Other answer have addressed the price difference. I have know companies that paid only a small percentage of the monthly premium. I have also found some that have paid 100% of the premium.
My question is how can plan's costs differ by so much? I'm tempted to
opt off of my company's plan and get added to my partner's plan as a
dependent, but just wanted to see if I'm missing anything.
So how hoes one make this switch.
You can't just decide tomorrow to be added to their insurance plan. You need to either wait until your partners company has their benefits open season to be added. The only other way your partner can make changes to their policy choice is to have had a [Qualifying Life Event (QLE)][qle].
There are 4 basic types of qualifying life events. (The following are examples, not a full list.)
Loss of health coverage
- Losing existing health coverage, including job-based, individual, and student plans
- Losing eligibility for Medicare, Medicaid, or CHIP
- Turning 26 and losing coverage through a parent’s plan
Changes in household
- Getting married or divorced
- Having a baby or adopting a child
- Death in the family
Changes in residence
- Moving to a different ZIP code or county
- A student moving to or from the place they attend school
- A seasonal worker moving to or from the place they both live and work
- Moving to or from a shelter or other transitional housing
Other qualifying events
- Changes in your income that affect the coverage you qualify for
- Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act (ANCSA) Corporation
- Becoming a U.S. citizen
- Leaving incarceration (jail or prison)
- AmeriCorps members starting or ending their service
Once open season arrives, or you have determined that a QLE applies to your situation, you then need to get the current documents that describe the coverage options and the costs.
Pay very close attention to the costs of adding a non-employee to the policy. Some companies that cover most of the coverage options for the employee cover a smaller percentage of the non-employees. That could mean that they pay 90% of the premium of the employee but only 25% of the premium of the spouse and children.
The word spouse brings up another issue. The portion that the company pays for a spouse and children being added to the policy is not taxable. The portion of the premium for people being added to the policy who are not tax dependents is considered taxable income. You might not save as much money as you first think. The company might want proof of marriage or proof of a domestic partnership.
I know that with some companies they expect that if the spouse works for a company that also has company sponsored health insurance, they require the spouse to get coverage from their company. I don't know if a company that has that type of rule also has a similar rule for domestic partners.
There can be one benefit of getting added to your partners policy. Some companies will give additional money or benefits to an employee that doesn't need health insurance through them. I have known companies that gave the portion of the premium they would have paid if you don't elect to get coverage. I have known companies that gave extra vacation days. Check with your employer.