As health insurance premiums are expected to hike up as a result of rising medical costs, you should brace yourself for a blow to the family budget. Policyholders may choose to switch providers for a better deal or abandon their cover altogether if their health funds continue to climb. But before you ditch your health cover, here are some tips to help reduce the impact on the price hike.
1. Pre-Pay And Save
Paying the annual premium upfront before the price hike which is on April 1, helps you beat the increase. Some health funds provide extra incentives for members who pay their premium a year in advance. These incentives could be a discount on the premium or a suspension of the increase. Opting for a direct debit premium may also help you negotiate a discount, which can help you pay on time and avoid late penalties.
2. Choose A Higher Excess
Most health funds allow you to increase your excess for a reduced premium, which means that you’ll need to pay more if you need to go to the hospital. While you may think you can save by dropping extras and increasing your restrictions, opting for a higher excess makes more sense in reducing your premium.
3. Change Your Co-Insurance Ratio
This is how much you’ll pay after you’ve met your deductible. A common ratio is 80/20, which means that after you pay your deductible toward health care expenses, your insurer pays 80% of the bill while you shoulder the 20%. Changing this ratio in order to pay more will mean a lower premium. Like choosing a higher excess, you have to weigh the costs versus the risks.
4. Explore Direct Primary Care
A growing number of primary care physicians are partnering with employers to deliver affordable preventive and primary care on a fixed-monthly membership model. Direct primary care, coupled with a high-deductible health insurance plan, can be an outstanding and relatively affordable solution for entrepreneurs and small businesses. A major drawback though is that it generally isn’t, on it’s own, a solution for the kind of catastrophic illness, like cancer, which leaves people bankrupt.
5. Trade Up Group Health Insurance Plans
If both you and your spouse have group health insurance plans available through work, figure out which one will cover both your needs at the lowest possible cost. This is a case to case basis though, for an individual family plan may offer a cheaper option for some people as opposed to group rates.
6. Find Out If You’re Entitled To A Corporate Or Restricted Fund
Talk to your employer and find out your options. Often, corporate or restricted fund members enjoy exclusive discounts and perks, including lower premiums for higher levels of cover or free gym membership. There’s also the possibility that you can join a fund that someone in your immediate family has access to.
