Health Insurance

One of the most challenging expenses that families and individuals face nowadays is the skyrocketing cost of health insurance. With health care costs rising at an unprecedented rate, and more personal bankruptcies caused by health care costs than any other factor, coverage is more expensive and more important than ever. Not only is there considerable uncertainty regarding the future of health insurance in America, there is also considerable confusion about health plans, how they work, and how to save on premiums in order to keep coverage more affordable.

Most people acquire health insurance as a benefit through their employer, or their spouse’s employer. However, these numbers are dwindling as more employers either lay people off or drop coverage as a cost-saving measure. For those that purchase their insurance individually (meaning that they are not part of a group), shopping around is a great way to find the lowest premiums. Although the process can be cumbersome, online shopping has made it somewhat easier. One little known trick that the individually insured can use is to check premium rates every once in awhile. If rates ever decrease due to economic situations such as deflation, a person who is insured individually can take advantage of these lower rates.

An increasingly popular way to save on health insurance premiums is to use a non-traditional health plan. High-deductible plans that are eligible for health savings account use are becoming increasingly popular. Under these plans, a person’s deductible and out-of-pocket maximum are usually considerably higher than other plans, but the premiums offer substantial savings. Those who use these plans are also eligible to save for the increased costs through a tax-favored account known as a health savings account. Most health savings accounts are quite simple to use, and are much less cumbersome than their tax-favored cousins for use with traditional plans, flex spending accounts.

Another way to save money on health insurance premiums is to use an indemnity plan instead of a traditional plans. These plans offer varying levels of reimbursement for various services, or will offer coverage for a certain number of days or visits. While these plans are limited in what they cover, most carry a catastrophic event provision, and the premium costs are significantly lower. For young and mostly healthy people, the plans offer major risk coverage at a greatly reduced premium rate.

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