The Great Recession has brought on a myriad of opportunities to save. Houses can be snapped up at fire sale prices, supermarkets are in price wars with their competitors, and government incentives on everything from fuel efficient cars to washing machines have brought down the cost of many purchases. The cost of nearly everything has gone down. But there is one major expenditure that keeps bucking the trend and continues to rise faster than the rate of inflation: health care expenses. Increasingly, medical expenses are eating up a larger portion of family discretionary income with little relief in sight. Here are 5 ideas on how you can cut your health care expenses this year and save hundreds if not thousands in the process.
Negotiate with the Doctor
Somehow we all have the notion that medical prices are set in stone. Nothing can be further from the truth. The price you get charged is dependent on the rate your insurance company negotiates with the provider. But this doesn't mean that you can't bargain down your share of the bill. Many people are reluctant to haggle with their doctors to avoid offending them or out of fear that they might provide worse service. Both these concerns are exaggerated and unwarranted. Most doctors will want you to provide a good reason why you think the fees are too high. If you are financially strapped, you'd be surprised at how many of them will just settle for reimbursement from the insurance company. Your chances of success are quite good. A majority of people that negotiate with the doctor will get a reduction in their bills.
Collections: Your New Friend
Normally, collections is something you want to avoid at all costs. Failure to pay your credit card will eventually land you in the hands of a collections agency and your credit score will be trashed. The same goes for hospital bills. Many patients get a rude awakening when they find out that their hospital bill has been turned over to a collection agency. In the old days, a hospital might wait six months or a year and coax you with numerous letters requesting payment. Not any more; if you're late more than 45 days, don't be surprised if you get a call from your friendly collection agency. But have no fear; this can actually be good news. Typically the collection agency will have some level of discount that is pre-authorized by the hospital. In my case, a bill that was a mere 45 days old was sent to collections. When I called them up to arrange for payment, they told me that they were authorized to knock off $700 if I paid immediately. Because I responded quickly and instantly paid the charges, there was no negative reporting to my credit file and they sent me a written letter to that effect.
Pill Splitting: Save Hundreds Each Year
Years ago, only a handful of people split pills. With the rising cost of prescription medications and the increase in insurance co-pays, pill splitting has gone mainstream. And it's no wonder, prescription medication prices defy logic. Take this example from Drugstore.com. 100 tablets of 50 mg Zoloft cost $372. Double the dosage and the price actually decreases to $353. While this example shows you how strange drug pricing can be, most of the time, the prices are nearly identical for different strengths. For about $6, you can get a quality pill splitter that will save you hundreds each year. Just be aware that certain time-release pills shouldn't be split. Consumer Reports has a good list of pills that can be split (PDF).
It's odd that so few people compare the prices of procedures with different doctors. This is probably due to the fact that procedure costs used to be secretive. But many hospitals and doctors are more forthcoming with the estimates for common procedures. Just call the doctors office with the specific procedure and your insurance information and tell them that you want an estimate of the cost. When you have two or three good estimates, approach the doctor that you are comfortable with and let him know that you have a lower price (if that is the case) from a competing hospital or doctor. Remember these are businesses and you may be able to save yourself hundreds if not thousands by shopping around.
Head Out of State or Overseas
If you have a heart attack or get hit by a bus, you won't be price shopping your options. But if you know you'll need a procedure in advance, you can head to a hospital in a lower cost state or for radical savings, head overseas. If it's not an emergency procedure or critical surgery, overseas may be your only viable option. Whether you are considering a hair transplant, plastic surgery, a knee transplant or even nursing homes - health care has vastly improved in lower cost countries such as Thailand, Argentina, and Costa Rica where the dollar still goes a long way. Doctors cater to foreign "health tourists" in world class hospitals that will charge you a fraction of the normal room rate. If you're not brave enough to head overseas, consider a quality domestic hospital in a lower cost location.
Of course, one of the best ways to save on health care costs is keeping yourself fit all life long. That $250 a year for the gym membership may be the cheapest health care cost of all.
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