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The High Cost of Health Insurance

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LLBy Laura Mangis

It’s all anyone is talking about these days: health care and health insurance. You needed to have healthcare insurance by March 31st, 2014, or you would risk getting fined. Whether you have it through an employer, parent, or you are purchasing it for yourself on the Health Insurance Marketplace, you need to be well informed. But a lot of people are still in the dark about the whole “health care reform” and they don’t understand how it has affected them.

Healthcare in America
February 15th was the deadline to enroll in a plan for 2015 as per the health insurance marketplace website. If you qualify for a Special Enrollment Period, you can enroll in health insurance outside the annual Open Enrollment period. You may qualify for a Special Enrollment Period (SEP) if you’ve had certain life changes like getting married, having a baby, or losing job-based medical insurance. These are called “qualifying life events.”

People got hit with fines in 2014 for not obtaining coverage by the deadline. Are you one of those people? The fee for not having health coverage is calculated one of two ways. If you or your dependents don’t have health insurance that qualifies as minimum essential coverage you’ll pay either a percentage of your total household income or a flat fee (whichever is higher). This will happen when you file your tax return for 2014. The penalty fees for 2015 have already been increased, and they are more than the fees for 2014. We can expect to see this sort of thing happen every year until everyone is covered.

Health Care Costs and Premiums
For decades, the way we’ve paid doctors and hospitals has driven up health care costs. The U.S. health care system pays physicians based on a fee-for-service financial model. The result is that health care costs over the past several decades have risen twice as fast as general inflation. But it’s not the doctors or hospital administrators who are the fundamental problem. It’s the financial model.

Click Here for a great Infographic about “The Rising Cost of Health Care.”

AHIP’s new iPad App, U.S. Health Care Spending 101, is an interactive guide for examining the history, components, and sources of spending for the largest sector of the American economy. Based entirely on federal data, the App provides the facts on more than 50 years of health care expenditures as well as projections of future spending growth. Check out this great video about the App: http://youtu.be/QRsoh68fXzg

How to Save Money on Health Care
If you are well informed and educated on this subject matter, then it’s possible to save money and get the best healthcare insurance available to you. This is something that you’ll want to keep reading about and watching for any changes that might affect you. With all the new information and changes happening in the medical and health insurance fields, it’s good to know about these things.

Do you qualify for a tax credit? If you do not have health insurance through your employer, you may be eligible for help paying for a plan offered in the Marketplace. Use a tax calculator to see if you may qualify for a tax credit. Government subsidies will sometimes pay for a portion of the plan premiums, and can be taken as a credit against annual federal taxes, or as a credit against the monthly plan premium.

Check out this wonderful article about Reducing the Soaring Cost of Medical Care.

Some ways to control health care costs include:

Check to see if your provider is in your plan’s network!

Choose a plan that is compatible with a tax-advantaged health savings account!

Plan ahead for medical expenses (this doesn’t always work out, but it’s worth a try)!

Know when to seek emergency care!

Reduce prescription drug costs!

Conclusion

The health insurance marketplace has changed and it can be confusing. You need to stay well-informed and up-to-date on everything. Until the whole “fee-for-service” financial model is changed you can expect prices to continue to go up! There are ways to save on medical insurance and health care, you just have to be proactive and look for them. You need to have a plan, be informed, make wise decisions for you and your family, and look for savings anyway possible.

Lauralynn Mangis is the Online Marketing Specialist at Advantage Credit Counseling Service. She is the author for Advantage CCS’s Blog called Dollars & Sense. Advantage Credit Counseling Service is a member of the National Foundation for Credit Counseling.

Views expressed are the personal views of the author, and do not represent the views of the National Foundation for Credit Counseling, its employees, its members, or its clients.

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