When you look at health insurance, you probably look at it as a costly expense that appears on the monthly budget. However, health insurance costs involve much more than the monthly premium. You also have to account for out-of-pocket expenses that include coinsurance, copayments, and the deductible.
Although you must find a plan that fits in your budget, you should not cut cost corners when it comes to buying a health insurance policy. You also have to consider the value produced by a policy. It is not a wise financial strategy to have an incredibly high deductible when you need a costly medical procedure performed.
Let’s find out how you can save money on health insurance and still buy a policy that provides value.
#1 Lower than Average Rate
Health insurance companies do not throw darts on a dartboard to determine policy rates. The companies spend time negotiating directly with medical institutions for delivering both in-network and non-network care. One of the facts of life for hospitals and other medical facilities is the rates they charge fall below what is eventually negotiated with a health insurance company. This is because medical institutions benefit from working with a large number of patients enrolled by the same insurance company.
To receive a discounted health insurance rate, you should ask to see the cost breakdown for a policy that should include the following numbers:
- Typical charges made by a medical institution
- Negotiated price
- Percentage of the rate the insurance company pays
- The amount you are responsible for paying
#2 Sharing the Costs of Health Insurance
Health insurance policies contain an annual deductible and an annual maximum for out-of-pocket costs. The amount of the deductible is the responsibility of the policyholder to pay, and when it reaches its limit, the insurance company starts to pay for health care coverage. Out-of-pocket expenses are higher than the deductible because of the addition of coinsurance and copayment clauses written into a policy.
The more you are willing to share in the costs of health care, the lower your monthly premiums will be. It can be difficult to find the right balance between paying out of pocket for health care costs and paying a higher premium for health insurance.
#3 Prevention Today, Lower Health Care Costs Tomorrow
One of the most popular provisions of the Affordable Care Act (ACA) establishes a preventive health care program for anyone that wants to participate in it. Preventing the development of an illness or a disease goes a long way towards keeping your health care costs down. If your physician discovers a medical issue early in the development process, the cost of treating the medical issue will be less than if you wait until the illness or disease reaches a later stage. It is also important to schedule regular visits with a specialist to avoid costly future health care problems.
Technology Can Save You Money
The healthcare industry is a labor-intensive industry that utilizes the services of highly-trained and well-compensated health care professionals. One of the most effective ways to lower the costs associated with health care is to leverage the power of technology. Telemedicine allows patients to interact with their physicians over the phone, which reduces the costs of health care. Many insurers offer this service as a free benefit written into a policy. Makes sure you find out whether an insurance company offers this cost-saving service free of charge.
Taking time to learn about the four ways health insurance can save you money ensures your policy never exceeds what you have established for health care in the family budget. With health care costs continuing to increase rapidly, any of the four methods should boost your finances.