How to Save Money on Health Care – Part 3
In this series of articles we give you some great tips on how to save money on health care.
Part 3 is about reducing your health insurance costs. Health insurance can be expensive but you can save money with these practical ideas.
Part 3: Save on Health Insurance
Obtain multiple health insurance quotes
Always shop around for health insurance and obtain multiple quotes before your buy. Premiums and coverage can vary widely. Get the best value for your money by obtaining several health insurance quotes and comparing the cost and the benefits of each option.
Consider key variables such as deductibles, co-insurance, co-payments for doctors' visits, stop-loss amounts, coverage for preventive care, and choice of health care providers.
You can start by obtaining free health insurance quotes here.
Choose a higher deductible
By increasing the deductible on your health insurance policy, you can save hundreds of dollars a year on premium costs. But be aware that by increasing your deductible, you are exposing yourself to greater out-of-pocket costs should you require medical treatment. Consider the state of your health and the health of your family and choose a deductible that you feel is most appropriate based on your expected health care needs and your budget.
Pay your premiums annually
By paying your health insurance premiums annually instead of monthly or weekly, you may be able to avoid "service fees" and/or "installment fees", or receive an early-payment discount from your insurer. Ask your insurance company what options you have and determine if this makes sense given your circumstances.
Review your policy in detail each year
Each year, as your health insurance policy comes up for renewal, review your policy in detail to ensure you are getting the right coverage for your needs.
Have you developed any medical conditions? Have your recently moved to a different area? Is there an in-network provider nearby? Have your recently got married? Have you recently separated from your spouse? Are you expecting, or have you recently had a child? Changes in your personal circumstances should give you pause to reconsider your coverage and make appropriate amendments to your policy.
Also consider whether you are maximizing the value of your health insurance. Are you utilizing the range preventive care services covered by your policy? Reviewing your coverage may remind you of some the benefits available to you and your family.
Don't pay twice for the same coverage
Don't purchase supplemental policies for items, such as cancer treatment, if you already have adequate coverage under your existing policy. If you don't think your existing policy provides sufficient coverage, find out how much it would cost to increase your benefits. Extending the coverage of your existing policy may be cheaper than purchasing an additional supplemental policy.
Ensure you have a stop-loss clause
A large proportion of insurance policies do not contain a stop-loss clause for out-of-pocket expenses. This means that if you are unfortunate enough to be afflicted with a serious condition, due to the high costs of treatment, the amount of medical costs you are required to pay yourself could be very large.
For example, assume you have a policy in which the insurance covers 80% of the cost, your co-insurance portion is 20%, and you have a deductible of $250. If the cost of medical treatment was $1,250, you would be required to pay the deductible of $250 plus 20% of the balance, being $200, to give a total cost of $450. That might be a manageable amount for most people. But what if you have a catastrophic illness and treatment costs $500,000? Your share would be $100,000. Could you afford that? That is why a stop-loss clause is important. A stop-loss clause limits your total exposure to a fixed amount, say $3,000.
The stop-loss amount will impact your premium, so talk to your insurance company about what limit is appropriate for you given your circumstances.
Don't buy a policy that excludes pre-existing conditions
If possible, avoid obtaining a policy that excludes any pre-existing conditions. Some insurers will make you wait a fixed period of time before coverage for certain conditions commences. Be prepared to wait if you have no other options, but do not purchase a policy that requires you to wait more than six months.
