Traditional health insurance can be expensive, even with programs offered through Obamacare. And when you’re ready to sign-up for healthcare, it can often be time consuming and confusing, especially for recent grads.
Thankfully, there are a few options that will help you pay for good medical coverage, without breaking the bank. If you’re wondering how to lower healthcare costs, here are three budget-friendly health insurance alternatives you can choose from.
How to lower healthcare costs
1. Join a healthshare program
Healthshare programs, also known as health care sharing ministries, are set up based on your religious or political beliefs.
These non-profit entities allow you to control your own health care coverage a bit more by pooling your financial resources, and those of other individuals in the same program. It’s not considered health insurance, but more of a health care cost sharing arrangement.
Instead of a traditional deductible, members of a health sharing program are usually subject to an annual fee and pledge to pay specific amounts of money, out of their own pockets. It’s basically an account you set aside money into, much like a traditional health insurance plan.
The barrier for applying to one of these programs is fairly low. You’ll have to provide information on your health conditions, medical history, and any political or religious beliefs you have.
However, you could be denied into a healthshare program for pre-existing conditions. Or, you may have to pay a higher monthly price as you strive to get back on track with a healthier lifestyle.
The largest and most popular health sharing ministries in the U.S. include:
Keep in mind that health sharing programs usually only cover healthcare expenses related to large and unforeseen medical emergencies. Or, things like a yearly checkup.
Dental, vision and cosmetic health care costs are not usually covered by healthshare programs. However, you can use your member-only savings or discount programs to negotiate lower costs.
2. Open a Health Savings Account
A Health Savings Account (also known as an HSA) is a tax-advantaged bank account that’s available to individuals who are enrolled in a high-deductible health plan (HDHP).
Essentially, you contribute your own funds into an HSA in order to pay for the high deductible that comes with your HDHP coverage.
The great thing about a Health Savings Account is that you have more control over how your funds are used. And, they can roll over year after year, even if you don’t spend all of your money in it.
Additionally, your HSA IS tax deductible and not subject to federal income tax at the time of deposit.
What’s more, you may withdraw your funds without any penalty or tax liability at any time. You just have to make sure you use the money to pay for qualified medical expenses, such as:
- Health insurance plans deductibles, copayments, and coinsurance
- Certain health premiums, including COBRA
- Psychiatric and certain psychological treatments
- Long-term care services
- Prescription drugs
- Dental services
- Vision care including glasses and Lasik eye surgery
- Medical transportation and lodging
Once your account reaches a certain balance you’re usually able to earn interest on your HSA. Some financial institutions also give you the choice of investing the unused funds in your HSA.
Thanks to the flexibility and control it offers for account holders, an HSA is a great budget-friendly option to traditional health insurance.
3. Apply for a discount savings card
Another good way to save money on health insurance costs is to apply for a medical discount savings card.
Many local pharmacies, including Walgreens and CVS, offer their own programs to members for a low annual cost. Visit eHealth online and see how much you can save on medically-related purchases for you, your spouse, and your children with a discount card.
In most cases, the pharmacy or medical program will guarantee savings throughout the year equal to, or more than, the annual fee you’re charged.
And the best part is that there are no pre-qualifications or medical records needed to apply. So there’s really no risk in applying for a discount savings program.
Reducing healthcare costs
At the end of the day, having health insurance lets you sleep better knowing your medical needs are covered.
If you’re struggling with traditional health insurance, these budget-friendly options are a good place to start. Don’t let health care costs stand in the way of peace of mind.
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