What Milton Bradley Knew

game of life 4When my sons were little, one of our favorite board games was the Milton Bradley game of “Life.” You select your playing piece, a small plastic car, then a spin of the wheel determines how far ahead you move on this simulated journey of life – choosing trade school or college, getting married or staying single, having children, planned or unplanned, establishing a career, buying a house — the steps that were part of the prescribed order of the day to a “successful” life.  The object of the game was to get to the end of the journey with cash still on hand.

One of the critical first choices was whether you wanted to buy insurance. It had an expense associated with it at a point in the game where you typically didn’t have a lot of cash. If you felt lucky you could always decline, keep the money, and hope you didn’t land on the spaces that signified disaster or illness. It always fascinated me how a simple choice and a spin of the wheel could impact the outcome of the game, good, bad, and ugly.

And so it is in real life. The basic principle of insurance is a tool to minimize financial risk. It doesn’t mean that there aren’t expenses if something bad happens. Only that having insurance means you don’t have to bear the full burden.

If you’re fortunate to have health insurance through your employer, Medicare, or privately, this is the usual time of the year you’re asked to review your benefits and update them for the coming year.  Some of us spin the wheel and don’t really look at or attempt to understand our insurance coverage until we need to use it. A recent study in the Journal of Health Economics surveyed 202 individuals with healthcare insurance on their understanding of five basic insurance terms:  out of pocket maximum, deductible, co-insurance, co-pay, and deductible.  Only 14% of those surveyed got all five right.  If you’d like to test your own knowledge, click here. http://www.washingtonpost.com/blogs/wonkblog/wp/2013/08/08/do-you-understand-health-insurance-most-people-dont/

This means that even if we do look at our insurance documents (and I confess, there have been times I, too have been guilty of only a cursory glance), really understanding the financial impact an accident or serious health condition would have on us may require some extra effort.

Many clients call private health advocates when they’ve become ill and seek treatment.  They are surprised at what their insurance covers or, worse, doesn’t cover.  I’ve worked with several patients who had never looked at their coverage documents and didn’t fully appreciate the scope of their financial responsibility for the services they received.

At this time of the year when many benefit plans are making their annual changes, I encourage you to take a close look at your health insurance coverage. Gather a basic understanding of what your plan covers and doesn’t cover so you can plan accordingly.

And if you’re finding it’s a confusing game for you, call me for a free 15 minute consultation.

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