3 Steps That Can Save You Thousands on Health Insurance Costs

Health insurance premiums have skyrocketed over the last decade. This poses a problem for millions of families and businesses that are already on tight budgets. The quest for lowering healthcare costs has become a priority. With some guidance from a professional, taking action on three things could help lower that cost.

• First, you should compare your plan to other plans in the industry, either with the same company or other competing insurance companies. Although many prefer one company versus another, it may not hurt to look at other insurance companies. You might be able to receive similar benefits while lowering your health insurance costs. We've seen some students save as much as 30% percent. Over time, these cost savings could be substantial.
• Have you heard of the concept of "self-insure?" This is where you take on more of the risk versus the insurance company for the first dollar benefits, such as doctor's visits. On a family plan this can reduce the premium by about $200-$300 per month. That's an additional savings of about $2,400 to $3,600 a year just for paying the co-pay on a doctor visit. It would take a lot of family doctor visits per year to make up that difference.
• Lastly, similar to the "self-insure" concept, would be to take on a little more risk through your deductible. Many people are afraid of higher deductibles. Most individuals don't want to expose themselves to high insurance costs when they have a claim. However, if you don't expect a major claim during the year, you can increase your deductible from say $1,000 to $2,000 or $5,000. Then, if or when you need to take a claim you may be able to finance the payment, similar to financing a car or furniture payment. This method may be appropriate for you if you are ok with taking on a little more of the risk in the form of a higher deductible to reduce your cost of insurance.

In a world of insurance law changes and rising health insurance costs, you need to find ways to make health insurance more affordable for your family or your business. In our Financial Matters sessions, students are exposed to these opportunities and are finding ways to reduce their health insurance costs, allowing them to put more money in their pockets.