Open enrollment. No two words strike terror in the average employee’s heart quite like these. Especially if you’re one half of a married couple or a domestic partnership, which means doubling your pain (er, pleasure) by sorting through your options … twice.
We feel your pain. That’s why we asked an expert on the best way to sort through your myriad options to get the best, most cost-effective coverage for you and your partner. It turns out there’s no one right approach, but taking the following steps will make this process … well, not exactly, fun, but manageable.
Angela Shaw, president of Austin Human Resource Management Association, which is an affiliate of the Society for Human Resource Management, the leading international organization of human resource managers, gives you a five-step plan to follow:
Step 1. Start with last year’s health expenses.
It’s Budgeting 101: Take what you spent last year, and assume you’ll spend the same amount this year. Add up your wellness visits to the doctor, any emergency services, as well as any other health care costs, and see what you were spending. Be sure to tabulate what you spent out of pocket, and what your insurance covered.
Step 2. Consider whether those expenses are likely to change.
Maybe you’re welcoming a new child into the world (or planning to). Maybe you discovered you have a chronic illness, or maybe you were cured of one. Or maybe last year’s expenses included a one-off (we hope) occurrence, like a broken bone. Any of those things can dramatically increase or decrease the cost of your health care and should be part of your conversation with your partner about how much coverage you need.
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Step 3. Do the math.
At this point, you’ll likely have three options:
- Cover your partner through your employer care plan.
- Get covered through your partner’s employer care plan.
- Each of you choose your own employer’s care plan.
There are, of course, exceptions — perhaps one partner works part-time, or freelance, or owns a business, in which case things get complicated. But let’s assume, for the sake of this article, that both partners are offered care through their employers. In which case, you have the above three options, which often include multiple choices within those options. (Health care is fun like that.)
Those options might include health maintenance organization (HMO) plans, preferred provider organization (PPO) plans, exclusive provider organization (EPO) plans and point of service (POS) plans. Plus, some high-deductible health plans are compatible with a health savings account (HSA) that can help you reduce your medical costs. As for which one health plan is right for you and your partner, here are some factors to consider:
- If you or your partner have a doctor you know and love, and whether that doctor is covered by one plan or another.
- How much you and your partner will pay for prescriptions or treatments you may need for chronic health conditions.
- Your financial situation and whether you can afford to incur out-of-pocket costs in order to meet the deductible.
- The cost and benefits of each option — for example, your monthly premium, your deductible, how much you have to pay out-of-pocket and exactly how much your plan covers.
- How much, if any, your employer will kick in for each option.
So yes: Some spreadsheets might be required.
Unfortunately, given the complexity of the plans (particularly when weighing yours versus your partner’s), there isn’t a simple online calculator to help you sort it all out. That said, if you are relatively stable financially, and you have children (or are planning to have them), you’ll likely be paying more per year for health care than a young, healthy childless couple that’s still paying off student loans. If you’re the former, you might prefer a plan with high initial out-of-pocket costs and a better deductible after a certain amount. If you’re the latter, you might want the cheapest plan, so long as it will have you covered in case of a catastrophe like a severe accident or illness.
Step 4. Talk to your HR person.
Naturally, Shaw pointed out that HR people are there to help. She mentioned that in smaller companies, HR people wear many hats, so it might be better to talk with your company’s benefits broker directly about any questions you might have. At a larger company, the HR department might have a benefits specialist, and they can walk you through your key decisions. Your partner should take advantage of these resources at their employer, too.
Step 5. Compare and contrast. And then decide.
Again, there’s no right answer. You ultimately need to estimate how much coverage you need, versus how much you can afford. And that will be different from family to family and even city to city or state to state, even company to company—if you start a new job while already covered by your partner’s plan, you will want to make sure you understand your options so that you’re neither double-covered (which is expensive), or under-covered (which is risky). If you must choose between one or the other, choose double-coverage — as Shaw puts it, she’s a “belt and suspenders kind of person,” and you’re better safe than sorry.
In the event of a tie, consider ancillary benefits. Some companies now offer pet insurance, gym reimbursement, and or benefits for quitting smoking or taking part in various health and wellness initiatives.
Find the mix of benefits that work best for you and your partner
As with all other issues in your partnership, communication is critical. Make time to sit down with your partner and review your options one by one. Rule out the obvious non-starters, and then write down the costs and benefits of what’s left.
There might be an easy winner; more likely, you’ll need to choose from a few slightly imperfect plans. Is it a chore? Yes. But hey, making the most of doing chores is what a successful partnership is all about.
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Louis Wilson is a freelance writer whose work has appeared in a wide array of publications, both online and in print. He often writes about travel, sports, popular culture, men’s fashion and grooming, and more. He lives in Austin, Texas, where he has developed an unbridled passion for breakfast tacos, with his wife and two children. This article is sponsored by Haven Life Insurance Agency.