How to save money on health insurance
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BLUEPRINT
Updated 9:23 a.m. UTC Nov. 13, 2023
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Key points
- Health care is increasingly expensive, but there are ways to save money on health insurance.
- Health insurance marketplaces offer websites where consumers can compare health plans and find health coverage that fits their needs and budget.
- Saving on prescription medications has become easier with pharmacy discount programs and online pharmacies.
Compare health insurance costs
Aetna
Provider network
More than 1 million providers
NAIC complaint level
Low
Kaiser Permanente
Provider network
23,900+ physicians in 39 hospitals and 622 medical facilities.
NAIC complaint level
Very low
An estimated 112 million Americans are struggling to pay for health care, according to the West Health-Gallup Healthcare Affordability Index and Healthcare Value Index, reported in 2022. These metrics were developed after the rate of Americans reporting skipping health care due to cost had tripled the year before.
A 2022 insurance survey conducted by The Commonwealth Fund found that nearly half (49%) of adults surveyed reported they would be unable to pay for a $1,000 unexpected medical bill within 30 days, and 46% of respondents said they had skipped or delayed medical care because of the cost.
Health insurance premiums, deductibles and copays have steadily increased over the past decade, making hospital visits and medications pricier even for those with employer-sponsored health insurance.
The Kaiser Family Foundation (KFF) reported that in 2022, the average premium for employer-sponsored family health insurance coverage had increased 20% since 2017 and 43% since 2012. In addition, KFF reported that 41% of Americans have medical debt.
Unfortunately, health care prices are expected to continue rising. Mercer’s national survey of employer-sponsored health plans found medical plan costs per employee are expected to rise 5.6% on average in 2023.
While paying for health insurance can be costly, those who don’t have health coverage often pay a steeper price. According to the U.S. Centers for Medicare and Medicaid Services, the average cost of a three-day hospital stay is approximately $30,000 and fixing a broken leg can cost up to $7,500.
There are ways to cut back on your health care costs without giving up your insurance coverage. Read on to learn ways to be a savvy health care consumer.
How to find cheap health insurance
Since health insurance rates vary widely, it’s wise to shop around and compare plans from different insurance companies.
Health insurance marketplaces, including Healthcare.gov and eHealth.com, offer websites where consumers can compare health insurance plans and pricing.
Natasha Cantrell, a director for eHealth, said marketplaces can help people save money by allowing them to compare plans from more than 200 insurance companies on one site.
“Consumers can see how plans stack up in terms of premiums, deductibles and copays,” said Cantrell.
Ways to save on health insurance
Here are a few ways to save money on health insurance and other health care expenses:
Don’t focus solely on monthly premiums
While it’s easy to think you’re saving money if your monthly health insurance premiums are low, that isn’t always the case.
“The most common mistake people make when comparing health insurance plans is to focus too much on monthly premiums and overlook the out-of-pocket costs that come into play when you receive medical care,” said Cantrell. “Cheap plans aren’t always the most affordable in the long run.”
Cantrell said health insurance plans with lower monthly premiums tend to come with higher annual deductibles, copays or coinsurance.
“These plans might be a good fit for people who are younger, healthier, who don’t use prescription drugs or who rarely visit the doctor,” said Cantrell. “Yet even then, it’s important to ensure you can afford the deductible or out-of-pocket maximum in an emergency.”
By contrast, Cantrell said many people save money by going with a higher-premium plan that has lower out-of-pocket costs.
“If you have a chronic medical condition, use prescription drugs on a regular basis or see the doctor frequently, the savings you can realize with a lower deductible may outweigh the higher monthly premiums,” she said.
Stay in network
To keep your costs in check it’s important to stay in your health insurance company’s provider network. If you are treated by a medical provider that doesn’t have a negotiated fee agreement with your health insurance provider, you might end up paying for the care out of pocket.
Cantrell said that while coverage levels can vary among different plans, some plans will not provide any meaningful coverage outside of your provider network, at least for non-emergency care.
“If there’s a doctor or hospital or pharmacy in your area that you want to continue seeing, make sure they are in the provider network for any new health insurance plan you’re considering,” she said.
Negotiate bills
If you have out-of-pocket costs for a hospital or doctor’s visit that you think are excessive, Paul Fronstin, director of Health Benefits Research at the Employee Benefit Research Institute, said it might be worthwhile to try and negotiate your bill.
“Start by researching the average cost in your state of the medical procedure you received,” Fronstin said. The website healthcarebluebook.com can help with this. “Then ask your hospital or physician’s billing department to see if the cost can be reduced. If not, you can see if it’s possible to do a payment plan or ask if you might qualify for any financial healthcare assistance programs.”
Avoid unnecessary emergency room visits
When your child is showing signs of an ear infection on the weekend, or you hurt your ankle while walking your dog in the evening, a trip to the emergency room may seem like the best course of action. After all, your doctor’s office is closed, and you need medical care.
Yet, Cantrell noted that in most cases you will save money by visiting an urgent care clinic that’s in your provider network, rather than visiting the emergency room. In addition to paying significantly less at an urgent care clinic, you can drastically reduce your time spent receiving treatment.
“Familiarize yourself with the urgent care clinics and hospital emergency rooms that are in-network, before the time comes when you need them,” she said.
Urgent care clinics
Urgent care clinics can treat minor illnesses and injuries, allowing you to reserve emergency room visits for chest pain, weakness/numbness on one side, slurred speech and other serious symptoms.
Many urgent care clinics accept health insurance, which can lower the cost of your visit.
Retail clinics
Retail clinics, staffed by a nurse practitioner or physician assistant, treat non-life-threatening illnesses and injuries, including respiratory infections, allergies and skin conditions.
They are often located inside grocery stores and pharmacies, such as:
- MinuteClinic (CVS and Target)
- RediClinic (RiteAid)
- Sutter Health Walk-in Care (California)
- Target Clinic (Target)
- The Little Clinic (Kroger)
- VillageMD (Walgreens)
- Walmart Health (Walmart)
According to MinuteClinic, the cost of a walk-in session without insurance ranges from $22 to $261, while a visit to the emergency room for the same services can cost $1,014 and up. MinuteClinic locations also accept health insurance, per the CVS website.
Start a Health Savings Account (HSA) or Flexible Spending Account (FSA)
If your employer offers an HSA or FSA savings account, you can set aside pre-tax income to pay for qualified medical expenses including deductibles and copayments. To qualify for an HSA, you must have a high-deductible health plan.
You can also set up an HSA through a bank or credit union. Using untaxed dollars from an HSA can often lower your overall health care costs.
Save on medications
Prescription drug prices are significantly higher in the United States than in other countries, but foregoing your medication is rarely the answer.
If you can’t afford your medication, talk to your doctor or pharmacist about getting a less expensive or generic medication, or applying to a patient assistance program offered through pharmaceutical companies.
SingleCare.com and GoodRx.com also offer consumers free coupons for discounts on medications. Mark Cuban’s website, costplusdrugs.com, also offers affordable medications by cutting out the middleman and delivering prescriptions directly to consumers.
Save money on health insurance FAQs
According to the U.S. Centers for Medicare & Medicaid Services, an employer-based health plan is considered affordable if the employee’s share of the monthly premium for the lowest-cost health insurance plan offered is less than 9.12% of your household income.
You can often lower the cost of your health insurance, but plans with cheaper premiums often have higher deductibles and out-of-pocket maximums. This can make your health care costs more expensive in the long run.
Use the Healthcare.gov searchable database to find a health insurance agent, broker or insurance assister who can help you identify your needs and evaluate your options. They can help you find the right balance of premium cost and coverage.
If you have out-of-pocket medical bills that you feel are excessive, you can try to negotiate with the hospital or physician’s office. Research the average cost of the treatment you received, then call the billing department. Ask if your cost can be reduced. If the answer is no, see if you qualify for any financial healthcare assistance programs, can pay in installments or can receive a discount for paying in full.
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