Consumers now have the option of shopping around for their health insurance rates, which was made possible with the enactment of the Affordable Care Act (ACA), aka Obamacare. By logging into the federal website Healthcare.gov, consumers can compare the available healthcare options for their particular state.
When shopping for health insurance, keep in mind that five primary factors will affect the plan's monthly premiums: age, location of residence, use of tobacco, the plan category, and if you also need to cover other family members, such as dependents.
As dictated by the current health care law, all insurance companies can only consider five areas when they set the premiums for their plans:
- Age: in most cases, the premium may be up to three times less for younger people than for older people.
- Location of residence: some of the ways that primary residence can affect your premium are state and local rules, competition, and the area's federally determined cost of living.
- Use of tobacco: if you use tobacco, you may see your premium being 50% higher than those who do not use tobacco.
- Plan category: there are currently five categories of plans – bronze, silver, gold, platinum, and catastrophic. Each category determines how you and the plan itself will share your over all healthcare costs.
- Individual or family plan – insurance companies will standardly charge more on those pans that cover the addition of others such as a spouse and/or dependents.
Worth noting is that each state has the power to limit just how much each one of these factors can affect premiums as a whole.
Now, let's look at some of the ways available that can aid in the lowering of the cost of healthcare premiums.
- Stop smoking
Even though the ADA worked at reforming healthcare by not allowing insurance companies to consider gender or prior health conditions in determining their premium prices, they are still permitted to charge those individuals who smoke as much as 50 percent more for the same healthcare plan.
- Deductible increase
The more you are willing to pay out of pocket for your health insurance, the lower your overall premiums will be.
- Co-insurance ratio
When looking at available health insurance plans, make sure to take note of your co-insurance ratio. The ratio will show how much of your healthcare you will be responsible for after meeting a predetermined yearly deductible. The most common ratio isthat of 80/20—where after you complete your required deductible, your insurance will pay 80 percent of any bills, but you are responsible for 20 percent—changing the ratio requiring you to shoulder more of a percentage results in lower premiums.
- In-network doctors
Although it is vital to weigh the cost ofyour plan against how well it will benefit you, you should also keep in mind that many require doctors that are in the plan's network. You may quickly learn that with the plan you were considering, your current PCP is not in the network, which could result in significant out-of-network charges.
- Group plans
If you are like most couples, and both have a health insurance plan through your respective employers, you may want to consider dropping one plan altogether. Sit down and look at which plan can cover both of you for the lowest amount.
- Access insurance needs
You may find that your situation and needs have changed from one year to the next but feel you are stuck with the same plan regardless. The truth is, you maybe missing out on a significant amount of savings with this way of thinking. Make it a point to reassessyour needs and determine if there are areas that you can cut in your insurance plan that will help reduce your premiums, such as how often do dependents see the doctor? Are you prescribed a large number of prescription drugs? Do you feel you can afford to shoulder the cost of your routine visits in exchange for lowering your premium?
- Savings at work
Most individuals who have a group health insurance plan through their workplace believe that they are stuck with whatever rates are offered each year. The reality is just the opposite. The company employees, especially those employed by smaller companies, can make a case for better and more economical coverage options. Many are unaware that there may be benefits tucked into your health plan that are optional and are causing your premium rates to skyrocket each year. Get together with your fellow employees and go over the options covered, and if you feel they are not needed, ask your employer to remove them during the next renewal period.
The ACA takes the guesswork out of determining if you are eligible for a subsidy. The premiums are based on your income level, and the subsidies are only available through the health insurance marketplace for each state. Also, the subsidies are provided in the form of tax credits.
Here at Savvi,our mission is to help people take the stress out of buying health insurance in Houston, San Antonio, Dallas, Ann Arbor, and Grand Rapids. Feel confident by knowing that you'll have the absolute best plan that fits your lifestyle & budget. We look forward to working with you.