Did you know that medical debt is the number one reason for personal bankruptcy filings in the U.S.?
If you didn’t, I’m guessing that probably didn’t surprise you. Healthcare expenses are unavoidable and expensive. Worst of all, sometimes your insurance won’t cover everything, leaving you with a fat bill to take care of.
If you’re having trouble managing your healthcare expenses, here are some tips to help cut your costs. They can’t make all the costs go away, but they may help reduce your medical bills and save you a bunch of cash.
Dealing with injuries and sickness is tough enough. Don’t add huge medical bills to your list of worries!
Doctor Visits
Use In-Network Providers
Insurance plans coordinate with doctors, hospitals, facilities, etc. These are called their “in-network” providers. Typically, in-network providers agree to accept a specific contracted rate for their services.
The rate for in-network providers is usually lower than the amount they’d otherwise charge an out-of-network provider. Most insurance plans either don’t cover at all or require a higher copay/coinsurance/higher deductible with out-of-network providers.
This is why you should stick to in-network providers whenever possible. Also, note that just because your insurance company lists a provider or facility as in-network doesn’t mean you’re automatically covered for all services rendered. Individual insurance plan coverage might vary on a case by case basis, but that’s the general rule of thumb.
It’s possible that you could go to an in-network hospital where the doctor is out-of-network and they might not inform you. So make sure you understand clearly about insurance coverage before receiving the service.
Pick the Right Facility
The cost for the same service could vary based on where it is performed. Even if you choose an in-network facility, depending on your coverage, some tests or procedures might be less expensive when performed at a laboratory or imaging center as opposed to a hospital.
Look up the price range and the “fair price” of the service you need. Ask about the price before you receive the service. Many insurance plans also have tools that show you nearby options, compare the prices of in-network facilities, and calculate your costs.
Review Bills Thoroughly Before Paying
Always read through each item before agreeing to pay the amount being billed. If the bill isn’t itemized, ask for a breakdown of the fees involved. The medical office is not immune to errors. They may list services you didn’t receive by mistake, or add up the numbers wrong.
Avoid the ER for Non–life-threatening Medical Issues
A walk-in clinic or urgent care facility is usually much cheaper than an ER. If you’re faced with a non-emergency situation, it pays to see whether there’s an open walk-in clinic or urgent care facility to visit instead.
Some walk-in clinics even offer sliding scale fees based on income. So you could end up saving money by qualifying for low-cost treatment.
You should research these places around where you live beforehand so that you know where to go in these situations. Always do your research before just driving to the nearest hospital.
Take Advantage of Telehealth
Telehealth is growing in popularity. You may be able to save time and money if you take advantage of virtual visits with a doctor by phone or video chat.
This might be your best option for common complaints such as sinus problems, upper respiratory infections, bronchitis, allergies, flu and coughs.
Prevent Health Issues From Escalating
It’s best to address medical issues early on before they escalate into bigger problems. Many insurance plans offer participants a yearly physical at no cost (because preventative care saves insurers money in the long run). If yours does, take advantage of it.
Even if it’s not free, regular checkup is good for your health, and helps prevent costly medical problems down the line.
Many people avoid going to the doctor for minor problems because it’s just a hassle to take the time off and worry about the money. But a seemingly minor problem can sometimes be a sign for a major health issue.
Just look up any minor symptom you can think of and you’ll probably end up with something serious like “cancer” as the diagnosis. I just googled “tired” and WebMD said “anemia” could be one of the causes.
Insurance
Choose the Right Insurance
Choosing an insurance plan is all about balancing coverage and premiums. A cheaper plan will cost you more if you end up having more health issues than expected, and vice versa.
You never know what unexpected illnesses or injuries might come up, but you can do your best to choose the right insurance plan by estimating your medical needs and expenses based on your medical history and any genetics data you can get your hands on.
If you’re unhealthy, lean towards bigger coverage. If you’re super healthy (exercise, eat right, don’t do dangerous stuff), you can probably get away with a cheaper insurance plan.
Understand your Benefits
No matter what type of plan you choose, it’s important to take the time to understand your benefits before receiving medical services.
Review which services are and are not covered, which providers are in-network and which are not, and find out if you need to obtain referral or pre authorization before moving forward with anything. This can help avoid unexpected out-of-pocket costs.
Appeal denied insurance claims
It’s not uncommon for insurance companies to deny a claim. Before you give up, try appealing first (if it’s reasonable). You may need to enlist the help of your doctor or a medical professional to argue for your case.
The amount of time you have to file an appeal varies, so make sure to act quickly.
Negotiate Services Not Covered by Insurance
If your insurance won’t cover some service, don’t give up and pay full price for it yet. Try negotiating with your provider first. Let them know that you’re paying out of pocket and see if there is anything they can do to potentially lower the cost.
Sometimes they will reduce the price for people not covered by insurance. For them, it’s less about being nice, but more about increasing their chance of getting paid.
Get Help from a Health Advocate
A professional health advocate is someone trained to negotiate medical issues on your behalf, including financial issues. If you’re unable to resolve your billing issue on your own, they may be able to help fight with your insurance company on your behalf to secure a more favorable outcome.
Some companies provide a health advocate service to their employees. If yours doesn’t, you can access a free health advocate via the Patient Advocate Foundation.
Drugs
Request Generic Drugs
When it comes to generic vs brand-name drugs, the main difference is name and appearance. The U.S. Food and Drug Administration (FDA) requires generic drugs to have the same active ingredient, strength, dosage form, and route of administration as the brand-name drug. They are also developed and approved according to the same standards as brand-name drugs.
Brand-name drugs are more expensive because the manufacturers have to cover their research, testing, and promotion costs and these costs are passed down to consumers. Patents allow brand-name drugs to be sold exclusively for a limited time, after which other companies are allowed to make a generic version of the brand-name drug.
Generic versions aren’t available for all medications. Ask your doctor or pharmacist if generic medications are available for your prescription. If a less expensive version is available, you could end up saving money.
Buy Medications in Bulk
If you have a medication you take on a regular basis, it pays to see whether it’s available in 90-day supplies instead of 30-day supplies which need to be renewed month-to-month.
This will save you a few trips to the pharmacy, and also save you money. The cost per pill is usually cheaper.
You may also get discounts if ordering your medication through a specific pharmacy or mail order service.
Ask for Free Medication Samples
Pharmaceutical companies always give doctors samples of their products to promote their products, which means doctors usually have a number of samples on hand.
If you’re prescribed some medication, try asking your provider for some samples. This could potentially save you a little bit of money.
Use Over-the-Counter Remedies instead of Prescribed Drugs
Sometimes taking prescription drugs is not necessary and there are lower-cost over-the-counter alternatives available. This is probably only possible with supplemental drugs. Ask your doctor if they are available.
Healthcare Programs
Open a health savings account
A health savings account (HSA) is a tax-advantaged medical savings account available to taxpayers who are enrolled in a high-deductible health plan. You can open one if your employer offers one or if you are enrolled in a high-deductible health insurance plan (HDHP) as defined by the government.
Here is how it works. Each year, you can contribute a certain amount of money (not exceeding the required maximum) to your HSA account. Then you can use the money in this account to pay for qualified medical expenses. The main advantage of HSA is that the money you put into HSA is reduced from your taxable income, so you’ll pay less taxes. Your money in the account can also be invested and accumulate tax-free.
I like to think of it as my cancer fund that I don’t have to pay taxes on.
Open a flexible spending account
A flexible spending account (FSA) is similar to an HSA in that they’re both tax-advantaged savings accounts used for medical expenses. They also work in similar ways. The main difference is, first, FSA can only come from your employer. You can’t open one by yourself.
More importantly, FSA has a “use it or lose it” policy, which means the money is gone if you don’t use it by the end of year. In an HSA, on the other hand, the money is rolled over to next year.
There are some exceptions, but typically you can’t have both an FSA and an HSA. Which one to choose and how much to contribute depends on you and your family’s expected health expenses.
For example, a young and healthy person might have an HDHP and an HSA, since HDHP plans are cheaper (although with high deductibles and out-of-pocket limits). Someone with higher medical cost may choose a plan that covers more and disallows HSA. In terms of how much to contribute, you should generally contribute enough to cover your deductible and expected expense.
An HSA is usually better than an FSA because the money rolls over each year in an HSA, but not an FSA. You would only choose an FSA if you predict upcoming medical expenses and don’t qualify for an HSA.
Sign up for Medicare on Time
If you have a disability or are getting closer to your 60s, you might want to start looking into medicare.
Medicare is a national health insurance program in the U.S. for people 65 or older and certain younger people with disabilities. It has different parts that cover different services.
It is mandatory to sign up for Medicare Part A once you enroll in Social Security. But parts B, C, and D are optional and you can delay enrollment if you have creditable coverage.
The initial enrollment period to sign up for Medicare begins three months before the month of your 65th birthday and ends three months after that month. If you fail to enroll during that seven-month window, you’ll face penalties later.
Apply for a Patient Assistance Program
Patient assistance programs (PAPs), which are usually sponsored by pharmaceutical manufacturers, are promoted as a “safety net” for Americans who have no health insurance or are underinsured. The goal of these programs is to provide financial assistance to help these patients access drugs for little or no cost.
To qualify, you’ll generally need to demonstrate a financial need for assistance and prove that paying for the medication in question will constitute a major hardship. If it sounds like it’s for you, learn more about it and try to apply.
Conclusion
Long story short: do your research before you pay for anything.
Pick the right insurance plan that works for you and make sure to read the policy very carefully about what’s covered and not covered. Once you start needing treatment or need to buy drugs, always check your options to get the best deal. Ideally, you should also look into an HSA or FSA to get the most tax benefits to pay for medical bills.
As always, thanks for reading. If you enjoyed that, check out some other articles on the site or subscribe down below to get weekly money tips.
Fun facts: I came up with the name PoketheJoe because I like poking him. I'm also smarter than Joe (but he doesn't think so).
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