The Secret to Finding Good, Cheap Health Insurance

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Is there anything more confusing than trying to pick out a health insurance plan? Between the acronyms that only make sense to the systems that create them and trying to find the balance between costs you pay now and what you might get stuck with later, health insurance plan comparisons can feel like walking through a maze — blindfolded.

If you need some help taking off the blindfold, then read on to learn how to find cheap health insurance, and how to find the balance between costs today and potentially larger costs tomorrow.

How to find cheap health insurance

The question of how to find cheap health insurance isn’t as straightforward as it seems. Sure, you can find a plan with inexpensive premiums, but your deductible might be through the roof. Or let’s say the deductible is within your realm of reasonable pricing, but the copays are higher than you’d prefer.

That’s why it’s so important to carefully consider all the costs involved when shopping for health insurance.

This sentiment is echoed by Policygenius founder and CEO Jennifer Fitzgerald, who said cost is the most important thing to consider when comparing plans, but that it comes in multiple forms:

Premiums: Paying rent on your health insurance

The most important cost upfront is the premium, that monthly fee you pay to maintain a health insurance plan. Typically, the higher the premium, the lower the other costs. Fitzgerald says a high-premium plan might make sense for your budget if you’re someone who regularly visits the doctor and takes prescription medications.

But if you’re healthy and rarely do more than an annual physical exam, you might be able to opt for a lower-cost monthly premium. Just make sure you realize that doing so could mean paying more for your prescriptions and copays, as well as having a higher deductible.

Deductibles: The wild card of health care costs

One of the best ways to keep your health insurance costs low is to choose a high-deductible plan with a low premium. However, this is also one of the best ways to wipe out your life savings if you end up needing to use a lot of medical services over the course of a year.

As you may know, you’ll have to pay out of pocket for most or all of your medical expenses until your deductible for the year is met — after that, your insurance will usually cover much of your remaining costs. So, if you have a low deductible, then you don’t have to pay much of your own money before your insurance kicks in.

However, if you have a high deductible and end up in the emergency room, you could feel like you’re paying everything out of your own wallet. If you’re willing to go high-deductible in order to save money on your monthly premium, make sure you’re prepared to pay the costs of your deductible should something happen.

Copays: Important but often forgotten

If you don’t go to the doctor often, then this cost is an easy one to disregard accidentally. However, anyone on a monthly prescription or with regular trips to see their physician or specialists needs to bear it in mind — those office visit and prescription copays can add up fast.

Like deductibles, you can usually save money on copays by opting for a higher-premium plan.

Network: The importance of making sure your doctors are covered

Have a favorite doctor or medical center? One way to incur major costs is to end up with a plan that considers such people and places “out of network.” Before selecting a plan, see if your doctors are covered — and if you’re not sure, you can call their office and ask.

That said, Fitzgerald warns that coverage can change anytime (even though you can’t necessarily change your health insurance plan if it does). So consider this in your comparison, but know that it’s not always set in stone.

Maximums: A limit for your out-of-pocket costs

As you consider how much various health insurance plans might cost you, Fitzgerald of Policygenius and Mom and Dad Money blogger and financial planner Matt Becker both note that there are maximums for out-of-pocket costs. As Becker explains:

“I like to compare the guaranteed cost, which is simply the total annual premium payment, and the maximum cost, which is the total annual premium payment plus the out-of-pocket max. Many times you’ll find that the maximum cost of high-deductible plans isn’t much more than the guaranteed cost of low-deductible plans.”

Of course, you’ll have to do your own price comparison to see if that rings true. As for current out-of-pocket maximum costs, Policygenius says for 2018 it will be, “$6,650 for individuals and $13,300 for families.” HealthCare.gov states the maximums for 2018 were “$7,350 for an individual plan and $14,700 for a family plan” for plans in its insurance Marketplace.

The cheapest plan might not be the one you think

As you can see, there’s more to a health insurance plan than the monthly cost of maintaining it. That’s why the plan that looks the cheapest can end up costing some people far more over time.

It’s important to think carefully about the services you might want to use so you can make sure this doesn’t happen to you. When you’re comparing plans, you’ll be able to see prices for all of the factors mentioned above. Find the plans you’re most interested in, and compare the price of each factor.

Then, walk yourself through the past year. How many times did you go to the doctor? How many different types of doctors did you see (including specialists for which you needed a referral)? Did you go to the hospital at all? How many prescription medicines did you take, and how often did you need to refill them?

Now map out each plan you’re reviewing using these data points. How much would each plan cost you this year if it were the same as last? Don’t forget to include anything you think that might change this year, including additional medical services you already know you might need, such as if you’re planning to have a child or have recently been diagnosed with an illness.

With this kind of mapping, you’ll have a fairly good idea of all the costs you might incur with various health insurance plans. Then you can find the one that’s cheapest for you for an entire year, not just each month.

Becker offers this way of thinking when comparing plans:

At its core, insurance is meant to protect you from worst-case scenarios. So, at the very least, you want to make sure you’re not picking a plan that caps your benefits or that excludes any conditions or services that could end up costing you in the long run.

Where to find cheap health insurance

Now that you’ve been armed with information to help you compare plans, let’s go beyond how to find cheap health insurance and discuss where to find it. Luckily, this part can be easier than it seems.

First of all, if your employer offers you health insurance, the various options will be presented to you by your HR department (or, if you work for a smaller company or an early-stage start-up, someone who’s responsible for this type of work). All you have to do is compare plans.

And although you’re not required to take your employer’s health insurance offering, doing so will usually mean big savings for you. According to data from the Henry J. Kaiser Family Foundation, the average employer pays 82 percent of the premium for an employee’s single coverage, and 69 percent of an employee’s family coverage.

As for freelancers, contractors, and anyone who doesn’t have an employer-sponsored plan, here’s how you can find a health insurance plan:

Use HealthCare.gov to find your state’s Marketplace

One easy way to find a health insurance plan is to go to HealthCare.gov and type in your zip code. Depending on where you live, you’ll either be redirected to your state’s Marketplace to look for plans or you’ll stay on HealthCare.gov to view your options.

Once you’ve done that, you can compare the various options and sign up for whichever plan makes the most sense for you.

Another benefit of shopping through government marketplaces is that you can find out if you qualify for even lower rates through plans like Medicaid. Fitzgerald says that many people don’t realize they may be eligible for these subsidies (or for plans that assist in your healthcare costs).

Get help with comparison sites

Although the Marketplace is where you need to go to sign up for health insurance and to see if you qualify for a subsidy, you can get a bit more hand-holding in comparison shopping through sites like Policygenius. According to Fitzgerald, they not only make it easier to search and compare, they also show you plans that you can’t see on the Marketplaces.

That’s because there are two types of plans: On-exchange and off-exchange. Off-exchange plans offer more specific options that might be worth exploring if a subsidy isn’t in the cards for you.

If you opt to try comparison sites to help you shop for a plan, you can then apply for the best one for you on your state’s Marketplace website.

Invest time now to set yourself up for the best possible scenario

We all want to know how to find cheap health insurance, but it’s important to do a holistic comparison that sets you up for success throughout the year. Remember, it’s not just about the monthly premium, it’s also about the other costs you can incur throughout the year.

Keep those deductibles and copays in mind just as much as your monthly premium, and make sure to consider how much you’ll need healthcare services. Then you can make a smart and economical choice for your health insurance needs.

Looking for even more ways to save? Check out this guide for to help you cut down on your health insurance costs.

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1 Important Disclosures for Laurel Road.

Laurel Road Disclosures

  1. VARIABLE APR – APR is subject to increase after consummation. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes.

2 Important Disclosures for SoFi.

SoFi Disclosures

  1. Student Loan RefinanceFixed rates from 3.999% APR to 7.804% APR (with AutoPay). Variable rates from 2.480% APR to 7.524% APR (with AutoPay). Interest rates on variable rate loans are capped at either 8.95% or 9.95% depending on term of loan. See APR examples and terms. Lowest variable rate of 2.480% APR assumes current 1 month LIBOR rate of 2.07% plus 0.91% margin minus 0.25% ACH discount. Not all borrowers receive the lowest rate. If approved for a loan, the fixed or variable interest rate offered will depend on your creditworthiness, and the term of the loan and other factors, and will be within the ranges of rates listed above. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. *To check the rates and terms you qualify for, SoFi conducts a soft credit inquiry. Unlike hard credit inquiries, soft credit inquiries (or soft credit pulls) do not impact your credit score. Soft credit inquiries allow SoFi to show you what rates and terms SoFi can offer you up front. After seeing your rates, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit inquiry. Hard credit inquiries (or hard credit pulls) are required for SoFi to be able to issue you a loan. In addition to requiring your explicit permission, these credit pulls may impact your credit score
  2. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

3 Important Disclosures for CommonBond.

CommonBond Disclosures

  1. Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). The following table displays the estimated monthly payment, total interest, and Annual Percentage Rates (APR) for a $10,000 loan. The Annual Percentage Rate (APR) shown for each in-school loan product reflects the accruing interest, the effect of one-time capitalization of interest at the end of a deferment period, a 2% origination fee, and the applicable Repayment Plan. All loans are eligible for a 0.25% reduction in interest rate by agreeing to automatic payment withdrawals once in repayment, which is reflected in the interest rates and APRs displayed. Variable rates may increase after consummation. All variable rates are based on a 1-month LIBOR assumption of 2.08% effective July 25, 2018.

4 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Education Refinance Loan Rate DisclosureVariable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of August 1, 2018, the one-month LIBOR rate is 2.07%. Variable interest rates range from 2.72%-8.17% (2.72%-8.17% APR) and will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a cosigner. Fixed interest rates range from 3.50%-8.69% (3.50% – 8.69% APR) based on applicable terms, level of degree earned and presence of a cosigner. Lowest rates shown require application with a cosigner, are for eligible, creditworthy applicants with a graduate level degree, require a 5-year repayment term and include our Loyalty discount and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty and Automatic Payment Discount disclosures. The maximum variable rate on the Education Refinance Loan is the greater of 21.00% or Prime Rate plus 9.00%. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Citizens Bank is required to provide every potential borrower with disclosure information before they apply for a private student loan. The borrower will be presented with an Application Disclosure and an Approval Disclosure within the application process before they accept the terms and conditions of their loan.
  2. Federal Loan vs. Private Loan Benefits: Some federal student loans include unique benefits that the borrower may not receive with a private student loan, some of which we do not offer with the Education Refinance Loan. Borrowers should carefully review their current benefits, especially if they work in public service, are in the military, are currently on or considering income based repayment options or are concerned about a steady source of future income and would want to lower their payments at some time in the future. When the borrower refinances, they waive any current and potential future benefits of their federal loans and replace those with the benefits of the Education Refinance Loan. For more information about federal student loan benefits and federal loan consolidation, visit http://studentaid.ed.gov/. We also have several resources available to help the borrower make a decision at http://www.citizensbank.com/EdRefinance, including Should I Refinance My Student Loans? and our FAQs. Should I Refinance My Student Loans? includes a comparison of federal and private student loan benefits that we encourage the borrower to review.
  3. Citizens Bank Education Refinance Loan Eligibility: Eligible applicants may not be currently enrolled, must be in repayment of their existing student loan(s) and must make the minimum number of payments after leaving school. Primary borrowers must be a U.S. citizen, permanent resident or resident alien with a valid U.S. Social Security Number residing in the United States. Resident aliens must apply with a co-signer who is a U.S. citizen or permanent resident. The co-signer (if applicable) must be a U.S. citizen or permanent resident with a valid U.S. Social Security Number residing in the United States. For applicants who have not attained the age of majority in their state of residence, a co-signer will be required. Citizens Bank reserves the right to modify eligibility criteria at anytime. Interest rate ranges subject to change. Education Refinance Loans are subject to credit qualification, completion of a loan application/consumer credit agreement, verification of application information, certification of borrower’s student loan amount(s) and highest degree earned.
  4. Loyalty Discount Disclosure: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower or their co-signer (if applicable) has a qualifying account in existence with us at the time the borrower and their co-signer (if applicable) have submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, or other student loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI, and VT and some products may have an associated cost. This discount will be reflected in the interest rate disclosed in the Loan Approval Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  5. Automatic Payment Discount Disclosure: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their student loans owned by Citizens Bank, N.A. during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. Discount is not available when payments are not due, such as during forbearance. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account three or more times within any 12-month period, the borrower will no longer be eligible for this discount.
  6. Co-signer Release: Borrowers may apply for co-signer release after making 36 consecutive on-time payments of principal and interest. For the purpose of the application for co-signer release, on-time payments are defined as payments received within 15 days of the due date. Interest only payments do not qualify. The borrower must meet certain credit and eligibility guidelines when applying for the co-signer release. Borrowers must complete an application for release and provide income verification documents as part of the review. Borrowers who use deferment or forbearance will need to make 36 consecutive on-time payments after reentering repayment to qualify for release. The borrower applying for co-signer release must be a U.S. citizen or permanent resident. If an application for co-signer release is denied, the borrower may not reapply for co-signer release until at least one year from the date the application for co-signer release was received. Terms and conditions apply.
  7. Average savings based on 18,113 actual customers who refinanced their federal and private student loans through our Education Refinance Loan between January 1, 2017 and December 31, 2017. The calculation is derived by averaging the monthly savings of Education Refinance Loan customers whose payments decreased after refinancing, which is calculated by taking the monthly student loan payments prior to refinancing minus the monthly student loan payments after refinancing. The borrower’s savings might vary based on the interest rates, balances and remaining repayment term of the loans they are seeking to refinance. The borrower’s overall repayment amount may be higher than the loans they are refinancing even if their monthly payments are lower.
2.57% – 5.87%Undergrad
& Graduate
Visit Earnest
2.80% – 6.38%1Undergrad
& Graduate
Visit Laurel Road
2.48% – 7.52%2Undergrad
& Graduate
Visit SoFi
2.47% – 7.99%Undergrad
& Graduate
Visit Lendkey
2.57% – 6.65%3Undergrad
& Graduate
Visit CommonBond
2.72% – 8.17%4Undergrad
& Graduate
Visit Citizens
Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.