When Paul resigned from his position last year, we were looking for alternatives for health care other than Cobra. We ultimately decided to go with Cobra temporarily because it ended up being the best alternative for us.
However, that may not be the case for everyone. In fact, there are some ways you can reduce your health insurance costs but you have to start before you need to find new health insurance. Here are ten ways to reduce health insurance premium costs.
Switch to a Higher Deductible Plan
The obvious way to lower personal health insurance costs is to assume a higher deductible. This will take more of the burden off the insurance company, which will mean they can charge less for your premiums.
Switching to a higher deductive plan helped us to the tune of a $1,000 a month savings! Yes, it's ridiculous! While on this plan, Andon had an accident which required a trip to the ER and some stitches. That charge was roughly $1,000 but it was still a better deal than paying that $1,000 additional each month that we may have never needed.
While it would be ideal to have savings built up to equal your out of pocket maximum, it's not always necessary. Hospitals and doctors will put you on payment plans even if you don't have the savings built up to pay your bill immediately. Take advantage of this but be sure to call and request to talk about your options rather than ignoring the bill.
Consider a Higher Co-Pay
Along with taking a higher deductible, assuming a higher co-payment amount will reduce the premium the insurance company will charge for your benefits. Instead of paying $20 per visit, see if there is a plan for $30 per visit, or more.
Look at your past experience with office calls to see if you could save over the life of the policy in premiums charged using a higher co-pay. Last year, I believe we went to the doctor less than 10 times total for our entire family. Having a higher co-pay would be a great alternative for people who generally have few office visits.
Related Post: Understanding Your Health Benefits
Keep Your Health In Check
Do you remember the last time you were required to fill out a health assessment form for insurance? They ask you all kinds of questions and it's because they need to understand your health history to assess your overall risk (i.e., high costs) to the policy.
With that, get your health in check now. Stop smoking, lose weight, get your diabetes under control (or even eliminate Type 2 diabetes by following proper protocol). This will help drop your insurance costs drastically.
Many health insurance companies offer discounts if you are participating in a fitness program on a regular basis. Some insurance companies will even offer you a discount to your local fitness center to encourage a healthier lifestyle. Prevention is the best medicine and the health insurance industry knows that.
Improve your Credit Score
Many insurance companies actually pull your FICO score in order to determine what your premiums will be. Make sure you get your free Credit Report annually. Improving your credit scores will show the insurance companies you are a good investment.
It's always good to stay on top of your credit history anyway to ensure everything is good. You don't want to be surprised when you go for a loan.
Open an FSA or HSA
These medical savings accounts are money pools you create by depositing ‘before tax' income. You can then withdraw funds from the account for medically necessary items. This can include anything from office calls to prescriptions to over-the-counter allergy medicines.
This is a ‘before taxes' account, which saves you money right up front. These accounts give you a place to keep money, tax free, to pay for your deductible and co-payments, as well as medical and health related supplies.
Related Reading: Use an FSA to Reduce Your Federal Income Taxes
Generic medications cost much less to produce and to distribute, and the savings are passed on to you. Also, some insurance policies no longer cover name brand drugs, so if you want the well-known ‘label' you'll pay the extra cost right out of your pocket.
Use Walk-In Clinics
Walk in health clinics, or ‘retail clinics' are popping up all over. You'll find clinics in malls, drug stores and even in large retail outlets. These clinics offer simple services like vaccines, routine checkups and even blood work, all without an appointment. Check their rates and compare to your primary physicians office. You may be surprised what you can save.
Use Urgent Care Clinics
Urgent care clinics are similar to an emergency room, but without much of the specialized equipment. These clinics are more suited to everyday emergencies, like issues requiring x-rays, bandages and stitches, but not for surgeries. Many times, these smaller clinics are much cheaper than going to a full fledged emergency room and have a lower co-payment because they bill as a clinic instead of an emergency care facility.
When you're looking for ways to cut health care costs, put these ten ideas to work. Trim your budget and continue to get the care you need!
Do you have other ways to reduce your health insurance costs?
Please comment so others can look into it too!