Some tips to save money on health coverage include getting preventive care and using in-network providers. Another tip to save money is to use a health savings account. Then, you can estimate the cost of your coverage. This way, you can avoid wasting money on unnecessary medical visits and prescriptions.
Although the topic of preventive care is controversial, the cost savings from more use of preventive services is significant. For example, a five percent decrease in hypertension could save $25 billion a year. Additionally, avoiding HIV infection can save an average of $355,000 over a lifetime. According to the CDC, lowering the cost of preventive services is a major way to reduce overall health care spending.
Preventive care is vital in keeping you healthy and helps you avoid or delay illness or manage your existing conditions. It can also help you save money on health insurance. It’s a good idea to incorporate preventative services into your health plan at all stages of your life, from childbirth to retirement. Not only can preventative care save you money, but it can also strengthen your immune system against common diseases and preventable conditions.
Many health plans cover the cost of preventive care services. A yearly flu shot can reduce the risk of getting the flu by 60%, and reduce the risk of hospitalization if you do get sick. These preventive services are often bundled into your health insurance premiums, and most plans are required by law to cover them at 100%.
Using in-network providers
If you’re looking to save money on health coverage, consider using in-network providers whenever possible. Insurance companies typically have contracts with specific doctors, clinics, and hospitals, and if you can use care from those providers, you can avoid out-of-network costs. If you can’t use care from a specific in-network provider, call the insurance company to learn which out-of-network providers are available. Although this type of care is usually more expensive, some insurance companies will cover out-of-network care for a reduced cost.
When choosing health care providers, consider the costs and benefits of each type of care. It is often more expensive to see a specialist outside of your plan’s network, and the costs vary by provider. Using an in-network specialist, on average, costs about $50. However, if you choose an out-of-network provider, you’ll likely have to pay 40% of the bill.
It’s also a good idea to contact the provider to ensure that they accept your insurance plan. Sometimes, contracts between insurance companies and providers change and websites are not always up-to-date. If you don’t know whether your plan is accepted at a particular provider, call the provider to confirm before going ahead and making an appointment.
Using a basic health plan with a top-up plan
Using a basic health plan with supplementary coverage can save money on health coverage and still get full coverage. This plan enables you to see any doctor you choose and it also allows you to receive out-of-network services. However, out-of-network services are usually more expensive in a PPO plan.
When choosing a health plan, choose one with a low deductible. For instance, a bronze plan has a lower deductible than a silver plan. The difference in deductibles between a bronze and a silver plan is only significant if the person has a high amount of health-care use. However, the lower deductibles of a silver plan mean that the premiums are slightly higher than in a bronze plan.
Another option is to use a health plan with a high deductible. This type of plan combines a health savings account with a traditional health insurance policy. You get insurance coverage and a tax-advantaged savings account for future medical expenses. You can use the money you save to cover qualified medical expenses.
Using a health savings account
If you are interested in saving money on your health coverage, health savings accounts can be a good option. They allow you to contribute pre-tax money to an account, and can be withdrawn tax-free for qualifying medical costs. These savings can add up over time. One strategy is to max out your HSA contribution limits each year. This means that you can deposit up to three times the amount of your deductible each year.
Health reimbursement accounts, or HRAs, are similar to HSAs, but they are funded by the employer. In contrast, HRAs cannot be taken with you when you change jobs. Another option is flexible spending accounts, which are offered through your employer. However, these accounts are not tied to a particular health plan, so you have flexibility when selecting one.
In our example, Phil, a single male living in Raleigh, North Carolina, works as a programmer for a start-up gaming company. He enjoys entertaining friends and cooking healthy meals. His health care spending is minimal – he only needs annual check-ups and flu shots. His FSA is funded with pre-tax money and will save him 30 cents on the dollar for any health care expenses in the coming year. If you have a high-deductible health plan, you can take advantage of the tax-free savings by contributing a portion of your salary to an HSA.