Here are five steps that you can take to save money on your health insurance premiums (and/or reduce other health-related expenses):

Step 1
Consider taking a prudent risk by going with a higher deductible health plan.  Doing so can save you hundreds (or even thousands) of dollars per year.  Every dollar saved can pay “first dollar” benefits (i.e. co-pays and/or deductibles) if needed.  And, if you don’t need to spend it on health care, it is pure savings.  In addition, the purchasing power of these saved dollars is increased by 40% to 50% if the savings is invested (passes through) a tax advantaged account such as an Health Savings Account (HSA) or a Flexible Spending Account (FSA).

Step 2
Consider participating in your employer’s health insurance plan if you are eligible.  As a general rule, employers in Colorado are required to subsidize “employee only” premiums by at least 50%.  This, combined with the fact that you can pay your portion of the premium with pre-tax dollars via payroll deduction, results in a net price that generally can’t be beat in the individual health insurance market.  IMPORTANT NOTE: Always seek out professional advice before ditching your individual health plan for group coverage.  There are some circumstances where the individual coverage may be better for you even if it is more expensive (in the short term).  Also, while it may be cheaper for you to hop on your employer’s plan, many times purchasing individual health insurance for your dependents is a better value.

Step 3
I have already hinted at this twice…make sure that you are being “tax smart” when considering your health insurance options.  If you are an individual looking for private insurance, consider an HSA Plan (a less expensive, high deductible plan combined with a tax advantage savings account).  If you get your health insurance through your employer, make sure that you are paying your portion of premiums with pre-tax dollars via payroll deduction. While this doesn’t really save you money on your health insurance premiums directly, it does reduce your tax burden increasing your take home pay.  If your employer does not offer “pre-tax deductions” tell them to call us because these “pre-tax plans” save them money too!

Step 4
If you have maintenance prescriptions, consider buying them through your insurance company’s mail order pharmacy. Most mail order pharmacies will permit you to purchase a 90-day supply of your prescription medications for the same co-pay you would pay for a 30-day supply at a traditional pharmacy. Most doctors are familiar with this process and are more than happy to accommodate you by writing a modified prescription.  In addition, always remember to ask your doctor about generic alternatives (most plans have lower co-pays for generic drugs vs. brand names).

Step 5
If you have a life or limb threatening injury, by all means, go to the emergency room (ER).  But for other milder conditions, avoid the ER if you can.  Most ER docs will tell you that as many as 75% of the cases they see could have been handled by a less expensive urgent care center instead. The co-pays for emergency rooms can be 2-5 times as expensive as an urgent care clinic.  In addition, ERs will always prioritize cases (as they well should) which could mean for long waits for patients with milder conditions.

For more money saving tips and advice, give us a call at 970-484-1250.

Want to check out some health insurance quotes right now?

Related posts:

1. 2009 Health Savings Account Limits HSA plan contribution limits for 2009. HSA updates for 2009....
2. The Pros and Cons of Group Health Insurance The health insurance marketplace is certainly challenging, but count your...
3. Only 59% Aware of Health Savings Accounts Via Money Management Executive June 3, 2009 Six years after...

Related posts brought to you by Yet Another Related Posts Plugin.

Group Health Insurance Pros

• Group health premiums are subsidized by the employer. In Colorado, generally, an employer must contribute at least 50% of the “employee only” premium.  As such, if you are the employee, you can likely get a richer health plan for less premium than you would pay in the individual health insurance marketplace.  However, the cost to add your dependents to the employer’s plan, may be cost prohibitive.  In this case, and assuming that your dependents can qualify for individual health insurance, then you may want to put them on an individual/private health insurance plan.

• Group health premiums for large families are the same as for small families; whereas in the individual market, you pay a separate premium for every family member.  So, if you have a large family, you may be able to get a better deal by adding them to your employer’s plan.  As with any health insurance change though, don’t make any changes without consulting with an experienced health insurance advisor in your state (we specialize in Colorado health insurance).

• Group health insurance in most states (Colorado included) is guaranteed issue — meaning that you can’t be turned down because of pre-existing health conditions.  This is a real blessing if you or a family member has a medical condition that prevents you from qualifying for a individual health insurance plan.  But, this is a double-edged sword.  While being guaranteed issue is a huge benefit for those with pre-existing medical conditions, it does come at a price.  This one feature alone accounts for most of the disparity between group and individual health insurance premiums.  Yes, that is right — in Colorado,  individual health insurance premiums are almost always less expensive than group health premiums.

• Most group health insurance plans cover maternity. So, if you are planning on having more children, you should definitely consider hopping on to a group health insurance plan.  While you can add a “maternity rider” to individual health insurance plans, these riders tend to be expensive, restrictive, and otherwise provide less value than the coverage you can get in a group health plan.  That being said, if you are considering having more children, we recommend that you contact a health insurance advisor in your state for advice about what is best for your family.  The right answer is different for each unique family.

• Economies of scale can benefit employees of large employers. It is true that the larger the group, the larger the risk pool is in which to share the risk which CAN result in lower premiums than are available in the individual health insurance market.  However, the guaranteed issue “issue” CAN wreak havoc on this type of plan.  For example, a large employer with good benefits tends to retain employees for long periods of time.  Eventually, the average age of the group starts to creep up and so do premiums.  In addition, people with large medical needs (expensive medical conditions) tend to be attracted to large plans because they are guaranteed issue with good coverage.  And so, over time, not only is the group’s average age increasing, but the group is also attracting employees with large expected health costs.  This is the dilemma that we see with large health plans like the U.S. auto-makers and even government health insurance plans.  Eventually, those with lots of medical needs begin to outnumber those with little or no needs and so premiums are driven higher and higher.

Group Health Insurance Cons

• Group health insurance can be more expensive than individual health insurance. You can see this for yourself, by checking out individual health insurance quotes for you and/or your family.

• What happens if your employment is terminated (by you or your employer)? Yes, you will likely have some benefit continuation rights (through COBRA or state continuation programs), but these benefits can be very expensive and the term limited.  So, eventually, you either have to secure another job with benefits, an individual health insurance plan (assuming you are insurable), or possibly join a government health insurance program for the uninsured (if you are not insurable).  Let me emphasize, that you should NEVER be without some form of major medical health insurance.  Being without health insurance puts you and your family in serious financial jeopardy.  In fact, a recent Harvard University study found that 50 percent of all bankruptcy filings were partly the result of medical expenses.¹  To the same point,  every 30 seconds in the United States,  someone files for bankruptcy in the aftermath of a serious health problem.  Don’t let this happen to you.

• Group health insurance premiums are rising faster than individual health insurance premiums. Why? Because most group health insurance plans are guaranteed issue and since they accept “all comers”, they tend to attract those with high medical costs.  On the other hand, most individual health insurance plans are medically underwritten.  This means that the insurance company can say “no thanks” to any application that it deems to not be in its interest.  Put yourself in their shoes — would sign a contract to provide $30,000 in annual benefits to someone that was only going to pay $3,000 in premiums (for a net loss of $27,000)  if you didn’t have to?  Hmm…let me me think about that one.  The answer is a resounding “NO!”.  Because of this underwriting process for individual health insurance, insurance companies can control their risk and more effectively manage their profitability, resulting in more stable prices.

Now that you have a better understanding of the pros and cons of group health insurance; next, let’s explore the pros and cons of individual health insurance (coming soon). Until then, please don’t hesitate to call us at 970-484-1250 for a free health insurance consultation.  Our health insurance advisors are well versed on both group and individual health insurance options, and they will take the time to understand your unique circumstances in order to recommend the most appropriate and best value solution for you and/or your family.

In addition, if you are an employer that would like to learn more about Sage Benefit Advisors’ services including group health insurance and other employee benefits, please give us a call or otherwise contact us.  We would be happy to provide a free benefit plan review to ensure that you are getting the best value for your premium dollars and to ensure that your benefit plan is optimized for recruiting and retaining the best employees possible.

¹Himmelstein, D, E. Warren, D. Thorne, and S. Woolhander, “Illness and Injury as Contributors to Bankruptcy, “ Health Affairs Web Exclusive W5-63, 02 February , 2005.

Related posts:

1. How to Save Money on Health Insurance Health insurance premiums are becoming a larger and larger portion...
2. Only 59% Aware of Health Savings Accounts Via Money Management Executive June 3, 2009 Six years after...
3. 2009 Health Savings Account Limits HSA plan contribution limits for 2009. HSA updates for 2009....

Related posts brought to you by Yet Another Related Posts Plugin.

Six years after health savings accounts were introduced, only 59% of the population has heard of them, only half of these people actually understand them, and only 14% of the overall population own them, Guardian Life Insurance found in its Spotlight on Consumer-Driven Health Plans Survey.

“Because these plans offer compelling benefits for both employers and their employees, we wanted to uncover the obstacles to increasing participation, identify key motivators and develop Guardian resources to expand ownership of HSAs,” said Tim Bireley, vice president of group medical at Guardian.

Fifty-two percent did not know that contributions to HSAs are tax deductible, and 55% did not know that withdrawals used for qualified medical expenses are also not subject to taxes. In addition, 60% did not know that they can take the HSA with them when they switch jobs.

For their part, employers also mistakenly think that HSAs are complex. Many also do not contribute to employees’ HSAs, and Guardian found that would make the plans more attractive to 61% of employees. Fifty-seven percent said that if insurance for critical illness were included, that would make HSAs more attractive.

“As the economy, coupled with rising healthcare premiums, forces business owners, employees and benefit decision makes to make difficult financial choices regarding their healthcare offerings, consumer-driven health plans can provide a solution,” Bireley said.

COMMENTS:

Sage Benefit Advisors conducts educational seminars on the benefits of HSAs.  If you would like for us to speak at your business or place of employment, just give a call…we would be glad to!

If you would like to learn more about HSAs for the benefit of yourself, your family, and/or your business just give us a call at (970) 484-1250 or e-mail Tim Hebert at tim@sageba.com.  Tim specializes in group and individual health insurance and has been actively educating businesses and consumers in Colorado about the benefits of HSAs since they came into existence in 2004.

Related posts:

1. Employers cover 85 percent of health premiums DENVER, Colorado - Employers cover 85 percent of the average...
2. The Pros and Cons of Group Health Insurance The health insurance marketplace is certainly challenging, but count your...
3. 2009 Health Savings Account Limits HSA plan contribution limits for 2009. HSA updates for 2009....

Related posts brought to you by Yet Another Related Posts Plugin.

However, we always invite you to call us to discuss your health insurance options before making your final decision and applying for coverage.  In doing so, we can learn important facts that may impact our recommendations.  For example, we like to know:

• What you do for a living?
• Your family status? Married? Have children? Considering have more children?
• Health history?
• Financial and tax status?
• Do you own a business?
• Risk tolerance (are you willing to go with a higher deductible in order to save on premium costs)?

The answers to these questions, and others, help us to ensure that we are making suitable recommendations for you and your family.  In addition, these consultations help to ensure that you fully understand the plan and features so that you get maximum benefit and value out of your premium investment.

Again, we invite you to use our website to get instant health insurance quotes; but please do not hesitate to call us for personal consulting and advice.  We can be reached at 970-484-1250.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

DENVER – Employers cover 85 percent of the average premium for their employee coverage, according to a new survey by the Denver-based Mountain States Employers Council.

The survey of 697 employers in Colorado and Wyoming found companies continuing to shoulder the lion’s share of providing health-care coverage to their workers despite rising premium costs.

“Health-care costs continue to be a major area of concern for employers,” said Michael Severns, MSEC president and CEO. “However, employers continue to pay for the majority of health-care premiums on behalf of their employees.”

The survey showed health-care costs rising 10 percent over 2008 levels but average health insurance premiums going up only 5 percent, according to the MSEC 2009 Health and Welfare Plans Survey.

The survey also showed more employers offering or considering offering consumer-driven plans such as Health Savings Accounts. The number of Colorado and Wyoming employers offering HSAs as an option increased from 7 percent to 21 percent over the last four years, the survey noted.

COMMENT: Sage Benefit Advisors specializes in group health insurance.  For a free  review, call 970-484-1250 or e-mail tim@sageba.com.

Related posts:

1. Only 59% Aware of Health Savings Accounts Via Money Management Executive June 3, 2009 Six years after...
2. The Pros and Cons of Group Health Insurance The health insurance marketplace is certainly challenging, but count your...

Related posts brought to you by Yet Another Related Posts Plugin.

• Contribution Limit: $3000 individual ($5950 family)

• High-Deductible Health Plan Minimum Deductible: $1150 individual ($2300 family)

• Out-of-Pocket Maximum: $5800 individual ($11600 family)

• Over 55 Catch-Up Contribution: $1000 individual ($2000 if both spouses age 55 or older)

If you would like to learn more about the benefits of HSA plans, we have additional information on our HSA page.

To review HSA plan quotes (for individuals and families) use our free, online quoting system.

If you are an employer and want to learn more about HSA plans for your business, please call 970-484-1250 to speak with a benefits specialist.

Related posts:

1. Only 59% Aware of Health Savings Accounts Via Money Management Executive June 3, 2009 Six years after...
2. How to Save Money on Health Insurance Health insurance premiums are becoming a larger and larger portion...

Related posts brought to you by Yet Another Related Posts Plugin.