American medicine is very well developed and has the largest medical services market in the world. Also in this country developed about half of all medicines in the world for recent decades. In terms of their income, American doctors are far superior to their colleagues from other countries. According to a study by the Kaiser Foundation, the average annual cost of insurance for an American family increased by 5% in 2019 and amounts to about $ 21,000, with employers compensating most, and workers paying about $ 6,000. Despite this, more than 60% of personal bankruptcies in the United States are caused by medical expenses. It is logical that many are very interested in the question of how to save on health insurance in 2020.
Until 2014, there was no compulsory health insurance in the USA The costs of medicine were fully borne by each individual person. So in 2008, out of more than 300 million Americans, almost 50 million did not have health insurance and were denied access to qualified medical care. Other about 50 million residents were insured to a minimum, which did not solve the problem, if serious treatment was required, access to expensive drugs was needed. The cost of insurance grew several times faster than the average salary.
American medicine has an established system for monitoring the quality of services, the rights of the patient and his relationship with the doctor are regulated by legislation, which allows the patient in case of medical errors to receive the help of qualified lawyers who will help to achieve large financial compensation. But if you suddenly become seriously ill, then you first need to pay a lot to get medical help, and only then, if the doctors do something wrong, after a while you can count on compensation.
We’ll learn more about health insurance in order to find out what opportunities are there to save on health insurance in 2020 and whether you can use them.
What is health insurance and why is it needed?
Since 2014, health insurance in the United States has become mandatory, and the medical field has undergone changes. However, insurance does not cover everything, but only a clearly limited list of medical services. The services of dentists and ophthalmologists, psychiatrists and pediatricians are usually not included in health insurance.
Only a very wealthy person can afford to buy a medical policy that includes all types of medical services. As a result, a serious injury or illness can severely undermine the family budget and cause personal bankruptcy. Therefore, save on health insurance in 2020 will remain a very topical issue for most Americans.
Medicine in America is really very expensive, so you should not neglect insurance, in addition, it is mandatory for all legal residents of the country and a penalty of several hundred dollars is provided for its absence.
When buying a medical insurance policy, you enter into a contract with an insurance company, according to which you pay a certain amount every month, usually at least $ 300, and the insurance company incurs a part of medical expenses if you become ill or get injured.
All Americans have equal access to emergency medical care, and doctors should not ask for insurance for patients, but in fact you will have to wait long in the corridors of the hospital if you do not have insurance, since those who have a medical policy are the first to receive help.
Just visiting a doctor to show where it hurts to you will cost you no less than $ 10-20, emergency care at least $ 50. For an uninsured person, calling an ambulance or visiting an emergency room can result in serious financial expenses.
Health insurance usually covers the cost of medicines, most of which are only available on prescription. For low-income Americans, a special federal Medicaid program is provided, and for the elderly is the Medicare program.
So a little less than 30% of Americans use government programs. Overall, almost 85% of Americans have health insurance, of which about 60% receive insurance from the employer, and almost 9% get it themselves. If you belong to the latter category, then perhaps you should take advantage of the financial assistance to purchase medical insurance so as not to be in a difficult situation if you become ill. In most cases, working Americans are not able to choose an insurance company, because they are forced to purchase the one that the employer offers them.
Types of Health Insurance
Most major companies provide insurance to their employees. Many organizations can take out insurance for several people. This insurance type is usually cheaper than individual. However, in the event of a serious illness of one of the members of the labor collective, the cost of the total price of insurance for the next year may increase. The average cost of such insurance is $ 600 per month per employee.
There are two types of health insurance provided by the employer – these are:
- Payment for services, when the insurance company reimburses up to 80% of the costs for the services actually provided by the doctors, and the remaining expenses are borne by the patient;
- Managed services, when there is compensation for the set amount for each employee, without additional services. It is not surprising that many people want to save on health insurance in 2020 in order to spend as little as possible on medical services.
In the case of a Service charge, the employer is interested in lowering medical expenses, for which purpose special companies are involved, collaborating with several providers of medical services, thereby reducing their cost.
Before going to a specialist, the patient is examined by a general practitioner. If there is a possibility of prescribing expensive treatment, it is necessary to obtain the conclusion of another specialist. There are also payments to employees in case they lose their ability to work, as well as in the case of job loss, when insurance can be extended for a year and a half, and the employer will pay 60% of the cost of medical services.
- The lowest cost of health insurance in the US is HMO (Health Maintenance Organizations). This is due to the fact that using these types of insurance you can visit a very limited number of doctors and medical institutions. You will have to be treated in institutions of the same network, and you will have a primary physician who will issue referrals to other specialists. Coverage does not include services provided outside this network, except in cases of emergency medical care.
- A much wider network of hospitals provides the type of PPO (Preferred Provider Organizations). You can be treated not only in hospitals of a certain network, but also in others, however, in order to save on health insurance in 2020, you should still choose the hospital of the network, since there you will get much more favorable conditions. Also, you will not need to take a referral to specialists, because they will be able to take you on insurance and without it. But it is worth considering that buying such medical insurance will be much more expensive than others.
So what is it worth choosing to save more on health insurance in 2020 – HMO or PPO? Here a lot will depend on your lifestyle. If you already have a family doctor, or you do not mind that the same therapist is constantly engaged in you, as well as you move around the country a little and do not mind being treated only on the network, then HMO will be a more suitable choice for you. Also choose HMO if you want to pay less and a low Deductible.
The PPO type is more suitable for those who want to choose a doctor for themselves according to reviews, and not the one they will appoint, those who travel often and want to be able to go to any clinic without an appointment. In addition, when choosing a PPO, you should be prepared for large insurance premiums and for paying a high deductible.
- There are other, less popular types of insurance. Many people who want to save on health insurance in 2020 use the POS (Point-of-service) type of health insurance because it assumes that you will pay less using the services of doctors and hospitals from the network.
- Another less common type of insurance is EPO (Exclusive Provider Organization), which works on the same principle as HMO, but in this case you will not have mandatory referrals to specialists and the main doctor.
- For low-income Americans who do not allow them to purchase health insurance or pay for treatment on their own, the federal government provides two special programs. The first is Medicaid, designed to help low-income people, funded by the federal government or a specific state. To use the services of Medicaid, you must prove that a person’s financial situation is below a certain level.
Medicaid provides several services:
- consultations of various specialists
- laboratory diagnostics
- inpatient and outpatient treatment
- X-ray research methods,
- stay in nursing homes.
Medicaid plays a significant role in the redistribution of income in the United States, and also helps tens of millions of Americans of different categories of the population.
The second government program is Medicare, which aims to help people near retirement age, as well as people over 65 who have health problems. The program is funded from corporate income tax, payroll tax and progressive income tax. Medicare stably provides up to half of hospital revenue.
The program provides the following medical services:
- diagnostic procedures
- some preventive services
- hospital treatment
- home service
- short stay in nursing homes.
The Medicare program does not provide long-term hospitalization, or free prescription drugs and hearing aids. There is another Tricare state health insurance program that provides insurance for veterans and their families.
You can get health insurance in the USA depending on your life circumstances and income level in the following ways:
- the state pays the insurance in full;
- part of the costs borne by the state;
- insurance is fully or partially paid by the employer;
- buy yourself.
What are insurance plans and how much does it cost?
There are basic insurance plans that differ from each other in terms of the percentage of coverage of medical expenses:
- the minimum insurance plan is available to those who can confirm that they are in a difficult financial situation or to persons under 30 years of age, no one else, and is designed for emergency cases
- the Bronze insurance plan, when the insurance company pays about 60%
- the Silver, when the insurance company pays about 70%
- the Gold, the insurance company pays about 80%
- the Platinum when the insurance company pays almost 90% of medical expenses.
In addition to the percentage of coverage, insurance plans differ in sundry conditions:
- Out-of-pocket maximum represents the upper amount, after payment which you begin to receive 100% coverage from the insurance company during the year
- Co-insurance, when you pay a certain percentage of the cost, and the insurance company compensates for the rest
- Co-pay is a fixed amount that you pay for each medical service, while the remaining amount is covered by the insurance company
- Deductible is the amount you need to spend before the insurance coverage starts.
Which deductible type to choose depends on what situation you are in right now. For example, if you want to save on health insurance in 2020, while you are not sick, and very rarely visit the doctors, then the best choice for you would be a high Deductible. Such insurance will be cheaper for you. If you never visit a doctor for a year, then you will spend less money. But you will be protected from high costs in case of accidents.
If you choose a high deductible plan, try to invest as much money as possible in H.S.A. If you do not use it, you can leave money and even invest it in the future. Money at H.S.A. can be used to pay for treatment and care for children, even if they are covered by another health plan.
High deductible insurance plans usually have lower insurance premiums and may be accompanied by an employer contribution, often to a special tax-free health savings account. This may make them less expensive than the PPO plan.
In the case when you or your family members have to undergo a lot of treatment, you will have to pay for everything from your pocket every time until you reach the Deductible amount. If the deductible is too high, then you have to pay too much out of pocket. Therefore, in such a situation, you should choose a smaller deductible, despite the fact that initially the cost of the insurance policy will cost you more.
When choosing the type of medical insurance, you should understand that dental and ophthalmological insurance are separate from the main medical insurance. Dental services include only child health insurance.
Recently, however, more and more insurance companies are starting to include these two option services in their basic insurance, and perhaps to save on health insurance in 2020, you should look for such an offer, but so far there are so many companies that offer such an opportunity.
The cost of insurance for the most part will depend on your income, region and the selected insurance plan. Such insurance, of course, will cost you more when buying a policy, but if you have any problems with your teeth or eyes, then it is probably worth spending a lot on such an offer, so that in the end you will pay less out by your own. If it’s hard for you now to find the necessary amount to buy such a policy, then you can take a personal loan and solve this problem. Despite everything, it is usually more profitable than paying for the services of a dentist or an ophthalmologist yourself.
Where and when is it best to buy health insurance
You can buy health insurance through the Health Insurance MarketPlace, a nationwide resource. Some states have their own sites.
Also note that there is a good time to buy insurance. With the beginning of reforms in the medical field, insurance companies can no longer change the cost of the policy during the year, but the period for purchasing medical insurance is now limited to the period from November 15 to February 15, although cases of relocation, changes in family composition and the like are an exception and allow you to purchase insurance outside the specified period.
How to save on health insurance in 2020
In some cases, you may qualify for financial assistance from the government, depending on your income level and some other conditions. If you are family with children, pregnant women, you have adopted children under the age of 26, as well as you are an older people or people with disabilities, then you should leave an application online on the website or at one of the local offices of the Department of Medical Services.
If you earn a little and buying health insurance hurts your pocket, you can either get health insurance from your employer or get a government subsidy.
Only a very small layer of people who earn average, and for whom the employer does not provide insurance, acquire health insurance at full cost. Some, even to save on health insurance in 2020, choose not to buy any, but to pay a fine. Sometimes it can even be cheaper if you do not have health problems and you are young.
Medical expenses are the first cause of bankruptcy of individuals in the United States. More than 60% of bankrupt citizens owe their deplorable position to expensive medical care. Moreover, three quarters of these bankrupts were not insured. Therefore, insurance, even not the most profitable, is still often better than paying bills by yourself.
Minimum insurance covers emergency care, visits to the therapist, physical examination and tests two to three times a year, as well as various preventive procedures and a short stay in the hospital.
The most expensive medical insurance costs those who are ill a lot. However, for some diagnoses, for example, severe renal failure, the state assumes all insurance payments.
In 2019, the individual mandate was canceled, which means that Americans who do not have health insurance in 2019 could avoid a tax penalty. The new rule provides for exceptions for residents in districts where no medical insurance company provides insurance coverage, or only one insurer offers it.
Under the Affordable Health Services Act, insurance companies had to justify any increase in premiums of 10% or more. In addition, the new rule will attract government regulators to review rates and free student health insurance plans from federal tariff review requirements.
The national health business group, which is conducting a survey of large employers, expects that next year the total cost of medical costs will increase by 5%. Experts recommend that employed US residents review their insurance plans over an open period to ensure that they do not miss the opportunity to save.
Another option to save on health insurance in 2020 is to use the premium discount offered by many employers, as well as their offer to deposit additional money into a savings account if employees agree to a health examination or check. Identifying factors such as smoking or high blood sugar can help prevent health problems that are more serious and costly to treat.
Use all possible options to save on health insurance in 2020 and do not refuse to purchase medical insurance, even if it is too expensive for your budget, it is better to take the opportunity to get financing from lenders, so as not to then spend a lot of money from your own pocket for medical services.