Healthcare expenses can be a major burden for many people, especially those on a tight budget. Fortunately, there are some smart strategies that can help you keep your healthcare costs under control. From planning ahead for urgent and emergency care to choosing the right health plan and asking more questions when your doctor recommends a new type of test, here are seven ways to save money on healthcare expenses. The most important key to saving on healthcare is to treat it like anything else you buy and pay for.
You would compare prices to get the best value for your money when buying a car or smartphone or you would buy brands at the supermarket. You can do the same with medical services. In general, the less you pay in premiums, the greater the other costs. If you use a lot of health care services in a given year, you could pay more in total with a low monthly premium than with a high one.
Therefore, the more care you need, the more it will be worth paying in premiums in exchange for reducing the costs of each service. To determine if a higher premium could save you money overall, look at your annual health care expenses. Review your care from the previous year, including doctor visits, tests, hospitalizations, and prescription drugs. Compare how much that amount of care would cost with different health insurance plans to see which one has the lowest total cost. When you compare health plans at HealthCare, the government, and some state health insurance marketplaces, you can see an estimate of the total costs. Another crucial factor when choosing a health plan is its provider network.
Many insurance plans have contracts with specific centers, including doctors' offices, hospitals, laboratories, and pharmacies. These providers cover the insurance company's patients at a lower cost than usual. The insurer saves money and providers get more business because the insurer directs patients to them. With some health plans, you can only use the health providers in your network. With others, you can go out of the network, but your coinsurance or copayments are higher if you do.
To keep your costs low, turn to network providers whenever possible. Your insurance company must include a tool on its website to show which doctors and facilities are part of your plan's network. Check before you get care to make sure you stay on the network. Health care costs add up quickly if you don't have health insurance or are underinsured. The cost of every doctor's visit and every lab test comes out of your pocket.
That can lead you to postpone necessary care because you're not sure if it's worth it. One way to keep those costs under control is direct primary care, also called concierge medicine. With this system, you pay a regular monthly fee, called an advance, to your family doctor. The fee covers all basic in-office care, no matter how much you need. It doesn't cover prescription drugs, visits to specialists, or more complex medical procedures, such as surgery.
You can combine direct primary care with a high-deductible health plan to protect yourself from overwhelming medical bills if you have a serious health problem. Doctors make decisions based on what they think is best for your physical health. They don't always think about how it could affect their financial health. Sometimes, they prescribe expensive drugs, treatments, or tests without considering your ability to pay for them. That can mean an unpleasant surprise when you receive the bill. To avoid billing issues, ask questions.
When your doctor asks for treatment, ask what it is and how much it costs. If the price is higher than what you can easily pay, say so. Ask if you can skip treatment or use a less expensive alternative. If your doctor thinks you need a procedure that you can't easily afford and isn't an emergency, find out if you can do it for less. On Healthcare Bluebook, you can check the typical price range for a particular procedure in your area.
Some insurance companies also have cost estimation tools on their websites. Once you have this information, compare prices. Contact the different centers in your care network and ask how much they charge for the procedure for someone in your insurance plan. Then, if your health plan requires it, see your doctor and request a referral to the center with the lowest price. If you're not sure if your health plan requires it, a referral never hurts.
The same goes for other types of care. If your doctor requests an expensive lab test, find out if your insurance company has a preferred lab that can perform it at a lower cost. If you are prescribed an expensive medication, ask if there is a “therapeutic alternative” - a similar medication to treat the same problem for less. A health savings account (HSA) is another great way to save money on healthcare expenses. An HSA is a tax-advantaged account used to pay for healthcare expenses that works like a 401(k). You fund the account with pre-tax dollars that generate money because the HSA is an investment account but he doesn't pay taxes on profits.
However, it's even better because you can also withdraw funds for tax-free qualified medical expenses at any time. To use an HSA, you must have a health plan with high deductibles. Some employers offer an HSA as a benefit and even contribute to your HSA like they do with 401(k)s.
ConclusionHealthcare expenses don't have to be overwhelming if you know how to save money on them.
From choosing the right health plan and asking more questions when your doctor recommends something new to comparing prices and using an HSA - there are plenty of ways to reduce healthcare costs without sacrificing quality of care.