Do You Really Save Money Paying Private Insurance For Orthodontics?
When a person pays for health benefits, they pay premiums. Health Insurance companies do their math as they have rules for Orthodontic payments. First, you need to have the plan for 12 months before your Orthodontics even kick in. Second, you are covered for either 50% or 60% of the price, the most common coverages. Third, you are required to spread the payments out over 18 months.
People often feel the relief of this payment schedule and don’t think about what it means. When you add the 12 months and the 18 months of payments together, you have 30 months of premiums. Now add in the 40% or 50% of the bill that you are responsible for. Here is one example. Orthodontics cost on average $8000. Premiums for Private Insurance can run $250 – $300 a month for a family. Lets work with the $250 a month times 30 months is $7500. Now add in 40% of the Orthodontics bill, going with the lower amount again, $3200.
If you went down this road, you just paid $10,700 for an $8000 dollar Orthodontics bill.
If you have an employer who is paying the premiums, you do save the premiums and the 50% or 60% covered. If you are an employer, you are probably aware that $250 a month for a family is a pretty good deal.
An employer in Canada can provide benefits to your employees and set the amounts you give them yourself. The advantages are 1) you only having to pay for what your employees actually spend, 2) you can cover yourself and your family 3) you remove the middle man telling you what prescriptions are covered and which ones are not or limiting how many Registered Massage Therapy sessions you are allowed each year to manage your pain.
Business Owners have another option for health benefits.
If you own you own Private Health Service Plan, you can pay the Orthodontist bill and write the entire amount off you taxes, essentially lowering the cost of the bill since you can pay for it with pre tax dollars. No monthly premiums, set up what ever payment plan you want and can negotiate with the Orthodontist and away you go. You can cover your health benefits and create a tax strategy with the money you would be spending on health care anyway.
