If you’re hoping a new administration will bring you health-care security, don’t hold your breath. With the country reeling from the banking debacle, and the markets in a free fall, even the most optimistic Americans question whether the next president will be able fulfill his health-care promises.
Senator Barack Obama, for example, may have a hard time passing costly reforms outlined in his plan, which calls for mandatory coverage of preexisting conditions, tax credits for families, and the expansion of Medicaid and the State Children’s Health Insurance Program (SCHIP), which would cover all children without private insurance.
Senator John McCain’s plan aims to cut tax breaks for companies that offer health insurance to employees, and replace them with a refundable tax credit of $2,500 for individuals or $5,000 for families—a promise that may be hard to make a top priority.
But no matter who wins, and what they are able to accomplish, there is a lot you can do to save on medical costs and plan for a healthier future.
Eight money-saving moves to make right now
- 1. Enroll in a flexible spending account (FSA) next month. At many companies, FSA enrollment for next year begins in November. An FSA allows you to set aside money from your paycheck—before it is taxed—to pay health-related expenses that aren’t covered by your insurance. By using pretax dollars, “you’re effectively buying health-care services at a significant discount,” explains Wayne Farlow, a certified financial planner in Westminster, Colo. For the average wage earner, it translates into at least a 30% savings on your health-care expenses.
2. Split your prescription medication. This cost-saving trick can cut your drug bill in half, literally. “If there’s the same co-pay for a higher strength medicine, you can split the pill in half and save money,” says Vibhuti Arya, a spokesperson for the American Pharmacists Association. Ask your pharmacist if the medicine is suitable for splitting, since some medications—particularly time-delivery drugs—are not.
3. Switch to generic medications. “If you’re starting a new treatment, why not start with the most economic medication rather than a brand-new drug?” asks Edward Jardini, MD, the author of How to Save on Prescription Drugs: 20 Cost-Saving Methods. Ask your doctor if there any generics—or similar medicines or ones in the same class—that are less expensive. Generics contain identical active ingredients and work the same way in the body. For example, ninety 10-milligram tablets of generic simvastatin, a drug used to lower cholesterol, sell for about $50, while the same amount of the brand-name Zocor costs about $240. Make sure you also ask your doctor about lifestyle changes and other steps you can take to cut your prescription medication cost.
4. Stay insured if you are fired or laid off. Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), you and your family have the right to stay on your employer-provided group health insurance for up to 18 months after you leave a job. You will have to pay for 100% of the coverage (rather than sharing the cost with your employer), but it is usually cheaper than buying an equivalent policy on your own. For more about your COBRA rights, visit this list of frequently asked questions assembled by the U.S. Department of Labor. Individual states also offer their own assortment of protections, so be sure to look into them.
Next page: Yes, you can bargain down medical costs
Comments (8)
We are doing most of what you suggest. We used to do the flexible spending account but after I retired it was no longer available.
I am for John McCain but in all truthfulness, I don’t think the tax credit approach will work. In a word, I don’t trust the insurance companies. They will quickly find a way to eat up the $5000 allowance and leave the insuree in a gown with his/her tail exposed.
George Hollis
Mr. Hollis, I don’t know how you’re managing health coverage but that $5,000 credit is only available to FAMILIES, not single people. Average cost of a reasonable health care plan is $12,000 per year, not including dental and vision coverage (both of which are crucial as you get older, given age-related problems like glaucoma, diabetic retinopathy, and macular degeneration as well as receding gums and wearing out of caps, crowns, fillings, and the like).
The age-related diseases like arthritis, diabetes, and the like also include costly medication. $5K won’t pay to insure a single child with an adequate level of care. McCain’s plan to tax employer-provided benefits will swell the rolls of the uninsured, and you’ll probably be joining them yourself soon. I can’t believe you’re seriously considering voting for him.
PLEASE NOTE: talk to your doctor before deciding on generic medications, especially with psychopharmaceuticals and antibiotics. There is a growing group of psychiatric professionals who no longer allow their patients to use generics because their patients reported lack of effectiveness – a little Web research will reveal this. And I myself have twice now had bad GI reactions to generic antibiotics (whereas the “brand version” never bothered me). More pharmaceutical researchers are beginning to discover that the FILLERS used to make medication – not the “active ingredients” – can affect the way the active ingredient behaves in the body (especially time release medication), and that cheap fillers can cause a range of reactions.
So where can I get less costly health insurance? I am single, 62 & my premium with BCBS is $549.00/month. That is with a $2500 deductible and none of the extras…..
I feel so very lucky. My husbands insurance does not cost us and dime. Generic brands are free and our “expensive” medications are very reasonable. I am so sorry everyone does not have our kind of coverage. By the way, my husband has a typical middle class job, no CEO or anything close to that!
To Kay Wilson, your insurance does not sound too bad. My husband and I also have BCBS and our ded. is $2500 and we pay $1473 a month……….we are both almost 60. And this goes up every year. We are self employed and get no breaks. And we are both in good health. Good thing we are, can’t afford to be sick.
As the grandparent of a grandson born with Cystic Fibrosis, I have to endorse a candidate who says no one will be able to be denied coverage. At 28 months he takes almost 30 pills each day as well as has nebulizer and breathing treatments.
My son-in-law will likely need to change jobs – he’s in management at one of the “Big 3″ automakers. If they can’t get coverage for my grandson, it will literally bankrupt them – and the rest of us – if we have to pay for all of his care.
I feel that in our country, health care is a right and that no one should be denied. $5000 for a family is a joke.
It may be hard to get the reforms passed, but we must try for those who can not get insurance.
I work with insurance through my employer (we are self insured). I gave the following recommendation to my friends (both in their early 60’s, one with a heart condition). Their premium went from $1,900 per month to $600. How?
I suggested they self insure. They researched and found a policy with a $10,000 deductible. I told them to take the $1,300 monthly premium saving and put it in the bank. In a little over 7 months they would have their deductible. If they did not need to use all the deductible, it was money in their pocket. The first two years they had little medical care (under $5,000). They estimate their savings at approximately $26,000+. May not work for all but it may be worth looking in to.