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Hi Personal Finance Fans,

Here is an easy question for all the economic gurus in this forum.

I am currently working for one global corporation. My wife is working for a big USA organization.

At this moment we are paying for our health care insurance from our own employers, we both pay now around $226.84* per month.

If she drops her insurance from her plan, and I add her on mine, then we will be paying $225 per month.

*The 226.84 number is calculated by multiplying by 2 her health care deduction, but she is paid biweekly, so it might be a little off.

  1. Do you think we should switch?
  2. Would this change bring us any tax issues?
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If I read your figures correctly, then the cost difference is negligible. ($1.84 difference)

The main determining factor, I'd think, would be the coverage. Do you get more, or less, coverage now than you would if you went together on the same plan? You'd both be covered, but what is the cap?

Plans, and employer contributions, change all the time. How is business in both of your companies? Are you likely to get cut?

Are you able to get back into a plan at each of your employers if you quit the plan for a while? These rules may be unpleasant surprises if, say, your wife cancels her plan, goes on yours, and you lose your job. She may not be able to get back into her insurance immediately, or possibly not at all. A spouse losing a job isn't a "qualifying life event" the way marriage, birth of a child, divorce, etc., is.

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    At least under my health care plan, change of existing coverage in a spouses plan is a qualifying event. I think it has to be this way, because there are many cases, myself included, where the open enrollment period for our employers does not match up. – KeithB Oct 18 '10 at 10:25
  • @KeithB - when I switched to my spouses' plan due to switching jobs, it was not considered a qualifying life event, so not all employers are so generous as yours. Definitely something to check. – justkt Oct 18 '10 at 13:01
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    Along with coverage, if there's a deductible you'll hit it sooner with both of you under the same plan than you would under separate plans. – Benjamin Chambers Oct 18 '10 at 17:24
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One thing to look into is if there is an extra fee for covering a spouse under you plan, if she is covered under her own employer's plan. I know that my wife's company charges around $100-$200 a year if I was to be covered under her plan, since I am eligible for the coverage where I work.

As far as tax issues, there shouldn't be any. I think the choice comes down to the coverage offered by both plans.

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