How I Found Affordable Private Health Insurance for My Family

Maybe you got laid off or your hours cut back like I did. Maybe you quit your job. It could be any number of reasons but when the time comes to start thinking about health insurance a lot of people get locked up from fear of not being able to find anything affordable.

I was able to find affordable insurance for me and my family. In fact, I prefer this type of insurance of the group insurance I had through my previous employer. Not only that, it blows my options that I had with COBRA away.

There are downsides, and I'll discuss those below but - for me and my family - this was a great option for us.

Get Yourself In The Best Position to Find Affordable Insurance

Before you read any further you have to understand that insurance company's are out to make money. They generally make a LOT of it. I have no problem with that. So, before you start searching you need to understand how to put yourself in the best position to get the best deal. That all starts with your current health situation.

It's hard to tell how health care reform is going to shake out but for people with past medical conditions or history like cancer, diabetes, heart disease, etc. it will always be a struggle to find reasonably priced health insurance.

The insurance companies know based on their actuarial tables that since it's happened in the past you are already high risk. So they will charge you accordingly.

Myself and my family were fortunate to have a fairly clean bill of health. So it made my job much easier.

Search for High Deductible Plans

One of the biggest mistakes I think that people make when they move from an employer-sponsored insurance plan to private insurance is they shop for the same deductibles they had with their employer. This is usually a huge mistake.

When I was with my employer my premiums tripled in 9 years. Also, I only had one option to choose from. It was NOT high deductible.

For a relatively health individual or family a high deductible plan is almost always a better way to go. But most employee sponsored plans have low deductible. This is slowly starting to change.

Ironically, my employee sponsored plan charged me $480 per month to put my wife and two young children on the plan. My family deductible was $2,000.

When I secured our private insurance (through the same company) I purchased a high deductible ($6,000 for the family) plan for all four of us for $380. So, if you are in reasonable health, you can see that getting private health insurance really isn't that exorbitantly expensive.

While the monthly savings on premiums isn't enough to make up for the deductible difference. There are other advantages:

• Ability to contribute to an HSA (Health Savings Account). You can contribute, tax free, to a health savings account each year. High deductible plans are the only plans eligible for this. The nice thing about HSA's is that if you don't use your funds this year, it rolls over and continues to build up. So, in our case, say we put $6,000 per year into the HSA. And this year we only use $2,000. The remaining $4,000 rolls over into next year.
• My current plan pays 100% of covered expenses after I hit my $6,000 limit. My employer sponsored plan still required me to make 20% of the payments even after I had hit my deductible.

There are downsides, but for us they didn't matter that much. First, we don't have prescription insurance. Honestly, this is no big deal as we hardly ever used prescription drugs. And, with the availability of inexpensive generics you have a lot of options.

Also, we no longer have dental insurance. Honestly, our dental on the employer plan was never very good. It paid 25% of our bill. At my dentist, he offers a 5% discount for cash payment. So the difference is now 20%. I made up for that personally by taking really good care of my teeth and getting my checkups changed from every six months to once a year.

Having private health insurance can motivate you in a lot of ways to pay more attention to your health.

High Deductible Plans Aren't For Everyone

Obviously, with a high deductible plan you have to be a saver. It's not for someone who likes to pay for things with credit cards. But, if you can do it I would almost always recommend a high deductible plan. It's been a great move for our family compared to the other options we had available.