Should You Get a High-Deductible Healthcare Plan?

It's that time of year again.  The weather's getting cooler, the leaves are changing color and we're glued to our TV's every Sunday watching grown men chase a leather ball. 

Tis also the season for open enrollment - that time of year when your eyes glaze over trying to decipher your healthcare options for next year. 

If you're like a lot of people, you just want to feel like you spent enough time "researching" it to make a "smart" decision, which is "deciding" to keep whatever you had last year. 

But before you mindlessly check that box again, there are a few things to consider - regardless if you're still working or on Medicare. 

If you're still working consider enrolling in a High Deductible Health Plan (HDHP).  As I've written before, if you enroll in an HDHP you can put money into a Health Savings Account, which has 3 very unique advantages:

  1. The money you put in pre-tax which will lower your current tax bill (like a 401k).

  2. The money you take out - if used for qualified medical expenses - is tax-free (like a Roth IRA).

  3. Lastly (as if you need more), you can invest the money you put into an HSA.

So you put pre-tax money in - grow it - and then take it out tax-free in retirement. It's the only way to never pay taxes.  

The catch is you need to pay for your current medical expenses out-of-pocket.   If you know you're going to need a lot of expensive procedures next year, then hold off on the HDHP/HSA combo.  But if your only medical plans for next year is your annual physical, then you should strongly consider enrolling in an HDHP so you can invest in an HSA.

If you're retired….take a look at your Part D plan (D stands for drugs).   Healthcare companies change their formularies (a fancy word for their covered drugs) every year.  So the Part D plan you had this year might not be the best one next year.   It pays to log into, enter your current prescriptions and review the list of providers. 

As I announced Tuesday, as part of my ever-expanding service offering, I would be happy to schedule time with you to review your healthcare options for 2018. 

Just click here to put some time on my calendar.

Disclaimer: This blog is for informational purposes only.  It is not intended to be actionable financial or investment advice. To determine if it's right for