Controlling Health Insurance Costs

If you are like me, you probably see an increase in your health insurance costs each year. If you are at your wits end on trying to figure out how to keep affording your health insurance each year, here are some tips to lower your monthly bill:

• The simplest cost save is raising your policy deductible. If you can absorb more costs yourself before your insurance kicks in, you will lower your premium. Plus, every insurance company, without exception, will increase your deductible without any questions. Ask your agent to find out how much premium you can save by raising your deductible.
• Don't take a doctor office visit copay. This holdover from group insurance days is the most misunderstood "benefit" in insurance. If you didn't realize it, copays cost you premium every month, whether you use the benefit or not. If you have small children (6 or under), a copay may make sense. If your kids are older or you don't have children and don't go to the doctor often, your paying for something you don't use each month. A copay only gets you from the waiting room to the examination room. Any tests done are subject to deductibles and coinsurance. Why spend $60 a month to pay for an office visit of $80 once a year?
• Consider a health savings account (HSA). If you don't know what this is, an HSA is a large deductible insurance product tied to a health savings account. The money that you put in to the account is tax deductible similar to an IRA. If you use it for approved medical expenses, no taxes. If you take it out for other reasons, you pay a penalty. Plus any interest you make on the account is tax deferred.*
• If you have a prescription plan, ask the cash price at the pharmacy or try and get a generic equivalent at Wal-mart or similar for $4. If your copay for prescriptions is $15 generic, some plans will charge you $15 even if the cash price is less!

By no means is this a complete list. If you want to find more ways to save on your health insurance premiums, contact your insurance agent.

* Before you opt for an HSA plan, get information about the product you are considering and review it with a licensed tax professional to discuss the specifics about the tax benefits of the particular product offering.