With Out-of-Pocket Medical Expenses Rising, It Might Be Time for Insurance Change

The advisers also said Melton should ask whether his company offers a medical care flexible-spending account. These plans work with existing health insurance. The employee sets aside pre-tax dollars for health-care expenses. Contributions are usually spread out over the year as payroll deductions. The employee can then withdraw the money tax free to pay out-of-pocket medical expenses.

However, these plans do not carry over from year to year, so participants have to be careful not to set aside too much. "The key is taking time now to assess your health-related expenses to include co-pays, deductibles, prescriptions, over-the-counter cold and allergy medicines, even contact lens solution," Owen said.

Melton said he has been looking at health care plans not offered by his company. Sneed said, however, that group health coverage is generally cheaper than an individual plan. "Usually the employer subsidizes the employee cost of coverage and many times the family coverage cost as well," he said.

That said, it wouldn't hurt Melton to research other plans. He can do so online at Web sites such as http://www.ehealthinsurance.com.

Although he has employer coverage, he might still be able to apply for government medical aid for his daughter because of the large expenses, Sneed said. "If she is accepted, he would keep her on his group plan as the primary insurance and Medicaid would become her secondary insurance, picking up co-pays and authorized hospital visits for just her," he said.

If that doesn't work, he can try the State Children's Health Insurance Program, which is a federal government initiative that gives states money to provide coverage to families with incomes that are modest but too high to qualify for Medicaid. Each state program has different guidelines. (The District's program is called the D.C. Healthy Families Insurance Program.)

Finally, if Melton sticks with Blue Cross/Blue Shield, he could contact the company and request that a case manager review his situation to see whether there's any way to reduce his costs. He should also be honest with the doctors and hospitals.

"He shouldn't be afraid to negotiate with doctors and/or hospitals for out-of-pocket expenses," Fernandez said. "Some doctors and many hospitals have discount programs in place for people paying out-of-pocket costs. And if they don't, try to negotiate anyway."