Should you and your significant other be in the same federal family health plan? Or should you each enroll in self-only plans? Think about it, because the health insurance hunting season closes Dec. 9.
Picking the wrong plan could cost you big-time — maybe even lead to bankruptcy — if you have a bad time next year.
After all, you may like the flexibility of a nationwide fee-for- service plan. There are plenty to choose from: The NALC, Blue Cross, GEHA, APWU and Mail Handlers plans are open to all federal workers and retirees. Other plans, such as Compass Rose, SAMBA and Foreign Service, are open to workers in the intelligence community, Foreign Service-related activities and law enforcement.
Fee-for-service plans in many cases allow you to pick your doctor, although going out of their network of physicians (which can be extensive) is costly.
In addition, there are Health Maintenance Organizations (HMOs) which emphasize managed care. In the D.C. area, the choices include Kaiser, CareFirst, Aetna, Coventry, Anthem Health Keepers and MD-IPA.
The good news, according to the experts, is that all of the plans are very good to excellent. In addition to premiums, one of the first things you should do is check to see if your doctor is in their preferred-provider network. If not you may need another health plan, or another doctor.
Equally important, check the catastrophic coverage of any health plan you are considering. Check out our “Bankruptcy Insurance” column on that very important subject.
HMOs typically have a more limited range of doctors, but many offer the convenience of one-stop health care, minimal paperwork and small copayments.
Because the two types of plans differ, many couples decide they may pick different coverage. Sometimes even if they are in the same plan and like it, they switch from family coverage to two self-only plans. Premiums are slightly less that way. For instance, Blue Cross basic’s self-only premium next year will be $1,590 while the family plan will cost $3,710. So you can save some money by each going it alone, right?
Not necessarily. Reason:
If you have a family plan you have one catastrophic limit (the amount you must pay out-of-pocket before insurance takes over). For instance, the limit to you in a self-only plan is $6,560 in the Blue Cross basic plan. The limit in its family option is $9,480. But …
If you are in two self only plans (even the same plan) you each must satisfy and pay that deductible before insurance kicks in.
Walton Francis, editor of Consumers’ Checkbook Guide to Federal Health Plans, provides this scenario: “Suppose you are in a family plan and you and your spouse are in a serious auto accident. Costs are out of this world, but you and your spouse will pay only one deductible.” But if the same couple has two self-only plans, and gets in the same accident, they will have two self-only deductibles to satisfy before insurance pays the rest.
There may be other good reasons for a couple to each have their own federal health plan. But saving money — if the worst happens — isn’t one of them.
Francis will be my guest on our Your Turn radio show Wednesday at 10 a.m. He’ll outline the pros and cons of his-and-her health plans and list things you should consider when shopping.
Listen if you can (1500 AM or online), and if you have questions email them to me at email@example.com or call in during the show at (202) 465-3080. The show will be archived here.
Feds who took TSP withdrawals during shutdown locked out of contributing for next six months During the 16-day government shutdown last month, more than 14,000 Thrift Savings Plan participants withdrew money from their accounts, the highest number of hardship withdrawals in a single month ever. This may have helped participants weather the financial uncertainty of the shutdown. But, under TSP rules, it also means they’ll be unable to contribute to their 401(k)-style retirement accounts for the next six months. Now, the Federal Retirement Thrift Investment Board, which oversees the TSP, is concerned that not all those participants will take the initiative to restart their contributions when the penalty period expires next spring.