In an effort to educate readers about the importance of healthcare coverage, especially during a global pandemic, we are creating a series about open enrollment for 2021. We will continue to share information about open enrollment and how it might affect this year, so please come back to read future posts.
When you shop for a new car, you’ll probably read customer reviews, compare safety and reliability ratings, check the gas mileage, consider financing options, and take a test drive before you buy. So, shouldn’t you pay at least as much attention to your healthcare choices? Most people would like to, but healthcare shopping isn’t quite as easy as buying a car. Figuring out how you could save money and still get the right healthcare can be a challenge.
In the United States, finding affordable care takes effort and persistence. The U.S. has one of the highest costs of healthcare in the world, costing an estimated $3.6 trillion in 2018, roughly $11,000 per person. If your employer doesn’t provide health insurance benefits and you don’t qualify for Medicaid, your best options could be found on the federal Marketplace or your state’s healthcare exchange, if your state has one set up.
Regardless of how you procure medical care, you can help keep your healthcare costs as low as possible by being aware of your options and by being proactive with how you access and pay for care. Below are seven ways that could help save money on healthcare for the calendar year 2021, during open enrollment, and beyond.
1. Shop around and compare plans
Comparison shopping for health plans is especially crucial right before open enrollment, which begins Nov. 1, 2020 for Marketplace, state exchange, and individual plans. Open enrollment for employer-sponsored plans varies, but is also usually in the fall. What is open enrollment? It’s an annual enrollment period, generally lasting about six weeks, when you may select a plan for healthcare coverage that begins the next calendar year. It’s always worth your time to review your plan to see if it provides the right coverage for your needs and budget.
When shopping for a plan, consider the following:
- Don’t focus solely on the monthly premium, especially if it’s coupled with a high deductible. You could still accumulate medical debt if you’re unable to afford the deductible in a medical emergency.
- Make sure you can afford the out-of-pocket expenses, such as co-pays and prescriptions. Check to see what extras are included in your plan, including screenings and wellness programs.
- Using out-of-network care providers can be very expensive, so make sure your plan provides enough nearby in-network care to keep your costs manageable.
- Review your current and possible future needs, and try to plan accordingly. An inexpensive plan that doesn’t quite cover your medical needs could cost you much more in the long term than a more-expensive plan with better coverage.
2. Choose the right care plans and providers
Determining which care providers are in-network and which are not can sometimes be complicated. However, not considering the “right” caregiver could result in a denied claim or, at best, a higher co-pay. Your plan will affect your ability to choose and utilize different types of providers and facilities.
As a general rule of thumb, Preferred Provider Organizations (PPOs) tend to offer more flexibility when seeking specialized care than do Health Maintenance Organizations (HMOs). For example, if you travel frequently, or anticipate the need for specialized care, a PPO could be the better option for you. If cost is your number one concern, HMOs often have lower monthly premiums and lower out-of-pocket costs than PPOs, which could make them a better option — as long as they cover your needs.
Regardless of which plan you choose, you’ll need to work to ensure you’re getting the most efficient form of care. When you need to visit a provider other than your primary caregiver, such as a specialist or testing facility, try to ensure they’re in-network before you schedule your appointment and get any pre-approvals required.
If you are in a more urgent situation, you can still keep an eye on what solution is best for your health (most important), and your finances (your next consideration). For example, you may be able to arrange an online consultation or visit urgent care instead of going to the emergency room. This option could lower your costs and even get you access to care more quickly.
3. Check bills and statements for errors
Billing errors can and do happen, and unfortunately, it is often up to you to correct these errors. Always check your bills and statements to ensure that they display the correct amount (which can be confusing) and cover what your policy says they should cover. It’s often just an honest mistake, such as using the wrong code or patient number, and it may take time to get it corrected.
You may get a preliminary statement that causes sticker shock, even if your insurer ultimately will cover most if not all of it. The explanation of benefits (EOB) from your insurer should explain what’s covered and what’s not. If you’re certain there’s a problem with your bill, be sure to address it as soon as possible and remain vigilant. If you were mistaken about a billing issue, but unable to pay, you may be able to negotiate either a lower amount or an installment plan.
4. Take preventative measures and create healthy habits
While some of our health outcomes are determined by our genetic predispositions, there is quite a bit we can do to ensure better health and fewer visits to the doctor. The Affordable Care Act (ACA) requires certain screenings to be covered without any out-of-pocket costs, including obesity screening and counseling, certain vaccinations, and depression screening. Prevention also includes taking your prescribed medications regularly and getting proper care for chronic illnesses and conditions, such as high blood pressure and diabetes.
Additionally, be sure you’re eating a healthy diet, exercising regularly, getting adequate sleep, and managing stress. Many insurers and employers offer wellness programs to help create healthier lifestyle habits, some may even include discounts on gym memberships and other money-saving perks.
5. Ask for generic drugs
Generic medications could cost 49 percent less than their name-brand counterparts, according to the Food and Drug Administration (FDA), and may be as much as 79 percent cheaper in some instances. FDA-approved generic drugs have the same active ingredients and work just as well as name-brand drugs. If a particular generic drug isn’t available and your insurer doesn’t cover the name-brand version, you may ask your doctor to get prior authorization from your insurer.
But there are a few more ways to try to save money when you get your prescriptions filled. Some large retailers, such as Costco and Target, offer certain prescriptions (typically generics) at a lower price than your copay, so you could even pay out of pocket and still save money.
6. Enroll in a Health Savings Account (HSA)
If you have a high-deductible health insurance plan (HDHP), as defined by the IRS, the ACA allows you to enroll in a health savings account, or HSA, to help pay for your deductible and other out-of-pocket expenses. An HSA, which is different from a flexible spending account (FSA), allows you to put up to a certain amount ($3,600 for individuals in 2021) of pre-tax funds into an account. Also, it may be invested without any capital gains taxes.
HSAs cover a broad number of services, including:
- Eye exams, glasses, and contact lenses
- Feminine hygiene products
- Birth control
Some employers even offer contributions to their employees’ HSAs, although the annual contribution limit is firm. Unlike an FSA, an HSA is not a “use it or lose it” fund and can be rolled over from year to year. If you have an HDHP, it’s worth looking into.
7. Be your own advocate
Even after you select your plan and follow every other step to save money on healthcare, you’ll still need to stay on top of your care and ask questions frequently. Health insurance companies and many service providers are businesses whose primary incentive is to bring in revenue, but positive health outcomes don’t always require expensive treatments or procedures. Here are some areas where it is important to advocate for yourself.
As discussed earlier, it’s up to you to raise concerns about billing errors, and you should keep an eye open for false claims, as well. Although a much rarer occurrence than a simple mistake, if you suspect billing fraud, providers and insurers may use plausible deniability in their defense against an intentional act of fraud. You can report suspected acts of insurance fraud to your state’s insurance department.
Fraud concerns aside, it’s important to be your own advocate in healthcare matters, whether it’s at the point of care or with the billing department. When in doubt, ask questions including:
- Do I actually need this procedure, medication, surgery, or therapy? What are my options?
- How much will I pay out of pocket for this treatment?
- Are there options for negotiating a lower price or a payment plan?
- Is there is a discount for paying cash?
- What are the likely outcomes for this course and are there other (cost effective) options?
You might not think of this as a path to saving money, but it is important to find a doctor who listens to your concerns and questions, so you can advocate for the best care possible. If your current doctor is not the right fit for any reason, look into your options and find a doctor who is.
As nearly one-third of Americans struggle with medical debt, it’s clear that access to affordable healthcare is one of the biggest determinants of financial health in the United States. While broader factors such as the healthcare access gap along racial lines and the reliance on employers for coverage are trickier to solve, some factors are still within your reach. By understanding your options before open enrollment, you’ll be better equipped to save money on healthcare while getting the care you need.
Save money on healthcare and improve your financial well being
You shouldn’t have to choose between access to adequate health coverage and paying rent, but getting the care you need at a price you can afford takes a bit of hard work and persistence. Getting affordable access to care should be part of your broader plan for dealing with debt, money, and planning for your future. Our simple-to-follow guide will help you find the tools you need to seize a better financial future. Get started by downloading our free How to Manage Debt guide today.
- If You Have Lost Medical Insurance, You’re Not Alone (Freedom Debt Relief)
- Getting Health Coverage Outside Open Enrollment (Healthcare.gov)
- Unemployed Due to COVID-19? Here’s How That Affects Medical Benefits (Freedom Debt Relief)
- Eight Ways to Cut Your Health Care Costs (MedlinePlus, NIH)
- Can You Keep Your Unemployment Benefits if You Refuse to Return to Work? (Freedom Debt Relief)