Seven Steps to Save Money on Health Care
In the U.S, any discussion of healthcare invariably includes the ridiculously high cost of everything, including insurance premiums, hospital bills and many medications. Still, there are some steps you can take to mitigate expenses.
I learned to navigate health care the old-fashioned way: because I had to.
From preemie twins in the Neonatal Intensive Care Unit, to an older a son with multiple health conditions, to my aging mother, I have spent time in hospitals, can compare multiple ERs, researched specialists, acquired medical records, filed appeals (and won), and paid attention to countless medical bills.
My work experience includes fifteen years for a state health department in software support for a state health department for fifteen years. I worked as office staff for a forensic psychiatrist for four years, and later re-careered as a paralegal. My first job? The legal department for the state Medicaid agency until I retired six years later to pursue publishing a book.
1. When shopping for health insurance, compare plans during open enrollment and pay attention to different options. Know what is covered, what is not, and what your deductibles are.
Healthcare billing surprises can often be averted simply by understanding what your insurance covers. Think of it as taking out a car insurance or homeowners insurance policy. Every plan is different and most have varying levels of deductibles. Pay up front in premiums, or gamble you will stay healthy and pay more later as incidents occur. Calculating a worst-case scenario of the maximum out-of-pocket is a sobering, and necessary reality-check.
Few people can go an entire year without having some medical or pharmacy expense. Unless cash flow is plentiful, budget a savings account to cover these. Check if your employer offers a program for healthcare reimbursement. These are dollars deducted pre-tax you can use for medical expenses.
2. Always Look for In-Network Providers and Facilities. Verify everything in Advance.
When a physician orders a test or procedure such as an expensive MRI or sleep study, shop around. If you use an out-of-network location, you will be responsible for the (substantially higher) cost with no recourse for not checking in advance.
The office usually refers you to a facility they like to work with, or that the physicians own. The problem is, if that specific facility AND location are not covered by your insurance plan, you will be charged the full cash rate, and perhaps not understand why. Before scheduling the appointment, place a call to your insurance company to verify in-network status and coverage, and find out if a prior authorization is required. Don’t rely on the insurance website for a list of current providers. Doctors and facilities change constantly, and updates to websites can be delayed.
One time, my daughter needed an MRI. The doctor’s office referred her to the closest location. I knew the company name was on my insurance so I did not think to call in advance. When she called to schedule the appointment the facility required $1,500 up front. I immediately called our health insurance, somewhat confused and upset. I was stunned to find out that location was not on our plan. Who knew? Would someone else have simply paid it? Perhaps. But, if we drove two miles further, a different location for the same company was covered. Done. Out-of pocket paid? $0.00.
3. Avoid the Emergency Room for minor issues and opt for an Urgent Care Facility whenever possible.
Most insurance plans have a very simple way to encourage patients to use an urgent care facility: Cost. A copay for an Urgent Care may be only $40.00 while an ER copay can run $300 or more.
It’s even worse with high-deductible insurance plans. You will be on the hook for the full price until you meet your (most likely very high) deductible. Urgent Cares usually see patients far faster than a hospital ER, and are far less crowded, limiting your exposure to other people who are sick. They are rarely open 24/7, so they may not be an option in the middle of the night. But could you wait three hours until one opens? That three hours might be equivalent to the wait at a hospital ER.
Hospital billing for a single visit to an emergency room is outrageous. Most visits run in the thousands of dollars for a few hours of care. My daughter received a bills totaling more than $15,000 for an ER visit this summer. Every single test is a separate cost.
In addition to hospital charges, expect an additional bill from every single doctor you see. Physicians are not part of hospital staff — they are contractors who bill separately. This includes surgeons, ER doctors, specialists, radiologists, and anesthesiologists, none of whom you have any choice in. Right or wrong, it’s how our current hospital system works.
In any life-threatening or serious incident, call 911 or get thyself to the hospital. Regardless of future bills, the ultimate goal of any health care program is to keep you alive and as healthy as possible.
4. Be Wary of “Standalone Emergency Rooms” to avoid Sticker Shock.
Do not confuse Urgent Care facilities with “Standalone Emergency Rooms.”
These are a relatively new business model of delivering emergency healthcare. Touted as a solution to long waits in the ER, they have all the diagnostic services of a hospital ER, but they are not hospital ERs and are often confused with lower-cost Urgent Care facilities. They cannot admit you to the hospital without an expensive ambulance ride for transfer to a hospital-based ER. Then expect all the costs of a second ER, doubling your cost.
These Standalone Emergency Rooms are often privately owned, and may or may not be affiliated with a certain hospital. Convenience comes at a high cost. They are huge profit centers for their owners and strategically located in affluent zip codes. Most insurers do not contract with them. At best they are considered “out of network.” It is only when patients later receive a huge bill for hundreds of dollars, they learn the difference, with little recourse.
If you truly need hospital-level care or to be admitted, go directly to the hospital. Hospital ERs triage people as they come in and prioritize by severity and urgency. Like any other business, they have no control over how many people come in at the same time, causing longer wait times. But if you are truly in a crisis, you will be seen right away.
5. Always read and question medical bills. This includes checking the EOBs (explanation of benefits) from your insurance company.
Even when you do everything right, billing errors can occur. Medical billers have little training and aren’t perfect. Appeal any unexpected bill you think should be covered by your insurance.
There are many possible billing errors that could result in your being billed the full cost of a service when it’s covered. They could bill the wrong insurance, or with the wrong diagnostic code, or miss that you even have insurance due to a typo. In each of these cases, they will bill you directly for the full cash price of the service. Anytime I get an unexpected bill, I call my insurance company right away. They have always been wonderful in intervening with the other facility to resubmit the bill correctly or assure me I am not liable at all.
6. Compare prescription costs on expensive meds. They can vary by hundreds of dollars.
Sometimes insurance covers meds — sometimes it doesn’t. I once called around for a patient on a single prescription. I checked with three grocery story pharmacies, Walgreens, CVS, Costco and Sam’s club. I was shocked to find a huge variation in costs on the same medication. Instead of going to your usual pharmacy — call around if something is expensive. Today, prescriptions are sent electronically from doctors’ offices, but pharmacies can transfer them very easily.
7. Stay as healthy as possible.
This may seem obvious, but take advantage of preventive services and annual checkups. Often insurance covers these at no cost. Insurers want their enrollees to stay healthy. Why? Money. Healthy members cost less to insure, which raises their profit margin. If you can avoid developing Type II diabetes with lifestyle, you will avoid paying for a lifetime of medications, insulin, and tangential conditions, not to mention enjoy a far higher quality of life.
But life happens. Healthy people have babies, need knee or hip replacements, or other “elective” procedures. We all get older, and like a fine race car, we require more maintenance as we age. Cancer, appendicitis, car accidents, heart attacks, genetic conditions, and many other issues come without warning and can happen to anyone.
One thing is certain. In the US, unless you are covered by Indian Health Services, the Veterans Administration, or Medicaid, there is no free health care. On Medicare? Your costs are less, but it never covers everything.
Learning the ins and outs of health care costs can save you tens of thousands of dollars over a lifetime. Pay attention to policies during Open Enrollment. Always use in-network providers. Opt for Urgent Cares instead of the ER whenever possible. Be wary of Standalone Emergency Rooms. Question all medical bills, and try to stay as healthy as possible.
Be well and stay well!
