Published on March 17th, 2020
Health insurance plans are meant to protect your finances from the impact of unexpected medical expenses.
Ironically though, some health insurance plans are expensive which would seem to defeat the very principle of financial prudence.
In fact, once you embark on your search for a budget-friendly plan, you could be forgiven for thinking ‘cheap health insurance plan’ is an oxymoron somewhat.
If you are on a tight budget, your health insurance options are certainly constrained. That however doesn’t necessarily mean you have been priced out of the market.
There are budget health insurance plans if you know where and how to look. Here are some tips to help you navigate the sea of available plans and eventually find the most suitable one.
1. Do You Need To Purchase Health Insurance?
The least you can spend on a health insurance plan is zero. It may sound implausible but there are people who might not need to purchase any health plan.
Depending on where you live and your current income, you might be eligible for Medicaid. Get in touch with your local Medicaid office or visit Healthcare.gov to see whether you qualify.
If you have kids, a number of states have expanded Medicaid coverage for children through CHIP (Children’s Health Insurance Program). To establish if your children are eligible, go to the CHIP Medicaid website.
2. Lowest Premium Does Not Necessarily Mean Most Affordable
If you or your dependents are not eligible for Medicaid or CHIP, then you do need health insurance.
As you start shopping for a budget health insurance plan, be careful not to make the mistake of judging a plan’s affordability based on its price tag.
Whereas it’s important that you determine how much a plan will cost you monthly, the question of affordability is often a combination of multiple factors.
Depending on your family’s needs and financial status, the average monthly cost of a plan might be much higher than the premium.
For example, taking up a high-deductible policy will imply paying a low monthly premium. Whenever you seek medical attention, you’ll have to pay a lot more than someone on a low-deductible high premium plan.
If you and your family are in excellent shape and rarely seek health services, then a high-deductible will be a great option.
However, if doctors’ appointments are a regular thing for your household, then the advantage of low premiums will be quickly cancelled out by the high cost of the deductible.
To know what plan will work best for you, take a look at your family’s health costs over the preceding 1-3 years.
Make sure you factor emergencies, medical appointments, medication, preventative care and any subsidies you qualified for.
Remember, the affordability of a plan comes down to how little you have to spend on health overall by the end of the year.
3. Engage A Health Insurance Broker
Since the marketplace was introduced, plenty of policies have been established ensuring millions of Americans have health insurance.
However, the marketplace doesn’t of itself automatically guarantee the best priced health insurance plans.
For the average person, the marketplace can sometimes feel like a mind boggling maze. Navigating it can be nerve-wracking.
It might be difficult for some to quickly gather the knowledge required to compare the available plans.
The fact that there are options outside the marketplace can make decision making all the more complicated.
How do you know you are really getting the best budget plan out there? Having someone by your side who can walk with you through the process and has a deep understanding of the system can make a tremendous difference. Brokers fulfil this role.
While insurance companies are focused on selling and supporting their own products, brokers have much greater flexibility and therefore no qualms about discussing the plans of multiple insurers with you.
Brokers aren’t employed by insurance firms. They work for you. It’s in their best interest for you to find a plan that satisfies your budgetary requirements while meeting your healthcare needs.
And it hardly costs you anything. Some brokers will charge a fee but most make their money solely from the commissions they earn from insurance companies.
4. Seek Plans Offering Technology-Based Discounts
Health consumer devices are near ubiquitous today. They have made it easier for individuals to keep track of their vital signs in real time.
Many insurance companies have taken notice and are evaluating how fitness trackers and other devices help minimize health risks.
For that reason, some plans provide discounts, financial reimbursements, contribution to health savings accounts and other incentives that ultimately reduce the net amount that goes to your medical costs each year.
Find out from your insurance broker or employer’s benefits manager what plans offer discounts for these new technologies.
5. Check The Plan For Your Prescription Drugs
If you normally take certain prescription medication, check how they are handled by the healthcare plan you are considering taking up.
Request for a list from the insurer to see where the medications stand. There are usually multiple options for medication each ranking at different price levels on the insurer’s list. Show the list to your doctor for guidance on what options are most effective.
Overall, if a plan has limitations on the kind of coverage they provide for the drugs you take, then you may want to shop for a plan that’s better.
Note that prescription drug discounts are available from some manufacturers as well. They may offer the medication at a lower price if you can demonstrate your income falls below a certain threshold.
The health insurance alternatives at your disposal can be confusing especially if you are trying to find one that’s a good fit for your budget.
Applying these tips will ensure you settle on a plan that gives you and your family access to good regular health care while keeping your family’s finances secure.