, and have been eating pudding and applesauce ever since.  It hurts, but I know it’s important that I got this taken care of.

So, this is quite a long post.  I’m impressed if you got all the way to the bottom.  But now my question for you:  Did you ever get your wisdom teeth out?  Have you ever made a health decision based on cost, rather than on the advice of a doctor?

Buying a car August 10, 2008

So, unlike my last post that merely mentioned cars, this post is actually about cars.  Somehow that post was made one of the top posts on the cars news list list on wordpress, which bumped my stats up a heck of a lot.  Which I found silly, since I didn’t really talk much about cars.

Anyway, so I’m writing this post to sort out my thoughts on buying a car.  With my new job, I really need to have my own car, as I can’t depend on borrowing friends cars much longer.  I know there are so many different things to consider, and I’m never very good at making decisions.  My friend Kendall just bought a car (and wrote a post about it), and she made it seem so easy!  I’ve taken a few steps towards buying a car, such as buying a copy of the Consumer Reports Cars magazine (they also have a pretty extensive website and blog, but a lot of it is by subscription only).  I’ve gone through all the new cars they’ve listed and sorted them out into cars I’m going to consider and cars I wont consider based on price, gas mileage, and appearance.  I know there are more things to consider, but that was my first step on paring down my options.  I know that, besides the cost/gas mileage etc. that I also want it to be a safe car (both for driving and, heaven forbid, an accident), that has airbags and other safety features like antilock brakes.  I want decent trunk space and prefer 4 doors to 2 doors.

Things I’m not sure about:  The maximum I’m willing to spend, how to go about getting insured, whether to do financing, and if I do, then with what organization?, new or used, how to negotiate.

I know for financing that it depends on the deals I can get.  If I get an interest rate lower than my current savings rate (with ING at currently 3%) then I’d consider it (I know that car dealerships sometimes have deals like that).  I also don’t know what sort of loans I’d qualify for.  I probably could also get a car loan from a bank, as well.  I shamefully don’t know my current credit score, so I guess I should figure that out.  If the car is cheap enough, I could perhaps pay it all at once with money in my savings account.  But again, that would most likely depend on what sort of car loans are available to me.

As for new vs. used, I’m worried that with new cars you lose a heck of a lot of the car’s value once you drive it off the lot.  But with newer cars comes more safety features, and perhaps better gas mileage.  On the other hand, I don’t want to spend too much, and used cars tend to be cheaper.  If I bought a used car, I would likely buy it from a dealer that certifies the cars and provides the warranty for it.  But sometimes you can actually get pretty good deals on new cars if the timing is right.

So it’s a pretty big step to take.  I’m trying to sort out all the different factors, but it’s difficult.

What do you look for when buying a car?  What are your priorities?  Any recommendations on a fuel efficient, relatively inexpensive car?  Do you buy new or used?

I just feel so overwhelmed, so any advice would be greatly appreciated.

I got laid off…now what? May 6, 2008

Yep, you read it here first folks. I got laid off. Thank that beautiful economy of ours, I guess. But now that I’m unemployed, what do I do?

Be thankful for the emergency fund

Remember that emergency fund that every personal finance guru, blogger, author, etc. tells you about? You’ll be very relieved when you find out you have that nice cushion to fall back on. And really, that whole “pay yourself first” idea really works. I never noticed the money was gone (every month I had an automatic transfer over to my ING account), and now that I need it, it’s sitting there waiting for me to draw from when I need to.

Take care of the transitions

Depending on what your severance package provides (or if you didn’t get one at all), you’ll probably look at a few things. Did you get any severance pay? Congratulations. Stash that into your bank account ASAP, and be thankful that your company was nice enough to help you out there. My company did provide some severance pay, but a friend of mine got laid off recently and got pretty much next to nothing. It’s really dependent on your company.

What are you going to do about insurance? Again, some of this depends on your company; they may immediately stop paying the premiums for your insurance, or provide you a grace period. Either way, you should learn about the COBRA. This is where you are given the opportunitiy to continue your insurance plan, but you must pay the premiums, at up to 102% of the cost. Many people can just find alternate, often cheaper plans that still cover their needs. Depending on your state, you might be required to have insurance (which is the case in Massachusetts). From what I’ve heard, if you don’t elect to continue through COBRA, but then something happens and you need insurance, you can retroactively get it taken care of. Don’t quote me on that, I’m looking into it.

Were you enrolled in a 401(k) or similar program? If so, you have a few options that I know of. They are summarized rather nicely in Get Rich Slowly’s page. I am most likely going to either roll my 401(k) over into an IRA, or, if I find new work soon enough and it’s a feasibility, I will move my 401(k) to my new company’s 401(k). What I will NOT do, and I don’t recommend you do it either, is cash out my 401(k). You have to pay a penalty, and taxes right then for your money, and now you are back to square one with your retirement planning.

And if you had an FSA account (I did), you’re probably going to have to just submit the rest of your claims ASAP, and lose any money that you didn’t spend. I guess this wasn’t something I considered when I initially signed up, but I guess that’s something to think about…how quickly you’ll spend the money in your account. I’m not sure what happens if you spent more than you accumulated, if you have to pay back the extra. I’ll have to check on that as well (for you guys, not for me).

Looking ahead

It’s rough, but it’s time to get back out there! Let your friends know that you are looking. I went ahead and listed it on my facebook profile…which worked out nicely, because a friend saw that and offered to talk to someone in his company that works in my desired area of research. Having good friends willing to help you out is definitely a plus. This is not the time to start networking with people you’ve casually met in the past…hopefully you’ve been networking all along…of course, if you haven’t, you might as well start now! It just looks a little fishy when you suddenly talk to someone you sort of know who can help you find a job. But don’t be afraid to. Update your profiles on your social/business networking sites, and confirm that the available information and connections is accurate and represents you in a positive light. My next step is to look at companies that interest me, and then determine if I have a personal connection to that company, either through friends or through my alumni network.

In the meantime, I’ve also started looking at the assorted job posting sites out there, like monster.com and career builder. There are plenty of others that I’m looking at, and if you want, I can post those, too, though I’m not sure how popular of a site they all are.

Well, hopefully you aren’t all in the same boat as me. Let me know what you’ve found helpful, or if you’re looking for information that I didn’t include, since I probably just omitted it for no useful reason.

[Edit: I forgot to mention applying for unemployment. There’s a good overview here, and for Massachusetts, you can find out how to file claims and such here. If you have trouble navigating that site, let me know. I managed to figure it out.]