Healthcare is a giant expense for Americans of all ages, but if you're not careful, it could end up costing you more money than necessary. Here are a few healthcare mistakes that could upend your budget and introduce a world of unnecessary stress in the coming year.
1. Going without health insurance
After the Affordable Care Act became law, those who chose to forgo health insurance were slapped with costly penalties. The purpose of this was to encourage all workers to purchase health coverage. But in 2019, that penalty went away at the federal level, and while some states have their own individual health insurance mandates, you might get away with skipping coverage at no added cost.
But just because you're no longer required to have health insurance doesn't mean it's safe to go without it. If you do, you'll leave yourself vulnerable to untold expenses the moment you get hurt or unexpectedly sick.
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A better bet? Aim to find an affordable plan. If you don't get sick often but want coverage for emergency situations, then a low-premium plan with a higher deductible could be a good bet. Keep in mind that if you're limited to buying health insurance through Healthcare.gov, it may be too late to enroll in a plan for 2020 -- but if you qualify for a special enrollment period due to a life event like getting married, you're in luck. Otherwise, get on a plan as soon as you can.
2. Not understanding your health insurance plan costs
There are several costs you're apt to encounter with regard to your health insurance plan. First, you'll pay a monthly premium, but if you get insurance through your employer or your spouse's employer, that premium may be heavily subsidized. Additionally, you'll generally be responsible for copays (a preset amount you pay for doctor visits or medications) or coinsurance (a percentage of the cost of your care). And you'll likely have an annual deductible to meet, as well -- that's the amount of money you need to pay out of pocket before your insurance company starts paying for covered services under your plan.
It's crucial that you know what these numbers are because without that knowledge, you'll have a hard time budgeting for them. Yet recent data from HSA Bank reveals that a shocking number of Americans are clueless about their healthcare costs, so if you're one of them, call your insurance company for more information or review your benefits online for better clarity.
3. Not reading your medical bills before paying them
How often do you get a medical bill in the mail, look at its total, pay it, and move on? Studying medical bills is hardly a fun way to spend a few precious minutes of your free time, but if you don't scrutinize those bills, you could wind up paying extra for medical care.
It's estimated that 80% of medical bills contain errors of some sort. Sometimes, it's a coding error that results in an added charge for you, the patient. Other times, it's a coding error that causes your insurance company to refuse to pay for the service at hand. As such, it's important to read your bills carefully and question charges that don't make sense. A little follow-up on your part could save you some serious money.
4. Putting off medical care when you need it
You may be tempted to skimp on medical care when money is tight, and if you do, you're in good company. A 2019 Bank of America report revealed that 53% of American workers have skipped or delayed medical appointments, tests, procedures, or medications to save money.
But that's a bad idea on multiple levels. For one thing, being stingy with medical care could harm your health. Secondly, ignoring smaller medical issues could cause them to escalate into larger ones, at which point they'll start costing you even more money.
Imagine, for instance, that a $300 medical test reveals a small growth that can be resolved with minor surgery for which you pay $1,000. That's a lot of money. But if you skip that test and the growth spreads, you may be looking at more invasive surgery, costly follow-up testing, and bills in the multiple thousands.
Rather than deprive yourself of the medical care you need, factor its cost into your monthly budget. At the same time, set aside funds for medical emergencies so that if you wind up with a larger bill, you'll be able to handle it.
It's important to manage your health, and it's just as vital to keep up with the costs associated with doing so. Avoid these mistakes in the coming year and with any luck, it'll be a physically and financially healthy one for you.
