For many Americans, one of the largest expenses they have to deal with on a month to month basis is their health insurance premium. For many families, their health insurance costs exceed even their mortgage costs. It can be a huge bill!
However, many have not considered that your health insurance rate does not have to be a fixed rate. Instead, there are several things you can do in order to get that monthly cost lowered to better fit your budget.
- Make sure you are not paying for more than what you need
- Raise your deductible
- Check to see if you qualify for health insurance subsidies
- If you have a spouse, compare healthcare plans
- Stop smoking
- Choose an HMO as your healthcare provider
- Use a fitness tracker
- Use a health savings plan
- Shop around
This is especially true if you have several insurance plans available to you through either your employer or the marketplace. Your plan may include coverage that you do not personally need. Take the time to see what your plan covers, and see if you simply have too much coverage. If you do, change to a plan with a lower monthly premium with less overall coverage.
Many high-premium plans have a high monthly cost because their deductible is very low. This means that if you use your insurance (a surgery, for example) you are responsible for paying the deductible, and then your insurance picks up the tab. Deductibles are annual, which means that once you have reached your deductible, most costs will be covered by your insurance.
Granted, this method comes with its own risks. For example, if you change to a plan with a high deductible but end up having a major procedure, you will be responsible for far more of the cost than you otherwise would.
Through the Affordable Care Act, many Americans not only have access to health care where they did not before but are also able to receive it with a subsidized cost.
Though there are several factors that determine whether or not you are eligible for a subsidy, it is generally determined based on your household income and the number of dependents that live with you. To see if you are eligible, you can fill out an application online.
Options will vary depending on what state you live in, but you may find you are eligible for premium discounts or tax credits to help offset the cost of insurance.
This method is for those that also have a spouse that works where health insurance is offered. Compare to see which plan offers the best monthly premium. Many times, it is cheaper for each person to be on their own individual plan than it is to both be on the same plan. Other times, the monthly premium is similar, but the overall deductible ends up being less expensive.
This does not apply to all plans, though it is a general piece of good advice regardless. Many healthcare providers will run physicals and conduct urine tests to detect the presence of nicotine in the bloodstream.
If they determine that you are a smoker, they can legally up the charge of your monthly premium, and the reason is clear. If you are a smoker, you are more likely to have health problems. If you are more likely to have health problems, you are more likely to make health insurance claims, which in turn becomes an expense for the healthcare provider.
Even if your provider does not check for smoking habits, leading a generally healthier lifestyle can lessen doctor visits, which can lower overall costs as well.
An HMO, or health maintenance organization, is a kind of coverage that can end up offering lower monthly premiums. With more traditional insurance, you choose your doctor and organize your own care. If you happen to choose a doctor out of network, both you and your insurance company end up paying more. In an HMO, you have a primary care physician who handles all of your referrals to other specialists. They will only refer you to a specialist within your network, saving your insurance provider money. Since your insurance provider is guaranteed those savings through an HMO, they are able to offer a lower monthly premium
A lot of health insurance providers will offer discounts for proof that you are being healthy. One of those methods is by getting a fitness tracker, like a Fitbit, and allowing your health insurance provider access to the data. If they have proof that you are being physically active, you may qualify for a premium discount. Remember, your health insurance company wants you healthy so you will not make claims that cost them money. Check to see if this kind of discount is available through your health insurance provider. Many will give you a fitness tracker for free to get started!
Having access to a health savings plan, if your plan provides one, is a great way to save on health costs. It will not affect your premium directly, but it will save you money. Any money you put into an HSA is usually tax-deductible or pre-tax, which means you end up lowering your taxable income. What that means at tax time is that you have less income that can be taxed, which means lower taxes.
If your employer does not offer health insurance and you do not qualify for a health market plan, that means you are on private insurance. Which means, of course, you have the power to shop around and choose the best rates. Rates are regularly changing, and you may find that the rate you have now is no longer the best rate available.
As with any insurance plan, it is always a good rule of thumb to shop around when possible to get the best rates.
If you struggle with your health insurance premium, do not despair! Contact your employer or health insurance provider to see if any of these steps apply to your personal situation. If they do, you could start saving on your monthly health insurance rates right away!
