You might be wondering why I recently spent half a week in the hospital? Well, my wife and I just welcomed the arrival of our second child, Gabriella, early Monday morning last week. As joyous and celebrated as the birth of a new baby is, it's also a very costly endeavor. I'm told it only gets more expensive the older they get, so maybe in retrospect having the baby is the bargain, even if it doesn't seem like it at the time.
Regardless of how much college tuition will be in 18 years or what the going rate for her dream wedding will be, right now we have easily accumulated over $10,000 dollars in medical bills throughout the pregnancy and delivery of the baby.
If we didn't have health insurance, that would be a bit of a problem. I don't know about you, but coming up with that kind of money on your own, even with nine months notice, is not realistic for most families.
Don't Try This At Home
I received a phone call recently from a young lady looking to buy health insurance. This is not an uncommon occurrence, since that is what I specialize in, and when the phone is ringing that means business is good.
However, what this young lady will eventually tell me was not and is the one thing you almost never want to do (at least without talking to an independent agent first) with your health insurance offered through work.
Before I even had a chance to start my normal evaluation process, the young lady abruptly tells me that she is pregnant and will be expecting her first child in seven or eight months. Now this still is not an entirely uncommon occurrence, as I have talked with plenty of women who try to buy health insurance after they get pregnant.
It seems like a logical process, however individual insurance, at least for the next 10 months, will not agree to cover any expectant parent, male or female. If you want to know more about maternity coverage with group and individual health insurance I have already written an entire article for you.
If Things Couldn't Get Any Worse
As her story continued to unfold and as I'm trying to give her any advice that might help reduce the hefty financial load coming her way, I started asking what, if any, other guaranteed coverage might be available to her.
I asked if her husband had benefits offered through his work, if the story couldn't get any worse, she informed me that he was currently on unemployment. Yikes. Needless to say, these are the types of conversations that make you want to cry yourself to sleep at night.
If Things Still Couldn't Get Any Worse, They Did
This is where the story really gets bad. My last ditch effort in trying to find some type of solution, I asked her if she had insurance through her job. Normally when I ask this question to someone in her situation, the answer is obviously no. However, today was very different.
To my surprise, shock and horror, she told me that in fact she did have insurance through her place of employment, but “it cost way too much, it was over $150 a month” which she did not take.
No, I'm not making this up. However, I wish I was.
Pick Up the Phone During Open Enrollment
After I picked my jaw up off the floor, I asked if she knew when the open enrollment period (when you can get on or off your company's insurance plan) was? She replied and said it was back in October.
What this means is, she will not be able to get on her company's health insurance plan until October 2013 or one or two months after her baby is born.
Had this young lady picked up the phone five months sooner, I would have been able to tell her to run as fast as she could to her HR department and sign up for their group health insurance plan.
I understand times are tough and $150 is a lot of money to a lot of people, but anyone who buys their own health insurance would gladly pay $150 a month.
When in Doubt, Take The Health Insurance
99 times out of a 100 your group health insurance plan will be your best option. It's possible that statement is only valid until January 1, 2014 when Obamacare turns health insurance upside down. Until then, know that you should rarely consider opting out of your group health insurance plan.
Now this young lady and her husband are faced with very difficult financial decisions on how to provide proper medical care during this important time in their lives.
Don't Make Changes/Decisions Without Talking to an Agent
Regardless of how big or small you think something might be when it comes to your health insurance, make sure you consult a professional first.
Otherwise you run the risk of making a very bad decision like that young lady. Sure she saved about $1800 a year by not taking the health insurance, but now she is facing $10,000 in medical bills. Not a very good trade off, is it?
The Bottom Line
With health care reform's main provisions rapidly approaching on January 1, 2014, this particular occurrence will probably no longer exist, however what will continue to be a problem is people making uninformed decisions about their health insurance without the help or guidance from an independent insurance agent, like myself.
There really is no excuse for not taking 15-20 minutes to discuss your current situation with a licensed professional. If this young lady had called me four or five months sooner, she would have saved herself thousands of dollars and received exponentially better care for her and her baby.
How You Can Help
If you know someone who is considering making a major or minor change to their health insurance, please share this article with them to let them know that the risk in doing so unadvised is very costly.
Also, please feel free to share your story of a time you got yourself into hot water with your health insurance.