It’s Benefit Enrollment Time – Medical Insurance Part 2 – The Plans and What They Really Cost

This post is part of a series on choosing benefits.  Today I will look at the ins and outs of our choices for Medical Insurance.

Large Conglomerate gives us three choices for our Health Insurance, all through Aetna.  The drug plans are the same with all three choices, so they won’t be included in these breakdowns.

Aetna Select Plan – They don’t call it an HMO anymore, but that’s basically what it is.

Good News

  • They’ve removed the referral requirement – something that I always thought was a supreme waste of time and money for all concerned
  • No deductible or coinsurance
  • Inexpensive office visit co-payments ($15 primary care, $25 specialists)

Bad News

  • $542.04 per month family premium, the highest of the three.
  • Only network doctors covered.  No coverage AT ALL for out of network services, not even reduced coverage.  None.  Nada.

Cost Estimate for 2009

For the purposes of comparison I am going to use last year’s office visit copay total to give me an idea of my out-of-pocket costs for next year.  I am not going to include pharmacy benefits in these totals.

Out of pocket for the Aetna Select are the premiums and copays.  Last year I paid out $375 for non-pharmacy co-pays, so by adding in the annual premium of $6504.48, if things stay the same as last year I can expect to pay approximately:

Premiums:  $6504.48

Co-pays:       375.00 estimate

ESTIMATED ANNUAL COST:$6879.48

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Aetna Point-of-Service Comprehensive Plan – Somewhere between an HMO and a PPO, from what I can tell.  Insurers continue to change names in an effort to confuse us provide us with more options.

Good News

  • No referrals required
  • Choice of in-network and out of network care, though out of network costs are higher

Bad News

  • $530.98 per month family premium
  • $250 Individual / $500 Family in-network deductible, $750 Individual / $1500 Family out-of-network deductible
  • Pays 90% once your deductible is reached, with the maximum you pay  $1000 Individual / $3000 Family in-network coinsurance, $3,000 Individual / $9,000 Family out-of-network coinsurance
  • Office visits have the same co-pay  in-network as the Aetna Select, but out-of-network services have no co-pay are only covered at 70% after the out-of-network deductible is reached

Cost Estimate for 2009

Out of pocket for the Aetna Point-of-Service Comprehensive Plan are the premiums, deductibles, coinsurance and copays.   I am going to assume that we have no out-of-network services next year.

Premiums:  $6371.76

Deductibles:  $500.00

Co-pays:       375.00 estimate

ESTIMATED ANNUAL COST:$7,246.76

That doesn’t include coinsurance, which could add another $3000 to our in-network out-of-pocket maximum.  Going out-of-network could add another $10,000 (an extra $1000 for the deductible, and $9000 coinsurance), bring our our possible total out of pocket to $17,246,76!

Egads!  That a lot of money out of pocket!

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Aetna High Deductible PPO Plan with Health Savings Account option – This is a traditional PPO plan, with in and out-of-network coverage, but the deductible is high.  To offset that you can have a Medical Savings account.

The theory here is that if you are healthy and don’t use your insurance much, you can save money on your premiums by taking a high deductible, and putting money into a Health Savings Account (HSA) (not to be confused with a Health Care Flexible Spending Account),

Good News

  • No referrals required
  • Choice of in-network and out of network care, though out of network costs are higher
  • Large Conglomerate contributes $500 for Individual or $1000 for Family coverage to the HSA
  • Your own contributions to t he  HSA can be taken with pre-tax dollars.
  • HSA dollars can roll over from one year to the next, unlike a Health Care Flexible Spending Account (which requires that you use all the money yearly or you lose it)

Bad News

  • $507.46 per month family premium, the least expensive of the three (at over $500 I put all the premiums under Bad News!)
  • $1,500 Individual / $3,000 Family in and out-of- network deductible (and if Family plan the full Family plan deductible must be satisfied before any claims will be paid, unlike the Aetna Point-of-Service Comprehensive Plan)
  • Pays 90% once your deductible is reached, with the maximum you pay $3000 Individual / $8000 Family in and out-of-network coinsurance
  • Office visits are only covered at 90%, and only after the deductible is reached

Cost Estimate for 2009

Out of pocket for the Aetna High Deductible PPO Plan with Health Savings Account option are the premiums, deductible and coinsurance.

Premiums:  $6089.52

Deductible:  $3000.00

Less employer contribution to HSA: (-1,000)

ESTIMATED ANNUAL COST:$8089.52

That doesn’t include coinsurance, which could add another $8000, bringing our possible total out of pocket to $16,089.76!


We do have to remember that  money isn’t the only consideration for choosing your policy.  Large Conglomerate was kind enough to put together a comparison chart where many of the coverages are compared and contrasted, so we could see if there are any huge differences in coverage.  And there are some.  if Husband drives me crazy enough that I must seek psychiatric treatment, I’m limited to only 20 visits per year, and only 35 days of inpatient coverage.

Aetna Select certainly gives us less choices, but within the choices we have we pay less.  A lot less. In fact, if I were to have another child I’d pay $25.  That’s it.  

Looking at the coverages and the numbers the only choice we can responsibly make is the Aetna Select, which is $309.60 more than last year’s total of $6569.88. We’ll have to find that money somewhere.  But we don’t have to worry about deductibles or coinsurance, and even if our co-pays for the year doubled we’d still pay less than either of the other options.

So, that’s it.  Choice made.  Next up are the Flexible Spending Accounts. We don’t use the Dependent Care Flexible Spending Account since I am a stay-at-home Mom (nor do I have my parents as dependents, thank goodness!), but we ARE going to use the terrific Health Care Flexible Spending Account benefit to further reduce what our out-of-pocket expenses really cost us.  Join me next time as I figure out how much to contribute!

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Read the rest of the series!

It’s Benefits Enrollment Time, Series Overview

It’s Benefit Enrollment Time – Medical Insurance Part 1 – Evaluating What You’ve Got

It’s Benefit Enrollment Time – Flexible Spending Accounts Mean More Money in Our Pocket!

It’s Benefit Enrollment Time – Dental Insurance and Why The Math is So Important

It’s Benefit Enrollment Time – Life Insurance a Bargain For Us

It’s Benefit Enrollment Time – Seeing the Vision Plan Clearly. Finally.

It’s Benefit Enrollment Time – Disability and Long Term Care Insurance are Good to Have

It’s Benefit Enrollment Time – Legal, Pet Insurance and Lots of Little Perks

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3 Responses to “It’s Benefit Enrollment Time – Medical Insurance Part 2 – The Plans and What They Really Cost”

  1. copyeditorsdesk Says:

    Good heavens! Those prices take one’s breath away.

    Makes me feel mighty lucky to work at the Great Desert University, where I pay $25/month for a PPO-like plan called an “EPO.” If I’m laid off, COBRA will be $476 a month (assuming GDU doesn’t get rid of that plan during the next 18 months, after which I’ll be eligible for Medicare, at $275 or so only about 10 times more than I’m paying now.

  2. Alison Says:

    We have a point of service plan. It makes no sense. We always have an idea of what we’ll have to pay for stuff, but we’ve always ended up paying less.

  3. Lisa Says:

    You are so very thorough. 🙂


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