Accessing health care isn't like going to the grocery store or buying a new phone, where you can just go somewhere else if you can’t find what you're looking for at the right price. Instead, many times you find out how much a service will cost after you've already used it.
Concerns about price stop some people from seeking treatment at all. To increase price transparency, a new government rule requires hospitals to provide clear and accessible pricing information online of 300 “shoppable services” in a “consumer-friendly format,” according to the Centers for Medicare & Medicaid Services (CMS). Yet this rule still won't give you an estimate of your individual costs, which is what you need if you want to try to lower them.
While there's no quick fix to lowering your medical costs in our complex system, there are questions you can ask to help you manage your health care expenditures.
Should I tell my doctor about my financial concerns?
Doctors don’t want to base patients' care on how much money they have. But in practice, ignoring a patient's financial situation can result in physicians making a recommendation or prescribing care that a patient can’t afford, says Eric Ellsworth, the director of health data strategy at Consumers’ Checkbook. Make sure to tell your doctors if you have financial constraints, because they likely won’t ask about it.
Call your insurer or use its website while at the doctor's office to determine if you can afford medication. Many insurers have prescription drug tools online, where you can plug in your medication to see if it's covered. If you're not using insurance to pay for the medication, you can find the retail price on a website like GoodRx. GoodRx also provides coupons, but keep in mind that medication you buy with coupons doesn't count toward your insurance plan's deductible or annual out-of-pocket limit.
“If you pull up that drug price in the office and say, ‘Hey Doc, this drug looks like it’s going to cost me $400,’ at least you can have a conversation about it,” Ellsworth says. “Maybe there are other options the doctor hasn’t thought about.”
When you're planning a procedure, try to get details about what extra costs might come into play — like if your fracture is worse than it originally looked on an x-ray, that might be a different procedure code than a simple fracture, so you can consider that in your overall cost, he adds.
It’s also important to know where you are in your health insurance plan’s deductible, and your doctor won’t know that (more on that in a bit). The deductible is the amount you have to pay out-of-pocket each year before your insurance kicks in and provides fuller coverage.
Do I have the right health insurance plan?
The right insurance plan can go a long way.
“The biggest most important tool in your toolbox when it comes to preventing a big medical bill is having the right insurance plan and understanding how it works,” says Caitlin Donovan, a spokesperson for the National Patient Advocate Foundation.
Look beyond your monthly premium when choosing a plan, to your deductible and cost-sharing, like copays and coinsurance. As long as you have money saved up to cover a medical expense that arises before you hit your deductible, a high deductible plan with a health savings account (HSA) may be a better choice for you than a plan with a lower deductible. High-deductible plans often have cheaper premiums than lower-deductible plans, and the HSA is a powerful saving vehicle. But if you’re living paycheck-to-paycheck, then a high deductible plan with a HSA that you can’t afford to fund isn't going to work for you.
No matter what your health insurance plan is, make sure you know the ins and outs. An important factor is knowing how much you tend to spend on health care every year, and when your deductible resets; if you know that you will hit your deductible by a certain point, saving major expenses for after that will save you money, Donovan says.
Ahead of extensive procedures, call your insurance company to make sure that everyone providing care is in-network, Ellsworth says. Some insurance plans don't offer any coverage outside of their provider network, while others cover it to a lesser degree than in-network treatment. (If you're going under anesthesia, don't forget the anesthesiologist, a category of provider that often flies under the radar and can result in a surprise bill). And get to know your insurance company’s doctor and pharmacy finder and price tools, ideally before you go to the doctor. That way, you can walk into your doctor’s office armed with information and know how much — or at least in the ballpark — a procedure is going to cost.
Should I always use my health insurance?
Sometimes, it may actually make sense to not use your insurance. Medical providers will often offer discounts if you pay upfront, as it saves them the hassle of having to deal with an insurance company. For example, a couple in Idaho with a high deductible found an imaging center where their daughter could get X-rays done for $55 cash upfront, versus $228 if they had billed it through insurance, KTVB’s 7Investigates reported.
The same goes for prescription drugs: some insurance plans offer affordable copayments while others require you to meet a high deductible before your out-of-pocket costs go down.
If you're a long way from meeting your deductible but you're approaching the end of the year (or whenever else your deductible resets), paying cash may save you some money. Just keep in mind that if you don’t use your insurance, what you pay doesn’t go towards your deductible — so it likely doesn’t make sense if you’re early in your insurance plan cycle for the year.
Can I shop around for medications and devices?
If your doctor tells you to use a medical device — like a wheelchair, splint or wristband — shop around. It is almost always going to be cheaper to buy these items from your local pharmacy or from an online retailer like Amazon than it will be through your doctor’s office or hospital system, Donovan says.
As mentioned, you can shop around when it comes to prescriptions too. Websites like GoodRx can help you find the lowest prices by comparing costs at pharmacies and grocery stores, as well as provide you with coupons.
What if my medical bill has an error?
Half of all medical bills have mistakes in them, the National Patient Advocate Foundation estimates. And Donovan says she’s never seen a mistake in the patient's favor.
When you get a medical bill, wait to pay it until you receive your explanation of benefits (EOB) from your insurance company. Providers will sometimes mistakenly bill you directly before sending it to your insurer. Once you do get your explanation, compare it to your bill to make sure nothing seems off and that no care is included that you didn’t actually receive, Donovan says.
If you find any issues — or you just want clarification — call your insurer.
Can I get outside financial assistance for medical bills?
If you’re receiving care at a hospital, ask if you qualify for financial aid. Many hospitals won’t tell you upfront, but financial aid could help you go from paying a high bill to paying nothing at all, Donovan says. Eligibility may be dependent on your household size and income.
There are also organizations that will provide financial assistance for copays. The PAN Foundation, for example, helps eligible patients pay for medication costs, copays, insurance premiums and travel expenses. Other organizations include the Patient Advocate Foundation, The Assistance Fund and Good Days.
Should I open a HSA?
A health savings account (HSA) allows you to save pre-tax dollars toward future medical expenses and is available for people with qualifying high-deductible insurance plans. Most workplaces that offer one of these insurance plans will also offer a HSA, so check with your employer about how to take advantage of this benefit. If you don’t have HSA through an employer, you can still open one through a financial institution like Fidelity Investments.
It’s a tool worth taking advantage of if you’re eligible, as they have a triple tax advantage: in addition to making tax-deductible contributions, an HSA will allow you to accrue tax-free earnings and make tax-free withdrawals for qualified medical expenses. There's no time limit on those funds, so if you don't have many immediate needs you can save up them up for medical expenses in retirement, including Medicare premiums, copayments, coinsurance and deductibles. Remember that if your children aren't on your insurance, you can still use your HSA for their expenses as long as they are your dependent.
From feminine care to over-the-counter medications to sunscreen and at-home COVID-19 tests, there are a ton of qualified expenses that you’re likely already buying. You can find what’s eligible at HSAstore.com.
Should I open a FSA?
Your employer may instead offer a flexible spending account (FSA), which allows you to set aside pre-tax dollars for eligible out-of-pocket health care costs by contributing regularly. The contribution cap in 2021 is $2,750 per employee. Keep in mind that, unlike with an HSA, you need to use your FSA within a certain time frame or lose the money. But if you plan well, those tax advantages could help you save some serious cash — you can calculate exactly how much and determine which expenses qualify at at FSAstore.com.
Similar to an HSA, lots of items already in your cabinets are likely FSA-qualified. You can even use the account to pay for gas to and from your medical appointments.