50 Ways to Cut Your Health-Care Costs

(MONEY Magazine) -- See gallery of tips

Even if you're in perfect health now, just thinking about the cost of medical care is bound to make you feel a little ill. With the price of everything from hospital visits to prescription drugs up more than three times the rate of inflation over the past few years, chances are the burden is starting to weigh on you: Average out-of-pocket medical costs for employees more than doubled between 2000 and 2005, while wages grew a measly 18%. Unhealthiest of all, some 35% of Americans say high costs routinely force them to neglect doctor's visits, skip prescription refills or otherwise skimp on care.

That's crazy. You don't have to choose between sound health and financial security. "Patients used to be passive and simply pay the sticker price," says Don Kemper, head of Healthwise, a nonprofit health-care information group. "Now people are starting to shop for value." In fact, with a little effort and a lot of savvy, you can trim thousands of dollars from your medical bills--and get better care too. Feeling better already?

Slash Your Doctor and Hospital Bills

Why spend hundreds a year on doctor visits--and maybe 10 times as much for hospital stays? You don't have to.

1 | ASK FOR A DEAL The rate that your doctor charges isn't set in stone. According to a 2005 Harris Interactive poll, about two-thirds of adults who negotiated for lower prices with a hospital or dentist succeeded, as did three out of five adults who bargained with their doctor. If you're paying out of pocket or face a high deductible, call your insurer's customer service number and ask about the rates it pays physicians in your area, which are typically lower than the sticker price set by providers. Then ask your doctor if he'll accept a similar amount.

2 | GET THE FACTS The more you know about the real cost of your care, the better you'll be able to negotiate discounts. Costs for 30 common hospital procedures can be found at cms.hhs.gov/HealthCareConInit, the website of the Centers for Medicare and Medicaid Services, or you can pay $7.95 for medical cost reports from HealthGrades, a ratings company. Large insurers like Aetna, Cigna and United Healthcare have also begun to post rates online for members, though not for every area of the country.

3 | PAY UP FRONT, IN CASH Most doctors lose thousands each year on unpaid bills and spend thousands on credit-card processing fees. If you're footing the bill, laying out the bucks in advance of treatment can get you a 10% discount on your bill, says Pam Deloney of the American Private Physicians Association.

4 | LOOK FOR MISTAKES As many as eight out of 10 hospital bills contain errors, increasing the tab by 25% on average. Keep a log of every test and medication you get, and check it against your medical file, which you can order from the hospital's billing office. If you spot an error, send a certified letter requesting a corrected bill, and a copy of all documentation to your insurer.

5 | CHECK UP BEFORE YOU CHECK IN Radiologists, anesthesiologists and other specialists don't always accept the same insurance as the doctor who admits you to the hospital. Call your doctor to get the names of the medical providers who will be involved in your treatment, and verify with your insurer that they're in the network.

6 | TRACK YOUR SPENDING Do you know when you've met your deductibles or how much money is left in your health FSA? Programs such as Quicken's Medical Expense Manager ($50 at quicken.com) can tell you and also alert you to potential savings such as overlooked tax deductions and possible billing errors.

7 | FOLLOW DOCTOR'S ORDERS Roughly half of all patients don't follow instructions about taking medicine, which results in 10% of hospital visits a year, according to the Merck Manual of Medical Information. Simply doing what you're told can save you your out-of-pocket share of the average $8,200 cost of a hospital stay.

8 | EQUIP YOURSELF Hospitals charge a significant markup on equipment like crutches or braces, so you're almost always better off buying them on your own.

9 | SEEK SMART COUNSEL If you're seeing a mental-health therapist every week, you're probably footing much of the bill: Most health plans limit coverage to 30 visits a year. You can cut the cost by going to a certified counselor or clinical social worker (average fee: $90 an hour) instead of a psychologist (around $120). A recent survey found no difference in effectiveness.

10 | VISIT A RETAIL HEALTH CLINIC Got an earache or upset stomach? Visit a walk-in clinic found at retail stores like CVS and Wal-Mart. Cost: about $25 to $100 for treating minor ailments, or about 25% less than the cost of care in a doctor's office, according to insurer HealthPartners. (But only 40% take insurance, so you may have to pay full price rather than just a co-pay.) Bonus: No appointment is necessary, and patients are usually in and out within 15 minutes.

Get Broad Coverage for Less

Chances are, you're paying more than twice as much for health insurance as you did just a few years ago. The goal: better protection for fewer bucks.

11 | CHOOSE WISELY Don't just take the easy way out during open enrollment and sign up for the same health plan as you had last year. These days the difference in premiums is small, ranging from an average of $590 a year for an HMO to $637 for a PPO; the real differences lie in the plans' co-pays and deductibles. To figure out which option is best for you, estimate what your total annual costs are likely to be under each plan, depending on your family's medical needs (many companies have online calculator tools to help figure this out). If you have kids, you'll likely want a plan with low co-pays for doctor visits and good coverage for preventive care; if you're young and healthy, a plan with higher deductibles and lower monthly premiums may be a better bet.

12 | WIDEN YOUR NETWORK You know that seeing an in-network doc will save you 50% or more on the cost of treatment. But sometimes only an out-of-network specialist will do--say, if that physician is far more experienced in performing the procedure you need than in-network docs. In those cases, it's worth calling your insurer's pre-certification department to explain why using the out-of-network provider is essential and ask for coverage at in-network rates. You've got a good shot. "Insurers would rather strike a deal up front than go through an expensive appeals process," says billing expert Nora Johnson.

13 | FOLLOW THE RULES Read the fine print on your plan to find out your insurer's requirements for referrals and pre-certification. You're likely to need them for expensive procedures like an MRI, which can cost you more than a thousand dollars if your insurer refuses to pick up the bill.

14 | GET WHAT YOU DESERVE Are you paying the tab for acupuncture or chiropractic care? Check your insurer's website or call the help line to see if your plan covers alternative medicine treatments. Some 87% now do. Many also offer discounts on preventive measures like vitamins and bike helmets.

15 | DON'T BE DENIED Your insurer refused your claim? Fight back. Begin with a phone call to customer service, and if that doesn't work, put your appeal in writing. Document everything, including the times of calls and the names of the reps you spoke with. "Every plan has an appeals process that you must follow to the letter," says Robert Bland of Insure.com, a consumer information website. For more information, download the Kaiser Family Foundation's guide to handling disputes with your employer or private health plan (kff.org).

16 | HIRE EXPERT HELP Buried under thousands of dollars in bills and claim denials you can't resolve? Consider hiring a professional billing and claims specialist to help you resolve disputes. You'll pay $50 to $250 an hour, but you may save up to 40% on your bills. To find specialists in your area, go to billadvocates.com and claims.org.

17 | CHECK YOURSELF OUT If you're in the market for a new policy and you've applied for individual health, life, disability or long-term-care insurance in the past seven years, go to MIB.com to see whether this insurance industry antifraud group has a file on you. Request a copy (it's free) to make sure the information provided about your health status is right. If you find a mistake, ask for a correction in writing ASAP. Errors can drive up your premiums by hundreds of dollars a year.

18 | CONSIDER AN HSA If you have a high-deductible health plan (at least $1,050 for individuals; $2,100 for families), you are eligible to fund a health savings account (HSA), which you can tap to pay medical expenses. You'll save about $1,500 in taxes for every $5,000 you put into an HSA. Any funds you don't use will grow tax-free and can be rolled over from year to year.

19 | STAY INSURED Leaving your job next year? Switch to the lowest-cost plan during this year's open enrollment. Then, after you quit, federal rules (known as COBRA) will let you stay on your employer's health plan for up to 18 months, although you'll usually have to pay the full cost, plus 2%. Once you've tapped out COBRA, you must sign up for a new policy within 63 days or insurers can legally turn you down or refuse to cover pre-existing conditions.

20 | BE FLEXIBLE Add up your co-pays, deductibles and other out-of-pocket medical expenses from last year to figure out how much to put into your flexible spending account (your benefits department can tell you what's eligible). For every $1,000 you put in, you'll slash about $300 in taxes.

21 | DON'T LOSE IT You'll forfeit any funds in your FSA that you don't use by the end of the year or by March of the following year (depending on your company). Need to get rid of some bucks? Stock up on over-the-counter medical supplies like Band-Aids, cold and flu tablets and aspirin; order a six-month supply of contact lenses and solution; or schedule an extra session with your shrink, if you've exceeded the number of therapist visits covered by your health plan.

22 | GAME THE SYSTEM If you're close to the dollar limit for doctor or, more likely, dental visits in a calendar year, book half your appointments in December and the rest in January.

23 | TAKE THE WRITE-OFF The IRS allows you to deduct medical bills that exceed 7.5% of your gross income. That's a high bar, but the list of eligible expenses is extensive, including insurance premiums, dental X-rays, fertility treatments, prescribed weight-loss and stop-smoking programs and even LASIK eye surgery. See irs.gov/publications/p502 for the details.

Pay Less for Drugs

It's a bitter pill: Prices are up 40% since 2000, while co-pays for brand-name drugs have doubled. But you don't have to swallow it.

24 | GRAB GENERICS Whenever you can, opt for generic drugs, which on average cost less than a third as much as their brand-name counterparts, according to the National Association of Chain Drug Stores. If you're paying retail for one prescription a month, you'll save $863 a year by going with the generic version instead of the brand name. Got drug coverage? You'll still save $13 on the average prescription co-pay, or $156 for a year's supply. And don't forget about over-the-counter medications: By sticking to the no-name store brand, you'll save $100 of the $400 that the average American spends annually on over-the-counter drugs.

25 | GO POSTAL Call your drug insurer, a.k.a. your pharmacy benefits manager, and ask if you can order your prescriptions directly from the plan. Typically you will save 15% to 35% on your monthly co-payments at the pharmacy, or nearly $90 a year on the average prescription.

26 | SPLIT 'EM UP High-dose pills are generally priced the same as their low-dose counterparts, so ask your doctor if you can safely split a higher-dosage pill in half. You'll save about $179 to $610 a year per prescription if you don't have drug coverage or 50% on your co-pays if you do.

27 | ASK FOR SAMPLES Drug companies give away tons of samples to physicians, so your doctor may be able to supply you with several weeks' worth of medication at no charge. Bonus: If you discover after a few days that the cream for your rash isn't working, you won't be left with an expensive tube of goo you can't use.

28 | SHOP MOM AND POP The federal government doesn't regulate prices on drugs sold at pharmacies, so your costs can vary widely depending on where you buy. In New York City, for example, the price for 30 tablets of the widely prescribed antidepressant Paxil recently ranged from $97 to $180 at various stores. If you live in Connecticut, Florida, Indiana, Maryland or New York, you'll find drug prices posted online at the website of your state attorney general's office (search "prescription"); otherwise, call a sampling of pharmacies in your area. The best prices are often found not only at discounters like Costco and Wal-Mart but also at drugstores that aren't part of a chain, says University of Maryland School of Pharmacy professor Bruce Stuart. "They have full authority to set their own rates because they own the place," he adds.

29 | FIND A CHEAPER ALTERNATIVE... If there is no generic version of a brand-name drug you're taking, ask your doctor about a therapeutic substitute or an older drug in the same category. A drug that has been on the market for more than 10 years will almost always have a generic version available.

30 | ...OR BUY ONLINE You may find the best deal of all at an online drugstore, particularly if you order more than one prescription at a time. Recently, for example, you could order a 90-day supply of Lipitor, a popular cholesterol-lowering drug, for $306, or as much as 30% off typical retail prices, at drugstore.com. To make sure a site is legit, check to see that it carries the seal of the Verified Internet Pharmacy Practice Sites (VIPPS), a quality-control program sponsored by the National Association of Boards of Pharmacy (nabp.net).

31 | SIGN UP FOR MEDICARE PART D Open enrollment for the government's drug plan for seniors runs from Nov. 15 to Dec. 31. If you're 65 or older and don't currently have drug coverage, sign up as soon as you can. Average savings on drug costs: 28%. If you delay and need coverage in the future, you'll get hit with a permanent penalty of 1% of your premium for every month you were eligible and didn't enroll. If you're in good health now, simply choose the lowest-cost plan in your area; you should be able to find one with premiums of less than $10 a month. Already enrolled? Now is your opportunity to switch to a different plan if you're not satisfied with the one you have. Compare plans in your area at medicare.gov.

32 | GO FOR THE DISCOUNT No drug coverage? Visit the Partnership for Prescription Assistance website (pparx.org), which has links to more than 400 patient-assistance programs offering discounts on more than 2,500 medications. Most programs require you to demonstrate financial need. But some, such as Merck's discount card, are open to all income levels.

Save on Your Smile (and Sight)

Who needs Prada frames and a professional whitening job? Not you. The key to saving on dental and eye care: Know where to look.

33 | STICK WITH THE PLAN These days most dental insurance works much like the typical health insurance plan, in which you pay a lot less if you use providers in the insurer's network than if you go outside the plan. If you haven't yet switched from your out-of-network family dentist to a practitioner who's on your plan, what are you waiting for? Your savings: 15% to 35% on the cost of most routine dental procedures, according to Mercer, a human-resources consulting firm.

34 | JOIN A DISCOUNT CLUB No dental coverage? Enroll in a discount dental plan, offered through major insurance companies like Aetna, Cigna and WellPoint. You'll pay about $100 a year ($150 for families) and save 20% to 30% on the cost of treatment by participating dentists. Just make sure that the network has practitioners in your area before you enroll and that the plan itself is legit (there have been a few cases of fraud) by checking to see if it's registered with your state insurance commissioner (naic.org).

35 | GO TO DENTAL SCHOOL If you're looking for bigger savings than the discount plans offer, try going to a clinic at a major dental school, staffed by closely supervised students in their final two years of training. (For a school near you, search for DDS/DMD programs at ADA.org.) These clinics charge about 50% less than dentists in private practice. One caveat: You could end up spending twice as long in the dentist's chair (hey, they're still learning).

36 | CHOOSE CHEAPER FILLINGS Many consumers opt for the aesthetic appeal of resin-based fillings, which are tooth-colored, instead of the old metallic (a.k.a. amalgam) variety. But amalgam fillings are 20% cheaper, and they last longer too.

37 | DON'T PAY RETAIL Depending on the brand and the number of boxes you buy, discount stores like Costco and online lens discounters often offer lower prices than optical retailers or your doctor's office. For two boxes of Acuvue Advance contacts, for example, you'd pay about $60 at Pearle Vision vs. $46 at online retailer AC Lens and just $38 at Costco.

38 | FORGO PRICEY EXTRAS Unless you're frequently in the water or snow, ditch the anti-reflective coating on your lenses and save $40. And pass up ultralightweight titanium frames too; plastic or metal frames are plenty strong and often cost hundreds less, says Richard Bensinger of the American Academy of Ophthalmology. Need reading glasses? Head to your local drugstore, where you can find perfectly good reading glasses for $10 or less.

Get Healthy, Get Wealthy

The single best way to save thousands on your health-care bills--and, oh yeah, live longer too: Try cleaning up your act.

39 | TAKE AN ASPIRIN...and maybe you won't have to call any doctor in the morning. If you're a man over 40, a woman past menopause or a smoker or have high blood pressure, high cholesterol, diabetes or a family history of heart disease, you can sharply lower your risk of a heart attack by taking an aspirin every day or every other day (consult your doctor first). The cost of aspirin: about 20¢ a day. The average cost of treating a heart attack: $25,000, including hospital, doctor and drug bills.

40 | STRESS LESS Between 60% and 90% of doctor visits stem from stress-related factors, says Dr. Herbert Benson, founder of the Mind/Body Medical Institute. So chill out: Take a yoga class, listen to music and exercise for at least 30 minutes a day.

41 | STUB YOUR BUTT You know those coffin nails aren't cheap ($4.35 a pack on average or more than $1,500 a year if you smoke a pack a day). But consider the extra costs of lighting up: $1,600 more a year in health-care costs than for nonsmokers, plus a 10% surcharge on homeowners insurance and up to 300% on individual life policies, not to mention higher dry-cleaning and dental bills. And you may soon be paying more for health insurance at work too. By 2008, 25% of companies expect to impose penalties for bad health behavior, such as higher deductibles and premiums for smokers.

42 | PUT A CORK IN IT If you're a binge drinker (routinely imbibing a minimum of four to five drinks at a sitting), you'll average $900 a year more in medical expenses compared with a teetotaler, according to the Lewin Group. To avoid these costs and stay healthy, have no more than one drink a day if you're a woman, two if you're a man. Plus, that $40 bottle of your favorite Bordeaux will last twice as long.

43 | GET MOVING Obese people pay about 26% more in medical costs than those who are in shape. So joining a gym or taking a dance class is a smart investment in your health. Or buy a pedometer (about $20) and aim to walk at least 10,000 steps each day.

44 | GET A LUNCHBOX Brown-bagging your lunch can help you lose weight since home-cooked eats contain 20% less fat on average than restaurant meals, according to the U.S. Department of Agriculture. Bonus: Skipping the $6 deli sandwich could save you about $1,000 a year.

45 | DRINK FROM THE TAP Americans spent about $10 billion a year on bottled water, $3 billion on sports bars and $23 billion on nutritional supplements last year. But most of that stuff has little, if any, proven benefit. So ditch the ginkgo biloba, drink from the tap and tote a banana, not a PowerBar, on your way to the gym.

46 | WASH UP Americans pay about $200 a year on flu treatments and countless more for colds but routinely neglect the best preventive treatment: soap and water. So get into the habit of scrubbing your hands for about 15 seconds, especially around the nails, before eating or handling food and after contact with any potential contaminants. Turns out Mom really did know best.

47 | LET THE BOSS HELP Take advantage of any wellness benefits that your company offers. About six out of 10 large companies now offer benefits like smoking-cessation classes, discounts on gym memberships and health risk assessments.

48 | ADULT-PROOF YOUR HOME Home accidents rank among the top reasons for visits to the emergency room. Some easy ways to make your home safer and avoid the $560 average tab of a trip to the ER: Install handrails along both sides of the stairs, use nightlights, put nonslick strips in tubs, check smoke alarm batteries every month and keep candles at least three feet from anything that can burn. (For more tips, go to homesafetycouncil.org.)

49 | FLOSS DAILY It's the best way to prevent periodontal disease (cost of treatment: from $200 for minor problems to $2,000 or more to replace a tooth).

50 | QUESTION YOUR TESTS You could spend thousands a year on cutting-edge medical tests, which usually aren't covered by insurance. Or you could hold on to that cash by sticking mostly with the baseline tests recommended by the U.S. Preventive Services Task Force (ahrq.gov/clinic/uspstfix.htm), which makes recommendations for patients based on recent research. So if your doc insists you need a whole body CT scan (cost: about $1,000), check the PSTF website as soon as you get home, and don't proceed until you get a second opinion.

SUPER SAVERS

ALEX AND DANA JAMISON

PARADISE VALLEY, ARIZ.

STRATEGY They've purchased separate health insurance policies and are funding health savings accounts.

SAVINGS $4,416 in annual premiums

After she underwent a kidney transplant five years ago, Dana Jamison's high-risk health status made buying health insurance an expensive proposition. The only family policy she could find was $14,000 a year ($5,150 deductible). Neither Dana, 43, an orthopedic surgeon who now works as a hospital consultant, nor her husband Alex, 47, a corporate mediation consultant, has coverage through an employer. So Dana bought a policy covering her alone (cost: $6,828 a year, $2,600 deductible), while Alex and the kids went with a separate policy that costs $3,156 a year ($4,000 deductible). Funding pretax HSAs with the full amount of those deductibles helps bring down the costs even further.

SUPER SAVERS

TINO AND ALYSSA FERRULLI

PHOENIX

STRATEGY They ask for generic drugs and samples, and they fund their FSAs.

SAVINGS 25% of their annual drug costs, plus $1,500 in tax savings

With a $50 co-payment on brand-name drugs, the cost of medications add up fast for the Ferrullis. So Tino, 48, a car salesman, and Alyssa, 35, a warranty director at the same dealership, request generic drugs whenever possible, saving $20 to $30 a prescription. When that's not possible, they ask their doctor for samples. So far these moves have sliced about 25% from their annual drug costs. To help offset the remaining out-of-pocket expenses, plus the cost of daughter Kylie's braces, the couple put $5,000 into their flexible spending account this year at work, for an estimated tax savings of $1,500.

SUPER SAVER

GLEN FURUMIZO

EWA BEACH, HAWAII

STRATEGY He's lost 30 pounds, and he swims or cycles almost every day.

SAVINGS $30 a month in prescriptions, plus a lifetime of lower health-care costs

When Glen Furumizo decided to get serious about losing weight four years ago, he was 30 pounds overweight and taking the drug Lipitor every day to control high cholesterol. Furumizo, 45, a technician at an oil refinery, started a low-carb diet, which helped him shed the extra pounds in three months, and has kept the weight off by swimming and biking several times a week. With his cholesterol now at normal levels, he no longer needs Lipitor, saving him $30 a month on prescription co-pays. Even better, "losing weight has lowered my chances of heart disease, diabetes and high blood pressure," he says. "I don't know how much that will save me, but it's a lot."

With Asa Fitch and Daphne Mosher contributed to this article.