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Suggest "high deductable" policy Posted by Bill Homer [Email] (#3427) [Profile/Gallery] (more from Bill Homer) on Thu, 10 Feb 2005 09:45:57 In Reply to: OT: Health Insurance, larry, Wed, 9 Feb 2005 17:08:10 Members do not see ads below this line. - Help Keep This Site Online - Signup |
Unless you are a frequent visitor to various medical practitioners, in which case you may have "preexisting conditions" that will not get covered by your new insurer, I recommend a high deductable policy - I personally try to avoid doctors unless really necessary. For my family, the difference from "full care" coverage to "high-deductable" is substantial, i.e. $600+ per month. I currently have a Unicare policy with a $4950/year deductable, so any policy that saves me more than $412.50/month is money in my pocket. But wait, that's not all!!!
In 1994, our esteemed leaders in Washington enacted a Health Savings Account program, whereby you can fund an account up to the amount of your high-deductable policy's deductable amount. Any extra at the end of the year is yours, no forfeiture, gets "rolled over". This means that I can set up an account and put in $4950/year, withdraw money from the account if I want to (without an excessive amount of paperwork), or let it roll over for next year, etc. If you ever need to liquidate this account there are tax penalties. In return for a small annual fee, several companies have expanded upon this program and offer various investment alternatives for your account, mine offers various Vanguard index funds. An accountant I know, also self-employed, is so enthusiastic about this program that he recommends funding the maximum amount every year and using it as a tax-free investment vehicle. Just another way that our government is battling the crisis in health care.
Note that the downside of a high-deductable policy is that it will make you more selective about what care you choose to have. If a practitioner recommends a $3000 test, i.e. an MRI, "just to be sure", you will be tempted/forced to ask "is this really necessary?" when the money is coming out of your pocket.
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