Beyond Biglaw: Shopping For Health Insurance

How should partners at boutique law firms go about buying health insurance? Columnist Gaston Kroub shares his experience.

Prior to starting my own law firm, I never thought too much about choosing health insurance for myself and my family. When you work at a Biglaw firm, even as a partner, the choice of insurance carrier is already made for you. There is a standard enrollment period, usually towards the late fall, and the firm usually schedules “benefit meetings” where attorneys and staff can ask questions about the benefit election process. Actually signing up is usually done through an enrollment website, and the biggest decision is usually whether to choose a plan that has a higher deductible but lower monthly premium, or vice versa.

From my perspective, the more important consideration was making sure to budget in case my family would hit the out-of-pocket maximum for the year; for those years when we had a child, that was almost a given considering the cost of having a baby at a private New York City hospital. Ditto for the year that I fell off my bike and needed hand surgery. In my experience most people focus on what insurance does or does not “cover,” though from my perspective it is just as important to think about your total exposure to health care costs.

Biglaw firms tend to be generous on their benefits, and choose insurance plans that are “fully loaded” and come with access to large networks of doctors. This is an important consideration, since there is no greater hassle than having to find a new doctor because yours is not part of a network, and there is no economic or medical justification for staying loyal. In fact, the ways most plans are structured, the actual costs between one carrier and another are relatively minimal. What you are paying for with “premium” plans is access to a deeper network of providers.

Health insurance is a big expense of course, particularly for family plans, but the cost is mitigated somewhat by the availability of a tax deduction. For partners, that tax deduction is one of the only ones available to them, since it is not tied to income. And I know that many law firms, both large and small, cover the cost of insurance for associates or otherwise provide some subsidy. Again, from a financial perspective the biggest concern is making sure you have budgeted enough to both cover the deductible you have, and the out-of-pocket maximum for the year.

When I left my Biglaw partnership to start KSK, I decided to stick with the plan offered by my old firm through COBRA. I was comfortable with the network, and had gotten used to managing the health savings account that accompanied my high-deductible plan. The account was linked to my checking account, and I could transfer money as needed to cover deductibles and other health costs on a tax-deductible basis. So choosing to stick with my plan was an easy decision. The paperwork to elect COBRA was very easy to deal with, and the firm’s benefits team was very helpful in making sure the transition was a seamless one. The only change was that instead of insurance being deducted from my draw, I would get a bill from the COBRA provider and need to pay them directly.

But COBRA coverage only extends for 18 months, and a few weeks ago I got a notice that I would be booted from coverage effective June 1. So I quickly went from not thinking about health insurance, other than remembering to pay the monthly bill, to becoming a student of the different options available to a small business owner in the post-Obamacare world. Let me just say it is easier to buy homeowner’s or car insurance. A quick call to a broker usually does the trick. But I also understand that someone can choose not to own a car, or that renting is better than owning a home — thereby obviating their need for insurance. Everyone that is breathing owns a body, however, and insuring that body’s access to healthcare (or more accurately that the owner of the body won’t face bankruptcy as a result of medical bills) happens to be the law.

The options available to me each had their benefits and drawbacks. My partners and I considered going with a group plan through the bar association. The major benefit of that approach seemed to be access to a larger network of doctors, but there was also a cost considering that we live in different states, and at least one partner would be forced onto his state’s individual “marketplace” even if we elected the group plan. Ultimately, we decided that it would be easier for everyone to handle their own insurance, by choosing a plan off the individual exchanges.

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The experience was an interesting one. The website basically worked, and presented information in a straightforward manner about the plan selection process. Thankfully, I do not qualify for or need a “subsidy” to help pay for insurance, which seemed to streamline the application process. Interestingly, there did not seem to be a mechanism for actually verifying income for those people applying for subsidies — glad to know we are so free with taxpayer money that we hand out subsidies based on the honor system. As offputting as that realization was for me, I had a legal obligation to comply with, so I went through the process of comparing plans.

Choosing a plan came down to narrowing the options based on what plans had the majority (if not all) of our family’s doctors within the networks offered. It seemed pretty clear that most of the plans provided some coverage in-network, but that out-of-network care was going to be something that was not going to be paid for. So after I narrowed it down to two plans, I went with the one (Oscar, for those who care) that seemed to have a more modern sensibility. Benefits-wise, my options seemed to be a wash. So I picked the plan, got a premium notice a few days later, and voila, my family had health insurance.

So it can be done. Even a coddled ex-Biglaw lawyer can buy their own health insurance, without much of a fuss. The biggest issue I encountered had to do with some missing information on the website that a few calls to Obamacare customer service did not address consistently. I got the answer I needed, however, and now have a new insurance company to deal with. Since it is 2015, the main immediate requirement is that I download a new app on my phone that I hope to seldom use — not a bad hope to have when it comes to using health insurance as well.

Please send any comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome. For those interested in the intersection of intellectual property litigation and investing, I have also started a new blog/newsletter/video series, “The Markman Note,” which is being hosted at Mimesis Law. Feel free to check it out and let me know of any thoughts or suggestions.


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Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique. The firm’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.