New Year, New Deductible: How to Better Afford Healthcare Costs

Every January 1st, the deductible on most health insurance policies resets. This means that we must begin paying into our deductibles again. Many of us may have difficulty paying for tests, medications and other medical expenses until our deductibles have been met for the year.

Fortunately, there are strategies available to lower your out-of-pocket healthcare costs. We have some tips.

Consider a Health Savings Account

To more easily afford their out-of-pocket healthcare costs every year, such as the deductibles, co-pays, and other non-covered needs, some choose a health savings account. This is similar to a standard savings account, where funds are held and with monthly contributions, they build up over time. The difference between this and a regular savings account is that this kind of account, commonly called an HSA, can only be used for healthcare-related expenses. And a bonus is that money in these accounts and the interest that accrues are not subject to taxes. There are some drawbacks. Money in an HSA generally can’t be used for health insurance premiums. There are also limitations. Individuals can only contribute up to $4,150 a year, while families can only contribute up to $8,300 a year, as of 2024. Those over 55 can contribute up to $1000 more in some circumstances. On the upside, if the money isn’t used, it usually rolls over into the following year. 

Understand the Particular Policy’s Out-of-Pocket Obligations

There's more to keeping healthcare affordable than the deductible of course. Though unfortunately too many people only review the cost of their deductible, so be aware there are other potential out-of-pocket costs. Obviously, different health insurance policies cover much more than other policies do. That’s why it’s so important to be aware of the actual level of obligation of your particular policy when it comes to paying out-of-pocket for care. 

Every year, review any changes in your insurance policy’s coverage. But where do you start? Be sure to note the following expenses: 

• Medication coverage: Be sure to learn about any changes to any prescribed medications. Some policies will eliminate coverage for categories or individual medications forcing you to make a change. Check before re-enrolling for the year.
• Emergency room and hospital visits: This is especially important for those unexpected moments. 
• X-rays, lab tests and other diagnostic testing: How about an MRI? When you need it, you really need it. 
• If applicable, consider prenatal coverage and post-natal care: Will you have to pay out of pocket if you want to use a birthing center? 
• What percentage are you responsible for after the deductible has been met? Can you meet that or is it better to dial-up coverage?
• The out-of-pocket maximum: This is the most money you will have to pay in a year. And while it may seem unlikely, one bad year can drive this amount sky high.

Understanding your policy’s coverage will help you understand better the expenses you might be responsible for and will give you a place to start when comparing whether you should re-enroll or look elsewhere.  

Check For Employer Assistance Options

Some companies have options to help their employees cover medical needs that go beyond basic healthcare. These could be in the form of employer-sponsored wellness initiatives, bonuses for health improvements and subsidies to help employees afford better coverage than they could alone. Ask an employer what they can offer and how they can help toward payment for healthcare costs. And don't be afraid to ask for help if it comes to a serious health hardship. 

Research Possible Manufacturer Discount Programs

For people who need specific medications and medical devices, some manufacturers offer assistance programs. These are generally designed for lower-income individuals, but that’s not always the case. Sometimes the cost of needed treatment is prohibitive, even for higher-income earners. These companies may provide valuable assistance. 

Shop Around to Save on Your Medical Expenses

Shopping around for medical services and prescriptions may save a lot of money and make out-of-pocket costs easier to handle. Some medical facilities charge less than others, even if the quality of care is comparable. For example, getting tests at an outpatient clinic or standalone center may be cheaper than the same tests at a large hospital. 

For prescription medications, be sure to get price comparisons at different pharmacies. If a prescription isn’t covered or carries a high co-pay, apps like GoodRx.com may offer discounts. Make a list of places that can help lower costs, too. Apps and programs such as Good RX can help people save thousands but you don't want to be searching for these while you're sick or caring for someone who is sick --- and you want to always read the terms of service, because companies like are in business to be profitable. Know these resources in advance and then keep a list in your medical files for reference later. Remember to update the list every year.

Ask About Payment Plans and Cheaper Alternatives

Doctors sometimes provide less costly treatment options. If the lower-priced option will provide nearly the same benefit, it may be well worth choosing. If that’s not possible, asking the doctor about payment plans may allow you to move forward with a procedure. 

While there’s no way to avoid many out-of-pocket healthcare expenses, there are ways to make the costs less of an issue in some cases. For many people, asking the right questions and being open to options and opportunities may give them better healthcare and still keep costs down. Though we empathize with those who feel torn between their health and their financial wellbeing. Remember, until we have a better option, it does pay to shop around. 

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