First baby, which insurance to choose?

[Guizmo]

Hi all,

My partner and I are having our first child. She has had a normal pregnancy so far and we are only about a month out from the birth. I am going to add our baby and my partner to my health insurance plan, but I am wondering which plan would be best based on what y'all have experienced.

Here are the options that I have through my employer:

DHMO 1000 - $1,063.63 a month premium

    Deductible- $1,000 Individual/$3,000 Family
    Out of Pocket Limit- $4,000 Individual/$9,000 Family
    No additional deductibles for specific services

DHMO 2500 - $915.59 a month

    Deductible- $2,500 Individual/$7,500 Family
    Out of Pocket Limit- $4,000 Individual/$9,000 Family
    No additional deductibles for specific services

HDHP 1500 - $1,001.54

    Deductible- $1,500 Individual/$3,000 Family
    Out of Pocket Limit- $4,000 Individual/$6,850 Family
    No additional deductibles for specific services

HDHP 3000 - $838.69

    Deductible- $3,000 Individual/$6,000 Family
    Out of Pocket Limit- $5,000 Individual/$10,000 Family
    No additional deductibles for specific services

Did anyone do a high deductible plan with your first child? Did you regret it? I am afraid since we are new parents we won't know what to do and will use the hospital a lot.

[ysette9]

Unfortunately that is the kind of thing you just can’t predict in advance. My babies ended up being preemies with time spent in the NICU before coming home. Most people have normal babies who are full term and don’t have to be hospitalized.

Would you be less likely to take your kid in if you were in a high deductible plan and weren’t sure if it warranted waiting it out or seeing the doctor?

[kimmarg]

Assuming you're in the states you should know that all the various 'well child' checks are covered in full with no deductible/copay (part of ACA). So it's just any illness that you'd be concerned about. Consider the following 2 scenarios: 1) uncomplicated pregnancy, uncomplicated birth, 1 or 2 trips to doc in first year for bad cough/flu.  2) uncomplicated pregnancy, complicated birth with NICU stay, multiple specialist visits, multiple illness visits in first year.  Either is absolutely possible at this point.  I would consider both do you have the CASH available to pay the full deductible AND will it stress you out/make you concerned if you need to pay that full amount?  Personally I went with the lower deductible HMO for both kids and I'm glad I did. While I think we could have paid the $$$ even for the more expensive scenario with the higher deductible, it would have stressed me out and I'm glad I didn't have that additional worry.

[Guizmo]

Thanks, yeah it is a bit of a toss up at this point. Maybe this year I will do the lower deductible HMO and if there are no chronic illnesses to worry about, I will switch to the HDHP plan. Thanks for the advice!

[Lucky Recardito]

When does the plan take effect? Is the actual birth event likely to happen after this plan starts? If so, you will likely hit the OOP max w/ the birth, before anything else happens. In that case, the math is (monthly premium x 12) + (Family OOP Max) = x; choose the plan with the lowest x, because your costs are known.

Also worth taking a look at networks. Is the hospital where you plan to give birth in-network for all the plans? How about your pediatrician, and your partner's OB or midwife (since she'll have some post-birth check-ups as well)? And the leading children's hospital in your area, in case kiddo needs some special care?

[EngineerOurFI]

Am I missing something?  Seems like HDHP 1500 is a no brainer for you since it has the same out-of-pocket individual max and a LOWER family out of pocket max than any other option and the deductible is barely higher than DHMO 1000.  Plus you should have access to a HSA since it's a HDHP.....so you can get the tax savings from that by maxing it out.  Is this plan going to be what covers the actual birth? If so, I would just go ahead and expect to be hitting the out-of-pocket maximum.  Trust me when I say it really doesn't take much to get there.  Keep in mind with a birth coming up you want a lower out of pocket max for both individual and family.  Keep in mind if kid and mom each have an issue (let's say a C-Section for mom and a NICU stay for kid) the FAMILY out of pocket max is going to be what you care about.  Your HDHP 1500 plan has a low-ish premium relative to the other options and still keeps out of pocket maxs low and gives you HSA access for tax advantages.....no brainer in my book.

My first kid was born on a high premium with lower out-of-pocket max.  We hit the $4k out-of-pocket max even though our deductible was only $1000 and it was 80% coverage after the deductible due to C-section (even with no complications and no NICU stay or anything).  One key point about that insurance though was that ALL ultrasounds were 100% covered without going towards deductible.  Turns out this is a pretty important prenatal coverage point (sounds like you're passed that point in pregnancy, so likely doesn't matter).

But for my current health insurance covering Kid #2 -- we're on HDHP where ultrasounds are NOT covered so it falls under deductible.  Looks like I'll have $2,000 in ultrasound costs alone before birth.  So we're definitely on track to hit the $6,000 out-of-pocket max for Kid #2 even with no complications whatsoever.  I max out my HSA but I'm paying for healthcare out of pocket since I can afford to do so (and considering my HSA as an additional retirement savings vehicle), but obviously if you're not able to do that at this point then of course contribute to HSA to get tax break and then yank it out to pay for everything.


In terms of what you should do for next year selection after kiddo has already arrived, that's a tougher stance.  You're not then in a situation where you know there's a massive bill coming as you are now with a birth on the way.  So then you'd have to look at some of the line item coverages on the DHMO 1000 plan to see if maybe more preventative that's relevant to your family is covered, etc?  However, if everything is relatively normal I'd still probably go for the HDHP 1500 plan, personally.  It's honestly a very low out-of-pocket individual max so if any one person has an issue your upper limit isn't that bad (same upper limit as the DHMO individual out-of-pocket max and LOWER than DHMO family max) and you save $62/mo on premiums and get HSA tax break access.

[Blueberries]

Just from a financial perspective, I always consider the out of pocket limits compared to the premiums.  For me, I'd choose this plan:

HDHP 1500 - $1,001.54

    Deductible- $1,500 Individual/$3,000 Family
    Out of Pocket Limit- $4,000 Individual/$6,850 Family
    No additional deductibles for specific services

Your max out of pocket is $6,850 (a birth will easily cost this much unless you've pre-negotiated) and the premium is similar enough to every other premium that cost-wise, it makes the most sense.  Are you able to contribute to a HSA or HRA?  Does your employer throw anything in?  That will also help.

Look at this and speak with your HR department:  https://www.opm.gov/healthcare-insurance/fastfacts/high-deductible-health-plans.pdf

Other things to consider are what hospitals are in network and whether your current doctors are in network.  If not, you can always change to another doctor, but you want to make sure the local hospital takes your plan, as you will not want to drive further out while your partner is in labor. 

[YttriumNitrate]

Am I missing something?  Seems like HDHP 1500 is a no brainer for you since it has the same out-of-pocket individual max and a LOWER family out of pocket max than any other option and the deductible is barely higher than DHMO 1000.

Would the DHMO plan include a bunch of services not included in the high deductible plan? For example, is the DHMO plan an HMO like Kaiser-Permanente? In that case, you'd be far less likely to actually hit the deductible than with a standard HDHP where you pay for everything out of pocket.

[CindyBS]

First congratulations!

With a big upcoming medical expense, you are probably going to max out any deductible in a short time.  We have a high medical needs child and max ours out every January for the year.

This is an excellent time to open a credit card with a minimum spend to get a good sign up bonus.  I do this almost every year.  Open the card right before baby is born (or right after) - your medical bills won't come for a month or so anyway.  Charge all the medical bills on the new CC - get the sign up bonus and then whatever the cash back rewards are (or if you want to do airline miles cards, etc.) 

doctorofcredit.com has excellent information on credit cards with sign up bonuses.  I've paid my deductibles with Chase Sapphire, Capital One Savor,  and a couple others over the years. 

Good luck!

[Guizmo]

Would the DHMO plan include a bunch of services not included in the high deductible plan? For example, is the DHMO plan an HMO like Kaiser-Permanente? In that case, you'd be far less likely to actually hit the deductible than with a standard HDHP where you pay for everything out of pocket.

Yes, the plans are through Kaiser. I'm only adding my family after the birth. So we may not meet the deductible or out of pocket on the HDHP once we are on the family plan. That's why it is a toss up.

[Guizmo]

Your max out of pocket is $6,850 (a birth will easily cost this much unless you've pre-negotiated) and the premium is similar enough to every other premium that cost-wise, it makes the most sense. 

The max out of pocket is certainly the most attractive out of the 4 plans so in a worst case scenario with tons of expenses this plan may actually come out on top. Hadn't thought of it in that way.