15 ways to save on medical costs

Medical insurance in the United States is a bit of a mess.  The costs are high, the choices are overwhelming, the bills require a Ph.D. to decipher, and the fine print and exceptions are plentiful. The good news is that if you can afford medical care in the US, it’s usually some of the best care you could receive.  That being said, there are ways to optimize the insurance system by challenging medical insurance norms and getting creative with how you approach and cover your medical expenses. Unfortunately, access to affordable healthcare is still a problem in the United States, and it’s even more difficult if you’re not traditionally employed. Access to affordable healthcare is often tied to traditional employment, and if you’re an early retiree or an entrepreneur, it can be hard to find good options.  My biggest advice is to research your options, be open to getting creative, don’t be afraid to piece multiple solutions together and continue to monitor and reassess your options over time.  Also, I am not a doctor or medical professional.  I am simply sharing my opinion and personal advice, and you should consult a professional to make your own decisions.  And most of this advice is heavily targeted to people in the United States, as medical insurance and services vary significantly in different countries.

Let’s start by discussing traditional insurance.  The traditional insurance route includes getting your insurance through the health insurance marketplace, an agent or broker, directly from an insurer, from an online insurance brokerage, or through a membership or health-sharing organization.  There are a couple of other routes for traditional insurance.  If you’re over 65, you’ll likely be covered by Medicare and you can choose whether to supplement with additional insurance.  And if you qualify for coverage, you could leverage Medicaid, a joint federal-state program funded through taxpayers.  I recommend everyone have some form of traditional insurance, even though it’s no longer required in the United States as of 2019 (and by required, I mean there used to be a tax penalty if you didn’t have insurance).

Even with traditional insurance, there are many creative ways to save money on your medical expenses:

1. Leverage an HSA or Health Savings Account if you’re on a high-deductible plan. It’s a fantastic tax benefit, and you should max it out and use it as a long-term savings account for medical expenses, or use it in the short-term if you need to. The financial podcast I co-host did a detailed episode on how awesome HSAs are.

2. Ask what the non-insurance cash rate is for services and consider paying cash versus using your insurance. If you have a high-deductible plan or have not yet met a lower-deductible, there’s a high likelihood that paying the doctor’s cash rate for services will save you money. For example, I just had to get an MRI and their non-insured cash rate was $665, but if they had filed it through my insurance, I would have paid well over $1,000 because I have a high-deductible plan.  It takes just a minute to ask any doctor’s front office what a visit or service would cost at the cash rate versus your insurance being billed.  Doctors have rates like this because they do service non-insured people.  Also, it’s not literally paying cash; you can put it on a credit card, write a check, or whatever.  They just want the direct payment from you versus filing and billing it to your insurance, which costs them a lot of time and money. 

3. Leverage mail-order prescription services if your plan offers them. Most standard insurance plans have a mail-order option, and it’s cheaper than going to traditional pharmacies.  It takes a bit more work and pre-planning, but it can save you a lot of money.

4. Leverage Teladoc services where you can. Most standard insurance plans and doctor’s offices now offer teledoc services, and they became much more prevalent during Covid.  Teledoc is where you see a nurse or doctor over a video call versus in person. Doctor’s offices won’t handle just anything over this type of visit, but they can handle many things. There’s usually a specific charge for seeing a teledoctor versus a live doctor, and it’s often cheaper and more convenient than going into a physical doctor’s office.

5. Ask questions about what things cost before you go in for a service. Don’t be afraid or embarrassed to ask questions over the phone before you go in. You will typically end up speaking to someone that focuses solely on billing, and they can tell you a lot. For example, they will often say they would need to make a call to your insurance company to confirm a charge, and you may need to say, “yes, I would like you to do that before I can schedule my appointment,” and they will do the research for you.  I recently had my physical therapy office do this, and I had to ask, but they did call and find out what my charge would be, and I discovered that it was cheaper to pay their cash rate of $100 per visit.

6. Leverage GoodRx for savings on prescriptions and doctor’s visits. Goodrx will cover online doctor’s “visits” via a chat app for 30+ standard services and treatments, and then they also offer discounts on prescriptions.  They provide access to doctor’s visits and prescriptions for things like a UTI, birth control, acne treatment, anxiety medication, diabetes medicine, acid reflux, migraines, and more.  I was 99% sure I had a UTI (sorry if that’s TMI), and my high-deductible insurance was going to have me paying $100+ for a doctor’s visit to get a prescription called in.  I knew what prescription I needed and thought it was silly to have to pay that much, so I happened to google UTIs and GoodRx had some paid ads running.  I looked into it, used it, and it was amazingly fast, high-quality service, and inexpensive. That’s the trifecta that I look for in anything, so I loved it!  They offer a gold membership that you can 30-day trial for free, and then doctor’s visits start at $19.  I have trialed a gold membership once, canceled, and then turned it back on for the one additional month I needed later, and they don’t seem to be limiting the number of times I can restart it.

7. Get creative on the timing and spacing of your non-time-sensitive medical expenses. Pay attention to when you hit deductibles and the overall timing of services.  For example, you get an annual physical each year for free, but on some plans, it has to be at least one year from your last physical to be covered.  I recently hit the annual max coverage on my dental insurance and needed a new mouthguard. Still, it wasn’t super urgent, so I pushed getting my mouth guard into the next calendar year, and it saved me $350 because my insurance covered half of the cost; it would not have covered that half in the previous year as I had already hit my max.  Another creative approach is to alternate between less costly high-deductible plans and more expensive plans in different years based on anticipated medical needs. For instance, I could plan one year to enroll in my company’s more expensive, lower-deductible plan to take care of several medical needs that I pushed out since they weren’t extremely time sensitive.

8. Check your bills and make sure you’re getting charged for the right services correctly. Read the fine print on your insurance plans and Explanation of Benefits (or EOBs, as they’re often referred to).  I have been charged incorrectly twice this year.  Some doctor’s offices bill overly aggressively or just incorrectly; they often assume your insurance company is paying and you won’t even notice or care.  If you’re on a high-deductible plan, you will get used to noticing and caring as you’re paying so much out of pocket for each visit.  Read your explanation of benefits and check the billing details.  You can learn a lot through reading these, and don’t be afraid or embarrassed to ask questions.

9. Research and ask questions on covid-tests, immunizations, and other related services. There are some services where your doctor’s office might charge you a visit, but there are other locations that service these things for free.  For example, there are $0 out of pocket drive-thru covid testing centers in my neighborhood, but I get charged for an office visit if I take my kids to the pediatrician for a test.  This is the same thing for my annual flu shot.  My company gives me a voucher, and I can take it to several pharmacies for a free flu shot, or I could pop by my urgent care and get charged a co-pay for visiting.  Some doctor’s offices won’t charge you for immunizations, but urgent care will, and again this is an example where you should ask questions.

10. Avoid leveraging an Urgent Care office unless it’s critical. The co-pays at an Urgent Care office are almost always significantly higher than a regular doctor’s office.  And you might think that it’s hard to get a same-day appointment at a doctor, but it isn’t always.  You can also call a different doctor nearby to see if they have openings. I’ve caught myself going to Urgent Care just because it’s quicker or more accessible, but there are often other options that just take a bit more pre-work or patience.

11. On the same note, avoid an Emergency Room unless it’s truly an emergency. I’ve heard of people going to an emergency room when they could have instead gone to an Urgent Care office. And yes, I just said avoid Urgent Cares, but obviously, they are cheaper if it’s a service they can provide, and Urgent Cares can provide many lower-acuity emergency services.

12. Get all of your kids on the same plan, even if they are part of a blended family and living across different households. Most insurance plans charge per family, not by the number of kids you have, so minimize the number of people who have to pay for a family plan across various families. I’ll share a personal example:  My daughter can be covered on my husband’s plan even though she’s not his father, because we are married and she lives in our home.  And my husband has two other children, so there’s no point in both of us being charged for a family insurance plan by our company’s when I could just move my daughter over to his plan. This is legal and allowed, and you just have to show proof of marriage and birth certificates for the children.  If you have blended families, consider being strategic about which kids are covered by which parents

13. Your entire family doesn’t have to be on the same plan; consider a hybrid approach with what makes sense for each of you. For example, my husband and three kids are on the same plan at his employer that is a more standard insurance plan with reasonable co-pays, but I am on a high-deductible plan because my medical expenses are relatively predictable, and I can afford anything that pops up outside of the norm.

14. Consider a different approach for dental insurance, including a Dental Wellness Plan direct from your dentist’s office. Many dentist’s offices offer an annual “wellness plan” to provide basic cleaning, x-rays, preventative care, and emergency visits for a fixed yearly cost. I’ve seen plans that range from $350-$500 a year for these services, and they are cheaper than paying individually for these services and perhaps more affordable than your dental insurance costs.  They also offer a discount on other dental treatments and services you need above and beyond preventive care (e.g., cavities, crowns).  There are concierge doctor’s offices and services that offer similar approaches for medical care, but I wouldn’t put these in the money-saving category, so I’m not covering those here.

15. Supplement your insurance with travel medical insurance. Many traditional insurance plans only have strong coverage in the state where you reside and purchase your plan.  If you’re doing any long-term travel outside of your state or the country, you should consider purchasing a travel insurance policy.  You can buy them for as little as a few days or use them longer-term for years.  You should first research what your standard insurance does and doesn’t cover, so you’re clear on what you want to find additional coverage for, and then read the details and fine-print of any other policies you’re researching.  Nerdwallet has a good article summarizing travel insurance. I also love “A Purple Life’s” summary of her retirement insurance approach (she uses World Nomad policy to cover her for travel across the United States).

There are also new kinds of insurance popping up like Sidecar Health, and this could be used on its own or alongside some other type of insurance.  Sidecar Health markets itself as a new kind of health insurance that is transparent and simple.  But like most insurance, I’d say understanding how it truly works isn’t exactly straightforward; it requires a good bit of research and reading the fine print.  Sidecar health has a specific rate they will pay for any service. They’ll pay you that regardless of what service provider you choose to see, so you could make money if you find a service provider that charges an amount below their average costs, or you could have to pay the difference if you choose a service provider that charges more than their reimbursement rate.  The idea is that everything is transparent, and so you know the rates and decide who you want to see and what you’re willing to pay.  The biggest negative to Sidecar Health, as I see it, is that there is no out-of-pocket maximum like with other insurance plans, and this is the primary situation where I want insurance.  So if you have major surgery or expense, they will cover you up to a certain point of whatever their plan covers, but after that, it’s all on you, and that could get quite expensive and is risky, in my opinion.  I feel like it’s an interesting approach for covering the more minor routine medical services I need. Still, I want insurance for the crazy expensive, unexpected stuff, and that’s where Sidecar Health lacks, in my opinion.

The insurance and medical industry are quite complicated.  As a result, it’s often hard to understand and really know what’s happening, but that also means there are many ways to save money if you’re thoughtful and pay attention.  So here’s to saving money on your medical expenses!

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Written while listening to The Beastie Boys Ill Communication Album

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