There’s no denying the U.S. health care system has a lot of problems. Right at the top of the list: the high cost of care. A 2022 investigation into this problem by Kaiser Health News and NPR exposed several shocking cases.
One woman lost her retirement savings and worked three jobs to pay off a $10,000 medical debt. A young father was denied care because of an unpaid bill. A woman who gave birth to premature twins is working overtime to pay $80,000 in medical bills from the birth.
Most medical bills aren’t that bad, but for anyone on a tight budget, they’re bad enough. The good news is you’re not completely helpless. A few smart strategies can help you keep your health care costs under control.
Ways to Save on Medical Expenses & Health Care Costs
The biggest key to saving on health care is treating it like anything else you buy and pay for. You’d shop around to get the best value for your dollar when buying a car or smartphone or buy off brands at the grocery store. You can do the same with medical services.
1. Choose the Right Health Insurance Plan
- The deductible, an annual sum you must pay out of your own pocket before your health insurance kicks in
- Coinsurance, a percentage of each health care bill you must pay yourself
- Copayments, or copays, which are fixed charges for specific medical services
- An out-of-pocket maximum, the highest total amount the insurance company can require you to pay for your own care in any given year
In general, the less you pay in premiums, the higher the other costs. If you use a lot of health care in a given year, you could pay more in total with a low monthly premium than a high one. Thus, the more care you need, the more it’s worth paying in premiums in exchange for lower costs on each service.
To determine whether a higher premium could save you money overall, look at your annual health care spending. Review your care from the past year, including doctor visits, tests, hospital stays, and prescription drugs.
Compare how much that amount of care would cost with different health insurance plans to see which has the lowest total cost. When you compare health plans on HealthCare.gov and some state health insurance marketplaces, you can see an estimate of total costs.
2. Visit In-Network Providers
Another crucial factor in choosing a health plan is your provider network. Many insurance plans have contracts with specific facilities, including doctor’s offices, hospitals, labs, and pharmacies. These providers cover the insurer’s patients at a lower cost than usual. The insurer saves money, and the providers get more business because the insurer steers patients to them.
With some health plans, you can only use health providers in your network. With others, you can go outside the network, but your coinsurance or copays are higher if you do.
For instance, suppose you need a mole removed — a procedure that costs $500. Your plan charges you only a $40 copayment to visit an in-network dermatologist. But if you choose one who’s outside the network, you pay 20% coinsurance, increasing the bill to $100.
To keep your costs down, stick to in-network providers whenever possible. Your insurer should provide a tool on its website to show which doctors and facilities are in your plan’s network. Check it before receiving care to ensure you’re staying in the network.
3. Use Direct Primary Care
Health care costs add up quickly if you don’t have health insurance or are underinsured. The cost of every doctor visit and every lab test comes out of your pocket. That can lead you to put off necessary care because you’re not sure it’s worth the money.
One way to keep those costs under control is direct primary care, also called concierge medicine. Under this system, you pay a regular monthly fee, called a retainer, to your primary doctor. The fee covers all basic in-office care, no matter how much you need.
The fee for direct primary care is typically between $50 and $150 per month. That typically covers basic care, such as preventive care, basic tests, and sick visits, though specific covered treatment may vary among direct primary physicians.
It doesn’t cover prescriptions, specialist visits, or more complex medical procedures like surgery. You can pair direct primary care with a high-deductible health plan to protect you from overwhelming medical bills in case you develop a serious health problem.
4. Check Costs
Doctors make decisions based on what they believe is best for your physical health. They don’t always think about how it might affect your financial health. Sometimes, they prescribe expensive drugs, treatments, or tests without considering your ability to pay for them. That can mean an unpleasant surprise when you get the bill.
To avoid a billing shock, ask questions. When your doctor orders a treatment, ask what it is and what it costs. If the price is more than you can easily afford, say so. Ask if you can do without the treatment or use a less expensive alternative.
If your doctor thinks you need a procedure you can’t easily afford and it’s not an emergency, see if you can get it done for less. At Healthcare Bluebook, you can check the typical price range for a particular procedure in your area. Some insurance companies have cost estimator tools on their websites as well.
Once you have this information, shop around. Contact different facilities within your care network and ask what they charge for the procedure for someone on your insurance plan. Then if required by your health plan, go back to your doctor and ask for a referral to the facility with the lowest price. If you’re unsure whether your health plan requires it, a referral never hurts.
The same goes for other types of care too. If your doctor orders a costly lab test, find out if your insurer has a preferred lab that can perform it at a lower cost. If they prescribe a pricey drug, ask if there’s a “therapeutic alternative,” a similar drug to treat the same problem for less.
5. Avoid the Emergency Room
Emergency room visits always come with a high cost. Even with insurance, you can expect to pay a higher copay for a trip to the ER than for care at a doctor’s office. And if you don’t have insurance, ER treatment could cost $1,000 or more.
None of this matters if you’re facing a life-threatening emergency. But in all other cases, you can save money by choosing cheaper options.
If your problem isn’t urgent, make an appointment at your doctor’s office. If the office is closed and you need care right away, these alternatives can help:
- Nurse Lines. Many insurance plans offer a free 24-hour phone line staffed by nurses. They can help you identify symptoms, treat them at home, and determine whether your problem requires a visit to the emergency room.
- In-App Communication. Some doctors use HIPAA-compliant apps like Spruce Health and Klara for communication. You can use these apps to ask a quick question rather than going to the doctor’s office. Direct primary care doctors are especially likely to offer this service, though after the pandemic, others are jumping aboard. The fee for this service may be less than an in-person consultation or even free from a direct primary care doctor.
- Telehealth. You can arrange a virtual visit with your primary doctor by phone or video chat. Or you can see a different doctor through a dedicated online telehealth service like Teledoc or Sesame Care. Your insurance company may also offer inexpensive access (log in for details). You can get a diagnosis, treatment plan, and prescriptions this way. The cost is usually $100 or less for general care, but specialists may cost more.
- Convenience Care Clinics. Large retail chains like drugstores, supermarkets, and big-box stores often have small health clinics on site. These facilities can usually treat minor ailments and injuries for under $150, even without insurance.
- Urgent Care Centers. An urgent care center can treat urgent but nonlife-threatening problems, such as a broken bone. They typically charge $300 or less, and they accept insurance. They’re open later than doctors’ offices, though usually not all night.
6. Set Up a Health Savings Account (HSA) or Flexible Spending Account (FSA)
A health savings account, or HSA, is a tax-advantaged account used to pay health care expenses.
It works kind of like a 401(k). You fund the account with pretax dollars that earn money because the HSA is an investment account. But you pay no tax on the earnings. However, it’s even better because you can also withdraw the funds for qualified medical expenses tax-free at any time.
To use an HSA, you must have a high-deductible health plan. Some employers offer an HSA as a benefit. Your employer can even contribute to your HSA as they can with a 401(k). You either submit medical bills to your employer to get reimbursement or use a debit card linked to the HSA to pay bills directly.
If you don’t qualify for an HSA, you can still use a flexible spending account (FSA). You can use this fund’s deposited pretax dollars to cover the year’s health care costs, though it isn’t an investment account and doesn’t earn money.
However, there’s a catch: You lose any money left in your FSA at the end of the year. You must be careful when funding your FSA to ensure you don’t put in too much. If you find yourself with extra money at the end of the year, you can try to use it up by stocking up on meds or buying an extra pair of glasses.
7. Ask for Generic Drugs
Nearly every brand-name prescription drug has a cheaper generic equivalent. The U.S. Food and Drug Administration says generic drugs typically cost 80% to 85% less than brand-name drugs. That’s a big difference if you pay for your meds out of pocket.
Some insurance companies charge lower copays for generic drugs as well. They may even offer a $0 copay on certain preferred generic drugs.
By law, generic drugs must deliver the same clinical benefits as their brand-name equivalents. They have exactly the same active ingredient, dosage, and strength. However, the drugs may differ in appearance, and their inactive ingredients may vary.
One of the best ways to save on prescription drugs is to ask your doctor to prescribe a generic medication. But even if your prescription calls for the name brand, the pharmacist may be able to substitute the generic version if you ask.
8. Check Drug Prices With & Without Insurance
Prescription drug copays don’t always depend on the medication’s price. Some prescription plans price drugs in tiers, charging lower copays for preferred drugs and higher ones for all other drugs.
In some cases, the copay for top-tier drugs is higher than the out-of-pocket cost. For instance, a medicine with a $25 copay might cost only $18 if you pay for it out of pocket. A prescription drug discount card could lower the out-of-pocket cost still more.
When you fill a prescription at the drugstore, ask about the cost both with and without insurance. If it’s only slightly more with insurance, it might be worth using the insurance to eat away at your annual deductible. But if it’s significantly cheaper without, skip the insurance and pay out of pocket.
9. Ask About Over-the-Counter Options
Sometimes, you don’t need a prescription drug to treat a health problem. Sometimes, an over-the-counter (OTC) drug can do the same thing for less money. In fact, many OTC drugs are just lower-dose versions of a prescription medicine.
There’s one catch with OTC drugs: In most cases, you must pay for their full cost out of pocket. Depending on the drug, that could cost you more than a prescription copay. However, if your doctor gives you a prescription for an OTC drug, you can pay for it with tax-free dollars from an HSA or FSA.
10. Fill Your Prescriptions at a Retail Chain or by Mail
Even if you can’t switch to a cheaper drug, you can save money by switching your pharmacy. The pharmacies at warehouse clubs like Costco often charge significantly less than drugstore chains for the same prescription drug. And you don’t need a membership to use the pharmacy.
Retail chain stores like supermarkets also offer low prices on many drugs. For instance, some generic drugs at Walmart are just $4 for a 30-day supply. Drug price-comparison sites like GoodRx or RxSaver can help you find the lowest prices in your area.
Also, some insurance companies offer significant discounts for using mail-order pharmacies. For instance, my plan charges me the same copayment for a 90-day supply from OptumRx as for a 30-day supply at the drugstore. Ordering by mail cuts my out-of-pocket cost by two-thirds.
Even if your insurance company doesn’t offer a discount, you may be able to save by ordering online. Amazon Pharmacy offers low prices on loads of vital prescription medications, and Cost Plus Drugs sells many generic medicines at wholesale prices.
In some cases, you can save by ordering online from a foreign pharmacy. Your best bet is usually Canada, where drugs are cheaper and they have similarly stringent medication approval rules. According to U.S. Customs and Border Protection, in general, it is legal to import medicines for your own use as long as they’re legal in the U.S. Canada Pharmacy accepts prescriptions from U.S. doctors and ships the medicines to U.S. addresses.
11. Review Your Medical Bills
After you receive care, your insurance company typically sends you an explanation of benefits (EOB) letter. It shows what services you received, how much the insurance company paid, and how much you owe. EOBs may look pointless, but they contain useful information.
Taking a minute to review your EOB might help you spot a mistake on your claim. The insurer might be charging you for a service you never received, charging the wrong amount, or denying a claim for something it should cover.
Better yet, request an itemized bill for services from the health provider. It breaks down costs for specific treatments more thoroughly than an EOB. For instance, for a hospital stay, it would list the number of nights in the hospital, the doctors you saw, and the medications you received.
Review the complete list of charges and ensure there are no erroneous charges. If you spot any, request a copy of your medical chart to compare the services you received with the ones on your bill.
12. Negotiate Your Medical Costs
Even if a medical bill is accurate, that doesn’t always mean it’s final. Sometimes, it’s possible to negotiate with the provider for a lower price.
If you’re paying for the bill out of pocket, explain that to the provider and ask for a discount. It’s in their interest to say yes since it’s a lot less hassle to accept a lower payment than sue you over an unpaid bill. Plus, it dramatically reduces the risk they’ll get nothing if you declare bankruptcy.
Providers may also accept a lower fee if you offer to pay cash rather than using insurance. That saves them the effort of submitting a claim and waiting for payment. For tests or outpatient procedures, offer cash before receiving the service.
If you can’t get a discount, ask the billing office for a payment plan. That allows you to pay a steep medical bill in a series of small payments rather than a lump sum.
13. Get Preventive Care
It’s cheaper to find and treat minor health problems before they become major ones. Insurers know that, so they often charge nothing for preventive care, such as a yearly physical or well-woman exam. Some preventive care, such as a vaccination, is always free under the Affordable Care Act.
However, even if some types of preventive care aren’t free under your health plan, it’s worth paying a copayment to get them. They can save you money by finding problems early — and in some cases even save your life.
Providers you should plan to see at least once per year include:
- Your primary care physician
- Your dentist (twice a year if possible)
- An eye doctor
- A gynecologist, if applicable
In addition to these annual checkups, it pays to get regular health screenings — especially for health problems that run in your family. Examples include a blood pressure screening, blood sugar and cholesterol tests, mammograms, and colon cancer screenings.
One final type of preventive care is immunizations. Children need certain vaccinations to attend public school, but adults also need boosters from time to time. Staying up to date with immunizations, including a yearly flu shot, can prevent costly illnesses later.
14. Take Advantage of Wellness Programs
Another way insurance companies try to keep you healthy (and keep their costs down) is to offer access to wellness programs. These programs can help you learn better eating habits, improve physical fitness, or quit smoking.
Wellness programs can include gym memberships, fitness trackers, and health coaching, all free or at discounted rates. For example, I get regular mailings from my health insurance company inviting me to participate in free weight-loss and joint-health programs.
Some plans even pay you to participate. My health plan offers me a $250 gift card each year for taking several basic preventive care measures like getting a physical and completing health screenings.
15. Live a Healthy Lifestyle
If keeping you healthy is good for your insurer, it’s doubly so for you. It saves you money on health care costs in the long run and can help you live longer and better.
Ways to maintain your health include:
- Eating a Healthy Diet. A healthy diet focuses on whole, nutrient-dense foods, such as fruits, veggies, and whole grains. Things to cut back on include meat, sugar, trans fats, alcohol, and processed foods.
- Getting Regular Exercise. If you don’t want to pay for a gym membership, there are many ways to work out at home for free. If you work at a desk, taking regular breaks for movement during the day is also important.
- Avoiding Tobacco. If you’re a smoker, quitting smoking is one of the best things you can do for your health. Plus, you’ll save a bundle on cigarettes. If you don’t smoke yourself, minimize your exposure to secondhand smoke.
- Getting Enough Sleep. Most people need at least seven hours of sleep per night. Most experts say you’ll sleep better if you go to bed and get up at roughly the same time each day. Limiting caffeine use and restricting your use of electronic devices at night can also help.
- Managing Stress. You can’t always avoid stress, but you can learn to manage it. Exercise, meditation, or chilling out with friends can help you cope. And if you’re still having trouble, check out our article on getting affordable mental health treatment.
- Avoiding Germs. Wash your hands regularly, taking at least 20 seconds each time. Consider masking up in crowded places, especially during cold and flu season. And practice safe sex, especially if you have multiple partners.
- Using Safety Gear. When you’re in a car, wear your seat belt. On a bike, wear an approved helmet. And if you play sports, always use the appropriate protective gear.
When it comes to saving money on health care, knowledge is power. The more you know about your health, health insurance, and choices for care, the better your chances of getting the treatment you need at a price you can afford.
Learn as much as you can, and don’t hesitate to speak up for yourself. If a doctor is pushing for a treatment option that doesn’t fit your budget, say so. Remember, your doctor isn’t the final authority in your health care — you are. You always have the right to refuse treatment or seek alternative options.