As healthcare costs rise, many consumers are forced to decide between paying higher monthly premiums or facing enormous out-of-pocket medical bills. However, choosing a high deductible plan doesn’t necessarily mean your healthcare will suffer. The following points explain how you can save money on healthcare without sacrificing quality or frequency.
Many Medical Services Are Fully Covered By Your Health Insurance
Under the Affordable Care Act (ACA), all health insurance companies must fully cover certain types of care, including:
- Alcohol abuse screening and counseling
- Blood pressure screenings
- Depression screening
- Many immunizations
- Obesity screening and counseling
- Tobacco use screening and help with smoking cessation
- Women’s preventive health services (including well-women visits)
When you receive these covered services, you should not pay a co-pay, deductible, co-insurance, or other payment. Unfortunately, many consumers do not understand that these services are completely free. Depending on your age and other risk factors, you might also receive other free medical screenings and services.
Save Money on Prescription Medications
If there is a generic version of your prescription, you can save a lot of money by opting against branded medication. According to the Association for Accessible Medicines, Americans saved $253 billion in 2016 by requesting generic and biosimilar medications. Generic mental health, hypertension, cholesterol, and ulcer medications typically offer the greatest savings. When you fill a new prescription or switch pharmacies, make sure you ask for generic medications when possible.
If there isn’t a generic option, you should ask your physician and pharmacist about the availability of samples, coupons, or rebates. Many pharmaceutical companies offer savings programs for expensive medications. Finally, some pharmacies provide certain medications (such as antibiotics, prenatal vitamins, and asthma meds) at little or no cost. A quick online search might help you identify pharmacies that offer reduced and no-cost medications.
Maximize Your Healthcare Savings Account
If you have a high deductible plan, a healthcare savings account (HSA) allows you to put pre-tax dollars into the account. You can use the money in your HSA for deductibles, copays, and other qualified medical expenses. In 2018, you can deposit up to $3,450 for an individual and $6,900 for a family in an HSA. People over 55 years old can add an additional $1,000.
HSAs offer a series of advantages. First, you do not pay taxes on your HSA contributions. And, depending on your income, your HSA contributions might reduce your tax burden by dropping you into a lower tax bracket. Finally, HSA funds roll-over each year and you can earn interest on them. If you remain relatively healthy and do not spend HSA dollars, you might build a significant financial nest egg for the future.
Treat Your Medical Conditions Appropriately
While you should always take your health and wellness seriously, you should try to seek the correct type of medical care for your needs. For example, don’t go to the emergency room for a minor sinus infection. The cost of treatment in the ER is typically higher than at an urgent care facility or your primary care physician’s office. Instead, opt for appropriate health care. If you can wait to see your doctor until the morning, do so.
However, you should never avoid necessary or emergency medical treatment. Too frequently, people delay treatment, thinking that their condition will resolve on its own or because they are fearful of the costs. Without treatment, your condition might worsen significantly, resulting in more intensive (and expensive) medical care.
Finally, don’t hesitate to ask your physicians and other medical providers about cost-effective treatment options. While the cheapest option isn’t always the best, some routine tests and services are relatively uniform in quality, regardless of price. You might discover that you can save a lot of money by price shopping.
Improve Your Health Insurance Literacy
Most Americans have a hard time understanding their health insurance plan and how it calculates their out-of-pocket costs. Depending on your health plan, you might pay:
- Deductibles: The amount you must pay for medical care before your health insurance starts to cover some or all of the costs.
- Co-payments: A set fee that you pay for certain types of doctor appointments or medical services.
- Co-insurance: The insurance company covers a percentage of the cost of a medical service, and you pay the remainder.
While interpreting your health insurance plan might sound daunting, many providers offer online tools to help you understand your health plan and its coverage.
Additionally, when you enroll for health insurance, health literacy can help you make the best possible decisions. For example, if you are young and very healthy, a high deductible plan might save you money. However, if you anticipate expensive health care needs, a high deductible plan (where you exchange a relatively low premium for a large deductible) might be a bad financial choice. Don’t hesitate to ask your human resources or insurance company representative for advice.
Generic drug access & savings in the U.S. (2017). Association for Accessible Medicines. Retrieved from https://accessiblemeds.org/sites/default/files/2017-07/2017-AAM-Access-Savings-Report-2017-web2.pdf
Revenue Procedure 2017-37 (2017, May). Internal Revenue Service. Retrieved from https://www.irs.gov/pub/irs-drop/rp-17-37.pdf