Lessons:
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Money-saving strategies
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,
Quotesmith,
a nationwide insurance broker has 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 you're
entitled to.
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 45% of your insurance
premium from your gross income. If your employer offers a
flexible spending account, sign up. You can pay your premium 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.
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
www.bphc.hrsa.dhhs.gov.
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.
Next: Your legal rights
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