Health care costs make up an increasing portion of incomes across America and are growing faster than overall consumer spending. Rising prices are one factor, but also consider that high-deductible health plans (HDHPs), which require consumers to pay out-of-pocket prior to insurance taking effect can put many off needed healthcare services and can leave many with medical debt. But don’t fret: there are ways you can cut costs. Keep reading and discover exactly how much health care really costs from every perspective — from premiums and copays through copays and out-of-pocket maximums!
One effective strategy to lower health insurance costs is reducing your monthly premium, although its amount depends on several factors, including type of plan you own, whether coverage comes through an employer or individually and employer contributions toward premium costs. Under Obamacare tax credits can help lower individual marketplace plans costs significantly.
Apart from your premium, other costs you might encounter include your health insurance deductible, copays and out-of-pocket maxes. Deductibles are fixed dollar amounts you must pay before your health insurance begins covering expenses; for instance a $25 copay at a doctor visit may apply as a deductible payment. Coinsurance refers to a percentage of covered services after meeting the deductible – typically 30% for hospital charges.
If you have a chronic condition requiring regular doctor visits and costly prescription medicines, your out-of-pocket maximums may increase accordingly. Traveling can have the same effect; as will paying out-of-network healthcare providers can cause your maximums to rise as well.
Your out-of-pocket maximum depends on which Medicare Advantage plan you enroll in; most plans feature provider networks with which doctors and hospitals must partner to be covered under your health insurance. Healthcare networks are composed of healthcare professionals contracted with your insurer in order to offer care at a reduced cost than if services were obtained outside their network. Find out which providers are in a specific plan’s network by reviewing its summary of benefits and coverage. Some Medicare Advantage plans also provide health savings accounts (HSAs) to help manage out-of-pocket maximums; these accounts are available both to original Medicare enrollees as well as Medicare Advantage enrollees. You can learn more about HSAs as well as other features of Medicare Advantage plans by consulting our Guide to Medicare Advantage Plans.