Is Vision Insurance Worth It? What You Should Know

We all know health insurance is something you shouldn't live without, but what about vision care insurance? Your ability to see is surely almost as important as your health. Vision care insurance can be purchased as a group benefit through your employer or as an individual policy. But how does the cost compare to the coverage you'll receive?

Here's how vision care insurance works. You send the vision insurer a check for your premium for individual plans, or have the premium deducted from your paycheck for employer-sponsored plans. In exchange, you'll receive benefits such as discounted vision exams, glasses and contacts. Some plans also pay out if you are diagnosed with an eye disorder or if your vision becomes permanently impaired.

Some vision care plans require you to see a provider in the plan's network. Other vision care plans simply require you to be treated by an optometrist or an ophthalmologist—in other words, a vision care professional who has graduated from an accredited college of optometry and is licensed by the state or who has gone to medical school and is certified by the American Board of Ophthalmology. If you already have an eye doctor you want to keep seeing, make sure their services will be covered by the plan you're thinking about purchasing.

Whether you purchase your own insurance or get it through an employer, expect to pay somewhere between $5 and $15 a month in premiums for an individual. To add coverage for a spouse, domestic partner or child, you may pay slightly less per person than the plan's individual rate. If your employer offers vision care insurance, you may only have one opportunity per year to sign up during the annual open enrollment period. Be aware that some individual plans charge a one-time enrollment fee in addition to a monthly premium.

Regardless of whether you obtain your coverage individually or through work, compare the policy's total annual cost  to your anticipated annual vision care expenses. You don't want to pay out more than you expect to receive. (For related reading, see: How to Shop for Health Insurance.)

Each plan covers a different set of expenses. Before signing up for any plan, check to see if it covers everything you expect to need. Bare-bones plans usually cover only eye exams, contacts and glasses and may function more like discount plans than insurance. More comprehensive plans don't stop at exams and vision correction, they also help with the costs of eye surgery, eye diseases (e.g., diabetic retinopathy, retinal detachment, retinitis pigmentosa, cataracts, glaucoma, macular degeneration) and permanent vision impairment. Most plans also provide discounts on laser eye-correction surgery.

The amount of an eye-related expense a vision care plan will cover differs significantly from plan to plan. One plan might charge you a $10 co-payment for an eye exam and cover the difference. Another plan might pay for $35 of your exam and expect you to pay the rest. Also, if a plan does offer coverage for eye surgery or permanent vision loss, it may not be anything like the coverage you're used to getting from health insurance. For example, if you need eye surgery for glaucoma (an optic nerve disease that gradually causes blindness), you won't pay an annual deductible of $200 for the procedure and have the remainder covered by vision insurance. Instead, your insurance might simply give you a flat payment of $1,000 for the surgery and leave the rest up to you. This system might sound stingy, but it has a bright side—by placing greater responsibility on patients to cover their costs and shop around for the best value, insurance companies can charge their customers lower premiums. (For related reading, see: Fighting the High Costs Of Healthcare.)

We've already touched on some of the limitations of vision care insurance. Here are some additional factors to consider when deciding whether to purchase coverage.

• How does the insurance policy define the scope of a covered eye exam? If you visit an eye doctor who includes services in the exam the plan does not cover, you will have to pay for them.
  
• The plan might cover lenses for glasses, but only basic lenses. If you want lightweight or anti-glare lenses, you'll pay all of the extra cost.
  
• The plan might cover frames but only up to a certain amount, so if you want a pair of $250 frames, only part of your cost will be covered. Or the plan might cover the retail markup of the frames and require you to pay the wholesale cost.
  
• All benefits are not necessarily available every 12 months. It might be a longer time period, such as 24 months.
  
• Some plans will only cover glasses or contacts, but not both, during the same benefit period. If you wanted to update both your contacts and your glasses, you would have to get contacts one year, then get another eye exam and choose the glasses benefit 12 or 24 months later.
  
• Some plans have waiting periods ranging anywhere from 30 days to 36 months. During the waiting period, you will receive reduced benefits or no benefits. The purpose of the waiting period is to prevent people from waiting until they have an expensive problem to sign up for vision care insurance. The way insurance companies are able to pay benefits when people need them is by spreading risk among a large group of people, some of whom are healthy and some of whom are not, and all of whom will experience problems at different times. Insurance companies need the premiums from healthy people to pay the expenses of unhealthy people.
  

If vision care insurance sounds too complicated, you don't think you really need it, or you're not sure if it will pay off, it's OK to skip it. Unlike skipping health insurance, skipping vision insurance isn't likely to land you in bankruptcy court or put your life in jeopardy.

There are a number of ways to get discounted vision care without purchasing vision care insurance. Big-box retailers like Costco and Walmart have optical centers in some of their stores. The centers offer exams by licensed optometrists and sell reasonably priced glasses and contacts. Exam costs vary by location because the optometrists who staff them are independent of the retailers. Walmart lets you look at frames and their prices on its website.

If you're not terribly particular about your frames, you can order a complete set of glasses through an online retailer at a stunningly cheap price. For example, how does $6.95 for both lenses and frames with $5.95 shipping sound? Some online stores will let you send them a pair of frames and they will add the prescription lenses. Discounted contact lenses are also available online. You will still need a prescription from an eye doctor when using these online services.

If your employer offers a flexible spending account (FSA), you can use tax-free contributions to pay for your medically necessary vision care expenses. Health savings account (HSA) funds can also be put toward approved vision care costs. See IRS publication 502 for a list of expenses you can pay for with FSA and HSA funds.

Deciding whether to purchase vision care insurance can be tricky, it's not unilaterally a good or bad deal. Whether it makes sense for you to purchase a policy depends on a number of factors, such as the policy options you have to choose from, the types of vision care products and services you need, and how frequently you need them. To make sure you're getting a product that will be valuable to you, do the research and the math before you sign up. 

(For related reading, see: Getting the Most From Your Health Insurance Policy.)