Health insurance can make the difference whenever a medical emergency arises. Knowing that you have the protection of a health insurance plan can save you from a lot of stress.
However, any convenience has a price, and medical bills can easily eat a lot of your precious money over time if you’re not careful. Especially if you need constant treatment, such as if you suffer from a chronic condition, health care expenses can quickly burn a hole in your pocket. From making wise use of HSAs and FSAs, to knowing what is HIPAA, there are several tricks to reduce the health insurance costs and lower your medical bills. Let’s have a look!
1. Find the best plan for your needs
After you chose which company is offering you the best deal, it’s now time to browse for different plans. Be sure to check different policies within the same company to find the most appropriate one to your requirements.
The most important choice is to decide the co-insurance ratio which means how much you are going to pay after you met your deductible. The deductible is the money spent out-of-pocket to pay for medical treatments.
Many health plans offer a common ratio of 80/20, known as a “Gold” plan. In other words, after paying the deductible, you pay 20 percent of the medical expenses while your insurer pays the remaining 80 percent.
There are many different plans available, ranging from 60/40 (Bronze) up to 90/10 (Platinum). The more your insurer pays for coverage, the higher is the premium you have to pay every month.
Changing your co-insurance ratio can affect the money you spend each month. You need to find the right balance between monthly expenses (premium) and insurance coverage.
For example, if you only see your doctor a couple of times each year, a high-deductible plan can be the best option. If you need constant care because you suffer from a chronic condition, instead, a Platinum plan can save you a lot of money.
If you are under 30 years of age, you can also choose a Catastrophic plan. Catastrophic policies only cover for 60 percent of total health care, but the first three primary and preventive care visits are free.
2. Stay healthy at all times
Taking care of your health is probably the simplest and most effective way to reduce health care expenses. Although it may sound obvious, improving your health can save a lot of money that will be spent in medical tests and drugs.
The risk of chronic disease increases dramatically with unhealthy lifestyle habits (such as living a sedentary life, smoking, or eating junk food). It is not infrequent for insurance companies to charge more for people with bad habits.
The Affordable Care Act can help you cut medical costs and stay healthy at the same time with free screening and preventive services ranging from blood pressure measurements to dental cleaning. For example, women can reduce the risk of breast cancer with free mammograms, while seniors have access to low-cost or free yearly flu shots.
3. Use the health insurance marketplace to find the best offer
The Affordable Care Act helps American citizens choose the best, most convenient offer among various insurers. A healthy amount of competition between brokers allows you to shop around until you find the best quotes that suit your needs.
Switching from a plan to the other is extremely simple, and absolutely safe as well. In fact, the Health Insurance Portability and Accountability Act (HIPAA) enacted by the United States Congress in 1996 provides you with the chance to switch from one insurer to another at your leisure. Other than providing customers with a broad range of rights, the HIPAA also protects your private information by establishing a set of rules to guarantee that all patient information is kept secure and confidential at all times.
4. Spend less when you buy medications
Prescription medications often represent a serious medical expense, especially for people who need constant care or suffer from chronic diseases. If your long-term therapy is not going to change soon, you can buy drugs at a much cheaper price by ordering a large supply. A 90-day supply can help you save a lot of money since several health insurance programs offer mail order options at competitive discounts.
Generic medications are also significantly cheaper than brand-name ones – always ask your doctor to prescribe generic drugs, and shop around for the less expensive ones. You can save up to 80 percent of the original price this way!
If you absolutely need a brand-name one, instead, you can always have a look at the manufacturer’s website for coupons and discount cards.
5. Use a Flexible Spending Account (FSA) or a Health Savings Account (HSA)
By using a Health Savings Account (HSA) or a Flexible Spending Account (FSA), you can set aside pre-tax money for health care expenses. Many employers offer these saving plans, and you should take advantage of them.
The money that you put aside in these accounts can be withdrawn tax-free to pay for medical expenses. You can compare your current health plan with an HSA by using one of the many online calculators available online and estimate your savings.
Unspent dollars in FSAs are forfeited if they’re not spent at the end of each year, so don’t let them go unused! Obtaining eligibility for an HSA is a little more difficult but all contributions are kept even if you change work, instead.
FSAs and HSAs are great ways to stash some money that can’t be taxed, reducing the amount you owe every year. Making sense of them can be a little complicated, but once again, the Internet offers a lot of tools to ease your math.