When setting up your budget for family health insurance, you'll have to make allowances for many factors. Use this formula to figure out how much money you'll need to cover your health insurance needs this upcoming year:

Add up Premiums

Determine how much you will be paying in premiums for the year. Be sure to add in premiums for secondary insurance, if you have any.

Check Your Deductible Requirements

Do you have to pay off a deductible before your health insurance kicks in? If so, make sure you add the full amount of the deductible into your financial plan. Now check your expenditures for the past five years and calculate out what you've had to pay out of pocket (towards deductible) on average for the past five years. Make sure you have that number added into the pot, with a back up plan of paying that whole deductible if worst comes to worst.

Check Your Insurance Coverage of Services

Will you have to pay for well checks out of your deductible, or are those covered? Look at your family's current health needs, and compare coverage rates. Do you have a child who needs testing for ADHD this year, and the corresponding medications and evaluations? Are there any scheduled or anticipated surgeries coming up? Will your family health insurance cover 80% of these charges, leaving you with 20%, or are you responsible for the whole shebang until you satisfy the deductible? You may need to get quotes from several sources in order to know exactly what to anticipate for the upcoming year, but it'll be worth it if it helps you know how much to put aside for the year.

Special Considerations

If you have a corporate sponsored FSA (Flexible Spending Account) or HSA (Health Savings Account) available, you'll want to be as accurate as possible with your budgeting so you don't put away money tax-free only to lose it because you didn't use it all. You'll want to put away less than anticipated in your FSA or HSA and then put some more aside in savings account just in case. If you find the end of the year approaching and you haven't used up all the money in your FSA, you'll want to start spending from your FSA to cover things like cold medicine, vitamins and other approved items that can be paid for from your FSA account. You'll be surprised how many items are covered by most FSA allowances.

Add it All Up

Combine these numbers to develop an approximate budget for your family health insurance expenses this upcoming year.