Last year, my family of four spent $15,000 on healthcare expenses—premiums, deductibles, and co-pays. And that doesn’t include another $10,700 in employer contributions to premiums. We didn’t have any major illnesses or injuries, just typical expenses for a middle-aged couple with two young adult children.
Turns out, our family’s bills are a bit below average. USA Today reports that a family of four spends more than $28,000 on average for healthcare costs.
Premiums make up a big chunk of that cost, and once a year you can review your choices and see if another plan would be a better fit.
But those bills that pop up when you need care add up, too. “Surprise medical bills place even the most financially stable family under stress,” says Gail Trauco, a patient rights advocate with Medical Bill 911.
Here are some strategies for reining in your healthcare costs:
Healthcare Cost #1: Your doctor listed as in-network, but you’re billed at out-of-network rates
“Insurance companies don’t update their lists of provider networks often enough,” says David Belk of True Cost of Healthcare. “Even if you check online to see if the doctor you’re about to see is in your network on the same day of your appointment, you might still get an out-of-network bill.”
The solution: Belk recommends taking a screenshot of your insurance company’s website showing your doctor was listed as in-network, so you have evidence to use when you appeal the bill.
Healthcare Cost #2: You’re hospitalized, and your doctor consults an out-of-network doctor
The solution: Appeal the charge, since you weren’t given the choice to see that doctor. “Usually, in such cases the insurance company will agree to cover the extra costs,” Belk says.
Healthcare Cost #3: You have Medicare Advantage and you travel a lot
Most Medicare Advantage plans are limited to specific geographic areas, says Lisa Zamosky, senior director of consumer affairs at eHealth, Inc.
The solution: Sign on to original Medicare and to a Medicare supplement to help cover additional costs. “Original Medicare has no network limits and will cover medical services delivered by healthcare providers participating with Medicare—most doctors and hospitals nationwide do,” Zamosky says.
Healthcare Cost #4: You don’t shop around for a test procedure
“Healthcare prices vary widely between providers based on location, in- or out-of-network status, insurance carrier, and even time of day,” says Lee Baxter, vice president of brand strategy and communications for My Medical Shopper. For example, he says a cholesterol screening can cost from $8 to $149 in the Salt Lake City area.
The solution: For non-urgent tests or procedures, compare costs ahead of time. Try your insurance company’s website, your employer, your doctor, or FAIR Health, a national nonprofit focused on healthcare cost transparency.
Healthcare Cost #5: Your insurance plan has a high deductible
Shobin Uralil, co-founder and COO of Lively, says, “We predict that every health plan will eventually evolve into a high deductible health plan.”
The solution: If your deductible is more than $1,350 for yourself or $2,700 for your family, you can contribute to a health savings account on your own or through your employer.
“Money may be taken out of the account to pay for a long list of qualifying medical expenses (including copays and deductibles) on a tax-free basis,” says Zamosky. “The money you save in an HSA is yours to keep and can grow from year to year.”
For 2019 individuals can contribute $3,500 and families can contribute $7,000. If you’re over age 55 you can add an extra $1,000.
Healthcare Cost #6: You are being billed for the difference between what was charged and what insurance covered
This surprise charge, referred to as balance billing, often stems from out-of-network charges. Balance billing for services like air ambulances can run into tens of thousands of dollars.
The solution: Try to stay in-network for your healthcare services. That’s not always possible, though: a hospital in your network might contract with an anesthesiologist or radiologist, for example, who’s not in your network.
If you’re hit with bills, check your state department of insurance—some states have laws in place to protect consumers. And if it turns out you have to pay, negotiate the bill with your healthcare provider. The National Patient Advocate Association might be able to help.
Healthcare Cost #7: You need care quickly, but your emergency room co-pay is hundreds of dollars
The solution: Choose the appropriate location for your care. If you’re facing a serious illness or condition, or an injury that requires full emergency room care, the emergency room is your best option. Otherwise, you can cut costs significantly by choosing:
- An urgent care center for less-serious conditions that still need attention soon. “Urgent care is a great alternative to the ER, with typically far less cost and shorter wait times,” says Ted Chan, the CEO of doctor review site CareDash.
- An appointment with your primary care provider if you can work that into your schedule or if you will need a referral.
- A convenience clinic, like those located inside pharmacies, for simple illnesses such as dermatitis, strep throat, or urinary tract infections.
- An online appointment if you want to see a physician soon without leaving your home.
Healthcare Cost #8: Your chronic condition is expensive to treat
“Cancer, diabetes, heart disease, depression, and addiction are some of the conditions skyrocketing personal healthcare costs,” Trauco says.
The solution: Use FAIR Health to anticipate your costs. Learn the medical terminology for your condition and its related exams, tests, and treatments so you can advocate for yourself. Keep track of all your services and costs, and review your bills for mistakes.
“Keep your payment receipts to ensure that each charge is credited toward your deductible,” Trauco says.