Money Essentials

Money saving strategies for your health

It's hard if you're young, harder if you're old or infirm.


If you are young and healthy, saving on health-insurance premiums is tough enough. Older people not in the best of health will have great difficulty getting an affordable plan.

If you're buying your own insurance, you've got to shop around for the best price. As long as you're healthy and under 50, insurers want your business. To avoid attracting applicants they don't want, though, many keep a low profile, so you'll have to seek them out by phoning agents, checking with your state insurance department, or going online. For instance, Insure.com maintains a national online database of carriers you can search for policies that might be available to you.

Older people or those with health problems will have a tougher time finding insurance. Government protections offer some help (see "Your legal rights") but insurers are not always quick to advise you of your options, so you may have to take the initiative to get the coverage to which you're entitled.

Make the most of spousal coverage

Working couples with insurance from two employers may be able to get more or pay less than one-income couples. Depending on the premiums and benefits of each available plan, the best deal may be separate coverage for each, double coverage for both, or forgoing one spouse's coverage in favor of the other's. If you have kids, you'll need to compare your options for family coverage. Be warned: The calculations can be mind-boggling and, even with double coverage, a couple can't collect more than 100% on the same claim.

Use available tax-breaks

If you're self-employed, you may be able to deduct 100% of your insurance premium from your gross income. If your employer offers a flexible spending account, sign up. You can pay your co-payments as well as expenses not covered by insurance with money that's not subject to income tax or Social Security taxes.

Take prudent risks

If you are generally healthy and use few medical services, you can cut premium costs substantially by buying "catastrophic" coverage. This is an indemnity policy with a very high deductible, perhaps as much as $2,500. Assuming this much financial risk can slash your premium by 50% or more, depending on your age. Don't try to trim your premium by reducing coverage on the other end, though. Make sure your insurance has a high maximum payout, at least $100,000, preferably $500,000. Also take care to understand the definition of "catastrophic."

Look for a subsidy

If your income is very low, if you're permanently disabled or if your medical expenses are extremely high, you may qualify for federal or state-subsidized insurance, such as Medicare or Medicaid (check your state Medicaid office). Regardless of your ability to pay, you may be qualified to receive free primary care through public health clinics. To find a site near you, check the Bureau of Primary Healthcare Web site.

If you lose your job or have health problems, federal and state laws give you certain rights to health insurance, which are described in the next section.

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