Employee Benefits - Health Insurance

Employee Benefits: Health Insurance

 

Health insurance varies widely from company-to-company, so Jack and Josh decided to go over some of the terms that might be written in your employment contract.

 

Terms

Deductible- The maximum amount you have to pay out of pocket before your insurance coverage kicks in.

Co-pay- A certain dollar amount you have to pay for each visit to the doctor’s office.

Co-insurance- The percentage of bill you pay after you pay the deductible. For example, if you have a $5,000 bill and your deductible is $1,000, you will pay $1,000 plus 20% of the remaining amount.

Premium- This is your monthly payment.

Exclusions- Some plans have exclusions, and some don’t. There are sometimes specific health conditions that insurance companies won’t insure.

Some insurance only covers in-network doctors, that are pre-approved by the insurance plan. Out-of-network doctors are medical professionals that your insurance plan will not cover.

Open-enrollment period- Period of time each year when you are eligible to switch health insurance plans.

The main variations in plans will be your, deductible, co-pay, or co-insurance. These are the main portions that will dictate your premium, or monthly payment.

High deductible plan will have a lower premium, because you have to pay more out-of-pocket. This can be great for young people because they are generally healthy and don’t visit the doctor often.

 

Health Savings Account (HSA):

1.     High deductible plan - It will have a lower premium, because you have to pay more out-of- pocket. This can be great for young people because they are generally healthy and don’t visit the doctor often

2.     Deducted before taxes with a $3500 annual limit for individuals and a $7,000 for a family

3.     You can choose to invest this money so it can continue to grow

4.     Can ONLY be used for health expenses

5.     Rolls over year-to-year

6.     You don’t pay taxes if it’s for medical expenses

 

Flexible Spending Account (FSA):

1.     Doesn’t have to go with a high deductible plan

2.     Use it or lose it- this money doesn’t roll over

3.     You don’t pay taxes if it’s for medical expenses

4.     Can ONLY be used for health expenses

5.     Some companies will match contributions to your FSA

 

Final Considerations

1.     Analyze your lifestyle and decide which plan is best for you.

2.     You can stay on your parents’ health insurance until you’re 26.

3.     Ask for help.

 

“Money Tip of the Week”

For Kansas residents, you can apply for the Low Income Energy Assistance Program and receive support to help pay for some of your utility bills. You have to be under a certain income limit to qualify, but it can be great for college students and recent graduates.