How to Shop for Health Insurance: 5 Tips for Lowering Your Premium

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The American health and medical insurance is an industry worth $967 billion.

As the population ages, the need for health insurance keeps growing. The sector has witnessed a 6.7% growth, and this is only predicted to keep increasing.

Insurance premiums will, therefore, become essential household expenses.

Here are tips on how to shop for health insurance premiums that are budget friendly.

1. Take Advantage of the Premium Tax Credit

The government, through the Internal Revenue Service (IRS), offers health insurance policyholders reprieve on their monthly premiums.

The Premium Tax Credit (PTC) is a refundable credit offered to policyholders who meet specific qualifications and are also taxpayers.

The credit helps any qualifying person or family pay their monthly premium of a Health Insurance Marketplace (HIM) policy.

When you apply for a HIM policy, you will find out if you qualify for the credit. The amount of credit you receive depends on the household income you state on your application.

If the Marketplace concludes that you qualify, your insurance provider will receive advance credit payments. These payments will then go towards reducing the out-of-pocket monthly premium costs.

Although the PTC helps deliver good health insurance covers it is essential to note that changes in your circumstances can alter its provision.

If you lose a member of your household, then it might lower your credit. The same applies if your income increases.

When your credit reduces, it is best to lower the number of advance credit payments you receive. Doing so will help you avoid having to refund during reconciling.

If you gain a household member, it goes towards increasing the credit amount. A similar effect will happen if your income reduces. In such cases, you should increase your advance credit amount to lower your premiums.

To qualify for PTC you:

  • Should have a household income falling within the specified range
  • Should not have anyone who can claim you as a dependent
  • Don’t file your returns under a status of Married Filing Separately

2. Stick to In-Network Providers

Different circumstances can lead to you changing health care service providers. One vital point to remember when it comes time to make the switch is staying in-network.

In-network providers are those that have a contract with your health insurance provider. The deal enables the in-network party to negotiate a fee that benefits both parties.

As a result in-network providers don’t increase your premium.
On the other hand, out-of-network health providers tend to increase your premium since your insurer will pay more.

3. Consult a Broker on How to Shop for Health Insurance

Health insurance brokers are professionals who are incredibly familiar with the health care insurance market. When you’re looking at ways to save on health insurance, you need to tap into a broker’s experience.

The health care marketplace is not designed to offer you the cheapest premiums. While there are many insurance companies, they can only assist you with the products they offer.

A health insurance broker has information on the market as a whole. As a result, they are well placed to assist you in securing the best affordable health insurance policies and premiums possible.

  • Specifically speaking health insurance brokers can help you by:
  • Detailing the costs and benefits of the various plans in the market
  • Helping you deal with physician assignment matters
  • Helping you identify the most suitable coverage plan based on their extensive research and relationships
  • Helping organizations design their health and wellness programs to serve the employees who qualify.

If you are worried about who will pay for the broker’s services you can rest easy. Some brokers might charge a fee, but they primarily make their commission off the insurance providers.

A health insurance broker is an effective means of securing plans with lower premiums while on a budget. Remember to find out if the broker is certified to avoid working with unqualified ones.

4. Continually Assess Your Health Insurance Needs

Many people tend to stick to the same plan once they identify it the first time.

While there may not seem to be any need to fix what has not broken, it can become a liability. That is because while the policy and its terms stay static your life keeps changing.

Did you pick up your policy before you had children and haven’t reviewed it since? You will find that taking a second look at that policy might give you ideas on how to trim the premium.

If you adjusted your policy once you had your children then has it been keeping up with their needs? A review might help you identify a more cost-effective policy covering your current situation.

Have you looked at the market to see what policies new entrants are offering? Even if you do not have the time to visit different providers technology can help solve that problem.

Visit online platforms that compare various policies for more info on ways you can save on your premium.

If your life situation has changed and you are now taking more prescription medicine, your premium can go up. Policy comparison sites can help you spy out health insurance discount offers that can reduce your premium.

Keep reviewing your insurance policy regularly to find out how you can keep premium costs down.

5. Increase Your Deductible

Increasing the amount of deductible you pay will have the effect of reducing your monthly premium. Since a deductible is paid out-of-pocket, it means that the amount the insurer charges will reduce.

If your financial ability can enable to increase the deductible, this will give you flexibility during negotiation. You can afford to bargain with insurance providers for better terms due to reduced payouts on their end.

It Can Be Done

Spiraling health care costs are a growing concern for the aging American population.

As more people sign up for health insurance, the cost of premiums is becoming a fixture in monthly budgets.

It is imperative to know how to shop for health insurance that will not empty the pocket. Check out our blog if you want to learn more about health insurance and cost-cutting tips.