5 Ways to Save on Your Health Insurance
Rent, internet bill, car payment and now you want me to pay how much for health insurance every month? These days it can feel like your paycheck is almost gone before you hit the grocery store or bar.
The good news is you have more health insurance choices today than your parents did, but it can still seem confusing and expensive. See five ways to spend less on health insurance this year.
1. Pick the Right-Sized Plan for You
A smart way to approach saving on health insurance isn’t always by comparing monthly premiums. It’s by evaluating health plans based on how much you’re going to pay over the course of the year when you add up premiums (your monthly payment to have insurance) and the costs you pay for medical services and drugs.
Even if two plans have the same premium, if one requires you to pay a lower cost for doctor visits and prescriptions, it could save you money in the long run.
For example, some plans cover generic prescription drugs for free, which can save you hundreds of dollars annually compared with other plans with the same monthly premium.
Honestly assess what healthcare services and drugs you’re likely to use for the whole year. That will help you select a plan that covers what you need and avoid paying for plan perks you aren’t going to use.
Here’s a few points to consider in evaluating which plan level might work best for you:
- Does the plan allow you to access the services you use most at a cost that works for you?
- What’s the copay (flat fee you pay each time you see the doctor or buy a drug) or coinsurance amount (the percentage you pay for services after you’ve met your deductible) for the medical services you use most?
- If you are in good health and don’t anticipate any major medical procedures, consider a high-deductible plan that costs less per-month than plans with a lower deductible.
2. See if You Can Score Financial Assistance
Financial aid for health insurance, otherwise known as a subsidy, is a type of financial assistance that can lower your monthly premium or reduce your out-of-pocket medical costs. The Advanced Premium Tax Credit lowers your monthly payment while a Cost Sharing Reduction subsidy helps lower the cost of deductibles, coinsurance and copays.
Whether you qualify for subsidies depends on your income, family size and the cost of health insurance in your area. Many individuals qualify for financial assistance if their annual income is less than $47,000. A family of four that makes up to $97,000 is also likely to qualify.
3. Shop Around for the Best Deal
You’d be surprised at how many independently insured people sign up for the same plan each year without shopping for better options. Would you make a major purchase at Target without checking the price on Amazon? Nope. So take the time to compare your current plan with new offerings to be sure you’re not paying more than you should for similar coverage.
Most insurance companies will provide detailed plan options soon in preparation for the open enrollment period from November 1 through January 12. While enrollment is technically open until January 12, you should purchase by December 15 to ensure your health plan starts on January 1 and avoid going without coverage in January.
If you don’t have a chronic illness, only see the doctor a handful of times a year and have minimal generic prescriptions, it doesn’t make sense to have the Tesla of health insurance plans.
Look for a plan that covers what you need most, and acts as a safety net in case of an unexpected emergency.
4. Know the difference between ACA-compliant coverage and Health Care-sharing Ministries
Health Care-Sharing Ministries (HCSM)
Health Care-Sharing Ministries are organizations in the United States in which health care costs are shared among members who have common ethical or religious beliefs. While HCSMs may offer affordable coverage, they are not real health insurance. They are not regulated by the Department of Insurance, and do not guarantee essential health benefits or coverage for pre-existing conditions and may have limitations on what they will cover. Which means they can deny you coverage or drop you off the plan if you get sick or hurt, or deny covering you for anything related to a past medical condition. They often have fixed annual limits on how much they will pay, leaving you on the hook if you have a big hospital bill. They also do not have partnerships with doctors and hospitals, so you are on your own to negotiate healthcare costs. Many doctors and facilities do not accept these plans for this reason.
ACA-compliant coverage refers to health plans that offer benefits for a broad-range of healthcare services that meet the requirements established by the Affordable Care Act, which is also known as ObamaCare.
Major health insurance companies, like Friday Health Plans, offer ACA-compliant coverage. ACA-compliant coverage covers pre-existing conditions and guarantees access to essential health benefits like free annual wellness exams and preventive medicines.
At Friday, many of our plans come with additional perks, like $45 access to Teladoc (an online healthcare service), free generic drugs, and $75 urgent care visits, as well as ironclad coverage in case you get really sick or injured. Because ACA-compliant health plans offer better, more comprehensive coverage, they may have higher monthly premiums. But these plans could save you a lot of money in the long run.
5. Skip the Shortcut: Going Uninsured is Risky Business
Do you think since you haven’t been to the doctor in years and don’t have any prescriptions, it’s smarter to just skip insurance altogether? Helpful Hint: it’s not smarter.
You’re leaving yourself open for financial catastrophe. Without health insurance, a car accident or major unexpected illness can turn into bankruptcy in a matter of weeks.
Every day you’ll need to worry about avoiding injury or illness—forget carefree skiing, travel, dance parties, bike rides or commuting with germy passengers. That’s a heavy burden to bear, not to mention the cost of getting treated if you do crash or get sick.
Get a comprehensive plan, or risk saving a dime to spend a dollar (or a few thousand).