I looked at my paycheck – the first one after coming back from maternity leave. I was so excited for that paycheck but when I saw it, I felt a horrible sinking feeling in the pit of my stomach. Something wasn’t right. I knew the numbers were wrong. My insurance payment shouldn’t be that high.
Right after having my third baby, my family moved to another state and I had to change our insurance. So much was going on with a new baby, and boxes everywhere, and I had to call my company’s benefits center to change everything. The lady on the phone was so sweet. She verified everything we talked about. She helped me set up the new plan. But what I didn’t realize is that there was more than one “basic” plan offered by my company.
Luckily, I’m the kind of person who checks everything. They’ve made mistakes before. When I returned from maternity leave with baby number two, my time off balance wasn’t correct and I had to pay money back to the company. That was painful. Just when I thought I’d be getting a paycheck again after returning from maternity leave, I had automatic deductions because my paid time off hadn’t been set up correctly.
With direct deposit, it’s easy not to pay attention to your pay stub. Just check your bank balance every other Friday and move on. But I always check my pay stub when i make changes. I knew the one I wanted was $150 per paycheck. My pay stub was staring at me with a number twice what I was expecting! What was going on?
I checked the benefits online and that’s when I realized there were two plans with the same name. One cost more and had a lower deductible, one cost less and had a higher deductible. That’s fine. At the beginning of the year I might have chosen the lower deductible, higher cost plan. I have three kids, 4 and under. Stuff happens. But it was June and it wasn’t likely we would actually need the lower deductible.
I added up the numbers:
6 months at $250 per paycheck versus $140 per paycheck.
We would end up spending two thousand dollars more in monthly fees than the high deductible.
Are you following? Because I literally had to do the math three times before I realized – with that sinking feeling in my stomach – that my careless decision on the phone that day was going to cost us $2000.
There is so much my family could do with $2000. Not to mention regular childcare and preschool costs, there are groceries, special dinners out, birthdays….you get the idea. $2000 is a huge chunk of change and I was going to have to pay that in monthly insurance premiums
I checked again and again but the ONLY difference in these two plans was the cost of the premiums and the deductible. Everything else was the same – same coverage, same doctors, same prescription costs. Only the plan I had chosen was $2000 more in monthly costs for a deductible that was $1000 less.
I think the worst part of that sinking feeling was knowing that I had done this. I had carelessly chosen the wrong plan when I called to make the change. I could blame it on having a new baby that was probably crying when I made the call or the stress of packing up all of our possessions. But the fact was that I made the decision.
The cost of the deductible is an important part of an insurance plan. If you live paycheck to paycheck then having to pay less when you go to the doctor is important. But if you can pay less monthly and save that for when you need it, having a higher deductible may save you money in the long run.
I admit that insurance makes my head spin! All of it seems designed to confuse people and make them crazy! I know that’s what it does to me.
I took a chance and called my company’s benefit department and asked them if there was any way I could change my insurance plan again. I know how strict they are with only changing once a year, but I had just moved and had a baby. I was hoping beyond hope that I was still in that “life change” window and could change to the lower cost plan.
Thankfully I had called them just in time. Literally if I had waited over the weekend (because of course it was Friday afternoon by the time I figured this out) they wouldn’t have been able to change anything.
After I hung up with the benefit department I breathed a huge sigh of relief. I couldn’t believe that I had almost made a $2000 mistake!
Lessons learned! And now I’m here to tell you how you can avoid this mistake too.
Tips to save money on health insurance
Always compare what the plans offer
If you have the chance to choose between different plans, always compare what each plan offers. Look at things like monthly (or per paycheck) premiums, deductible amounts, prescription costs, costs for services, etc. Usually it’s pretty difficult to know what you will be charged exactly. The premium amount and deductibles will be the most consistent. If you are planning on having a baby soon or some other specific medical procedure, you might be able to compare those costs as well. However, most of the time insurance is to cover you for what you DON’T expect.
Get the right information
Be sure you have the correct plan names when signing up. This seems silly, but like in my case, the plan names were similar and I chose the wrong one.
Verify your plan
Make sure to check your email, snail mail, or online portal after the change to make sure it is the plan you expected. Do this as soon as possible, so you can make changes if needed.
Check your paycheck or bank balance
Make sure you are paying the right amount. Don’t let errors linger, and call your plan administrator as soon as possible if it’s not right.
I hope this helps. The key here is to pay attention to the details. Ask as many questions as you need to make sure you understand what you are signing up for. It doesn’t matter if you think you will “annoy” someone. It’s their job to help you and it’s your responsibility to make informed decisions. Insurance is complicated, make sure you’re not spending money you don’t have to.