Thursday, August 13. 2009
Insurance RABBLE RABBLE RABBLE
Kevin and I have been looking to purchase group health insurance for the company. I contacted several local agents, over e-mail, asking for rough quotes based on our ages, marital status, number of dependents, etc. We received a litany of replies ranging from a quick e-mail with rough rates to a couple of agents insisting on meeting with us in our office who then had us fill out detailed insurance application forms. The quotes we have received so far have all been fairly comparable ranging from approximately $250/month for $2,600 deductible and 0% coinsurance with Companion Life to $85/month for $5000 deductible 0% coinsurance with Assurant. So much more after the break…
Below is a table of health insurance quotes we have received so far. Quotes are for 24 year old males with no dependents and no prior conditions. Deductibles are given for individuals (family deductibles are normally double). BCBS quotes are exact while Assurant and Companion Life quotes are estimates based on age and number of dependents only. Prescriptions are not covered on HSA plans.
| Plan Name | Deductible | Co-Insurance Rate (% we pay after deductible) | Maximum Out of Pocket | Price/person/month |
| Health First HealthLink 50/50 (BCBS + Chamber of Commerce) | $1,000 | 50% | $3,500 | $176.57 |
| Health First HealthLink 60/40 (BCBS + Chamber of Commerce) | $500 | 40% | $2,000 | $195.32 |
| HSA HealthLink (BCBS + Chamber of Commerce) | $2,500 | 0% | $2,500 | $156.96 |
| HSA HealthLink 2 | $5,000 | 0% | $5,000 | $131.38 |
| Blue Solutions Option 1 (BCBS) | $1,000 | 50% | $3,000 | $166.59 |
| Blue Solutions Option 2 (BCBS) | $500 | 40% | $2,000 | $187.73 |
| EAM PPO CMM (BCBS + Employers Association of Montana) | $3,000 | 0% | $3,000 | $148.36 |
| EAM PPO HDHP (BCBS + Employers Association of Montana) | $5,000 | 0% | $5,000 | $125.36 |
| 80 Real Choices II (Assurant) | $1,000 | 20% | $2,000 | $211.56 |
| 100 Real Choices II (Assurant) | $2,500 | 0% | $2,500 | $174.41 |
| 100 Real Choices II HSA (Assurant) | $2,500 | 0% | $2,500 | $150.96 |
| 100 Real Choices II (2) HSA (Assurant) | $5,000 | 0% | $5,000 | $84.89 |
| Traditions Plus HDHP (Companion Life) | $2,600 | 0% | $2,600 | $232.77 |
Companion Life quotes tended to be higher across the board
so we are no longer considering them as a possible supplier. Ideally we would go with Assurant because
they have the best deal on the high deductible + health savings account plan
(Almost 50% cheaper than the equivalent BCBS plan) but we are a little afraid of using an insurance company that is not part of the Bozeman Deaconess network (or Bozeman Deaconess is not part of the insurance network, I'm never sure). Being the reasonably intelligent guys that we
are we understand probabilities. Because
insurance companies face administrative costs and because insurance companies
are risk adverse anyway
we know that we would never receive an
actuarially fair price to be insured. On
the other hand it would be nice to know that should anything catastrophic
happen we wouldn’t be bankrupted and forced to share a park bench with a
hobo. On the advice of some well
respected economists, who suggest that people are often over insured when it
comes to short term health insurance
we are looking at high deductible plans paired with a tax exempt health savings
account.
This seemed like an amply appropriate time for this article now that the debate over health care on the national stage has reached a fevered pitch. One of my very favorite economists, Greg Mankiw, has been a very outspoken critic of any sort of nationalization of our health system citing statistics that point to the fact that