Reduce Your Health Insurance Costs - Six Strategies For Saving You Money

By Marty Lisevick


My wife Donna and I are driving around Glastonbury, CT. yesterday and she started telling me how the gas prices differ dramatically in town. She is a very astute woman who can always find a bargain. As I looked around the town I saw she was absolutely correct. One station has regular at $2.28, another at $2.16, and yet another at the other end of town at $2.06. I'm sure the bargain hunters like her go to the one that sells for $2.06 - money's tight and you save it wherever you can. Then I started thinking about the similarities of pricing in CT when it comes to health insurance. Our capitol of CT is Hartford - "Insurance Capital of the World" - a lot of different insurance companies selling similar health plans - sometimes with a wide variety of pricing. I wonder if people spend as much energy looking to save money on gas as they do on their health insurance. If they did their savings would be a lot more substantial!

With that in mind, here are my six ways to reduce your health insurance costs.

1) Review your coverage and cost every year - It never ceases to amaze me the people who brag about how they saved $100 bucks for the year on their car or home insurance but never bother to look into their health insurance plan. If they put the same type of effort and research into this they could be putting a lot more money back into their pockets. There are health insurance companies now that offer 2 or even 3 year rate guarantees (the premium rate stays the same over that period) and insurance brokers like myself can help you review your coverage, often times help you find a similar or more inclusive plan for less money. This past week I helped a 55 year old woman reduce her health insurance costs by $250 a month - changing her plan to a different company (she had never switched before, they just continually rated her up each year) that she had for over 6 years to a different company. In the process I lowered her deductible, and helped her get improvements in her overall coverage amount, prescription drug coverage, increased number of doctor visits per year, and added a dental plan. She essentially just saved $3000 over the course of the year and walked away with a much better health plan. If you want to do this on your own, there are many websites out there that can help - you can compare costs and plans with all of the major companies - or feel free to contact me and I will be happy to help you. Do not be afraid to change companies - rates and coverage can vary dramatically.

2) Unnecessary options - Take a look at your coverage - are there options in it that you really don't use or need? For example, if you are young and healthy and rarely go to the doctor - you probably don't need a plan that gives you unlimited doctor visits over the year. There are many plans that will cover 2 -4 visits a year or you can choose to pay for the visit out of pocket it you wish. This can drop your premium down dramatically. Do you rarely need prescription medications - if you don't or you can go to Wal-Mart and get the generic brand for $4 - that is a great solution. I have had clients who had great prescriptions drug plans that had a $2000 a year cap that didn't need it - just reducing it to a $500 cap can reduce your premium. Do you have a vision plan, but don't wear glasses or contacts? That is an easy and obvious option to take a look at! If you pay a lot for dental coverage, you can see if you have an Aspen Dental office in your area. Look into getting a dental discount card (usually around $9 a month) and see how much a month going there can save you. Dental plans can vary dramatically - I have been able to drop clients costs from $45 a month to $15 a month in CT. - be sure you look at it.

3) Look into a high deductible plan with supplementary coverage - One of the greatest costs to a client in health insurance is caused by accidents. Many companies offer supplementary accident coverage that will fill in the holes left by high deductible insurance policies. For example, I have a 41 year old female client with a high deductible plan - $5000 on any hospital/surgical visit. The plan is very basic - offers a couple of office visits a year, prescription drug coverage, dental, vision, etc. She is paying around $180 a month for the plan. One of the smarter things we did was include a $2500 supplemental accident plan - covers her up to $2500 in the event of an accident - has a $100 deductible. Sure enough, she slipped in her kitchen and fell - threw out her back - by the time she was done she had $1800 in expenses - the plan covered all of it except for the $100 deductible. She saves money on a high deductible plan each month, and has the accident piece taken care of. If you own a business, look into a high deductible group plan, combined with a supplementary plan like AFLAC - they offer great solutions to the holes in the coverage and help keep your premiums low.

4) Quit smoking - You can save big dollars on your insurance costs just by quitting smoking. To test this, I plugged myself (45 year old man - good health/preferred rating) into a health plan that would cost me $219 a month. Next I rated myself as a preferred smoker and the premium jumped to $318 a month! So then I put my wife (39 year old and myself -non-smokers-preferred rating) on the same plan and our premium came to $386 a month. That same plan would cost us $562 a month if we are listed as preferred smokers. So if you smoke, give it up - if you won't stop for your health, then stop smoking for your wallet!!! A lot of companies will give you the preferred rating if you have stopped for 6 months. You can save up to 30% on your costs by kicking the habit!

5) Overweight - drop the pounds - If you are overweight, health insurance companies will rate up your policy premium. The average rate up can be around 25% if you are 20-30 pounds overweight. Once you drop the weight, contact your company - if they won't make the adjustment for you - start looking at different companies - your savings could be substantial.

6) Find a solution to your coverage problem - There is a solution out there for you. I recently sat with a group of realtors who were under the misconception that they could not get health insurance because their company did not offer a group plan. Nothing could be further from the truth - I showed them some individual plans that several of them are now with. I also was able to put four of them into a small group plan (they were willing to start their own business together that could produce a Schedule C and the appropriate tax documents). I recently also had a 50 year old female client - who was not insurable by individual plans due to her condition - but we were able to find her a guarantee issue plan that would cover her. Companies that would routinely deny coverage to people for years for such conditions like diabetes are now accepting the exact same people as clients. The message here is don't give up - and if you need help - get a broker/agent to help you find the coverage you need.

I hope this helps you to find ways to reduce your health insurance costs. If I can be of further assistance, feel free to drop me a line at your convenience.


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