The following is a staff writer post from MikeS. He is a married father of 2. So, with the cat, he ranks number 5 in the house. He loves numbers and helping people. Please leave any questions or comments below for either Mike or Crystal.
It usually starts as something simple. I needed to look at whether I had been billed for a past medical visit. That simple task, combined with all of the healthcare talk in the country, piqued my curiosity. That led to a full-on dive into my medical claims file. I have data going back to 2011. That’s the year I began tracking all of our health care expenses.
Before 2011, I didn’t track my medical claims, as there wasn’t really a need for it. The little guy changed all that when he arrived. For those of you who are unaware, he was born with a heart condition that required immediate intervention. He was transported to a hospital 2 hours away from where he was born, to correct his problem. He spent the next 3 days in cardiac-intensive care, and then amazingly I got to take him home. Needless to say, there were a few bills associated with all of it. I began tracking everything, even the smaller stuff like the cellstar 24 well plate, just to stay on top of which bill we had received and which ones we had paid.
You can imagine that 2011 was the most expensive year as far as the totals go. In all, between what I paid and what insurance covered, a total of $113,178 was paid out. Thankfully, my portion of that was only $7,739. For all 6 years combined, I have paid out $32,214 and insurance has covered $144,038. Those totals are for medical, dental and any vision claims. The little guy has the highest totals for our share, $14,274 and I come in at the lowest $3,134. It is fairly interesting to me that over the 6 years, the totals for each of the years are pretty close to the overall average. I use that kind of information for budgeting purposes. The lowest out-of-pocket year was 2013, with only $3,751. With the switch in 2015 to a high-deductible plan, insurance has only paid about $2,000 the last two years. That’s basically the costs of our annual physicals and any associated lab work.
My Bad Years
Thankfully, I am relatively healthy and have not needed much medical care. I go for my annual check-up and for most years, that’s it. For 2 years though, that was not the case. One year, I broke my ankle and the other I need root canal. The root canal actually ended up being more expensive than the broken ankle, likely because insurance generally covers less for dental procedures, than medical ones. So, my $3,134 claims total for the 6 year, $1,597 is from the year of the root canal, and $1,357 is from the broken ankle year. That’s 95% of my total. As I said, I am relatively healthy.
With the HSA, I need to keep track of all medical expenses, so I know how much, if anything, I can withdraw from the HSA. I fully fund the HSA every year, but thankfully do not have that much in medical expenses every year. That has allowed me to build the account up over the last few years. The account now has over $7,000 in it, and I have the ability to withdraw another $750 to pay for past medical claims. I am treating these funds as a secondary emergency fund. Since I paid the claims already, but have yet to withdraw the money from the HSA, I can withdraw it any time I need it. I plan on leaving that money in the HSA until I truly need it. I would like to continue to build up the HSA balance. Never know if the kids will need braces or if the little guy will need additional cardiac care. By having that cushion, it helps protect my finances should something major happen. How are you preparing for the unexpected?
FYI: I worked at a dead end cubicle job from 2005-2011 for about $30,000 per year. I went self-employed in July 2011 and make between $70,000-$90,000 through blogging, professional pet sitting, hubby's reffing, and our rental home. If you’d like to start your own site (link to my free step-by-step guide), I highly suggest checking out Bluehost (my referral link with a nice discount for you, PLUS a free custom header banner from me!). Please contact me any time at budgetingfunstuff*at*gmail*dot*com with questions or just to brainstorm! I’d love to help!