Up-Front Savings Versus Downstream Costs — Which Is Best?

money savings takes time
October 21, 2020
James Ashford

3 MIN. READ

When people think about paying for insurance, one of their first questions is often, “How much is this going to cost me?” Most people consider the answer in terms of the monthly payment. However, when your clients ignore the costs they might end up paying down the road when they have a claim, they might be making a very costly choice.

Everyone is concerned about the high cost of health insurance, including vision plans. At Vision Care Direct of Oklahoma, we’re aware that your clients might be worried about monthly premiums, and we understand why many of them might find a lower premium plan more attractive than one with higher premiums. But which one will end up costing them more in the long run?

What are the total costs?

According to HealthCare.gov, clients need to look beyond the premium they’ll pay and consider how much they might need to spend each year on medical care such as doctor visits, procedures, and prescription drugs.

If they need a lot of care, they could end up paying more in deductibles, copayments, and coinsurance if they choose a lower premium plan than if they pay for a higher premium plan upfront. They might also find that lower premium plans have stricter benefit limits and higher out-of-pocket maximums compared to those with higher premiums.

What does this mean for vision care?

The same holds true for vision insurance. There are lots of low premium plans out there, but the coverage is bare bones. Your client might come to you and want a plan that offers a super low premium but end up getting a case of “sticker shock” when they go to the eye doctor and find out they need a new pair of glasses.

It can be even worse if they need a special type of frames or lenses, such as progressive lenses or multi-focal contacts. With Vision Care Direct, upgrades are often pre-loaded, so customers can take advantage of pretax savings that they would not get if they had a bare-bones plan.

So what should I recommend?

The typical spreadsheet approach to vision coverage sales doesn’t give your customers much detail about what they’re getting for the cost. As such, you need to go over what kinds of deductibles, cost-sharing and out-of-pocket maximums they might expect with a lower premium plan as compared to a higher premium plan.

It would also help your customer to remind them that if they expect to need regular vision care, including eyeglasses or contact lenses, a low premium plan may not be the best option when compared to a higher premium, but a fuller coverage plan, like that offered by Vision Care Direct of Oklahoma.

The more comprehensive plans often provide far richer coverage and give customers much better benefits at the point of sale. So instead of getting hit with a large surprise bill, and maybe even forgoing care because they can’t afford it, your clients can get the care they need at a price for which they can budget throughout the year.

The bottom line

No one likes sticker shock, and one of the worst places for it as a customer is at the doctor’s office. Customers won’t want to miss out on the care they need because of unexpected expenses. So, while they might initially be attracted to a lower cost plan, it is important that you, as a broker, inform them of the pitfalls of those plans and the advantages of richer benefit plans. While they may pay more upfront with a higher premium plan, they can better budget for this care and avoid getting hit with an unexpected bill when they need care or services.

To learn more about how we can help you suggest the best vision insurance for your clients, contact Vision Care Direct of Oklahoma today.

Not sure where to get started with recommending self-funded plans? Vision Care Direct of Oklahoma is pre-paid plan provider with and extensive of specialists who deliver eye care in Tulsa and nationwide with excellent value for employers and plan recipients.

Find out more about our self-funded plans and other flexible options.

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