If there’s one topic today that generates confusion in nearly every circle—it’s health insurance.
For those fortunate enough to have an employer who runs interference between employees and the new healthcare regulations, it may feel like business as usual.
However, for folks like me who are self-employed and have to navigate our own coverage, it can feel daunting. These seven tips can help you maximize use of your insurance and save even more.
1. Estimate your annual healthcare expenses
Estimating what you spend, and which family member(s) you spend it on, can guide you in everything from what type of plan to choose, to which options to add in, to how much to contribute to a FSA or HSA.
What to do:
- Write down your monthly premium costs.
- Estimate how many times each family member visits the doctor each year, and what for (preventative/routine versus diagnostic/treatment).
- Note anyone who has a chronic health care need (braces, diabetes, etc.) and how much that costs you per year.
- Note anything not being covered by health insurance now (dental, vision, etc.) and how much that costs you out of pocket per year.
- Total everything—that’s your estimated annual cost for family health issues.
2. Don't rule out a high deductible (HD) insurance plan
For some families, opting for a high deductible insurance plan (with deductibles starting around $1,000 for individuals and $2,000 for families) makes the best financial sense.
A HD plan offers two key benefits:
- You don't pay costly monthly premiums for health care your family doesn't need or use.
- You can open a HSA (health savings account) where you can stash pre-tax funds that accrue year after year. You can use these funds to pay for out-of-pocket expenses as they arise.
DON'T choose a HD plan if:
- You’ll be tempted to spend the funds you should be saving elsewhere.
- You or anyone in your family needs chronic, regular health care.
- You have any reason to suspect your health spending may change drastically this year.
3. Opt-in to your employer's FSA (flexible spending account)
A flexible spending account operates a bit differently than a health savings account. Here, you do lose any funds not used at year-end.
But at least the funds are tax-sheltered until you use them, and they can make it much easier to cope with unanticipated medical expenses, including replacing glasses/contacts, affording 90-day prescriptions, dental/vision checkups that don't fall under insurance, medical supplies and equipment.
4. Check with your insurer before filling any prescription medications
Not all prescription drug plans are created equal, which means that some drugs may be more expensive than others (this is called "tiered pricing").
If you’re thinking about changing insurers and anyone in your family needs a specific medication regularly, be sure you can afford the cost with the new insurer before making the switch.
As well, it can help to keep a printed copy of your insurer's tier program with you to show your doctor—chances are they may be able to prescribe something from a cheaper tier that will work just as well and help you save!
5. Compare costs between regular and mail order pharmacy options
Most insurers will give you an option to get regular prescriptions filled through mail order. In many cases, ordering a 90-day supply will cost you less (and save you time too!).
If you can't find savings here, try one of the big box warehouse clubs like Costco—you don't have to be a member to use their pharmacy services.
6. Consider a discount club for dental work
So long as your family's dental needs are routine and minimal, a discount club or plan may help you save more than a traditional insurance plan.
Discount clubs are membership-based, and they negotiate discounts (often as much as 60% off retail costs) with a group of providers.
What to look for:
- Excellent local provider coverage (if you use a particular provider, be sure you check that this provider is already in the club or can be added).
- Discounts of 40% or more on services.
- Reasonable membership fees (most clubs charge between $12-$30 monthly).
- Ease of using services (making appointments, billing, customer service).
Where to look:
- Contact your state dental association for recommendations (search by state).
- Visit a clearinghouse website that lets you compare plans (like dentalplans.com).
- Ask your dentist for recommendations (often they know of the clubs with the best benefits).
- Use a site like brighter.com to select your dentist first and then join the club they work with.
7. Ask about special service offerings
Often these are not advertised in your insurance plan (if they’re mentioned, it will be in the fine print most of us never read!), but they can save you a bundle!
For instance, if someone in your family has a chronic health issue that requires certain equipment or supplies to manage, your insurer may have a program to provide those items to rent or buy (an example might be an asthma nebulizer for treatment of chronic asthma).
Another example, your insurer might be partnering with a health club to offer members discounts on gym memberships. Your insurer might also offer lower premiums for members who lose weight, stop smoking and achieve other health care goals they provide coverage for.