Call Us

Four Easy Ways to Save on Health Insurance

Take advantage of these tips so save on your overall healthcare spend

Key Takeaways

  • As people look to cut costs on their overall spending, many are looking to trim the fat when it comes to their overall healthcare spend.

  • Enrolling in a High Deductible Plan (HDHP)A High Deductible Health Plan (HDHP) is a type of health insurance plan that features higher-than-normal deductibles. These high deductible amounts are usually intended to lower your monthly premium payments. with a Health Savings Account (HSA) is a popular option for people who are generally healthy and looking for ways to reduce their monthly premium spend. HSAs allow you to save money for future medical expenses or to cover your high deductibleA deductible is the amount you pay out of pocket before your insurance company covers its portion of your medical bills. For example: If your deductible is $1,000, your insurance company will not cover any costs until you pay the first $1,000 yourself., should you need to.

  • Limited network plans also typically have lower monthly premiums. This is a good option for people who do not need to use out-of-networkOut-of-network refers to doctors, hospitals and other providers that do not have an agreement to treat your health insurance company's clients. Visiting an out-of-network provider typically means more out-of-pocket costs and less coverage. providers.

  • Evaluating the options available to you and your family and potentially mixing and matching your policies is another way to save. If you or your spouse have employer-sponsored coverage, it makes sense to weigh individual or family coverage pros and cons.

  • No matter which health plan you choose, it’s important to understand the risk involved before you purchase the policy. Look at deductibles, out-of-pocket maximumsOut-of-Pocket Maximum (OOP) is the maximum amount of money an individual will pay towards out of pocket expenses like deductibles, co-payments, and co-insurance. and policy exclusions.

Young African American couple shops for health insurance.

Cutting Back on Your Healthcare Spending

Everyone wants to know the secrets behind saving money — no matter what you’re spending it on. When it comes to spending on your healthcare, there are a few different things you can take advantage of when it comes to reducing your overall costs.


1. Consider a High Deductible Plan with a Health Savings Account.

Pairing a High Deductible Health Plans (HDHP) with a Health Savings Account (HSA) is a great way to reduce your monthly premium costs and save future healthcare expenses. As of 2020, individuals are only eligible for HSAs if they have a $1,400 deductible. With a qualifying plan, they can save up to $3,550 a year for healthcare services. Similarly, families are eligible for an HSA if they have a $2,800 deductible and can save up to $7,100 a year. [1]

There are many advantages to combining HDHPs with HSAs, which include:

  • HDHPs offer you lower monthly premiums.
  • Funds in HSAs collect interest.
  • HSA funds roll over year to year.
  • Funds are saved for future medical costs and retirement health costs.
  • HSA contributions are tax deductible.
  • There is a catch-up period between the ages of 55 to 65, which allows consumers to save an extra $1,000 in the HSA


2. Pick a health plan with a limited network.

Health insurance plans with limited networks, like Health Maintenance Organizations (HMO) are typically able to negotiate cheaper rates, resulting in lower monthly premiums for you. HMOs still provide the same 10 Essential Health Benefits as other health insurance plans; however, if you travel a lot or commute to work, this may not be the best option as coverage is limited to a specific geographic area.


3. Mix and match policies.

Many people tend to go with one group health insurance plan instead of comparing the group plans or plans on the individual market. For example, say a married couple has a health insurance policy with one employer but it may actually be better financially for the husband to stay on his work’s group plan and the wife to stay on her work’s group plan. It all depends on how much a company passes on to the employees in terms of premium costs for dependents and the benefits offered.

When comparing plans, consider reviewing the Summary of Benefits and Coverage (SBC) alongside employee premium costs for an apples-to-apples comparison.

Keep in mind, healthcare needs change over the years so if you have one plan that you enjoy and are comfortable with, call your health insurer to change to a same plan with a different deductible. As people age, they tend to use healthcare services more, so it typically makes sense to lower the deductible and pay a little more in monthly premiums.


4. Understand the risk.

Many consumers go for the lowest monthly premium plans but may not understand that they are responsible for the $5,000 deductible when utilizing healthcare services.

For example, if there is a plan that has a $2,500 deductible and costs about $88 per month, the same plan may be available with a $10,000 deductible and with a $56 monthly premium. If you pay $32 more per month, you’d only be responsible for $2,5000 in case of an illness or injury as opposed to $10,000.

The small difference in monthly premium results in a huge financial exposure in the event of an unforeseen medical event.

In addition to comparing deductibles, it’s important to review out-of-pocket maximums and policy exclusions before making a decision.

What's Next?