Nov 24, 2024
Going without health insurance could leave you on the hook for catastrophically large bills. But this year, you may end up paying more for health coverage due to circumstances outside your control.
Employees should expect a 7% to 8% rise in their premium costs on average this year, according ot CNBC. But that doesn't mean your personal cost of coverage won't increase even more.
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Why the increase? Part of it has to do with a general rise in inflation.
But as CNBC reports, an increase in major medical claims and the adoption of GLP-1 drugs used to treat conditions like Type 2 diabetes and obesity are driving costs up for everyone.
Given this uptick in costs, it's not surprising to learn that as of March 2024, 25% of Americans had skipped or postponed health services over the past 12 months because of cost, according to the Kaiser Family Foundation (KFF).
If you’re worried about paying for health care, whether it’s insurance premiums or copays for care and medications, there are steps you can take to make it more affordable. Here are some options worth looking into.
1. Choose the right insurance
If you haven’t elected your health coverage yet for the new year, make sure to crunch those numbers carefully. It’s common for employers to offer both a low- and high-deductible health insurance plan, and picking the right one could cut down your costs significantly.
Deductibles and premiums typically have an inverse relationship. The higher one is, the lower the other is.
If you’re a generally healthy person, you may want to stick with a health plan that offers a higher deductible and lower premiums. But if you have known health issues, then a plan with a lower deductible and higher premiums could make more sense for you.
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2. Get a tax break to offset your healthcare bills
Contributing funds to a tax-advantaged health savings plan could help offset the costs you’re facing. If you’re on a low-deductible health plan, see if your employer offers a flexible spending account (FSA).
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FSAs max out at $3,300 in 2025, but you do generally need to use up your balance by the end of your plan year or your company’s grace period, or otherwise risk forfeiting the remainder.
If you’re on a high-deductible plan, a health savings account (HSA) may be a better choice. HSAs offer the benefit of not putting an expiration date on funds like FSAs. In fact, you’re encouraged to carry an HSA balance forward because unused balances get to enjoy tax-free investment gains.
HSA contribution limits for 2025 are $4,300 for self-only coverage and $8,550 for family coverage. If you’re 55 or older, you can contribute an additional $1,000.
To qualify for an HSA in 2025, your health plan needs to have a minimum deductible of $1,650 for self-only coverage or $3,300 for family coverage. And your out-of-pocket maximum can’t exceed $8,300 for self-only coverage or $16,600 for family coverage.
3. Use generic drugs when possible
As of March 2024, 21% of U.S. adults said they did not fill a prescription because of the cost, per the KFF. And about 10% of adults have either cut pills in half or skipped doses to reduce their costs.
Rather than struggle to cover the cost of medication, ask your provider to switch you over to a generic version of the pills you're taking. The Association for Accessible Medicines reports that brand-name drugs cost patients almost nine times more than generic drugs. And 93% of generic prescriptions are dispensed at a price point of under $20.
If the medications you take don’t have a generic form, see if the manufacturer has a patient assistance program you qualify for. And don’t forget that medical offices receive free samples of pills all the time. If you’re paying a lot, your doctor may be able to hook you up with some of those samples to lessen the financial burden.
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Maurie Backman has been writing professionally for well over a decade. Since becoming a full-time writer, she's produced thousands of articles on topics ranging from Social Security to investing to real estate.
