A recent poll commissioned by the Canadian Medical Association has found that many Canadians, especially those in lower income brackets, are cutting back on health spending to save money.
What is surprising about the survey’s results, released on Monday, is not that so many Canadians are delaying medical care due to financial strain – it’s that these findings are considered to be new.
I was fortunate growing up to have a father in a government job. His generous benefits package got us new glasses every two years, orthodontic care and orthotics.
But not everyone had the same privileged access to health care. My husband grew up with a self-employed father. In lean years, of which there were several, visits to the dentist were a luxury that had to be skipped.
These are the choices that families in our country have to make every day, recession or no recession. For those that don’t have employer plans, dental visits often become discretionary purchases.
This is where private health care insurance can play a role. There are insurance products that offer dental, vision and prescription drugs coverage for individuals and families. If you’re self-employed, you will be able to write off a portion of the premium costs.
However, when money is tight, paying for more insurance is probably the last thing you want to think about. Depending on the size of your family, premiums can run into hundreds of dollars of month.
Tina Tehranchian, a certified financial planner with Assante Capital Management, suggests that one approach to health insurance on a budget is to focus on your biggest risks first. In her view, unexpected health costs are the most significant threats to a family’s financial well-being.
Some medical conditions rack up thousands of dollars per month in prescription drugs. However, the average trip to the dentist is typically equal to the cost of the insurance premiums you pay for coverage. Even if you need root canal surgery, the tab won’t come close to drug expenses.
“I see clients all the time more willing to cut back on health than dental, when it should be the opposite,” says Tehranchian. “Big, unforeseen health costs could bankrupt you.”
Another way to manage your health costs if you’re self-employed is to establish a health spending account. You can set up this specially designed trust account that is dedicated to health care costs with a financial planner or accountant. The contributions made to the account are tax deductible and can be used for medication, dental expenses, chiropractors – even some plastic surgeries.
The health spending account allows the self-employed to save for that visit to the dentist’s chair. In tough times, planning ahead for expected expenses is the best way to care for your family’s health.
