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Navigating the Health Insurance Maze: What To Do When Both Partners Work

May 2, 2023 by Jay

If you and your better half are part of the working crowd, choosing the ideal health insurance can feel like a game of 3D chess. Generally, you’ve got three moves: each hold onto your own employer-provided policy; both sign up for one policy; or, somewhat ambitiously, you could both join both policies.

Let’s dive into these choices.

Rocking Individual Policies

Sometimes, “yours” and “mine” work better than “ours”, and you may decide to stick with your respective pre-marriage policies. Sure, tying the knot qualifies you to jump onto the same policy, but if you’re both content with your current plans, why mix things up?

Sure, you may not share the same network of doctors, and tracking two separate premiums might seem a little tricky. But if the premiums come straight out of your paychecks, it’s a hands-off approach.

Jumping onto One Policy

Thinking of teaming up under one policy? This involves a strategic pick between your two existing plans. To weigh your options, consider:

  • Premium costs
  • Each policy’s deductible
  • Co-pays under each plan
  • Co-insurance for each plan

Taking a holistic view can guide you towards the best choice. For instance, if one policy has a high deductible but low premium, while the other has a low deductible but high premium, decide what suits you better. Would you prefer more cash flow each month (lower premiums) or less out-of-pocket expenses when you visit doctors (lower deductible)?

Doubling Up with Both Policies

Thinking of going all in and joining both policies? That means double the premiums but with the perk of extra coverage. Don’t mistake this as ‘double coverage’, though. Insurance companies employ a ‘coordination of benefits.’ Your employer-provided insurance is your ‘primary policy,’ and your spouse’s is theirs. The other insurance is the secondary policy.

Here’s a quick rundown of how this works:

Say you slip, break your leg, and wind up in the ER. First, you’ll file a claim with your primary insurance. If you have a $500 deductible, you’ll need to cover that with your primary insurance. After the $500, your insurance covers 80% of the ER costs, leaving you responsible for the remaining 20% plus the $500.

Next, you file a claim with your secondary insurance. The secondary insurance waits to see what the primary insurance pays, and then applies its benefits to the remaining balance. However, the secondary insurance has its own deductible, which also needs to be met. If that also has a $500 deductible, you may see little, if any, benefit from the secondary insurance.

Though the idea of having two policies may seem appealing, evaluate the total out-of-pocket cost before deciding. If both policies have high deductibles or different networks of doctors or hospitals, it might not make financial sense to pay premiums for both.

Switching Gears to Your Spouse’s Health Insurance

Once you’ve decided on your preferred policy, it’s time to sign up. Usually, you’d need to wait for open enrollment to add dependents or switch policies, but marriage, being a ‘qualifying life event’, lets you skip the line. Other life-changing events, like having a baby, also count.

Insurance companies typically allow 60 days after the event to tweak your policy. If you don’t add your spouse to your policy (or vice versa) within that period, you’ll have to wait for your company’s open enrollment period. Your HR department can give you the timeline for this.

Spousal Health Insurance Isn’t a Given

According to the Affordable Care Act, US companies with 50+ employees must offer health insurance to their workers. However, there’s no mandate for spousal coverage. Employers may opt to offer it, but they’re not legally required to.

Also, pay close attention to your employer’s financial contribution. If they cover 100% of the employee’s premium, it doesn’t mean they’ll chip in for a spouse’s premium. Ask detailed questions about costs to make the most financially sound choice.

Before settling, weigh all health insurance options alongside your partner. Consider your frequency of healthcare visits. Regular doctor visitors might prefer a plan with a lower deductible. If neither of you uses insurance much, but you’d like it in place for any ‘just in case’ scenarios (a wise move), you might choose a plan with a higher deductible, keeping more monthly income in your pocket.