Question from a reader:”I have medical coverage at work but noticed that the plan is coming up for renewal and the rates are ginormous. I am thinking of opting for the cheapest plan that means I don’t pay hardly anything in premiums. I am pretty healthy and young.”
My answer is if you are healthy and think you won’t be needing the coverage, go for the plan that won’t offer a lot of coverage but at least offers you something. In this day and age I strongly suggest you keep any medical coverage that you have if you can afford it.
A lot of PPOs that are out there offer 70/30 coverages where you pay 30% of whatever is outstanding on a medical bill with a cap of something like $2000-$3000. That isn’t bad if you never get sick or injured and you can save maybe $5000 a year in medical premiums. The problem arises when you have something unexpected like you break your arm playing volleyball or your kid gets sick and needs to spend a night in the hospital. The $3000 you have saved in the past gets chewed up pretty quickly. If you visit the doctor frequently, the co-pays add up and even though they may be deductible at tax time, you still need to front the money for the doctor’s offices.
HMOs may cost more but if you are sick or injured it is easier to pay $25 or $100 then to start worrying about where you will have to come up with $3000 from. The downside with HMOs is that sometimes you may have to wait and wait till you get something done. That is true though with PPO coverage as well.
You are your own judge of your health. Just make sure that you stash the extra cash you are saving away and keep it not only for the proverbially rainy day but for the sick day as well.
Not much to report on for the stock market this week. I expect the market to go up slightly or stay flat because of the President’s Inauguration. I expect flat news on any stimulus packages so nothing new on that front. There may be a slight buyer’s remorse drop in the market a week from now after the election and the continuation of earnings releases will reflect the supply destruction phase that our economy is going through now.
Keep those questions and posts coming gang!
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Kim Isaac Greenblatt
Medical Coverage – If You Have It Keep It
Tags: Business, medical coverage